Welcome to the Skyworks Solutions First Quarter of 2008 Earnings Conference call. Now at this time, I would like to turn the conference over to Tom Schiller, Investor Relations for Skyworks. Mr. Schiller, please go ahead.

Good afternoon everyone and welcome to Skyworks Fiscal First Quarter of 2008 Conference Call. With me today are Dave Aldrich, our President and Chief Executive Officer, Don Palette, our Chief Financial Officer and Liam Griffin, our Senior Vice President of Sales and Marketing. Dave will begin today’s call with the business overview followed by Don’s financial review and outlook. We will then open the lines for your question. Please note that our comments today are statements relating to future results that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially and adversely from those projected as a result of certain risks and uncertainties including, but not limited to those noted in our earning’s release and those detailed from time to time in our SEC filings. I would also like to remind everyone that the results and guidance we will discuss today are from our pro forma income statement consistent with the format we have used in the past. Please refer to our press release within the Investor Relations section of our company website for a complete reconciliation to GAAP. I will now turn the call over to Dave for his comments on the quarter.

Welcome everyone. Today, we announced our first fiscal quarter 2008 and I am pleased to report that we delivered solid performance in the December quarter with our team’s focus on operational execution translating into improvements in profitability. Our increasing diversification in the new markets, coupled with content gains in the handset front-end modules fueled double digit top line growth and expanding margins as well as both record earnings per share in cash flow generation. Specifically during the quarter, we grew our top line 11% sequentially to over $210 million. We expanded our gross margins to nearly 40%. We have posted $29 million of operating income, this is up 26% sequentially. It represents nearly a 14% operating margin. We delivered EPS of $0.17 and we have generated $55 million of cash flow from operations. At the highest level, our performance continues to reflect the fundamental shift taking place in our business. Frankly and based on many of your recent many investor comments, I do not believe we have adequately communicated to investors just how significantly Skyworks has evolved over the past couple of years, so as a result, I would like to spend just a few minutes today outlining the transformation that is occurring within our company. Now, for many of you, if you have followed us at the time of the launch of Skyworks or at the time of the merger in 2002, Skyworks was at that time a digital-base pan and primarily a 2G CDMA and GSM power amplifier company. Since that time, we have aggressively focused on four initiatives. First, we are continuing to diversify Skyworks. We are leveraging our catalog business, our world-wide distribution network and we are expanding into a broader set of end-market including broadband, industrial, medical, computing, wireless networking, cellular infrastructure and to give…

Revenue for the first fiscal quarter was $210.5 million dollars, up 11% sequentially and $3.5 million dollars better than our guidance. Gross profit for the quarter was $83.8 million or 39.8% of revenue and 40 basis points sequential expansion and 130-basis point improvement year over year. Our continuous improvement over the last four quarter reflects the following: Enhanced product mix is multi mode, FEMs and linear products become an increasing part of business, higher equipment efficiency and in fact, utilization, progress on yield improvement initiatives and double digit year-over-year material cost reductions. You may not realize this, but at Skyworks, each and every function, department and operating location has monthly, weekly and in some cases, daily improvement initiatives with very specific metrics that aggregate to our profit growth targets. We have structured these metrics to clearly tie to incentive plans and align with shareholder value creation. We believe this attention to detail is helping to drive our margin improvements. Going back to the income statement, operating expenses were $55.2 million of which R &D expenses totaled $32.9 million and SG&A cost were $22.3 million. As a result, our operating incomes for the quarter was $28.6 million, up 26 % sequentially and representing a 13.6% operating margin. Our net interest and other expense for the quarter was $158,000.00 while taxes were $568,000.00 reflecting a 2% cash tax rate. Net income was $27.9 million yielding a record $0.17 of earnings per share, one penny ahead of consensus estimates. Now, turning to the balance sheet. We exited the quarter with cash and cash equivalents as well as short term investments of $207 million. During the quarter, we recorded $11 million of depreciation, generated a record $55 million in cash flow from operations, invested $19.1 million in demand driven capital expenditures primarily for fab…

(Operator Instructions.) Our first question will come from Amit Kapur from Piper Jaffray. Amit Kapur – Piper Jaffray: Thanks a lot guys and congratulations on the strong quarter. Maybe we could just start off, obviously there is a lot of debate out there in terms of the nature of the macro environment, maybe if you could give your view on what you see in terms of levels of handset inventory out there? What kind of your orderly times were doing exit in 2007?

There are areas of weakness. We have seen some areas in China for example on the low end, some pockets of infrastructure, a couple of customers are soft. Unfortunately, we were ramping while weighing in a couple of others that are very strong even in the infrastructure requirement, although, I mean I must say that there has been nothing significant enough to move the dial overall at Skworks. In our case, we are seeing strength from our linear products. We are seeing this average blended ASP content increase to begin to become a reality such that our ASPs are increasing in handsets and as you know, we are ramping some new customers we have acquired over the last six to nine months. We do see pockets of weakness and some choppiness. I think overall, the handset industry is relatively strong and we are picking up share. Amit Kapur – Piper Jaffray: Great, maybe could you give us a sense of what linearity was during the December quarter, was it pretty normal?

Linearity was actually pretty normal for us as Dave outlined. We have very good position now across each of the top five OEMS that we had good visibility exiting the quarter, and visibility looks decent now as we move into the market.

(Operator instructions.) We will next go to Edward Snyder with Charter Equity Research. Edward Snyder – Charter Equity Research: Thanks a lot, good quarter. Obviously, there is a lot of chatter that says about the macro environment, you mentioned China was an area of weakness. We had BAMI (ph) from Antidigits and Ralph on TriQueen (ph) on an investor call yesterday, both seemed kind of upbeat about the end market strength in sheer gains, but clearly that everybody had given their share on the quarter and we are hearing about some relatively large share shifts especially in CEMA, so you mentioned you were picking up share, could you give us some kind of indication where you think you are gaining share, what technology, what OEMs and who are you gaining it from? And then also, you have done really well at the largest handset OEM, have you leveraged your position there from 3G into their EDGE GSM businesses, or are you almost exclusively just 3G there?

Let me comment on a couple, first, as we mentioned in the prepared comments, we are shipping EDGE and WB and CDMA to all of our top-tier customers. So we do not have customers that are buying just EDGE or just WB and CDMA, at least not among the top tier. And the reason for that is pretty simple. There is a real advantage to coupling the complicated filter and the multi-throw switch, the logic and control that drives in most cases multiple events of EDGE and then in Asia, you have bands, one, two, three or four bands of WB and CMDA, so there is a real current consumption size overall bill to material cost advantage. So most of these solutions are highly proprietary in custom, and they are a real win-win for OEM customers, so that is the answer there. When we are seeing share gains is because we are now a pretty broad proxy as I mentioned in the prepared comments a couple of years ago, we are shipping to three of the five top customers. We are now shipping to all five and we are shipping all modulations to all five virtually. Right now, we are beginning to see real growth as the industry increases and as the average content as there is more EDGE in 3G, the average content moves a dollar or two as opposed to several dollars a phone, so the blended that duck-tailing in of higher dollar content is causing us the increase. So we are taking share by virtue of the fact that there are a few and discrete solutions and we have swept in more functions. We are taking share by shipping to all five and of course linear products as an area of growth for us.

Our next question is from Sujin daSilva with Kaufman Brothers.

Congratulations on the quarter. You talked about the share gains. Can you talk about among the top five, which one do you think has the best share gain opportunity as we look at ’08?

What is tough for us to get into that kind of granularity, I think the phenomena of htier being more content is not specific to any one customer, so I believe that we will see a blended ASP increase as all of the top tiers are moving from a mix of emerging market low end as well as EDGE and WB-CDMA to varying degrees, so that phenomena includes across all customers. Clearly, the OEMs are sum-gaining from others, and so as we see that overall market dynamic, it were not pretty as I have said, pretty broad proxy for the overall industry an we would to see those OEMs who are gaining share as those OEMs gain share, that shifts some of our volume from OEM A to OEM B.

Okay, great. That helps, and then, just one quick follow up. You have done well with Apple and some of the new products with the iPhone. Do you have any update on the opportunities there are they refresh their product lines or perhaps some of the computing products that they have currently?

Oh yes, absolutely. With respect to Apple as you may know, we really cannot speak in detail about that company, but we certainly pursue opportunities with all the major players both in notebook computing and also handsets and we encourage you guys to do your tier-downs and gain your insights from there.

Great, thanks.

Our next question is from Aaron Hashaq with Morgan Stanley.

Great, thanks for taking my questions. I am happy to hear you guiding dollars flat in the March quarter, is that something that you think kind of hold it to your flat or just let growth beyond that even as you continue to grow the business in the second half of Fiscal ’08 or how much gross should we look for?

I would expect that there will be some slight growth. If you look at our expense base, most of those cost are fixed, we have a great model in place that allows us certainly to leverage very effectively operating expenses, but there are some minor variable causes associated with some commissions and some volume related expenses, but I would say, you would not want to model any significant increases in our expenses on a go-forward basis.

Okay, and then as you look at the factors that are better than normal seasonality in the March quarter, the share gains and the MediaTek, the ramp of your new tier one customers and some of the transitions to find the modules and Motorola low-end, which do you say is the biggest factor helping you offset seasonality.

Let me give the top two or three, one is in these newer applications with these adjacent markets and non-handsets. It is less seasonality, so what we are seeing is a quarter where we are typically think of handsets as being seasonal, the markets were addressing either if they are seasonal and maybe a different season or they are not seasonal at all, so that scenario where we tend not to see that seasonality and as that business has grown, that has become a bigger impact for us. I would say the second is that we are beginning to see displacement of our business on the 2G side with more and more EDGE and more and more WB-CDMA where we sweep in the filters and switches, so I think you are starting to see that creep from relatively simple dual band power amplifier to a relatively complex multi-mode FEM, I would say that is number two.

Our next question is then from Todd Koffman with Raymond James. Todd Koffman – Raymond James: Yes, just with regard to the weakness you have seen in Asia, can you give any more quantification on that since the number of other vendors has talked about that as well.

Let me try to clarify that. I mean, it is obviously, I will use the word choppy for lack of a better word, I would say that what we are seeing today in China frankly is we have a large customer called MediaTek in China, they have lots of customers that are indigenous to the local branded OEMs within China and one of the things that we are seeing is that the supply chain constraints, we have been looking to fill and I think an underserved customer there, by filling that void. We have been scaling up for that customer and working very hard to gain design wins and the challenge for us is to make sure that is a permanent share gain, and so that has been our goal and those are the discussions that we have been having with that customer. So, while I look at China, I think, the end handset sales across the industry are strong. Again, there is some choppiness and that is one area where it is difficult to handicap it or take a beat on it because you are seeing some constraints and some share shift, which makes it difficult to quantify, but again, I do not believe it is a major issue. I do not believe there are major pockets of inventory and our business in China, for ’08 looks frankly quite strong.

Our next question, you will have to help me on your first name, last name is Kidron in Oppenheimer. Ittai Kidron – Oppenheimer & Co.: Congratulations on a good quarter. I had a couple of questions, Don, first to you. What are you now starting to generate, how should we think about your net interest income for the quarter going forward, and Dave, can you comment on what would be seasonality for the handset market in your opinion as you hear it from your customers on an aggregate basis, of course on December to March, that will be interesting to hear.

Where we have been running right now and it has not had the cash balance at this point has not had a material impact on that is that we have a net interest expense and interest income of about 100K a quarter that is running. You can start ramping that up a little bit as we move out to the year, but it is not a real material number for us at this point in time. Should not have much of an impact on your model, we do not expect that that is going to change dramatically. Ittai Kidron – Oppenheimer & Co.: But this quarter though, I am missing $50 million off your balance sheet, if you generated $55 million, your cash balance went down almost offset by $49 million that you paid. Where is the outlook that you generated?

We had the free scale acquisition as well as some selected patents and that was around $30 million. That is the biggest piece of that. Ittai Kidron – Oppenheimer & Co.: And Dave, if we go to the markets?

I think a couple of OEMs have reported at this point, as you know there is a lot of information that will be coming in shortly for December of quarter end sales, from where we sit, the hub holes for us were strong, the visibility is quite good. The order of linearity was about what we expected, so I would think you are looking at 10% or so sequential unit decline and there is some pockets I think accreting customers look very strong. Our tier ones, the larger customers tend to be more typically seasonal, and in our case, China, we discussed why we are filling a need, and we have some very new entrance, there are some new customers for us REM being one and we are starting to see some of those customers. Actually, they look quite strong in the market. So it is a bit of a mixed bag, but I cannot do any better, roughly the seasonality in the 10% range.

Our next question is from Jeff Caval with Lehman Brothers.

I was wondering if you would refresh us a little bit on how your long-term margin structure is developing? Previously, you said mid-40s margins and the $250 million quarter range.

Jeff, if you are referring to the business model that we talked about last quarter. I mean, I think first of all, if you take a look at where we have been on the last three or four quarters, we are making consistent progress on the margin front and we are very positive about that and it is really, from the product cost side, it is really being able to execute and focus on the blocking and tackling of margin improvement. It is the material cost that we have been delivering the double digit material cost out year-over-year. We are continuing improved product yields and we will continually improve the efficiencies and productivity in the factory. Those things coupled with the volume, we feel very, very comfortable that we are going to be able to deliver margins in the low 40s and that is what the business model is based on and it will remind everybody, the model is about $240 million to $250 million in revenue about 42% margin, 23% office expenses which gets to about an 18% return. That is our internal target.

And our goal is how do we drive that to 20-points of operating income, we can see 18 and that is sort of doing the things we are doing today and our goal is through more linear products to continue to focus, can we get that number to 20% and that is what we have targeted ourselves internally.

And then could I ask what the mix of linear was in this quarter?

Both of our segments grew from the prior quarter and our linear mix is roughly consistent with what it was in the prior quarter and it is roughly 25% linear and 75% handset.

And are you guys talking about the margin structure inside the linear business?

No, we do not disclose that. The margin structures are created by the overall results and that is the specific margins on that segment.

Would you consider doing so at some point in the future?

It is difficult for us, Jeff because we said in the prepared comments that the contribution margins are over 70%, but remember these products are using the same core technologies as our handset business, so we operate them in our same assembly facilities, our same external boundaries and internal boundaries, so for us, it is really a blend on the supply chain side. The pricing tends to be higher to the contribution margin is 10 to 15 points higher. But we really do not segment our business in terms of the full absorbed gross margin all the way through.

Okay, that makes sense. Thanks very much, Dave.

And our next question will come from Jaroon Boss with UBS.

Congratulations on a good quarter. Two quick questions, can you maybe talk about linear into the March quarter what you feel there should represent in terms of total revenues, and as a follow up any assessments that you can mention for the quarter.

With respect to linear, we actually see linear going into March about flat. It will not be subject to the seasonality that we see in handsets. We are seeing some dynamics within LP moving around. There are some infrastructure share shift. Erickson has been a little bit light, but it has always picked up. We have also diversified into a number of new markets as Dave outlined, energy management, satellite set-top boxes an others, but linear, at this point, it looks pretty strong going into March. It should be roughly flat sequentially.

Okay, great, and any 10% costs that you have mentioned?

For the quarter, we had Sony Erickson and Samsung were both above 10% and Motorola was just slightly below 10% for the quarter.

And a very quick follow up, amortization in the quarter jumped to 1.9 because of the free select positions, any new run rate we should model?

Correct! Two million a quarter. That is directionally correct for the balance of the year, yes.

Our next question if from James Fawcett with Pacific Crest. James Faucette – Pacific Crest Securities: I just wanted to follow up on a couple of questions that have already been posed. First of all, as far as the linear products business, how are you thinking about the economic sensitivity of that business, especially weighted to relative to handsets and how they traditionally shrug off any economic slow down or they have in the past?

James, this business is maybe for a point of clarification, as I have mentioned, we have got, between two or three thousand, about 2500 part number skews and over now, a thousand customers and it is growing pretty rapidly and think of it is a catalog standard business, so we have got to catalog that is as thick as a phone book, not because we want to lug it around, but it is because it is a market where you take fundamental building blocks and then you characterize them across as many parameters as you can possibly think off so that they can be adapted in as many applications where we are seeing the business as a distribution base, broad catalog business, and then within that business, we have begun to identify vertical applications where the size and the margin warrants constant development or application specific development. Liam and I have talked about a few of those. I know that these are quite different, energy management, I do not see as a seasonal business for example, automotive is seasonal, infrastructure is cyclical, albeit is not necessarily seasonal, but when you aggregate them all, this business has very, very low customer concentration, very low product concentration. I hope that helps. James Faucette – Pacific Crest Securities: Well, actually, what I am asking is I am wondering how much more sensitive to just economic cycles do you think that business generally is. I understand it is way more diversified across customer basis, but I am just wondering if you feel like it is more economically sensitive than the handset business?

I do not think it is more economically sensitive to me, handset business. Intuitively I would say that it is not, but again I have to really frankly step back and analyze the various pieces to try to understand that which is utility oriented or more discretionary and frankly I would be giving you a weak answer if I tried to quantify it. James Faucette – Pacific Crest Securities: Just a quick follow up on the free scale product acquisition, how much of a contribution was that in the December Quarter, firstly? And secondly, are you producing those products internally as of yet, and if not, when do you plan to?

It is hard, the materiality, it was immaterial for both our First Quarter and the Second Quarter. There was no material impact on the revenue. We expect that to change in the second half of the year and it will be a contributor as both REM and Motorola transition to our products and burn off some of their inventory. So in the balance, the second half of the year, we are expecting to be more of the contributor.

So, when we blocked this business in addition to of the design, rights in the IP and the exclusive rights to work within their transceiver, where it is sold in those accounts, we did not buy finished goods, so that inventory and late stage finished goods is bleeding though the supply chamber. James Faucette – Pacific Crest Securities: Great, but are you already producing that internally yet or should we expect that to ramp in the second half?

It is transitioning as we speak and we did not buy any fab assets, so it is transitioning to our foundry and being qualified as we speak and it will be on our production facilities in the second half.

Our next question is from Aalok Shah with the Credit Suisse. Aalok Shah – Credit Suisse: I know most of my questions have been answered but just, I want to follow up a little bit on the linear products a little bit more. It seems like, you guys have got into – down about 5% next quarter and I am trying to figure out if the margins are so much higher in the linear product’s group. Could we see gross bargains going up even above the 39.8% range? Is that something that you guys are just conservative about right now or shouldn’t we kind of start to see a little bit increase in the margins?

I would look at that business. It does have higher contribution margin as we have discussed substantially higher. I think the share or percentage of the revenue in Q2 is not overly significant. I think Kansas will be down less than seasonality. I think we need our products ill be more flat and seasonal with a lot of embedded dynamics within this broad portfolio. We are trying to be prudently conservative. And so, we are pushing 40% at this point on a revenue base of a couple of hundred million and we feel very, very good about that. There is an upside opportunity as we move in to Q3 and into Q4 and into 2009 for sure. Aalok Shah – Credit Suisse: And then David, can I follow up really quick on Casio? What do your utilization rates are night now?

Well our utilization and our internal factories are running well into the 80s and operating to below 90s. We have bought some equipment on line that is being qualified as we speak. We are transitioning to six inches and a lot of our equipment is in. There are no bricks and water, so it is relatively inexpensive proposition. But it doubles our true – and our existing boundaries, we are duck tailing that end but what is different about us is that we do have fully qualified suppliers for all of our major. Where we are vertically integrated, we have copy of the exact fully qualified suppliers on the outside who are ramping to varying degrees so we have an ability to address a lot of upside demands without having to get out in front of the high end of all of our customer’s curve by being totally vertically integrated. We like that high breed model a lot and I think it is going to serve us very well and our investors well over the next 2, 3, 4 to 5 years.

Our next question is from Craig Ellis with Citigroup. Craig Ellis – Citigroup: I want to drill down into gross margins a little bit more. It looks like the business is developing a profile where margins are a little bit flattish in the first part of the calendar year and then you get some uplift in the back half of the year. In December, we are up 130 basis points versus December of last year. So, the questions is, is that the profile that you think is starting to manifest in the business and secondly, as we look out to where we will be exiting, I think you can get the same type of gross margin improvement over the next four quarters as you did within the last four.

Maybe Don and I can answer this together. It is very revenue dependent and overall our yields are improving are improving across the product portfolio into varying degrees. We are shipping more linear products with more diversified, more dollar content and front-end modules. So, there is a trend towards higher margin as we work those products into a fixed cost structure. And in the second half of the year, you said, one half of the answer – it is volume dependent. The second half of the year was the growth comments that we have made and where we see our business moving. Higher revenue will translate into higher margin. And as Don just mentioned, you know the 42% range is what we have stated publicly, 18% operating income at 240 to 250. we are now at a 210 run rate we just think that with a quarter $210 run rate we have got a lot of upside capacity rooms so we have not talked specifically about when we will intersect with that margin, think of it that way, at $242.50 we are on 18% operating income with over a couple of hundred basis point higher gross margin.

And it also makes more sense to when you are looking at margins as you sort to have to take it off on where we are and our most recent run race, because year-over-year comparisons can get muddy by what day, depending on the mix and where you are in the volume. So I think it is a much easier model to try and work off of recent quarters and project where you think that benefit is going to be on a go-forward basis from there. I just think it makes a lot more sense. Craig Ellis – Citigroup: Okay that is reasonable. And then a follow up on the linear business and really more a detail, typically, when we think about a linear business, we think of one that is about 50% through distribution, 50% direct sales. How should we think about the direct versus distribution mix in your business?

Well, we have a similar dynamic here. We have world wide distributors and even third party sales reps. So that does pick up, I would say, for us it might be about 60% of the business. Where we actually have lots of smaller customer’s portfolio, and then we have more or less global account opportunities with larger companies like Erickson, Nokia, Siemens, and while we go with the direct sales team. Craig Ellis – Citigroup: I know you guys have talked about a number of new products that were hitting the portfolio in the middle of ’07. Is that what we are seeing now? The growth in the linear business being fueled in part by what you are doing on the customer diversification side but in part, based on the success of the new products that were brought out mid last year.

Yes absolutely, and as Dave outlined, we have a couple of thousand skews and we developed a fresh setof analog and mixed signal devices in the last calendar year, about a hundred devices or so. So we are moving in a new segment like energy management where we have very costumed DCO synthesizers, PLLs, frond-end modules are integrated together to form a very unique R solution. We are starting to move forward into automotive; we talked about cable TV and Desktop. So it is a combination of new products and also expansion to some of these interesting vertical markets.

Our next question is from Pierre Maccagno of Needham & Company. Pierre Maccagno – Needham & Company: Could you give an approximate breakdown of your 2G versus 3G and how each of those grew? Also, if you can give us an update on Helios, where the customers growing?

If you look at the next, the 3G business is larger right now. You know, you know obviously a cheap – and CD business was about 60% with WCDMA being the balance. Pierre Maccagno – Needham & Company: And how did those particularly grow?

Well obviously, there are dynamics involved. The 2G market is being fueled by new subscribers in China and India and we have had some strength there with a conflict media attack but the real growth is really occurring in WCDMA and WCDMA for lots of Dave’s outline really means that WCDMA product coupled with an edge device. That is really the architecture that we are pursuing in getting design traction on those. We moved into March and each quarter in 2008 – growth in WCDMA and Edge Devices.

On Helios today is a little bit under 5% of our total revenue, and just keep in mind, just to remind you, we have talked about this in the past few quarters. We have a small very focused team that are dedicated to serving our RF needs for both our linear products business infrastructure, new broader catalog, some applications specific devices as well as handsets because there are subset of handset OEM that are looking for a multimode power amplifier switch built resolution with a stand-along transceiver to make with their chosen baseman support. So, in our business it is always 100% of the time that our frond-end module is made into a stand-along transceiver.

Our next question is from a VJ, Brian Murdock of Georgia bank. Brian Murdock – Georgia Bank: A question on Nokia, did you see the gains you had in the quarter coming from perhaps on yield issues—editors in that company, or you see these as design wins and share games that you see is sustainable over the next year or two, thanks.

Well, again we are a little bit handicapped here because we cannot speak specifically about our customers. I think you understand that, but Brian I would say that at a higher level. It is not so much the case that we are taking share from a specific company. It is more the transition of the market and the need, the underserved need in the market to have a company that can feel a pretty complex set of technology in a frond-end solution that provides the harmonics, the current consumption size and overall bill of material cost. In the case of a large OEM with a sophisticated architecture, the design window to enter a platform is measured in years, Brian. It is two to three years so it is not a sort of an opportunistic play. It is a custom, these customers tend to buy a custom – proprietary that a platform base and there is all sorts for that platform. Brian Murdock – Georgia Bank: Or could be that the shift to WB-CDMA and Nokia is good news for you.

I think the shift to anybody, the EDGE, WEDGE, and WB-CDMA is great news for us.

Our last question is a follow up from Edward Snyder with Charter Equity Research Edward Snyder – Charter Equity Research: Dave you mentioned, you have got a lot of external qualified vendors to help you address outside the demand efficiency without having a lot of additional costs like some of your competitors did. That does not come for free though. Obviously, margins there will not be as good as the intruders and internally, any feeling at all if we see – picking the man we should see a pinch to my margin somewhat, what would you suffer by doing that and then secondly, you said free scales of product line will start at the second half of ’08. This is obviously going to be much faster ramp than just the new products. You have Motorola and 0 out there burning off finished good inventory when they are done. TheY are going to come to you for the product. So, should we expect some sort of maybe not a hockey stick but to step up in the second half of the year as you start producing that to customers that are already built in.

Okay, let me compartmentalize that a bit, with respect to the Foundry parts, it is a little bit different than thinking about it on if you are, for example on sea moss environment where you go out in a merchant market, you are paying the best possible price, you can then you look to drive yields and further materials cost reductions overtime to negotiation process. In this case, when we have done the Gallium-arsenide side it is quite a bit different. We have taken our process our IP, our quality people, our designers. Our device people and we have done an absolute copy exact on the very stringent contractual requirements to actually bring up a partner into volume production with MRP links and also it looks and feels and smells to our people just like what we produced internally. And because we have that kind of a relationship and we are dealing with supplies who have a different cost structure and operate it in lower cost parts of the world at much different costing. We are able to get pricing because of this arrangement that is remarkably close to our internal cost. So we do not suffer a gross margin reduction if that is your point. In this case, it is very different. You are right. If we would have to go outside and say well let us not buy a lot of packages outside and having the fun that there are gross margin requirements and their cost of capital then there is obviously flexibility advantage offset by gross margin but in the case of the boundaries it is quite different. I am sorry, would you repeat the second half of the question. Edward Snyder – Charter Equity Research: In the free scale, you mentioned it is going to contribute in the second half of this year as your two big customers, one roll on a rim, burn off their finished good in the door. Shouldn’t we be modeling maybe not a hockey stick increase but some significant stepup in revenue because it is not like you are ramping a new product that has – and sell. You have got people in stall based incumbent customers that will start ordering it from you again.

I think the absence of specific guidance from us in the second half, I think your intuition is right. It is a faster transition and we do expect it to be a contributor in the second half. So, I think your point that it would ran faster than your normal design when it is true.

We do have one final question. It is Mike Burton with Think Equity Partners. Mike Burton – Think Equity Partners: I need to talk a little bit about your contribution margin in WCDMA and Edge or Wedge compared to GSM.

GSM is much more mature so we are producing enormous volumes there. The yields have been coming up very quickly and Wideband CDMA and remarkably they are quite close the Wideband CDMA gross margins are very good once you get them into the north of 85% yield and that is where we begun to drive them. We are not there across the portfolio but they are increasing in a semiconductor learning curve that we understand, I think quite well but test times are coming down so utilization comes in much more volume to any given step in the process and so the contribution margins today are quite similar, overall, over time, the gross margin in our entire business, the blend of gross margin increases because we simply have more dollar content driving not only higher utilization but there is a fixed cost element to our cost of sales. So, on a product by product base it depends upon where we are in the yield learning curve and unfortunately products that are launching are launching the way we would expect them to. Mike Burton – Think Equity Partners: Supposed the OEMs that are reported to have spoken optimistically about 3G in ’08, can you provide us some insight on your own estimates for 3G next year or perhaps what percent of sales you see that becoming?

Yes, absolutely, Sony Erickson, and Samsung have both recorded pretty much in line and you are correct that it did report favorably on 3G or WCDMA , we see that clearly as the fastest growing segment of the market and as we have outlined before, for us, I do not think we have a case where we have the WCDMA part without an EDGE and largely in EDGE, FEM made it to that 3G band or multiple bands. If you look at the numbers, ’07, we think it is about $180 million 3G phones worldwide in the 1.1 billion and that number is going to well into the high twos, maybe as high as three hundred million next year.

And with that, this does conclude today’s question and answer session, I would like to turn the conference back to David Aldridge for our closing comments.

Thank you very much. This concludes our conference call today and on behalf of the entire team, I thank you for your participation.