Question-and-Answer Session
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Operator
Your first question comes from Tom Roderick - Thomas Weisel Partners.
Tom Roderick - Thomas Weisel Partners
Larry, I wanted to dig in here because you’re talking about investments on some nice new wins that sound like you’re going to make those investments heaviest here in the fourth quarter. You’re kind of guiding to gross margins that continue to be in the low 50% range. So as we start to think into fourth quarter and next year, is that sort of the floor on where we should think about gross margins and then once they start ramping up, could we see the margins back in the mid 50s or even higher once transaction volumes from these investments come online?
Lawrence Irving
Yes, Tom. So obviously we extremely excited about these new wins that we have and we’re moving very fast to get these into production. So we expect as we said some early investments that are going to lower the margins here in the fourth quarter and we anticipate it to be in the low 50% range as we move forward at least initially during those early stages, but we still from a long term perspective still consider that our gross margins to be in the 58% to 60% range and will provide some further guidance on the next call when we have a better view of that.
Tom Roderick - Thomas Weisel Partners
So, Steve, in terms of the agreement on the OEM side, you said this is the most comprehensive agreement you’ve signed. You had some nice names attached, but we haven’t really seen I guess significant volumes. Can you just talk a little bit more about how you’re supporting some of these other Tier One carriers with respect to how these OEMs turn on the devices with other carriers?
You’ve done a great job with AT&T in the past. Can you talk about, how you’re building connections into the back end. I think you mentioned Vodafone, Hutchison, Orange and then T-Mobile. Can you repeat what you said on those carriers and how the OEM relationships are building to connections beyond AT&T?
Steve Waldis
I think, Tom, there’s a couple of things. One is as it relates to the OEMs. This is definitely at least for Synchronoss’ perspective, the OEM is our direct customer and I think a couple of things that are working in our favor, one is that obviously most of the providers today as you seen in the U.S. are opening their networks and allowing multiple merging device providers to offer services across their particular networks.
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