Question-and-Answer Session
Operator
(Operator Instructions) Our first question comes from Uche Orji - UBS.
Uche Orji – UBS
First question is about your long-term margin. Just wondering, in a sense, what is the gross margin expectation and how much revenue growth you would need for this and also if you have any timeline in mind to achieve this target.
Donald Palette
As we have articulated over the past year or so, our previous targeted model of $240 million in quarterly revenue that we were going to be at 42% gross margin and 20% operating margin. As our Q1 guidance indicates, we’re expecting to achieve these targets this quarter. So given our future product mix, new markets, and the value of our new products, we see a path to the mid-20’s for operating margin.
This expansion is going to be a combination of both gross margin expansion and leveraging our operating expense base, but right now we’re just not providing the detailed elements today, but we certainly will over time.
Uche Orji – UBS
Secondly, who was the ten percent customers was this quarter and who was your largest customer?
Dave Aldrich
Sure, we had two ten percent customers this quarter. We had Samsung, Sony, Erikson. Just want to note that LG and Motorola, all those were in the high single digits for the quarter, with Samsung being the top customer for the quarter.
Operator
Our next question comes from Ittai Kidron - Oppenheimer & Co.
Ittai Kidron - Oppenheimer & Co.
First a household question, Don. You retired some of the debt. How should we think about the share count evolving here? I don’t know if the convert is in the outstanding shares count here or not. Second, with regards to your mid-20’s. I understand it’s a long term, but does that require fundamental change in mix between your linear and sale, that on the current mix just by continuing to drive your leverage you can get there or is it really a product mix that needs to change?
Donald Palette
I’ll address the first question. We guided $179 in Q1. As far as the converts, the debt that is outstanding through any of the quarter ends we’ve just gone through, there already is dilution for some of those converts space in the fact that they have been in the money.
On a go-forward basis, they have cash settlement options. So we have the option of when the debt matures, we have this first maturing March 1 to either settle an equity or pay in cash. Our intention is to pay it in cash. So I wouldn’t expect any future dilution.
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