Good afternoon, and welcome to the Flextronics International third quarter fiscal year 2009 earnings conference call. Today’s call is being recorded, and our lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. At this time, I would like to turn the call over to Mr. Warren Ligan, Flextronics' Senior Vice President, Investor Relations and Treasury. Sir, you may begin.

Thank you, operator. Good afternoon, everyone, and welcome to Flextronics conference call to discuss the results of our fiscal third quarter-ended December 31st, 2008. On the call today is our Chief Executive Officer, Mike McNamara; and our Chief Financial Officer, Paul Read. The presentation that corresponds to our comments today is posted on the Investors section of our Web site under Calls and Presentations. We will refer to each slide number so you can click to the appropriate slide. During the call today, Paul will review our financial results, which include, working capital matrix, cash flow, and return on invested capital. Paul will also discuss the impact of the goodwill impairment charge and Nortel’s bankruptcy on our financials. Next, Mike will review the quarter and business outlook and provide guidance for the fourth quarter ending March 31st, 2009. After Mike’s comments, we’ll take your questions. Please turn to slide two. This presentation contains forward-looking statements within the meaning of the US Securities Law, including statements related to revenue and earnings guidance, our expectation about our future cash flows and return on invested capital, the expected impact of Nortel’s bankruptcy on our future operating results, and our expectations regarding our business in the current economic environment. These forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by these statements, are based on our current expectations, and we assume no obligation to update them. Information about these risks is noted in the earnings press release on slide 22 of this presentation and in the Risk Factors and MD&A sections of our latest annual report as amended and filed with the SEC as well as in our other SEC filings. Investors are cautioned not to place undue reliance on these forward-looking statements. Throughout this conference call, we will reference both GAAP and non-GAAP financial measures. Please refer to the schedule to the earnings press release, slide 18 of this presentation, and the GAAP versus non-GAAP reconciliation in the Investors Section of our Web site, which contain the reconciliation most directly comparable GAAP results. Now, I will turn the call over to Paul.

Thanks, Warren, and good afternoon, everyone. Please turn to slide three in the presentation. Our third quarter revenue was $8.2 billion, compared to $9.1 billion from the year ago quarter, representing a decrease of 10% reflected in the softness in market demand as you might expect from the current macroeconomic environment. Adjusted operating profit was $186 million, compared $300 million last year, which was a decrease of 38 %. Adjusted net income for the third quarter was $127 million, compared to $250 million a year ago. And adjusted earnings per diluted share was $0.16, compared to $0.30 last year. Please turn to slide four. Here we show each market segment’s quarterly revenue in percent of total quarterly revenue for the past five quarters. Revenues in the infrastructure segment was $2.6 billion, which comprised 32% of total revenue and decreased 19% over the year ago quarter. Slightly more than one-third of the year-over-year revenue decrease in dollars was attributed to Nortel reflecting our prime reduction in business levels with Nortel. Revenues associated with Nortel decreased from greater than 10% of consolidated revenues at one time to below 5% this quarter. In addition, we have been actively reducing low ROIC programs from our infrastructure segment as we continue our focus on ROIC and asset velocity in this segment. Revenue from the computing segment was $1.3 billion, which comprised 16% of total December quarterly revenue, and only decreased 5% over the year ago quarter. We continue to be very excited about the new program wins in this segment. Revenue from the mobile segment was $1.5 billion, which comprised 18% of total revenue and decreased 25% over the year ago quarter. While our revenue’s being negatively impacted by weakened market demand for some of our larger customers, the end product wins with new customers,…

Thanks, Paul. The continued slowing of the global economy dramatically reduced demand across virtually every product category in every geographic region we operate in creating one of the most difficult economic environments in our history. While December quarter revenue of $8.2 billion and adjusted earnings per share of $0.16 were within the updated guidance range we presented at our analyst day on November 18th, 2008, this was our first December quarter since 1996 where revenue declined sequentially. As we progress through the quarter, reduced customer spending, limited access to credit, and all the other effects of the macroeconomic environment weighed heavily on demand. During November, we experienced an accelerated impact of these deteriorating demand trends, which are continuing as we enter the March quarter. The overall realities in this market are certainly sobering as new business winds have not outpaced the decline in revenue. We continue to build our organic pipeline as well as focus on emerging markets. We will also continue to execute on our diversification strategy, which we believe lessens the impact of a challenging end market demand, and in particular, our customer exposure. As evidence of our ability to further execute on our diversification strategy, our consumer exposure over the last two years has gone from 59% to 38% this quarter. Our scale and breadth of service offering has greatly expanded our available markets and customer opportunities ,and has aided our ability to further develop our infrastructure, industrial, medical, and computing businesses , which has helped to mitigate the overall eroding demand environment. Our top priorities in this environment are to control costs, improve internal efficiencies, reduce inventory levels, aggressively manage working capital, generate strong cash flow, and improve our capital structure. These times are unprecedented. And our ability to execute on these controllable aspects of the…

Thank you. (Operator instructions) This first question comes from Brian White from Collins Stewart. Your line is open. Brian White – Collins Stewart: Yes. Good afternoon. When we look at the inventory decline was pretty phenomenal in the quarter. Maybe you can talk through what you did to drive this decrease. Are we going to see further decline at the March quarter?

Yes. We’re really, really pleased with the results and all the hard work that went into that. A lot of it was that we actually just pulled out a recessionary playback from 2001. We learned a lot back then about how to drive the inventory out. And I think back in 2001, it took us about four quarters to go figure it out, but there were a lot techniques that we implemented to go make that happen in terms of how we manage our MRP, collaboratively working with the customers to understand what their demand patterns are. And it’s kind of a funny thing, but we actually worked with our customer last quarter to push demand down, which sounds kind of crazy. But we actually continuously challenge what our customers were going to load because I think we were perhaps a little bit more negative than our customers were. And that they don’t want to be left holding with too high inventory level. So anyways, between working with the customers and actually implementing a lot of the things that we learned over a one year period in 2001 about how to plant safety stocks, how to manage lead times, how to load the MRP system, which just created a very, very good results for us. And do we expect it this quarter? We do. So we’re doing the same thing. We’re pushing it down and I would expect to see continued improvement in terms. Brian White – Collins Stewart: And when we look at capacity innovation in the December quarter, maybe what you’re looking for in the March quarter. Just also if you had – was there downsizing in the December quarter of headcount and maybe what you expect in the March quarter?

Yes. So there was a yes significant downsizing. I think I’ve mentioned it. When we put a pretty flexible base in and we did this, years and years ago and so our ability to thrust down pretty rapidly is high. So there were a very, very significant amount of reductions in the hours worked reflects. So already last quarter we put in PTO, forced PTO, we shutdown factories, we put people on short of work weeks. We had a significant amount of lay offs, which included a lot of temporaries. As mentioned, we reduced the overtime hours very, very substantially. But between all that is we were able to react pretty aggressively. So I would say that all those different items were significant, were very active, were put in really across the board and really in just about any geography. Brian White – Collins Stewart: And do you have–

Well, say this quarter, so we’re rapidly responding to those that the marketplace is presenting to us. Brian White – Collins Stewart: And then what type of percentage decline did we see in the workforce and also could be the utilization rate, which you’re looking for?

Yes. The factory dealer utilization rate comes up a lot. There’s three different kinds of kind of utilizations. There’s really the factor utilization, there’s the equipment utilization, and then there’s the people utilization. And the fact that utilization be in the least important, the physical phase that is. It runs well below 1% of sales and that’s real hard to flex obviously. The equipment runs between 1% and 2% of our total place and that also is difficult to rationalize in a very, very short ordeal. Alternatively, these are typically on in for five to seven year depreciation cycle so about 20% burns off the year. And then third thing’s people, which makes up the big amount and our objective is to directly respond to the market place orders with reduction in hours and those could be like I’ve said shorter work week, they could be PTOs, they could be outright lay offs and they could be overtime. So it’s really a combination of those things, but it’ll be our objective to flex that directly to the revenue in hand. But again, it takes a quarter really to have that flow through and there’s a cost for that. Brian White – Collins Stewart: But Mike, do we have a percentage kind of maybe on equipment that we’re looking at here?

Well I think the way to think about it is that we came up the September quarter doing 8.8%, so we have enough – or $8.9 billion. So we have enough equipment to do $8.9 billion of sales. So if you think that – you take the misquoted guidance at $6 billion that it directly translates. Brian White – Collins Stewart: Okay. Thank you.

The next question comes from Jim Suva, Citigroup. Your line is open. Jim Suva – Citigroup: Thanks, Mike. Have you seen any changes to your OEM customers as far as pricing? What they’re asking for? Some in-sourcing? Are they asking for better terms now that there’s a lot of excess capacity out there and there’s some competitors who don’t have quite the financial position that you do to maybe strive a little bit more for business?

Well those are a lot of things in that one comment. But the answer is we’re seeing some of everything. Certainly, in terms of aggression that’s in the market place or maybe of lower terms from the OEM. William’s always asked us for better and better terms and lower and lower prices. Is it more difficult than it was in the past? Maybe not, I do find that the overall environment is becoming more competitive. I think that the competitiveness is actually more challenging in the consumer mobile space probably than it is in other product categories. But we’re starting to see an increased amount of competitiveness. I don’t know if it’s driven as much by the OEMs as driven by some of the excess capacity of the contract manufacturers. So I think that’s part of it. I think without question people and I are looking for terms, but at the same time we’re kind of asking to improve those terms kind of simultaneously as we look at credit we extend through AR. We’re actually working to reduce that risk and tangle in the other direction. So I think while people might ask, I think people also understand the difficult credit market. And I actually don’t expect to see much movement at all as it relates to concessions to the OEM in that space. Jim Suva – Citigroup: Okay. And a quick follow up for Paul. Paul, there’s kind of been no restructuring charges now for this quarter, but with your run rate of sales at this release what it is for the March quarter. Do you have to institute another restructuring program given your size relative to where the demand is?

Mike. Sorry. We actually considered to react to the demand signals that we have and align our cost base. I mean, that goes on daily here, day in day out. So we continue to do that. In terms of cost, there was an insignificant amount spent in the December quarter and there’s an insignificant amount planned in the March quarter. However, we’re still waiting for demand signals to settle down to understand the new levels of run rate for revenue. And should that mean that we have to take – do something more saleable then we’ll inform you. But we have nothing of that magnitude in mind of this stage. Jim Suva – Citigroup: Great. Have you ever think to think about GGM as –

Think about they’re running a close to 25% to 30% overtime level and we’re running a 25% to 30% temporary workforce worldwide and you think of that base and flexibility on top of 200,000 people. I mean, that is an enormous amount of flexibility we’re getting at very, very low cost. And that’s basically what we did. We reacted very, very significantly last quarter. The numbers were extremely high, but the cost of it is that we’re also putting in that flexibility is not so high. Now as we get into more and more challenges gone forward if that base continues to erode, the cost of that flexibility gets higher and higher. And we’ll have to reevaluate what our position. But so far we’ve been able to react pretty effectively without doing anything major. Jim Suva – Citigroup: Okay. And housekeeping. Why is stock comp going up year-over-year?

That’s a good question. Sorry I don’t have the answer at hand, but I’ll certainly follow up with you later on my call. Jim Suva – Citigroup: Okay. Thank you. Thanks, gentlemen.

Yes. Thanks. Next question?

Next question comes from William Stein from Credit Suisse. Your line is open. William Stein – Credit Suisse: Thanks. I think a lot of investors have been interested in the financial covenant. If I understand there are two maintenance covenant that have been concerning people. I’m wondering last time you guys talked about our EBITDA rather was down about 50%, you’d still be okay. Can you talk about how you view that today? And also what you have to see in terms of both potential write downs for this and the decline in EBITDA in order to have any trouble on some?

Yes. We ended the quarter well in compliance with our covenants and feel very comfortable with that especially having taken out some more debt as we noted. Going forward, it’s all a matter of earning levels and we’re not partake to talk about that at this stage. However, we’ve modeled certain scenarios out and we still remain under compliance and we’re not concerned about it. So I think you understand the detail of the calculation, but it’s something that of course we pay close attention to. And the good thing is the business is generating significant cash and the downturn that helping us with our liquidity and our net debt and our ability to be opportunistic in the capital market. So that’s the kind of way we’re out at that. William Stein – Credit Suisse: Perhaps I could try in a different way. If you saw the current quarter come within your guidance range or maybe at the low end and then no meaningful rebound over the next few quarter and profitability is kind of the same levels as well. Do you think there’s a chance you’re tripping one of the two covenants?

No there isn’t. And that’s certainly something we model and pay close attention to. William Stein – Credit Suisse: Great. Thank you.

Next question comes from Amit Daryanani from RBC Capital Markets. Your line is open. Amit Daryanani – RBC Capital Markets: Thanks. You guys it’s a question on Nortel Law pot. The thing is when you guys bought all the Nortel assets several years ago ten or five of some of the manufacturing sites, you might have fold one or two of those. But can you just talk about the remaining sites that are left. Is that some Nortel centered business? And are you planning to shut them down in the near term?

Yes. We actually have one. The original base – we have one factory left in Calgary. There’s quite of bit of other work in there at the moment. And we’ve been downsizing that factory probably for like three years. So I would call it on a planned phase down and a – So we have very little left of that. We don’t own the factory. We have several hundred people and it has a very planned phase out. Anything else we bought from Nortel has already been closed. Amit Daryanani – RBC Capital Markets: All right. And then I’m not use to just cruising it. The reality for FLEX at this point given the macro environment become $24 billion to $25 billion kind of annual revenue company, do you think that you guys have the core structure to sustain 3% to 3.5% EBITDA margin on that kind of run rate and it’s not – Can you start with what the reconstruction you would have to do to get there?

Yes. So it again depends on mix and exactly what is that business made of. But it would certainly be – I mean how we look at the business is that it’s going to be 6 million at this quarter or there about. This downturn can last a long time. We don’t know what it’s going to be like in the future, but we certainly have to anticipate that there’s going to be an extended downturn of business just so say the new base is 6 billion and we feel that we just need to adjust to that base and start working it back up to our 3% level because that is the new level. We think we can get there, but again it depends on mix and it depends on how fast we can get there. But it is certainly our intention to reset our company to the new lower level, and then start grinding it back to three points. Do we think we can get there? It is likely yes. We have to be able to get there. Amit Daryanani – RBC Capital Markets: Mike, what I am trying to get and think about is, can we get there just on an organic basis or would we have to take some outside restructuring chart to achieve that at some point?

And it kind of depends on what kind of – what the mix is, but if we were going to stay flat at $25 million, we might accelerate it getting to the 3% or 3.5% level by taking some charges. I think that is a possibility, but we really have to see what the mix is and really decide on what the overall level is going to be. But the answer is, again, you get there faster by doing restructuring. But then again, we want to be thoughtful and careful about what we restructure and what we don’t. Like I said, I outlined a huge ability to respond down on the highest cost element, which is our labor. So I think it just depends. But what I can assure you of, for sure we think there is a new level, for sure we need to go adjust down to it, and for sure we have to go run our business to get back up to 3% to 3.5%. And we’ll find a way to go do that. Amit Daryanani – RBC Capital Markets: Fair enough. And just finally for me, on the SG&A line, $212 million from this quarter. Could you just talk about how much of that is variable versus fixed? And I am trying to get a sense really on next quarter, would sales be down 25%, what SG&A run rate do we think about?

Well the variable run rate essentially is the R&D spent out of that number, which typically runs around 20%, and the rest of it is pretty fixed. Amit Daryanani – RBC Capital Markets: Perfect. Thanks a lot guys.

The next question comes from Alex Blanton from Ingalls & Snyder. Your line is open. Alex Blanton – Ingalls & Snyder: Thank you. I am going to continue on the income statement here. If you take the mid-range of your EPS guidance and work back up using interest cost of $54 million and 4% tax rate, it is about 1.5% operating EBIT margin on $6 billion mid-range sales and that is $92 million. And if you assume $200 million in SG&A down $12 million, you get $292 million for gross profit, which is virtually the same gross margin, 4.88%, as you had in the third quarter despite the fact that your sales might be down 22% sequentially. How do you do that? And does it have anything to do with the fact that you must have had a big impact on absorption from reducing inventory by a billion dollars because, well, at $900 million, let us say, adjusting for Nortel? A if you adjust, let us say, that the impact is 10% of that would mean that before inventory liquidation costs like that and absorption, you would actually would have maintained the – you’d have about a 5.9% gross margin in the third quarter. So is it the absence of the huge inventory reduction that allows you to hold a gross margin like that on a big volume decline or is it the mix or what?

Hey, Alex. So maybe I will take those one at a time. Alex Blanton – Ingalls & Snyder: I got one more question after this, but it is a short one.

That is great. So the first question of gross margin coming up December going on to March. You are right. If you model it out, it roughly stays flat on the gross margins percentage basis. That is reflective of our accelerated activity that is taking out cost that has enabled us to maintain gross margins at those levels. We have been, as Mike said, been very proactive at taking down the labor cost (inaudible), which is the highest cost driver of the variable cost component. So we continue to do that through a much lower revenue base in the March quarter. That was the first part of it. The second part of it, I did not quite understand because taking out inventory hasn’t necessarily reduced – hasn’t had an effect on absorption. Alex Blanton – Ingalls & Snyder: But it means that you produce less than you sell, which obviously affects your absorption if you are absorbing costs in the inventory at all. The amount that it affects depends on what percentage of your fixed cost you absorb in the inventory. But if you do not absorb any into the inventory, then there is no effect.

That is true. And it goes back to the first point of how we absorb the overhead costs, which has a lower revenue base and maintain the 4.8% to 4.9% gross margin. And the largest driver of that is the labor cost, which at this day absorbs n inventory is typically how you do it. And so having reduced the labor cost substantially, it enables us to maintain that margin percentage level. Alex Blanton – Ingalls & Snyder: Okay. All right. The second question, which is shorter, is at your November 18 meeting, you pointed out there was a provision in your 6.5% bond that would be triggered by the impairment charge and that would prohibit you under that provision from repurchasing stock. And so that you were not able to repurchase stock even at the depressed level that it was and got to after that meeting and still is. But you thought that there could be workaround for this or re-negotiation of it or whatever. So how do you stand now regarding possible repurchase of shares under that provision? |Can you do it or not?

Right now Alex, we cannot. What it is, as you have already pointed out on the 6.5%, it is the actual restricted basket issue. And therefore, until that basket becomes positive or the issue is resolved, there would not be any allowance for repurchase of our shares. Alex Blanton – Ingalls & Snyder: But is it under negotiation to change it?

It is certainly within our thoughts and plans to address this issue but– Alex Blanton – Ingalls & Snyder: You could buy a lot of stock at the current price.

Absolutely. Alex Blanton – Ingalls & Snyder: So it is a real shame that you cannot do it.

You got to tell the rest of the guys in this call, Alex. Alex Blanton – Ingalls & Snyder: All right.

Oh sorry.

Go ahead, I did not mean that.

No you are right, Alex. You know it is all part of our ability to manage the capital structure and we have been focusing on the debt repurchase, as you know. But we will want to make sure we have a balanced approach going forward. And any restrictions that we have, we will either decide to live with them or decide to remove them. So that is in our daily planning for sure. Alex Blanton – Ingalls & Snyder: Okay. Thank you.

The next question comes from Matt Sharon from Thomas Weisel Partners. Your line is open. Matt Sharon – Thomas Weisel Partners: Yes, thanks. I just want to go back to the outlook commentary in your guidance, which is a wider range, and we certainly appreciate that given the lack of visibility. But is this going to be – need to be a very backend loaded quarter in order to get even to the midpoint of your guidance. And just as you started the quarter, you had Celestica earlier. For instance, just say that they saw a big order drop off in the month of January, is that how your quarter started out and will have to be more backend loaded?

No. I do not think so anyway. It is hard to say because we cannot predict the future, but our quarters typically are not very backend loaded. And I think the behavior that we saw in early January was not much different than we anticipated in December, to tell you the truth. So I actually do not think there is a meaningful change. In fact, there was such little change in our order book in January that maybe we were just already discounting what ended up coming in January, which is a possibility. Because like I had mentioned earlier, we were aggressive with our customers and pushing those forecasts down just because we did not believe in the future and we did not want to get stuck with the inventory. So I think there is – the other key thing that I think that we are missing some demand date on is we actually are two cycles out of the real demand sell through. So in other words, we sell to Sony, we sell to Wal-Mart. So really, we have to get Wal-Mart say to go to Sony, they then go to us, and then for us to load our schedules. The same thing when we sell to Cisco, we really need to wait for Verizon to give us the orders from Cisco perhaps. And to me, there were so many people on extended shutdowns over the holidays that I actually question how much good data really came out at the end of January. So I think there is still more data to come out that we need to absorb and understand, but I do not think the first two weeks in January, and we did hear from that from last this call, but I do not think the first two weeks was any different than where we anticipated. And perhaps it was just because we already were judging our forecast down. Matt Sharon – Thomas Weisel Partners: Okay. Thanks. That's helpful. And then just on the inventory. Good job obviously in December with the big revenue drop off in March, can you keep at that turns level or should we expect inventory days to go up a bit in March?

Yes. We'll for sure expect going to go up. Every March quarter we have a pretty good cliff up and inventory days. It's hard to react. Just the way we do the inventory calculation, somebody else's, it's pretty much impossible to react down 25%. So what we'll do is we'll give a good hard rod at driving as much inventory as we can out in March. And then I think the balance will write itself in June, and I think by then I actually hope to be at a stable base granted it's probably a lot lower than we had last June. A new base revenue, that is. And I would expect it to be a little stable. But during this adjustment period, we are going to see the inventory turn phase go up. Matt Sharon – Thomas Weisel Partners: Okay.

And we'll every March even in the good environment. Matt Sharon – Thomas Weisel Partners: Sure. Okay. Thank you.

Are you ready for the next question?

Yes.

Next question is from Stephen Fox [ph] from Bank of America. Your line is open. Stephen Fox – Bank of America: Hi, I will be quick. I just was curious how you would gauge the chances of recovering some of the $145 million charge with Nortel in the future?

Well, since we've actually taken a provision or distressed customer provision, we obviously think the chances are pretty small, and that's why we took the reserves. And we will get new information, I'm sure, as we go through – particularly, it has been on the credit committee, but that will take a long time. But I think for now we have to assume that that's a low probability if that happened. Stephen Fox – Bank of America: And then the chances of other charges are zero based on the agreement you've reached now at Nortel.

It was never a zero course, a significant amount of judgment that goes into establishing our reserve elsewhere and hoping that Nortel comes through this process. There are other possibilities. And that could end up being negative for all parties related in this. But we're not planning for that. We're planning for them coming through it, and we think the reserve that we took would be adequate. Stephen Fox – Bank of America: Okay. Thank you.

Next question comes from Shawn Harrison from Longbow Research. Your line is open. Shawn Harrison – Longbow Research: Hi, good evening. I was just hoping maybe if you look out, say with the next 12 months and now, there's extremely limited visibility. But if you could maybe quantify by each end market that you serve the run rate of revenues and what you're expecting in terms of decline. And then on top of that, are you also pruning out additional low margin business over the next few quarters?

Yes, we are. And we have been doing that for I think when we first went to discuss with you guys, either it was back in June or July timeframe, where we said that it would be our objective now to generate cash and because there's a lot of opportunities of what to do with our cash. And we believe that those out of our company was pretty complete. So we've been on that mode for a little while. We’re seeing some of those reductions, and for sure we've seen a lot of those reductions already. And we're continuing to work it in this environment. Our cash is very, very important to us, and we're making sure that we earn on it. Otherwise, we shouldn't be spending it. So we're pretty tough on our team and work on that very, very hard. So it's not just a low margin either. But really the ones that are consuming a lot of net working capital, which is just as much a focus of the low margin accounts. That's right though. At the end of the day, it's return of the investment capital. Shawn Harrison – Longbow Research: Okay. And then the earlier part of my question. Just in terms of trying to size maybe the declines potentially over the next 12 months in terms of a run rate by end market.

Yes. That one's really a tough one. And as you know, we don't know. We’re not close enough to our customers in demand to be predictive about that. I think for us and what we see in terms of the markets, we are very bullish about medical that we think more and more outsourcing opportunities are coming out of this environment. And it is an industry that is very reasonably new in terms of outsourcing. We think that is a big upside. And in general, we think the infrastructure business will be down, but we also think relative to the other businesses, we think that is going to be a strong point or stronger. So maybe we will go down less is maybe the way they described it. But, yes. We really don’t know what the end is going to look like. Shawn Harrison – Longbow Research: Okay. And then may be just another question kind of in the general scheme of things. What are you looking for right now to indicate, you are seeing the bottom in demand, is it to stop negative order revision? Is there something else in that sense?

I would not say we have seen the bottom. Like I said, I actually think we need some more data to see whether there is another click down or if it has stabilized. I do actually kind of hope that this quarter, we will know what the bottom looks like, but I am not sure if that is true. And like I said, I think there are lot people on vacation and a lot of new data that needs yet to come out. So I am actually not bullish that we have seen the bottom, but we do not know. But I think we just have to be very, very reactive to anything else that comes at us. But hopefully, we will see the end of the down cycle this quarter. It would be nice to see. Shawn Harrison – Longbow Research: Okay. Thank you.

The next question comes from Sundar Varadarajan from Deutsche Bank. Your line is open. Sundar Varadarajan – Deutsche Bank:

Yes. It is a difficult question, and you are right. We could easily see a decrease in the amount of higher volume lower margin programs. But simultaneously, we’re also happy to adjust our profit where our cost structure simultaneously with the new revenue level. So you have got a lot of effects going on somewhat simultaneously. And so it is really difficult to sort through at this point. We also have a lot of ramp ups. You know one of the problems that we talked about last call is well our mold [ph] business looks kind of reasonably flat year-on-year. Alternatively, there is a lot of ramp downs in one region on one type of phone, and lot of ramp ups in another region with another type of phone. And while the revenue looks reasonably stable, it also comes with the cost. So I think between all those effects and the uncertain economy, we are not really – I do not think we can actually forecast what exactly what our margins look like, only to say that we just have to respond as rapidly as possible and it is our objective to start working this thing up to three points. Sundar Varadarajan – Deutsche Bank: Thanks. A couple of questions on the cash flow front, how should we think of CapEx for the next few quarters? And how much cash restructuring payments do you have from some of your older restructuring kind of initiatives?

So from a CapEx perspective, I can tell you what our internal targets and that as we ratchet the spending down, it will approximately be roughly 50% of depreciation, so approximately $50 million a quarter. Sundar Varadarajan – Deutsche Bank: Okay.

From a restructuring cash perspective, we have approximately $177 million left and about $71 million of that comes out in March. And then, it is about $30 million in June. And after that, it is roughly $10 million a quarter for a few quarters until it runs out. Sundar Varadarajan – Deutsche Bank: And just one more question on your AR securitization, could you just give us what the outstanding – I think you have three different AR facilities, what was the net balance, net of retained receivable, and net over retained interest at the end of the December quarter?

Yes. It is roughly $800 million. Sundar Varadarajan – Deutsche Bank: All right. Great, thanks.

Okay. So I think that’s it.

Yes, we’d like to thank everybody for participating in the call, and we look forward to talking to you in the next quarter.

Thanks very much.

Thank you for your participation in this conference call. You may disconnect.