Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Steven Crowley – Craig-Hallum Capital.
Steven Crowley – Craig-Hallum Capital
I noticed in the NV&A section of your 10-Q that you just posted this afternoon that you talk about having increased R&D for sensor and coupler product development. I sense that’s rather regular activity for you, but I want to ask if there’s any color that you can provide us on some of that increased R&D investment in those areas.
Curt Reynders
We have been working on a number product in sensors and couplers and just in general what we try to do is extend the advantages that we have in those areas. In couplers it’s usually channel density and small size and for sensors it’s magnetic sensitivity and size. So those are things that we’re continuously working on extending and in particular, I think Curt mentioned we have a piece of equipment to test what we call the ULLGA packages which are 1.1 millimeter square of less than five one hundredths of an inch, and we’ve been expanding our product offerings in that package which extends our advantages in size.
We already feel like we have some of the smallest products of their type in the industry, but we’re always looking to extend those advantages. So that’s one example of the types of efforts that we’re undertaking. So there was as you point out, a modest increase in our R&D expenses which had been decreasing for awhile.
Steven Crowley – Craig-Hallum Capital
My understanding is often the standard sensors and couplers that you sell are into industrial market places and applications. Can we talk a little bit about what you’re seeing out there in the more industrial side of your business, whether or not there are some signs of improvement, what those might be and what that might mean for you?
Curt Reynders
I think we’ve seen signs of an upturn and experts have said the recession is likely over. As far as our industrial customers, we did see that especially towards the end of the second quarter, although information from our customers is mixed. Although if inventory levels are becoming lower, that could bode well for us as it tends to increase purchases by distributors and others and we’re hopeful that an improving macro economic environment will help our business, especially in the factory automation.
Steven Crowley – Craig-Hallum Capital
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