Good day and welcome to the Lantronix's Fiscal 2016 First Quarter Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there’ll be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Ms. E.E. Wang, Investor Relations. Please go ahead.

Thank you, Casea. Good afternoon everyone and thank you for joining the Lantronix first quarter of fiscal 2016 conference call. Joining us on the call today are Kurt Busch, Lantronix’s Chief Executive Officer and Jeremy Whitaker, Lantronix’s Chief Financial Officer. A live and archived webcast of today’s call will be available on the Company’s website at www.lantronix.com. In addition, a phone replay will be available starting at 08:00 PM Eastern, 05:00 PM Pacific today through November 5, by dialing 877-344-7529 in the U.S. or for international callers, 412-317-0888 and entering pass code 10074744. During this call, management may make forward-looking statements, which involve risks and uncertainties that could cause Lantronix’s results to differ materially from management’s current expectations. We encourage you to review the cautionary statements and risk factors contained in the earnings release, which was furnished to the SEC today and is available on our Web site, and in the Company’s SEC filings such as its 10-K and 10-Q. Lantronix undertakes no obligation to revise or update publicly any forward-looking statements to reflect future events or circumstances. Also please note that during this call, the Company will discuss some non-GAAP financial measures. Today’s earnings release, which is posted in the Investor Relations section of our website, describes the differences between our non-GAAP and GAAP reporting and presents reconciliations for the non-GAAP financial measures that we use. I will now turn the call over to Kurt Busch, President and CEO of Lantronix.

Thank you E.E., and thank you to everyone joining us this afternoon. During the first fiscal quarter ended September 30, 2015, we continued to execute on the fundamental elements of our strategy, developing and launching smart IoT and M2M solutions, expanding our sales and marketing efforts worldwide and exercising financial discipline while investing for growth. Growth in new IoT modules, and our new SLC 8000 advanced console manager helped to deliver sequential total revenue growth in the first quarter of FY16. Lower-than-expected sales in some of our project driven new enterprise solution led to flat new product revenues for the quarter. We saw continued improvement in our gross margins for the second quarter in a row and a return to non-GAAP profitability during the first quarter of FY16. On the product development front, we announced the next generation version of the xPrintServer Office, the first and only print server appliance that supports thousands of printer models and is both Apple AirPrint and Google Cloud Print certified. We are finalizing development of a new private label custom print server for a major printer manufacturer. We expect to begin shipping this product as soon as we complete a final certification. Earlier this week, we announced an agreement with Avnet, Incorporated, a leading technology distributor. Under the terms of the agreement, Avnet will distribute Lantronix IoT modules and solutions throughout North and South America. This agreement expands the ecosystem we are building as part of our goalof enabling the Internet of Things, and represents a significant milestone in our continued effort to expand our sales and marketing channels. With the current outlook of opportunities, designs and project wins we expect a return to revenue this fiscal year. We remain confident that we will achieve double-digit new product revenue growth. Before I go into more detail on our progress and expectations, I'd like to turn the call over to Jeremy to go over financial highlights. Jeremy?

Thank you, Kurt. Please refer to today's news release and the financial information in the investor relations section of our website for additional details that will supplement my financial commentary. Now I'd like to take a few minutes to go over the highlights of our results for the first quarter of fiscal 2016. As discussed on previous calls, our revenue has a history of fluctuating from quarter-to-quarter due to the nature of our project-based sales cycles. Net revenue was 10.6 million for the first quarter of fiscal 2016, a decrease of 963,000 compared with 11.5 million for the first quarter of fiscal 2015, and an increase of 342,000 compared with 10.2 million for the fourth quarter of fiscal 2015. The year-over-year decrease in net revenue was primarily due to a 10% decline in Legacy Product sales, which is relatively consistent with the trend we have seen in our Legacy Products over the last couple of years. In addition, we continue to see weakness in capital spending from some of our US-based customers. New product revenue was 1.9 million for the first quarter of fiscal 2016, compared with 1.7 million for both the first quarter of fiscal 2015 and the fourth quarter of fiscal 2015. New product revenue continues to be impacted by the project-based nature of our sales cycle. For example, our Secure Lantronix Branch Office Manager or SLB 2 benefited from a large rollout with Verizon during the first quarter of fiscal 2015. Verizon continued to purchase the SLB 2 during the first quarter of fiscal 2016, but at a lower rate. On a positive note we recognized revenue from the completed delivery of the first significant production order for a consumer drawn application, using our xPico Wi-Fi IoT module. In addition, our SLC 8000 advanced console manager continued…

Thank you, Jeremy. As I stated on previous calls, our growth strategy is focused on disciplined and innovative product development in close collaboration with tier 1 customers, expansion of sales channels worldwide and exercising financial discipline while investing for growth. During the first quarter we are continuing to make progress on all of these fronts. We were pleased to report improved sequential sales during the first quarter of FY16 as we achieved modest sequential revenue growth, improved gross margins, a return to non-GAAP profitability, and improved working capital. On the product development front, we launched the next-generation xPrintServer Office, the only print server appliance supporting thousands of printers that is both Apple AirPrint and Google Cloud Print certified. We are reaching completion of a private label custom print server product that leverages our xPrintServer technology. Designed for a top global printer manufacturer this new product is currently going through one last certification and we expect to begin shipping this product later this quarter or early Q3. We expect this project to turn into a significant long-term relationship. Moving into the next few quarters, we are in the final stages of development of a new IoT module platform that we expect to launch during next year’s Embedded World in February. This new wireless platform is already in the sampling phase with key beta customers. Initiate response has been very positive and we expect this to be a key revenue driver for new IoT modules. Focusing on our new product sales, we continue to attract new orders and design win opportunities for our new enterprise solutions and IoT modules. Some examples include we delivered the first significant production order for a consumer drone application using our xPico Wi-Fi module. In addition, we added new design wins for IoT modules from a diverse…

Thank you, operator. I'd like to thank you all for your participation on our call today. We look forward to updating you on our progress, achievements and actions when we report on the second quarter FY16 results in late January 2016.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.