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Financial Services Innovation Lab, Georgia Tech 19

B

Q4

R. Scott Graham

Gregory F. Milzcik

Fine. Okay. Next question is could you tell us the Synventive contribution to operating income dollars?

Good try, Scott, though.

ANET

Q1

Jeff Kvaal

Jayshree Ullal

Okay. Are you able to share with us kind of a loose dollar range for how kind of a loose dollar range for how in either the first or the second quarter?

Well, I think the first quarter is done, but you can tell, we projected lower than consensus. You can count all of that and more as supply chain that and more as supply chain related.

CTAS

Q1

Michael Fox:

William C. Gale:

Again with regard to the document management business, have you noticed any increase or decrease in the multiple that you guys have been paying?

Probably, they have come down a bit, Mike, as we have basically, I think, established the presence in the major city that we wanted and bought some of the better companies. Now, as we look for other acquisition opportunities, we can take a little harder line and I think that you would probably, these are multiples down slightly from what they have been initially.

HOME

Q4

Dan Binder

Judd Nystrom

Its Dan Binder congratulations on a another great quarter and year. My question was around your comp store sales guidance for Q1 looks like you probably up against easier one and two year comparison what you just faced in Q4. And it’s below your full year guidance for this year. Just curious if that's just being prudent or is there something you’re seeing around weather or anything else?

Dan this is Judd, what I would tell you as I shared on the prepared remarks, our business was very strong all last year and Q4 certainly we saw and acceleration on a two-year stack perspective. We had weather that actually benefited us earlier in the quarter in Q4. And we were prudent to know that we were up against an easier January the year before and we expected normal winter which we got a normal winter. We know that weather evens itself out sometimes you get good periods sometimes you get a challenging periods. February was a little bit more challenging for us to be candid when you look at our footprint we have a disproportionate number of stores in Texas. And we saw heavier rains and a slower start to the patio season. And then nor Easter has been hitting your neck at the woods have been helpful from that perspective, but what I can point to is first and foremost, when you don't have that weather we can direct rebound from a business perspective. And overall, we feel really good about how we’re positioned, how we are positioned competitively, how the field is executing, our merchandising assortment and we know that it will even itself out over time. Some of that demand will move from Q1 into Q2. But we feel really good about being able to deliver another year of 2.5% to 3.5% comp for the full year. The choppiness will move through in various quarters, but make no mistake we feel really good about the strategic initiatives we have in place.

GCI

Q3

Craig Huber

Gracia C. Martore

Then my last question, Gracia, for that U.S. TODAY content that you put in these 4 pilot markets, I mean, you've said 70 pages in total across a week. I'm curious, does that include extra ad revenue in there as well? Or that can't be all just editorial, I assume, right?

First of all, those 70 pages include both USA TODAY content, as well as additional local content. A lot of it is content, but there is some advertising. So for instance, for a USA TODAY advertiser now has an opportunity to be across a wider swath of consumers by being in that section. So obviously there is going to be some advertising content as well as a great deal more of editorial content as well.

RHT

Q3

Ross MacMillan

Charles E. Peters

Charlie, I just wanted to drill in to the current backlog number. Am I right, you said $180 million? I think that's up from $120 million at the end of last year. And so effective with the -- effectively, if I took your billings proxy and I added in that $60 million, which wasn't billed but effectively will be recognized to revenue in the next 12 months, that seems to me to be a higher growth rate, more like 18% on that sort of bookings proxy, if you will. Am I going about that math in the right way? Is that the right delta, $180 million versus $120 million on the current backlog?

Just to clarify, the total unbilled backlog was a year ago over $200 million. A portion of billable within 1 year was the $120 million you're describing. The total backlog now is -- the total unbilled backlog now is over $280 million, and the portion to be billed in the next 12 months is over $180 million. So yes, your math was right. There's $60 million more that's going to be billed in the coming 12 months than we had a year ago that was billed in the last 12 months. And the reason we went into some length to describe it in our prepared remarks was because of -- the way the billing numbers came out, it was very clear that the strength in the business is stronger than the billings number would make it appear.

PDLI

Q2

Roy Buchanan

John McLaughlin

Okay. And a little bit of a follow-up, but apologize for naivety but Roche never – the facts that they sent you, they never, I guess, acted on that in Europe. That was just -- that just resulted in you filing suit in Nevada. Is that correct?

Sure. So I think there's two parts to your question and let me try and get both of them and if I miss something, please jump in. So the first part is, is yes they have made a repayment to us in full, on time for both US and those portions they were, that their letter challenges, ex-US. So yes, and they've not filed any challenges ex-US to the patents in Europe or any place else.The second part is the action in Nevada is -- it's not patent case or a case involving the European patents. It's actually a contract case. So the question is whether or not when Genentech sent that [fax] at the behest of Roche and Novartis challenging the patents, whether that constituted a challenge to our 2003 settlement agreement and a settlement agreement is a contract and that's why I say this is breach of contract case, not a patent case. And the question is under the settlement agreement, whether or not that fax constitutes a challenge which breaches a settlement agreement and that's what's before the court.

MNST

Q3

Mark S. Astrachan

Rodney C. Sacks

Hi, guys. I guess one follow up to the last question. So monthly volatility has certainly increased from a sales standpoint. If you go to April and May it was up in the lower 30 if you had in June deceleration, July was up 25% August, September then worse in October back up. I realize when you get the orders and when you ship the products that you can’t fully control but is there something that you’ve thought about or is there some way that we can sort of rationalize how the selling and sell through sort of work here. So there’s a bit of an explanation for the increased volatility because obviously the underlying sales per the scanner date are good but they ship way too much volatility here month-to-month. I guess any color there. And then the second question -- so you exhausted the share repurchase authorization. How you are thinking about the roughly $600 million in cash on the balance sheet right now?

First, going to the first question Mark. The best measure of the sales which gives you a smoother feel for – you need to follow the Nielsen’s, because the Nielsen’s are obviously a broad sample of different channels and if you look at the Nielsen’s going through from the July Nielsen’s, it’s pretty steady. Monster four weeks for the end of July was 20.2% up, in the convenience channels was 18.1%, in August 19.5%, in September and 19% for 20th October. That gives you a pretty smooth channel and that’s all sales are basically going year-on-year, that’s the increase in the channel. Ordering patterns from our customers are what they are. It depends on timing of promotions, timing of orders and so I can’t show any more color on that other than to say that you look at the sales going through and you got to look at – I know that everybody works off and looks at quarters but at the end of the day you also have to look an annual base in which I think gives everybody a fairer and a more balanced view of the direction of the company, the brand, the sales etcetera. Our quarters are just all choppy, that’s the only patterns have come in and that’s how we take it as it comes.

BLDR

Q2

Alex Rygiel

Chad Crow

And any comments on progress through July, as it relates to 2Q results?

It's good. And I think our guidance for Q3 reflects that.

NMRX

Q3

Ross Licero

Stratton J. Nicolaides

Okay. And can you give us a little more color around the -- where the new subscriptions are coming from during the quarter?

Sure. We -- well, a number of them came from some of the managed services platforms and solutions that we launched earlier in the year. And then it's a very broad-based growth from anywhere from fleet, including security. We had a number of new applications come into play, including things like bin monitoring, tank monitoring applications and just pretty broad-based growth from a number of critical markets. But what we're looking for in the ensuing quarters and months -- months, I should say, and quarters is a significant ramp up in these high ARPU managed services subscriptions.

GCI

Q3

John Corright

Gracia C. Martore

Gracia, I just want to say that you and your team have been incredibly nimble in restructuring the balance sheet, because I remember back in -- when you had the New York City analysts luncheon, your bonds were yielding I think over 20% and I couldn’t figure out how you could do any refinancing, and here you are, you’ve done basically $750 million of financing just in the last few months so -- yet you are very light on your feet. Terrific.

Thanks very much. I just need to lose a few pounds, but yeah, thanks. I think we’ve got time for one more -- two more questions.

TAP

Q3

Bryan Spillane

Peter Swinburn

Good morning. Peter, I just wanted to get back on Judy’s question relative to the Foster’s swap. If I understand the logic behind buying the instrument, it’s basically making an assumption that the Foster’s stock price is going to go up, so the question is why would Molson Coors be making that assumption? What other step is there that might be involved strategically beyond just taking a flier on the Foster’s shares?

There are two points that are really important. Why have we got this? I think that’s pretty straightforward as far as we’re concerned. The Australian market has been interesting to us. We’ve studied it for quite awhile. Foster’s is interesting. We had the opportunity to get into an economic exposure at an entry price that, to us, was very attractive. We didn’t want to put the business in a position where we had an over-exposure. We haven’t done that. What we’ve done, I think, is pretty prudent and sensible within that context. That’s the background. Yeah, I don’t want to misrepresent the Foster’s management, but I think they said that they were in a very fluid situation. We’ll continue to review our position, and whatever we do we’ll do in the best interest of our shareholders. I would caution that we could take the view that we could stay where we are, we could move forward, or we might move backward and out. Whatever we do will be in the best interest of our shareholders.

DGII

Q3

Greg Burns

Ronald Konezny

Okay thanks. This quarter very strong performance in the solutions business you know what was the mix of hardware versus recurring in this quarter, was the strong performance a function at big pharma customer you announced last quarter and if so kind of how what is the I guess timeframe on completing that roll out?

Yes. So, we had over 50% of the solutions revenue was driven by one-time implementation whether it’s professional services or the equipment itself and so that also had an impact on the overall gross margins. We are still seeing and have confidence in really high gross margin on the recurring side. We do expect a significant amount of net adds this current quarter as well, there is a portion of it that’s driven by large national retail chain, but were also having success in transportation and in healthcare as well. So we expect to see improvement in margin, but that we will still see probably in excess of 50% of our revenue be one time in nature even in the current quarter.

GLW

Q2

Patrick Newton

James Flaws

Okay. And then, I’m sorry, in the touch notebooks, that all baked into Gorilla Glass for Q3?

Yes, but very small levels. We’re still unsure about how fast the consumer acceptance will come on touch notebooks. I was delighted to see in the Best Buy circular last week quite a few advertised, but we put in a fairly low level right now.

PTEC

Q1

Rich Kugele - Needham & Co

Richard Arnold

That’s probably appropriate. I’m just wondering, in terms of broader units, if the PC industry is down, call it 15% in March; would you expect to also be down 15% or would it be something less than that or something more than that?

I think we continue to expect to outperform the rest of the industry Rich and one indicator you’ve got of the probability or potential of us doing that, is that though the March quarter is typically down sequentially from the December quarter, we are entering this March quarter with almost exactly the same deferred revenue backlog that we ended last March quarter with and the deferred revenue backlog is the best predictor of subsequent quarter revenue of any of the numbers that we release.

KLAC

Q4

Mahesh Sanganeria

Richard P. Wallace

Right. And then one quickly on the OpEx. With the revenues going down so much, won't OpEx should be going down because your bonus allocation probably should be going down for the quarter?

Yes, let me just add to that. We are starting a new fiscal year, so September is the first quarter. Obviously, we're well aware of the plans for September as we make our plan for the fiscal year. And we feel very confident about our plan for the fiscal year. And we think we'll have a very strong FY '15 for KLA-Tencor. And we're obviously aware of what that means in terms of the -- starting with the September quarter. So I think we're actually well positioned to outgrow the industry as we go forward.

B

Q4

R. Scott Graham

Christopher J. Stephens

So I just want to make sure, earlier, Chris, you indicated that the aftermarket and OE numbers, well, you said quarter-over-quarter, you mean year-over-year, right?

Yes, so fourth quarter, let me give some color on fourth quarter. So OEM quarter-over-quarter was up 10%. Aftermarket was down for an overall Aerospace for the quarter was up 2%. And then, Scott, just to elaborate from a full year point of view, we saw 5% OEM growth year-over-year, down on the aftermarket side with an overall Aerospace of 2% growth.


KLAC

Q4

Mehdi Hosseini

Richard P. Wallace

Rick, when you were talking about outgrowing the industry back at SEMICON, outgrowing by 5%. Is that revenue-based or shipment?

Well, we generally look over our timeframes in terms of -- ultimately, it has to be revenue. So it varies. But as you know, Mehdi, depending on the start and endpoint, you got to integrate it over time. But ultimately, if it didn't turn into revenue, it doesn't really count, right?

SXC

Q1

Tom Endel McConnon

Mark E. Newman

It's actually Tom McConnon from Indaba. Quick question guys. With the dropdown that should obviously increase the GP cash flows pretty significantly, can you give us some kind of sense of pro forma what the GP cash flows should be once you've completed this dropdown?

Yes, based on where we are in the splits, we've identified $23 million, and probably close to $4 million of that relates to GP cash flows.

FISV

Q4

Tien-Tsin Huang

Thomas Hirsch

I just want to make sure because your guidance does assume some level of repurchase then, right?

Yes, absolutely. As far as allocating our capital.

NMBL

Q3

Aaron Rakers

Suresh Vasudevan

So what's your product gross margin assumption this current quarter?

We don't offer up the details -- the guidance on margin Aaron. But in offering up the guidance for Q4 as we said, we've taken the competitive environment into account and we have modeled it accordingly.

PRM

Q2

A.J. Guido - Golden Tree Asset Management

Kim R. Payne

Correct, but those are all things that you don’t expect to happen again.

That’s fair, yes.

PM

Q1

Vivien Azer:

Jacek Olczak:

Okay. That's helpful. Thank you. And then on iQOS, given the strong demand that you've seen in Japan and the delay in the national launch, which I guess occurred yesterday, how are we thinking about the incremental market introductions that are anticipated for the year? Will the strong demand in Japan perhaps delay some of the, I think it's 13 markets that you're targeting by year-end?

Well, we targeted 20 markets to be present with iQOS on the city level, on the national level by the year-end. I mean, clearly the Japanese performance is – and I could say it like this

LBRANDS

Q2

Brian J. Tunick

Nicholas P. M. Coe

So I guess first one for Nick. Maybe outside of the big 3 categories, have you done any research or identified maybe a fourth or fifth big category that you think can drive the BBW business in the future? And then maybe Sharen can talk about the Beauty business. It's been a hot topic. Whether you want to discuss the margin impact for the first half or the product flows for the second half, but maybe just give us an idea of where you think we are in the spectrum from the Beauty business being incremental to Vicky's [ph].

Brian, we're always looking at and testing different ideas outside of those 3 core categories. But I think the real interesting thing for us is looking at all 3 of them, we see an awful lot of productivity gains to be gotten within them, especially when I look at the home business and some of the things that we've added in there, whether that's decorative accessories or just the continued growth of new fragrances, et cetera, that we launched within there. So I think as we continue to look for ways to elevate the brand, look for ways to reinvent the brand, I think we'll be doing it very, very focused in those 3 categories because, once again, I feel like there's awful lot of productivity gains to be gotten and still left in the 3 key ones.

SYK

Q2

Joanne Wuensch

Kevin Lobo

But when you say you have a product for that ship it's not just a robot, but I would assume that you're building out a whole ASC suite, is that the right way to think about it?

Yes Joanne, the right way to think about it is, we have virtually everything they need for an orthopedic surgery center from building out the suites with the booms and the lights and the room design, to the operating table, to the beds and stretchers that are required, to the power tools and the flight helmets that they wear, all the implants from foot and ankle procedures, all the way to shoulder, including hips and knees, sports medicine procedures. Just think about our portfolio it absolutely covers the gamut of what they need in those surgery centers. So that really makes life easy for an operator in ASC to be able to contract with one company to cover such a huge portion of the procedures that are being done. So our portfolio really lines up beautifully for that. We also you may have read recently that we have this deal with conformance that we worked on a couple years ago. We have started launched our first few cases of a very, very simplified streamlined offering that provides less sterilization, we call it kind of a knee in a box. The official name of it is Triathlon AS-I with personalized cutting guides for the procedure. And so that was designed specifically for the ASC and that's now launched, but frankly a few years ago we didn't realize that Masko would be popular in the surgery center as proving to be. So we now have both said that we cannot, because some surgery centers won't own have a robot, but yes it involves a huge portion of our portfolio across some of our MedSurg products as well as our implant businesses.

WBA

Q4

Peter Costa

Alex Gourlay

Can you help us understand more how the revenue stream is going to flow from these various products in terms of -- and concepts that you have in specialty because of more of a clearer strategy from you in terms of what your goal is to deliver?

Well, I think -- I'd go back to the central model, which is the predominant one at the moment in terms of the model there. You can see that our growth has been pretty reasonable this year in 20%. And that will continue as a market growth. We want to grow with Prime and grow it with that model.The other -- and of course, 340B, again, is another area where we're growing as well. So that's pretty clear.Now again, we're not the biggest, but we're a lot bigger than we were two years ago and growing faster than we were two years ago. With the Shields one, it's an early stage investment. We're a minority shareholder and we're developing the local community model and specialty. We believe that more and more patients will want to be taken care of closer to their home and closer to the community. And as drugs develop, there will be new payment models. So we believe this model will be more suited too.

ENTR

Q4

Aalok Shah

Patrick Henry

Okay. One more quick one. MoCA 2.0, when do you think they're expected to be shipping in volume?

Hard to tell. We haven't even announced the product yet. So, I think that you will probably see, we should look at kind of the – aligned with the kind of third wave of growth in MoCA. In 2012, we will probably start seeing MoCA to start coming into market in that time frame in decent volume would be my guess.

BIO

Q4

Dan Leonard

Christine A. Tsingos

Okay, and then final question for you, Christine. Have you taken a look at some of the proposed plans for corporate tax reform and what impact it might have on Bio-Rad? And I think the part I could use the most help with is the potential border tax adjustment. Given you have all these costs in Europe, it's unclear whether you're a net importer or exporter.

Okay. So I'll take that one first. We are a net exporter. It is true that we have a sizable footprint in Europe, but we also have a sizable footprint here in the United States, and on both sides of the business, but especially on the Life Science side, we are a net exporter. Regards to some of the other plans, we don't know until we know, until these plans become real, but whether it's what the Republican Party is talking about or Trump talks about from time to time, I think either way you slice it, Dan, we're probably going to be a beneficiary of that in terms of a lower tax rate in the U.S. And then, on top of that, we will be able to turn on a lower tax rate in Europe with the turning on of SAP in Europe. So if we're really lucky, we'll get a benefit in Europe as well as a benefit of whatever they do here in the U.S.

WBA

Q4

Kevin Caliendo

Alex Gourlay

One quick follow-up. I think you're no longer a preferred pharmacy in SilverScript. Is that correct? And if so can you just talk about what that might have done to the comps going forward?

Our position in SilverScript's hasn't changed. We've been generally either in the open or non-preferred really for quite a while. So that piece has not changed.

EXPE

Q3

Ross Sandler

Michael Adler

First, on TripAdvisor. The margin there compressed a little bit for the first time in a while. Can you talk about what investments you're making and what's driving that? And then second is more of a hypothetical question around ITA. But according to Hitwise, you guys get around 25% of your traffic from the search engine, the majority of which comes from Google. So if we were to hypothetically assume that the Google ITA deal goes through and that worst case scenario, a couple of years down the road, you lose a meaningful chunk of that organic traffic, how would your marketing mix or your kind of go-to-market strategy change under those hypothetical circumstances?

Sure. So on TripAdvisor, the OIBA margin was 53% for the quarter. So we think absolutely fantastic performance for the business, and the core business continues to grow and be as efficient as ever. We are continuing to make acquisitions to try and fuel growth down the road as well. So the investments are fairly wide-ranging. There are a number of international points-of-sale that we've launched this year. Those tend to operate at a loss to breakeven in the first year or so. We have the investment in SniqueAway that Dara discussed earlier. We are also continuing to invest in the vacation rental space, where we think we have a pretty good opportunity to become pretty large in that space by leveraging the TripAdvisor brand, and we recently made an acquisition in that area to expand internationally. And then China, we've talked about our efforts with TripAdvisor in China fairly significantly, and we acquired a company called Kuxun, which is an air metasearch player. And then we also have a TripAdvisor-like product in China called Daodao. So for us, when we step back and we look at the amount of investments that we're making in this very high margin business and we see it grow as rapidly as it is and still deliver 53% OIBA margin for the quarter, we're pretty pleased with the balance that we've been able to strike between printing earnings as well as making sure that we are building a business for the future.

DGII

Q3

Jaeson Schmidt

Ronald Konezny

Okay and then last one from me and I will jump into queue. I know you just outlined some of the challenges and successes in the transpiration healthcare and food market, and given some of the challenges in the food market on the solutions side. Should we think that market is a big part of the story in calendar 2019 or will transportation and healthcare really continue to be the drivers?

We are committed. We think that we can attract a significant number of food customers throughout calendar 2019. We've got a number of large engagements that had begun deploying. In some cases food, especially QSR restaurants has a franchise model so that can introduce friction in terms of how fast and how large an implementation can get. But with the constant drumbeat of recalls and food bone illnesses and the amount of press, there has never been more interest in companies getting a hold of their operations, getting a hold of their product safety and making sure that they have done what they can to deliver safe and effective service and products to the customer. So, we think there will be continued interest and the trends are favoring remote monitoring and patent recognition.

CVU

Q3

Kenneth Herbert

Okay. That's helpful, thanks Doug. And can you remind us what percent of the growth, the top-line growth in the quarter was WMI versus the other contract wins in organic growth?

In the quarter, WMI was about $5 million in revenue. So CPI's revenue increased about more than 10%. Our revenue went up almost from 20 to - from - sorry, from $19 million to $20.5 million.

NMBL

Q3

Keith Bachman

Suresh Vasudevan

Hi. I wanted to come back to that last point. A couple of observations. One you've made the comment essentially that the profit pool of the storage time that you are pursuing has declined because of pricing pressure. In kind you are actually making more investments to respond to that so you're actually participating in the lower profit pool, combined with it's just not clear to me that NetApp, HP, EMC and Hitachi are going to change their behavior. You could argue they keep getting aggressive to keep their systems in place even if it's below cost just to secure the maintenance streams associated with it. So I'm unclear. You’ve said a couple of different times you think you can generate leverage in the second half of next year. I don't think you’ve made the case why. It's not clear that you actually can return or improve your leverage even as we look out over a period of time. So I’d like to hear why you think you can improve your leverage, your profit rates given the backdrop?

I’m happy to address that, Keith. If you look at where we are placing our investments, the big investment we are making in our commercial segment. That's adding commercial teams and in programs aimed at driving opportunity generation for the productivity of our commercial teams. Today our mature commercial teams operate well above breakeven levels of productivity. And so investments we make and we also have a very well understood pattern of how long it takes for us to bring on a commercial team, how long it takes for us to get that commercial team to be on the same curve as a mature team and that is on the outside four quarters. Now some of the investments we make will not just help with new teams we bring on they actually make our existing teams more productive as well. So, we are very confident that the first investment stream that directed at our commercial segment has a well understood pattern of payoff, pulling investment from that is what cost us growth, putting investment back there we know will not just drive growth, but also drive operating leverage. The second investment we're making is really in broadening our flash platform which is aimed at the large deal segment. I want to say one other thing. In the large deal segment, even as I said the price competition our win rates there are healthy. Well that's what's driving a faster growth for us in that segment. Fibre Channel is now almost a quarter of the mix of protocols. It was just 17.5% a quarter ago, right? So we're seeing really good progress there broadening our flash platform will only help that segment as well. That's sort of how I think about the investments and why they are not just supportive of growth but they are supportive of leverage as well.

EXPE

Q3

Imran Khan

Dara Khosrowshahi

Two questions. One, I think you talked about 21% increase in selling and marketing driven by -- one of the big reason is keyword pricing. Could you give us some sense about what kind of conversion and return on investment you were seeing from those increased spending? And secondly, Dara, I think you talked about 43% of the bookings are merchant. Can you give us some sense like what percent of your hotel booking is merchant versus agency and how that trend is trending?

Sure. As far as on the keyword pricing, et cetera, I'll answer that, and then Mike can talk about merchant. The 21% increase in sales and marketing wasn't necessarily all keyword pricing. But it does reflect an increase in aggression on our part in the CPC space and search engine marketing in general. Both and are being very aggressive than some of the new territories that we're going into, new markets in Europe, Asia-Pacific, where we go in with more aggressive efficiencies, so to speak. So that's not necessarily keyword pricing going up. That's just our getting into new markets, which tend to be less efficient from a marketing perspective than, call it, our more mature markets where we have more repeat users, et cetera. So I think while there is some keyword pricing in there, while we are, on balance, being more aggressive in certain markets and we do anticipate being more aggressive in the European, Asia-Pacific markets, it's a combination of our getting into new markets and our being more aggressive on the keyword pricing front. As far as ROI goes, as we get into these new markets, as we increase our spend, our ROI is lower than, call it, the mainline spend that we have in place now. So my expectation will be that for a couple of quarters as we spend up, our CPC ROI will go down, and then what we do is we spend time optimizing the ROI there, understanding which keywords work, understanding which keywords don't, optimizing our landing pages, the presentation to the customer, which usually gets us some efficiency back. But right now, we're in a mode of spending up. You see it in our sales and marketing numbers but also, again, it's something that we manage and you see it in our revenue numbers and gross bookings numbers, which are quite healthy.

BJRI

Q2

Mary Hodes

Gregory Trojan

Okay, got it. Thank you very much for that clarification and then can you just talk at a high level about the level of promotional activity that you're seeing in the industry right now and with traffic turning negative in Q2, do you think that there's any changes that you need to make in your philosophy around promotions or value to drive better traffic in upcoming quarters?

That's a lever we look at literally, you know, almost everyday, certainly every week in our business, Mary, and -- and, look, there's always promotion out there, I think I said this on the last -- on the last call, we get asked that question every single time as if, you know, this level of promotion and competitiveness in our -- in our market is, you know, intensifying or wildly different and we don't see that. I mean, I think it's kind of always a constant on and the other element I'd mention is people forget about, we're competing in a very fragmented industry at the end of the day; the number of independent seats out there is much greater than the chains we all think and talk about. So -- so, honestly, I just think that can be a little overdone and over talked about in our -- in our space at times. It's something, obviously, we pay a lot of attention to in general as our business is going up and down and so we'll make adjustments. I think the most pressing activity is making sure we're being more aggressive where our business needs the help the most and right now that would be California.

VSH

Q3

Jim Suva

Gerald Paul

And any end markets consumer through distribution that you’re seeing?

The computers relatively weak these days, relatively weak. Hand phones, not the smartphones, regular phones are weak. I think this has much to do with overstocking everywhere but okay, in this case maybe the end sales has suffered already, the end market sales.

PTEC

Q1

Nathan Schneiderman - Roth Capital Partners

Woody Hobbs

Woody, one of the comments you made was that some of the pressure in core system software was offset by revenue lift from FailSafe. Can you clarify? I don’t know if you’re willing to talk to the dollar amount of contribution from FailSafe, but could to at least… I’m sorry?

As Rich said we’re not going to do segment report.

TECD

Q4

Brian Alexander - Raymond James

Bob Dutkowsky

Great, and then just one follow-up. I know you guys don’t like to talk about specific vendors, but I thought it was interesting to hear that both Tech Data and Cisco called out Germany as a country that grew double-digits despite the horrible macro backdrop there. In your case, I know you have been executing better there for the past several quarters. But, were there any specific large deals that drove your performance in Germany that could be categorized as non-recurring that we should think of going forward?

No, I think the German story for Tech Data is one, again, I mean the harp on it, but one of execution. We have set our sights and mapped out a plan of steady recovery in Germany and quite frankly the economic environment has slowed us down some, but the team continues to execute very-very well. There really aren’t any strange one-offs that are contributing to our success in Germany. It's just very-very solid execution and improvement in all fronts on the distribution model. We are managing our vendors efficiently, we are buying right, we are covering the right customers with an improved coverage model, and our management team has now had a handful of quarters now of stability to be able to really predict the business and drive it and you can see the results are beginning to take shape.

MPAA

Q2

Steven L. Dyer

Selwyn H. Joffe

Yes. Great. Just looking forward, are there opportunities, in your view, to take market share in any other segments or with any customers in rotating electrical going forward? Or how should we think about the market share shift over the next 6 to 12 months?

We expect to gain market share. Our momentum is positive. I mean, it's always obviously unknown and unpredictable, but we do a great job for our customers. We've had some gains, and we certainly hope that will continue. I mean, our focus internally is to make sure our customers compete more effectively than our competitors' customers.

RDUS

Q4

Greg Harrison

Pepe Carmona

Just one more if I can on the patch trial. So if you were to hit the non-inferiority margin statistically, but still being numerically below subcutaneous, would that be a problem clinically for doctors and for marketing to patients?

At the end of the day, the bridging studies that was agreed with the FDA for BMD is if we keep that number within that range, so above that threshold, we will have an approved product and obviously it will apply the TYMLOS label to it. Competitive wise, I think those are different questions. I think that’s -- we will have a better understanding of how we're going to commercialize it later on.

MPAA

Q2

Bhakti Pavani

Selwyn H. Joffe

Yes. In addition, about -- from the additional customers point, what are your expectations for the wheel hub assembly product line for the second half, from the marketing standpoint?

Yes. We expect it to be strong. Again, we're sticking to our guidance of $45 million of revenue right now, on sort of a 12 month run rate. Hopefully, we'll do better than that, but we -- again, we're new at rolling the products just being launched and being made available to other customers. Again, the outlook looks positive. But at this point, we're sticking with the $45 million revenue outlook for these 12 months.

HPE

Q4

Shannon Cross

Tim Stonesifer

Okay, thank you. And then Tim, can you just talk a little bit about maybe the progression of margins as we think about 2018? You said back-end loaded, but I am just kind of curious given all the cost-cutting we have done now and that how we should really think about the ramp and do you think you can get back to some of the more historical levels when we get towards the end of the year? Thank you.

Yes. I think – again I think we feel very good about the 11% to 12% in ‘18. We will be low in Q1. I mean if you go from Q4 to Q1 we have typical seasonality. So, if you go back to ‘17 or ‘16 or ‘15 and look at the EGOP, you will see some of that seasonality. The other thing that you have will be when we took out that $200 million of $300 million of costs in the second half of last year, not all of that was run-rate. So, although we will see cost savings going forward when you compare Q4 to Q1 we will be a little bit lighter. So, Q1 margins will be still pressured, but then as you go forward again if you look at that $250 million of cost savings as I said earlier roughly two-thirds of that or so is in the second half. So, you can load it up that way. The M&A again as we continue to right-size the cost envelopes of that, that will continue to progress as we go out through the course of the year. So – and then mix, nice point as we continue to grow Aruba all-flash high-performance compute and those product lines become a heavier mix, we should get a natural lift. So, we would expect to see Q1 margins somewhat pressured, but those will continue to improve throughout the course of the year and wound up in the 11% to 12% range.

AMSWA

Q4

Kevin Liu

Vincent C. Klinges

Okay. And lastly for me, just with the return of some of the higher license growth levels you've seen in recent quarters, what are your hiring plans like as we head into the current fiscal year?

This is Vince. We actually – at Voyager level of the high-end product we actually are at 21 dedicated salespeople. That's up from 14 this time last year. So that's a pretty big percentage increase for the Company. So we do plan to incrementally grow that from here but we're going to try to see the fruits of that increase of people this year first.

HLX

Q2

Martin Malloy

Johnny Edwards

On the Noonan field, is it possible that after you do some of the well intervention activities and that you might be able to add back some of the proved reserves you’ve taken off?

I think we would possibly add back production. The reserve reductions were actually based on the reservoir performance and we are taking a slight production right now, due to the number 3 being offline and the only reserves we possibly could add back there would be the reserves that we’re getting drained by offset operators if we had that production on, we could add those reserves back.

WBA

Q4

Brian Tanquilut

James Kehoe

Good morning guys. Just a follow-up to that question from Ricky. So as we think about where the store base is going, going forward where you're adding a lot of services Kroger, LabCorp, FedEx, how should we be thinking about the gross profit dollars per store? I get the gross margin commentary of how you guys are obviously doing a lot of things there, but how should we be thinking about the gross margin profile -- or the gross profit dollars given that it becomes more like rent revenue rather than true gross profit margins?

I think if you think about it though the first place you go to is the storage in the stores. So these stories were built in a time when a lot of inventory was in the physical location. If you plot out three years from now there'll be no inventory in the stores in the back-office. So that freed up a couple 1,000, 2,000 square feet per stores. So if you think about it the first piece of the development was free because we've downsized the back-office and the storage space. So the impact on our revenue throughput was minimal.And as we go through each of the partnerships because we're getting an uplift there's a lot of science that goes into this. So we'll be losing -- if you shrink the size of your retail footprint how much you are losing versus you're going to get some uplift from the increased traffic, I don't think you're going to see a massive reduction in the space -- sorry in the revenue as a result of this, quite the contrary.So what you end up with is a more efficient box where you're probably dedicating less space to some categories where you weren't making very much money. You've gotten rid of your storage. You got rid of your back-office. And then you've got value-added services who are attracting different customers in there. And ideally your foot traffic has gone up as a result of that and a more efficient sales per square foot.So I don't think you'll see the revenue. I think Alex is right. I think you'll see the revenue find consistent with what we have potentially improving. And then you see a big change in the rent. And bear in mind that we're quite over rented, so it's a long-term opportunity for the company versus our competitors, we probably years ago entered into lease contracts that were in the best locations, the nicest places and probably overpaid a bit.So as you look forward over a multiyear horizon, we would expect consistent quite material reductions in the cost of rent. And then at the same time, we make each store more efficient in what's in each of the stores. I hope that gives you enough insights on it.

ROLL

Q4

Edward Marshall

Dr. Michael J. Hartnett

Okay. So is it a content discussion about these contracts or is it a pricing discussion?

It's both. It's both. Certainly, the new airframes, there's a lot of new content in the new airframes and a lot of new designs in the new airframes. So there's substantial content discussion going on around that, and the rest of it is about pricing and terms. Terms are a big deal, and terms are hard to negotiate and seems like everybody has been schooled on that to an art form. So, these contracts are taking time to put in place.

SYK

Q2

Pito Chickering

Kevin Lobo

Good afternoon, guys and thanks for taking my questions. The first one that has -- a little bit guidance that you provided, can you give us color on where gross margins and SG&A sort of you exiting the year as compared to the fourth quarter of 2019?

Sure, I won't speak specifically to guidance on gross margin or necessarily SG&A. I guess what I can tell you is that, as we look at gross margin, we probably would plan on more orthopedic business, maybe impacting that gross margin, but that will be dependent on continued ramp in those businesses. On SG&A, we aren't fully ramped in terms of what I would call a normalized spend. And so as we look to continue sort of fueling the growth, as we ramp back up, we'll probably see increases in SG&A over the course of this year.

ANET

Q1

Amit Daryanani

Jayshree Ullal

I was more trying to think guess, could this help you and maybe size how much it would help you in the back half of the year, when the supply chain bottlenecks alleviated and lead times normalize. But maybe another way, I guess, maybe if you could help us.Is there a gross margin impact you're dealing with because of the supply chain constraints? Is the way to quantify that in the first half of the year? Thank you.

I mean, we saw a little bit of incremental spending in Q1, but it was very small. We will see some in Q2. But again, I think it's manageable at this stage, right? Again, I'd go back to the 63% to 65%, and we'll be - the midpoint of that range is a good place to start, and then we'll see how we go.So there is some incremental costs because you're prioritizing supply over some other things, but at least in the first half, we don't see something that's really significant.

VRTV

Q4

Daniel Jacome

Mary A. Laschinger

Can you tease that out a little bit? I haven't covered you too long, but I did go over the transcripts since the IPO and I don't think I've ever seen the word weather in there, so please.

Okay. Yeah, we have mentioned it in prior earnings releases. But this year, the severity of what we saw impacting operations from the Northwest to the East-West on almost a rolling basis for both the month of January and February shutdown operations. I mean, we saw things, for example, in the State of Minnesota where the school systems were shutdown for an entire week, consumers just weren't going out and it impacts in particular our FS business, as well as our Print business. And so, it's all driven by how active is the consumer outside their home, as well as the government shutdown, as you can imagine, a lot of paper goes into the government and people that supports the government. And so, those two factors we believe will have an impact on the business here in the first quarter. We don't know yet to what degree, but it does happen when you shutdown a facility for a day or two, we're just not shipping anything. And therefore -- and then a lot of times, it's transactional business that doesn't come back.

SMCI

Q3

Michael Bertz

Charles Liang

Okay and so you think with the new products here into December we should be in better shape so how would you think then I guess geographically relatively would you assert that the U.S. would be now relatively stronger quarter-to-quarter versus say Europe, you're looking into December, would that be your expectation?

Because the USA market is more sensitive in technology. Whenever we introduce new architecture USA markets basically responds quicker, that's another factor.

SCHL

Q4

Drew Crum

Maureen O'Connell

Okay. And the CapEx that you're guiding to this year is elevated [ph] obviously. What is a more normalized run rate for CapEx going forward?

Also, I should say that our definition of free cash flow in 2016 does not include the $186 million tax payment related to Ed Tech sales. So that is not included, which would write down our cash balance at year end. As far as the normal CapEx, I think the range that we are guiding to today is more normal. If you look at our historical levels that would be the range we are normally in. The last two years we stopped CapEx, particularly in the technology area as we assessed what our corporate level needs were. And most of what we spent last year in technology was expense, as opposed to capitalized, because we were in the design phase. Now we will start capitalizing as we go live with certain systems.

ODP

Q3

Colin McGranahan:

Michael Newman:

Just on gross margin, it's still an improvement fifth quarter in a row but the least improvement we've seen in a while. But gross margins are still more than 200 basis points below historical levels in the 30 to 31.5 range. I know there's probably a 100 bps there on rent deleverage, but what needs to happen to get the rest of that 100 to 150 basis points back?

Yes, I think it's general leverage across the company. I think, rent is the key piece. We're talking about a number of programs to take the level of rent down, but it's leveraged across the company. It's also our contract business and we're working hard at looking at improving profitability there. Steve talked about the customer savings programs and some initiatives there, but those are the pieces I would highlight as why we're short based on your question.

DGII

Q3

Greg Burns

Ronald Konezny

Okay, so is there like a bulge in revenue here from these kind of rollouts that are more hardware upfront hardware dependence as opposed to maybe looking forward. So a slower run rate of growth at some point after these large roll outs.

NO. It's a really good question. We are hopeful that we can continue to have strong additions, now how we offer our product. We give our customers the choice of more of a managed service, where they are paying lower no money upfront and have more of that the obligation on the recurring, but there are many customers that want to have some of that obligation to fill in the form of the capital expense and then have a lower recurring. So we are going let the market decide, the market is still maturing, so we feel that it's the right thing to do to give the customers the choice rather than to force it in one model, but we do anticipate that in general, larger customers are going to want to have some of that implementation in the form of a onetime CapEx and than associated with that is the recurring.

GIS

Q1

Chris Growe

Don Mulligan

Okay. And then maybe a question for Don -- you or for John about the cost savings coming through this year. So with little softer sales in the first quarter, I know you kept your guidance in place for the year. Do you now expect a heavier degree of cost savings may be along those if you could -- I know we have $400 million, I think of HMM savings, $40 million overhead savings, so are there any project entry savings that have come through this year?

Minimal projects entry as John said, we’re going to be starting that effort this year. We’ll see significant savings starting in ‘16. We’re not making that a great deal this year. It’s mostly going to come from our overhead efforts. And obviously there is the ongoing both HMM efforts that we see within our COGS, within our overhead expenses. First, when we you start the year like we have, everyone is tightening their belt a bit from an admin standpoint. And the one thing I would notice is that we did see growth in our media support. So that's one area because we have good ideas to drive growth in some of our key segment and some of our key platforms. We haven't cut back. What we’re doing it is really an overhead in some of those project areas we discussed. We’re still targeting the $40 million for this year and it would be something larger in F‘16.

AMSWA

Q4

Matthew Galinko

Michael Edenfield

So I guess in terms of your deal pipeline, I know you've been talking about some pretty healthy pipeline in the last couple of quarters. So I'm just curious how that played out versus your expectations and kind of versus how things have closed historically? Are there deals still lingering, and if there's any hesitation, why is there? And then lastly, how is that factoring into the conversation now, is it being decided early in the decision-making process or is it coming down to the wire that people decide how they are deploying the product?

It seems to be a pretty good selling environment, particularly when you have a new platform coming in like SaaS. It stimulates demand. But still, it's not going 100% for us so far, and we kind of like having a mixed mode to tell you the truth, but it's really we focus on what the customer wants. If they want perpetual, we love to work with them. If they want SaaS, we love to work with them. So the great thing is that we have platforms to do both.

HOME

Q4

Curtis Nagle

Judd Nystrom

I mean just a follow-up, I guess for Judd. How should we think about on a per store basis what SG&A should look like I think over the past few years it's been approximately flat. If you take out advertising it’s been down I think maybe a couple percent a year and you've gotten really, really nice leverage. Going forward, what do you think is a fair assumption?

It's actually going to increase this year and it's going to increase because we're actually making significant investments in the business. So going up 30 basis points and marketing, making reinvestment in price which is not part of the cost per store but making those investments labor hours so that's putting more investment back in the store for our customers. And then overall, we'll have higher preopening expenses in D.C. So depending on how you calculate your average store SG&A you'll see more investment. The good news is, we're able to fund that by expanding our gross profit rate. And we've been holding a gross profit rate steady and still reinvesting our price. We're going to still continue to reinvest in price. The good news is, for your earlier question or for the earlier questions on direct sourcing because we're in the early stages we'll get benefit from that. That will allow us to invest in other areas of the business.

BGS

Q2

Sean Naughton

David Wenner

On Rickland, it seems like that was a brand that was a little bit more challenging in terms of the distribution [indiscernible] quarter and for the rest of the year. What specifically is happening there with that particular brand, has it lost any shelf space, or is it really more about losing out this volume to some other product channels?

Well it wasn't a significant retail brand, if you will, with a significant shelf space in grocery stores or in mass merchants. But having said that, the shelf spaces had -- is being challenged hard and -- wherein some competitive categories like the bars, we are having to work hard to maintain our presence in supermarkets and places like that. The brand was by and large a warehouse club brand and still is, but its core product line, the yoghurt bars have been copied and underpriced significantly by others in the clubs, and that's put a dent in that business. Now, we have been innovating and going beyond those bars, with things like trail mixes, and we believe that we can still do a good job with that brand and if you will, create a posture around the brand, that this is all about innovative snacking, on trend snacking with consumers, and especially quick to market and responsive to what warehouse club consumers want to see in terms of snacking. That's the role we see for the brand going forward right now, and to the extent we can build up the brand and get consumers used to the Rickland Orchards name, then you can successfully build the retail business as well.

AAPL

Q2

Shannon Cross

Peter Oppenheimer

What’s the – what’s the timing on construction of the new headquarters? Any update there?

No, no update. Things are quite busy here. And well we will begin to focus on that in the future, but no updates today.

PTEC

Q1

Rich Kugele - Needham & Co

Richard Arnold

Okay. Then just lastly on the HyperSpace side, without any revenue comments, can you give us any metrics that we can monitor the interest level; any general sense on the number of downloads to-date or how much has been the free trial versus purchased?

The other thing I would say Rich is, when there is data that would be useful to people to help them to project revenue, we will figure out what the right set of metrics are and will attempt to begin providing it. However, we are cautious about making any commitment to sort of granular forecasting elements and particularly to product level revenue guidance and so the simple truth is there is not yet enough data and therefore it doesn’t make sense for me to provide you any data. Once there is data, then I will translate that guidance at least into our top line revenue guidance, but not necessarily into product level metric disclosure.

VNRX

Q1

Kyle Mikson

Cameron Reynolds

So I was wondering if you could talk about how the first nematocysts products can be launched and what the go-to-market strategy is. Specifically was wondering what the most likely use for the first assays are going to be I get? I understand that it is probably from monitoring, but just like which disease I was kind of thinking. And when you say launching the product on multiple platforms, do you mean allies or beads when you say that or do you mean like, the actual amino assays analyzer like the ? And then on the go-to-market plan, is there going to be like a beta launch in Europe and then like a broader launch later? Or how should we think about that? Thank you.

Thank you, Kyle, and thanks for your questions. I will answer them more than make sure if I forget one of them, please return. So which disease so a couple of quarters ago, we thought perhaps under NETosis/influenza, sorry, for COVID in an influenza might be the way to go. But I think given the waxing and waning of NETosis from COVID, I think perhaps sepsis might be the one which is easiest to get the traction in. Certainly the easiest way to get large numbers in a trial because obviously, as I’m sure everyone’s aware, it is even during the pandemic, there is the biggest killer in hospitals. So it is obviously a very, very big problem and therefore much smoother ride to get the numbers needed for trial. When we say multiple platforms that is a good question. So we launched the vet on plates, and initially where we are now. As you can hear, we have been working a lot on getting it on the machines. We are using IDSs as machine but we have also explored different machines, we can use it on the larger auto analyzer machines. And we are also producing the beads at large scale now so we can absolutely launch things depending on what machines are available but on bead based machines, and adapting to a new machine seems to have taken just a few months ago. There is obviously new regulatory work but the actual adaptation is quite easy. But we have also mentioned we have also working a lot on a point of care both lateral flow small machine. We have actually, Dr. Eccleston, who is in his new role, as technology has been looking at a lot of different options for just simple yes, no lateral flows, quantitative point of care, and also the small machines. I won’t mention the companies but because of confidentiality, but we are talking to quite a few. And we actually have our essays out to a quite a few different companies. So for small point of care machines, as well as lateral flow. So it is what we aim to do with everything. I think, as I think it is clear, what we believe is this is going to be potentially huge in a very wide range of areas. So rather than saying to a customer, or a government or someone, it has to be on beads, or this machine, or this point of care, we aim to offer a full menu. So I guess they say, courses for courses, sometimes plates are easier, particularly for research. The machines are very easy, if you want a high throughput. The RDS machine, for example, can do 500 samples a day on a quite a small machine. We are hoping in the future to license to groups like the big auto analyze the companies, there is about half a dozen of them at Roche, Siemens and then developed a point of care. And that is quite developed to the point of care as well. So the go to market strategy. That is a very good question. And I think, as you have probably created, from what I said, we have been very, very happy with the results. In the diagnostic power, increasing diagnostic power, patient selection, also monitoring disease progression. Also, we are trying to show some prognostic value as well, from the assays, which I think we may get to. So the go-to-market, I guess like every way you are looking at different regions. The EU, to get a CE mark could actually be reasonably quick, because the platform we have CE mark very similar assays before, and then we aim to see mark them on beads quite quickly. So once we have the chosen intensive use, and it could be one of a few of those things. And the samples run, it is just a couple of months process to finish off the CE mark. So what is caused us some time has been finding the right population to get a CE mark trial in. But if, as you mentioned, at which indication, sepsis can be reasonably quick, because there are many, it is everywhere, as you know. And that is year round, summer, winter, and in every hospital in the world. So I hope that answers all your questions, how does that matter? And the U.S., there is some talk of trying to get emergency use, which of course we try for the COVID. But I don’t know, I think it is certainly less than 50/50, we would get that so it would be normal. The process we look to go through in a range of areas is to go to a CRO collect for a 510 (k) and then go for it go through that path which Dr. Terrell has done quite a bit of work from in a range of areas. So the cost of that is a few million dollars typically. We tend to look at two or $3 million and it usually takes up 12-months, 18-months for collection, plus all the regulatory timing from whenever we start the process, which we are working on now, but we don’t have a timeline from when we expect to start. I guess that will be driven from the data we have got coming up in the next few months. We have our assays in the hands of a bunch, like five or six different groups now who were using them in their own trials to show the efficacy as proof of concept. So that is all coming together really well. Does that answer your question?

OSUR

Q3

Patrick Donnelly

Stephen Tang

Thanks guys. Steve maybe just following on on the capacity side. I mean with the 1Q launch obviously kind of ramping at risk a little bit ahead of time, what type of capacity should we be expecting upon launch of the self-antigen test? I know you talked about expectations of selling pretty much everything you guys can make. So how are you thinking about capacity? And then at the same time, are you thinking about carving that up and directing a certain amount of capacity towards professional prescription OTC? What's the right way to think about that from your side?

Yes. So we are on plan for what we announced previously and that is, we're going to move from 35 million tests per year to 55 million tests per year by the first quarter of 2021 and 70 million tests per quarter by the third quarter 2021. And remember, embedded in that capacity is about 17 million to 18 million units per year of capacity for our existing HIV, HCV and Ebola tests. So when we come on stream ready to serve the professional market, we will have the capacity that you can calculate from our previous information. I think, we're going to sell as many as we can make for the professional products. And then, as we have more certainty about the timing for the Rx self-test and for the OTC self-test, we'll begin making allocation decisions about which products to get what capacity. I think we really do see a sweet spot in the self-test whether it's Rx or OTC and we'll make the combination that we need to from there. And I think as I've said before, the design considerations here are to try to make the same form factor and product design for all three use cases, professional Rx self-test and OTC self-test. That's an approach that I think -- I don't think any other company has taken in the marketplaces yet. So that design for manufacturing is really built into our plan here and that's what allows us to have a more fungible discussion between

DIOD

Q1

Gausia Chowdhury

Emily Yang

Hi, good afternoon. This is Gausia Chowdhury on behalf of Shawn. Congrats on a solid quarter and guidance. First off, can you give the POS versus POP? I think you said POS is down slightly. Could you give more details, please?

Yeah. So, this is Emily. So, our POS is down slightly compared quarter-to-quarter. POP also down slightly quarter-to-quarter, that's based on our guidance. So that's how we look at the inventory level as well, right? So, still within our range as defined normal between 11 to 14 weeks.

ODP

Q3

Stephen Chick:

Neil Austrian:

Second, if I could, I know it's small and this maybe for Charlie or maybe even Neil as well. But the sale of Israel, as I recall, if I got it right, you had just maybe closed out or exercised a put option against you to buy the minority stake of that in 2008? So was that an asset that you're proactively, I guess, approaching people for a sale or were you approached? And is it a sign of other things you might be looking at or entertaining as you look at other assets and their strategic relevance to you?

The only thing I might add is that at this point in time, we're not looking at selling any of the assets that we own.

LTRX

Q3

Mark Spiegel

Kurt Busch

Hey guys. I see two good things in this report. And unfortunately it looks almost like only two good things, but they might be meaningful. Sequential revenue overall was down 2.7% with last quarter was down 7% versus the quarter before that. Has the business stabilized in terms of revenue?

And right now Mark it’s -- well first of all Mark thank you for calling in. I mean we believe that given the traction we’re seeing on the next generation products that we’re working to stabilize that revenue. But again we don’t have really good visibility on a quarter-by-quarter basis. But we are very positive about the outlook.

LBRANDS

Q2

Janet Kloppenburg

Sharen Jester Turney

I wanted to ask Sharen about the focus that's been given to PINK and the greater value message, I think, that's going out of the customer there. I wondered if you could talk about it and the strategy there, and I'm wondering if that at all could inhibit margins for that brand going forward. And also, I wanted to -- I wondered if you could comment on the performance of sport. I think it looks great, and I'm wondering if you'd consider accelerating the rollout of that product category.

Thank you, Janet. Let me take the first one. PINK is really focused on a good price point in terms of our bra business. We think it's very important. It's part of our strategy as graduating that bra customer into Victoria's Secret lingerie. We continue to increase prices in our bra. And in fact, the Date Bra and now the Wear Everywhere Bra are doing very well. There's comparable pricing in the panty business. We do have a good, better, best reach strategy in the apparel business, so I think it's very well balanced. And so I think we are constantly looking at the opportunities that we have there. And there are no inhibitors in terms of the margins by our pricing strategy. We are seeing some success in sport, especially within the bra category. We are rolling the sport bra to 300 additional stores that we started basically in July and into August.

BKYI

Q3

Brian Kinstlinger

Mike DePasquale

And in terms of retail and e-tailers, are these some of the larger guys? Obviously, the Home Depots and Targets of the world, Telelock, should we expect these types of relationships with a smaller bricks and mortars and hardware stores, how do I think about -- and will you announce some of those relationships?

We will announce those relationships when they have product in store and they will be some of the larger ones that we all know about it are very notorious in moving these kinds of products, both not only locks but that also with electronic products, right, because this is not just a lock. You can buy a Master Lock four pack for 19.99. This is really a specialty product, blue tooth enabled, fingerprint enabled. So it's more of an electronic type product. In fact, there was a video that was posted up to our social media channels. It was a news segment that was shot in Pittsburgh yesterday that kind of reviews the product and why this particular interviewer believed that it was a wonderful gift product for the holidays. It's a special product. It's priced really, really well and it's available in different form factors and colors. So it's cool and we think that not only e-tail channels, but brick and mortar channels are going to pick this up and feel really good about it and we think we're going to move a lot of product. But again timing is everything. We won't be able to get into brick and mortar until the first quarter or maybe towards even the first -- end of the first quarter as most very large big box type retailers have cycles and we're in that cycle right now.

POWL

Q4

Brent Thielman D.A. Davidson:

Pat McDonald:

I guess just relevant to the Power/Vac business, can you guys talk a little bit about what you're seeing there just given its exposure to general manufacturing and commercial construction sectors?

I would say if we have any area that we are seeing some volatility in the market, it would probably be the commercial market segment served by that area. But, we continue to work with our partners over there, new opportunities and quotations in market segments that are still positive. We are working hard to identify those and go capture those.

QADA

Q3

Bhavanmit Suri:

Karl Lopker:

One more last, any large SAP displacements in the quarter?

There were no specific large displacements. There were a number of the elsewhere SAP was in the mix but there wasn't anything to point to.

BBBY

Q2

Oliver Wintermantel

Mary Winston

Yes, thanks very much. I just wanted to clarify, when you said that the inventory fell-through, that should not have a gross margin impact throughout the rest of the year, so I just want to clarify that. And then my other question on gross margins is like the shipping costs seem to be a benefit in the second quarter. So was that driven by lower sales and that’s why shipping costs were better?And then now looking into the back end of the year, if you expect that your sales are going to improve throughout the year and the BEYOND+ membership promotions that you have during the holiday season, should we expect gross margins to be down because of shipping costs or should that have a negative impact? Thank you.

So that was a multi-part question. I’m going to start with the first one, and I may have to ask you to repeat a couple of your sub-bullet points. So, on the inventory you’re asking about the margin impact as we take out the merchandise.Again, we’re mindful not to cannibalize sales, you know during the holiday period and we can, using a third-party liquidator, remove that merchandise from our stores, but not have it out in the market competing, you know competing against ourselves or be liquidating it in a heavy fashion during this time frame.And then I think you asked about shipping expense. Yes, we’ve seen shipping as a favorable driver as a percent of sales benefiting gross margin this quarter and I’m sorry, if you could repeat your next question.

BLDR

Q3

Jay McCanless

Peter Jackson

And then, just wanted to ask also, with the sharp drop in prices over the last couple of months, is this something where there is an inventory problem inside the industry that's working itself out? Or is this more dislocation from people being worried about whether housing starts keep growing. What do you guys think has caused this sharp decline over the last two months?

And I think you hit the nail on the head a little bit in terms of the industry-wide inventory levels. I think that that disruption we saw earlier in the year with regard to transport caused people to take safer positions. So, when it turned, there was enough wood on the ground and in the channel that people have been able to do what Chad talked about, which is just kind of wait it out a little bit, see what's happened, and it's corresponded with the seasonal decline in usage. And you sort of layer those things together and, yeah, I think it's structurally something we'll work through, and to Chad's point, it'll find its level pretty quick here.

KLAC

Q4

Christopher J. Muse

Bren Higgins

I guess, first question, considering the extended lead times that you're seeing, particularly on the foundry side, I'm wondering if that extends also into other customers into 2015. What I'm trying to get at is how do you see the ramp in terms of '16, '14 spend and, therefore, the linearity to shipments the foundry gets for you guys into the next year?

C.J., good question. Thanks, it's Bren. So I think as we look out going forward here, I think that clearly, this -- and I talked about it at SEMICON West where we had effectively one customer that we're expecting to ship somewhere close to $100 million to -- in the September quarter and we plan to book those orders in June. That business fell out; other businesses came in to replace it. And so it did put a bit of a hole into the shipment forecast for the quarter. I think going forward, as we said in the prepared remarks, we see the shipment trajectory of being positive, and we'll see a resumption of growth into December. And as we said in the remarks, it looks like it's greater than $800 million or so. I think it's interesting. It is fairly fluid in terms of timing or it has been, although, I think that those -- these orders that we did see in the quarter in foundry are a, I think, a good confidence point in terms of timing and when we expect that capacity to get added as we go into the first part of 2015. So we'll see. I mean, there has been a fair amount of fluidity around the shipment plan over the last couple of quarters. Clearly, this one in particular, it was a large sizable order, and those orders are slotted in -- mostly in the first half of the year.

PTEC

Q1

Paul Hill - PMH Capital

Woody Hobbs

Then just in relation to the strategic review or potential strategic view, say just running the numbers, sort of a cash position of $30 million, gross profit of $60 million, if you did the two times multiple amount, you’d get $120 million combined obviously. It would give you an EV of about $150 million and I guess the stock price is currently residing around about sort of $3 a share. There seems to be obviously a gap between the intrinsic worth of the business and the market value being ascribed.

Well our view, as reflected by our comments for the last 2.5 years, is that the value of this business resides in the new product opportunity and the extraordinarily large target market that those products open us up to and it is management’s view and the board’s that any sort of effort to harvest through a strategic transaction would be way premature, given that those products are just now coming to fruition.

BLDR

Q2

Matthew Bouley

Chad Crow

So, the truss plans that you guys acquired in July, obviously at the same time, you guys are investing in your own plans and the new greenfield. Can you take us or help us think about how you're going to balance that going forward? Perhaps of what you're looking for in a given market where you might choose the M&A route instead of a greenfield? And, is this something that we should expect to see more of? Thank you.

Yes, if don't believe we've said on prior calls. I look at a lot of these opportunities as a build versus buy decision. And at the right multiple, it makes more sense in my mind to go the M&A route, it gets you into the market quicker plus you're not adding capacity into a market which can be difficult and create some real pricing war. So, it'll be a balanced approach though, like I said, we're going to be -- we're going to be pretty busy. And it's got to make sense from a financial perspective and from a multiple perspective, but I like the fact that we have the flexibility to do either now, now that we've gotten our leverage ratio down, we can make those decisions and be, a little more opportunistic when it comes to grow in value as part of our business.

ANET

Q1

Aaron Rakers

Jayshree Ullal

Thanks a lot for taking the question. Kind of a different way of maybe asking the same question again. But I'm curious of how you think about the demand profile from the cloud guys. We're seeing industry reports talking about pretty healthy server demand at several of these public cloud vendors.We've seen the numbers from Microsoft and others. And what kind of the lag effect you see between server footprint deployments or expansion versus actually pulling more network bandwidth means and obviously, a benefit for Arista?

First of all, we do see cloud titan use case demand in basically three areas. Either our customers are adding additional core or spine capability or they're expanding racks to increase their server density or in some cases, we're also seeing some geo expansion for their international needs. Although some of them have been ordered from the United States, increasing our U.S. titans contribution.So I think the use cases for us is very, very clear. What we also see is that because we have long lead times that Anshul and the team are working very closely on really understanding and sharpening their forecast and timing and working with us on scenarios and contingencies.So I think when they are starting to look at their 2020 deployments, they're not just looking at Q1, Q2, they try to give us visibility for the second half as well. And so while we have not factored any of that into our Q1 or Q2 forecast, we are seeing them doing some very prudent planning and for business continuity in their 2020 time frame.

OCX

Q1

Bruce Jackson:

Doug Ross:

So with DetermaIO, there’s clearly a potential here for this test. You’ve got it available [indiscernible] test. Can you tell us a little bit about some of the stuff you need to go through in order to make this available as a clinical use test, and then when could that happen?

Right. So yes, as I’ve said a bit before, the clear bar for improvement upon tumor mutation burden on PD-L1 which is the current biomarkers that are in use out there and to some degree MSI, but not in lung cancer, is to show that we offer incremental value and that really means that we’re independent of tumor mutation burden and/or PD-L1 which in all of the clinical studies that we’ve done to date is looking very, very promising. And so doing a retrospect of studies on a large enough cohort is second, if you will, independent study in lung cancer and/or a second independent study in triple-negative breast cancer is on that path, I’ll put it that way. Also getting access to, as Ronnie says, a randomized clinical trial for perhaps an alternative drug to those that are on the market for first line and demonstrating a strong performance associated with a particular agent is another route to either a companion or complementary diagnostic, and we’re actively pursuing both of those trials.

NWSA

Q2

James Dix:

Chase Carey:

Good afternoon gentlemen. Two quick ones. Given that your international cable growth was so strong over ad growth of 27% in the quarter, operating growth, profit growth of 37%, is your expectation with that too can accelerate in the second half of the year, is there something which is going to cause that to moderate. And then just secondly, now that you are sit here at the midpoint of the fiscal year, is your expectation for the mix of operating income for the full year now more weighted to cable and TV or is there something in the seasonality for the second half that is what kind of your expectation for that mix growth probably unchanged versus when you’re originally gave your guidance? Thanks.

I think in the international channels to be strong in the first half and that we expect to sort of sustained similar strength through the second half, I mean it’s strong (Inaudible) pretty happy, we will just keep rolling along like as well and so.

BLDR

Q2

Megan McGrath

Peter Jackson

And just a bigger picture question, on some of your initiatives, you've talked about specifically, pricing and efficiency initiative. I'm just curious in this kind of an environment when you have really aggressive lumber price deflation. Does that make the pricing initiatives are more or less important as you're seeing such large deflation? And has the priority in those initiatives shifted at all in this current environment?

And just sort of recap some of the some of that price, the work that we're doing is really focused on discipline process, right? Is it this is in out to gouge the customer type of dynamic. This is a, how do we make sure we're updating our prices effectively. We're giving people tools to use so that they understand the cost benefit of the relationship with individual customers. It's just, I would say fundamentals that we can get and have been getting better at. So it is very, I would say long-term good practice that we think is going to help us regardless. And it's a great is a great project and a high priority.

DOV

Q2

John G. Inch

Paul E. Goldberg

Good morning. Ron, I echo [ph] your sentiments. So on the just as the clarification, so the $0.04 of contribution from the impact of Crenlo and Triton. So Triton was... I think, it was just kind of breaking even. So the $0.04, is that really the way to look at a penny of contribution from Crenlo? Is that per quarter, is that the way to think about it?

I just want to qualify. Triton was losing money at the beginning of last year. But as we exited last year, Triton was, in fact, making money. So just swapping out Crenlo and Triton it's just an incremental $0.01 per quarter going forward.

AMD

Q4

Matt Ramsay

Lisa Su

No, thanks for that. As a follow-up, I guess, for both of you, but maybe for Devinder, just a couple of little pieces. For me, it looks like, on the operating expense side, you're going to be up in the neighborhood of mid-20s for the full year in the annual guidance that you outlined. Maybe you could talk a little bit about the focus of that? Is it branding and marketing in the PC and server spaces as you grow, or is it in other areas in R&D? And then, secondly, I think you guys had disclosed the data center revenue mix. So, GPU plus server in prior quarters? And if you have that number handy, that would be really helpful. Thank you.

Matt, the only thing I'll add to that is for the data center revenue, particularly in Q4, it was very heavily weighted toward server CPU, just given some of the lumpiness of the data center GPU revenue.

KLAC

Q4

Mahesh Sanganeria

Bren Higgins

Right. And then one quickly on the OpEx. With the revenues going down so much, won't OpEx should be going down because your bonus allocation probably should be going down for the quarter?

Well, when we look at OpEx, I mean, the way we think about sizing the business is relative to the roadmap requirements to maintain the product investments that we need to make. And so we're less sensitive, obviously, to a quarterly change in that. And I think given our expectations of the ramp in business, we think given the -- what we feel like we need to do and our expectations of our fiscal year, but also as we look at into calendar '15, we think that's sized right. I think over time, depending on performance, you start to see variable comp move both directions. But it doesn't do that necessarily in one quarter. It all depends on what happens on sort of annual views in terms of how we pay that out. So for now, I think it's reflecting, I think, the -- some higher program investments and I expect to see those going through over the fiscal year, and I'm currently sizing the business right now around -- on an annual basis, somewhere between $925 million and $935 million for a fiscal year, and that translates into the guidance range that we gave you. Business is a lot stronger. That probably doesn't change all that much. Probably a little bit related to comp. If the business is weaker on the margin, probably doesn't change much the other direction. I think significant moves either way, obviously, will have us reacting to it, but that's how we're looking at it today.

UHS

Q2

Frank Morgan

Steve Filton

Okay. One more follow-up. You mentioned in your earlier comments on – you had a theory about potential readmissions on the behavioral side of the RTC. Do you have to have a number like what percentage of RTC patients actually end up being readmitted in any given year? Have you ever seen that number or do you look at that number?

I'm not aware of that. It may well be that we have that data. I mean, really all I was suggesting is that as Medicaid programs try and reduce utilization, one might expect to see a reduction in both admission rates and length of stay and for the most part what we have seen over the last few years is really no decline in admissions. In fact pretty strong admissions on both the residential and acute side. But a contraction in length of stay, and again, my sort of conclusion that I draw from that is that it may be somewhat self-defeating strategy and that you are getting some patients out sooner. But you are not really helping drive down the overall utilization if they are not effectively completing a course of treatment.

HOME

Q4

Brad Thomas

Lee Bird

Well Lee may be taking the flip side of that, do you think the business may be in a position where it might be able to deliver mid single-digit comps over the next couple years?

I’d tell you, we don't plan ourselves too low single-digits in the way we focus our efforts. And that – but it doesn't always hits. Sometimes weather shows up some other things happen. I rather plan for something higher and ensure that we deliver on what we've just shared with you. So we have a lot of initiatives, adds up to something higher. I hope it hits. Obviously you can see in years past we've actually been able to hit - numbers that are higher than that and that's helped us with – wetter weather sometimes the product acceptance was better than we had planned, not as good as we had hoped. Actually we continue to think our product is fantastic. So I would say we gun for something higher because we put a lot of energy against it, but we never commit to anything higher than that because – you wouldn't want us to and stuff happens. And so Judd talked about the weather this quarter for example. Hey, I'm not excited about all the rain and all the snow everybody is getting is that that help patio sales? No. We're projecting a positive same-store sales growth despite the wettest February in 120 years of recorded history in Texas, where they were four Nor'easters in five weeks and but you don't want to hear us whining about weather. You want us to continue to deliver a same-store sales growth every quarter. So we'll gun for something higher and commit to what we've had in prior year.

HY

Q4

Mike Shlisky

Ken Schilling

Good morning everybody. I have got to get a little bit of nitpicking on my questions here to start off real quick unfortunately. First I want to ask about the income from the affiliates line, you had additional 19 -- I think it was $19.8 million of income there, and see how you adjusted it in your press release out of EPS, which makes sense. But it seems to have not been adjusting out of adjusted EBITDA, so your EBITDA was almost $20 million higher than it probably would have been, without that onetime item. Is that correct? And is there any reason why you didn't want to adjust it out, it's a 35% plus of your EBITDA for the quarter?

Yeah Mike, you are absolutely correct. The $19 million is the improved equity earnings in our JV, our finance JV in the U.S. We tried to stick to us a very strict interpretation of how you calculate EBITDA. So only the interest, taxes, depreciation and amortization on our financial statement were the items we called out. In your analysis, if you would pull that out, that would be your version of EBITDA, as there is no standard EBITDA out there. But you are absolutely right.

GGG

Q1

Jim Krapfel

Pat McHale

Hey, good morning. So revenue growth has been consistently robust in the Americas region. But what do make of the more tepid growth in overseas markets really over the last three years, which appears to have underperformed in the regional economies, especially in light of the conversion opportunity in spray equipment? And is the competitive environment becoming more challenging in those markets?

Okay. So I’m going to hit region by region. Our performance in South America, I think, has been reflective of the underlying economies down there. Brazil, certainly, the last couple of years, has been a major headwind for us. We are making progress in that geography in terms of market penetration with our contractor business building out channel and doing some end-user conversion. Again, it’s a very small number and we have a long ways to go, but I see us making forward progress. In Europe, I believe our business there has outperformed the economy. I mean the Western European economy for several years has had really almost no economic growth. And if you take a look at our performance in the West has been pretty decent. Certainly for the last year or so, the Russia has offset a lot of our performance and sort of masked some good work that we’re doing there. Asia Pacific has been, I’ll say, a sore spot, particularly on the contractor side for us. We certainly are not meeting our own expectations in terms of market conversion. Our contractor sales in Asia Pacific - not in every country, but in Asia Pacific as a region has been disappointing. We have made some changes there. We have made some leadership changes in the contractor business. Those I would say are in their infancy here in terms of trying to see if those can have an impact. We are doing some things on the product side. There definitely is more competition in China at the low end than there were a few years ago, but I think generally speaking we feel that it is more of a Graco execution issue on our contractor business in Asia Pacific and that we need to get our act together.

AAPL

Q2

Ben Reitzes

Tim Cook

Yes, good afternoon. Thank you. Could you talk a little bit about the Mac business? It seems that desktop side exceeded our expectations, obviously due to the launch, but sequentially the ASP in desktops if my math is right, looks like it was down quite a bit. Could you just talk about what’s going on in the Mac business, how the new Macs are doing, what you think of your pipeline, but also what’s going on with ASPs like – am I right that there was a mix down in the desktop area and just what’s going on in particular with regard to the mix with this tough economy in maybe notebooks and desktops?

Across the quarter, as we got into March and announced a completely new desktop line, we saw an acceleration of sales and it was that acceleration that allowed us on a sell-through basis to approximately be equal to the year before. After we did the desktop launch, we began to ship a higher mix of desktops than we were before the transition and that helped to push the overall ASP down. Within the desktops themselves, the top end of the line, Mac Pro, we had a lower mix to the Mac Pro, a higher mix to the Mac mini than we had before the transition and really all throughout the quarter, the Pro products that are primarily being sold to the creative professionals, were weaker than they were in the year-ago quarter and we believe that that’s mainly economic related, as you would guess, businesses are cutting back on technology expenditures. In addition, education in the U.S. contracted by about 11% year-over-year and this is a result of states not having the tax revenues as projected and we are hoping that as we get into this quarter that the stimulus funds that were approved last quarter begin to flow to the states and we see some benefit from that. But that remains to be seen. So, net-net, yes, ASP did decline, it was – desktops were a piece of it, but doing all the desktops in a single day, which was – it’s unprecedented for us to do that, really helped us drive more sales in March and get the Mac business to a much better level by the end of the quarter. In the notebook business, we did have an ASP decline sequentially and that was mainly driven by a higher mix to the $999 MacBook that we had announced partway through the quarter in the October – late October timeframe. I think that’s actually a good thing, not a bad thing, because I think what you see is, for us anyway, the consumer is holding up much better than the professional, and much better than education. Education is gated by tax receipts and funding and the professional is really cutting back expenses and delaying – I don’t think it’s business we are losing necessarily, but delaying purchases.

AAPL

Q2

Shannon Cross

Tim Cook

Thank you, good afternoon. Tim, can you talk a little bit about what you’re seeing in terms of the competitive landscape for smartphones especially as we move closer to the launches of Palm Tree and as well as obviously the iPhone 3.0? And then I have a follow up.

I think it is difficult to comment on products that aren’t shipping and so I – there is nothing intelligent I could say on the pre. The iPhone has now sold over 21 million and has the highest overall customer satisfaction of the new order shipping. And so we think that we are in a great position and with the combination of the App Store and affiliates download that should occur tomorrow, we think that we are years ahead. We very much look at this business or see it through the software platform lens and I think that has – that has benefited us and our customers very well. The breadth of Apps on the store mind boggling from everything from fun things as games to very serious medical kind of applications. And so the power of the device and the ecosystem is enormous and I think we are just scratching the surface now on its opportunity.

ENTR

Q4

Tore Svanberg

Patrick Henry

Very good. And then moving on to DIRECTV and their MoCA deployment, it looks like there is an 18 million unit opportunity there. How should we expect that to ramp through time? Is that similar? Is it fairly slow in the beginning or do you think you already started to see some meaningful units already in the first half of the year?

Yes. I don't know if DIRECTV talks specifically about their launch plan. Typically, what they'll do is they're launching some percentage of the US with a new technology, maybe a third or half of the US and then over the next quarter, pan out to a nationwide type of a launch. So I think that business is going to continue to ramp for us throughout 2010 and possibly in the 2011. One of the things that really bodes well for the company is I think we are also seeing a really big ground swell or purchase of HDTVs which basically is the precursor to people upgrading their Pay-TV service from standard def to high def service. So most of the products we are going into really are going to benefit from consumers upgrading their service from standard def to high def service and this is with DIRECTV, this is also what Verizon, but also with the cable MSOs. So I think that provides us a good opportunity as that part of the market continues to expand.

KLAC

Q4

Krish Sankar

Bren Higgins

Got it. All right. And then just a 2-part question for Bren. On the December quarter shipments over $800 million, can you talk a little bit about what it is in the composition of the review between foundry and memory and other guys? And also did you give the June quarter order breakdown by geography?

I think the breakdown of the geography is on the web, in our supplemental information. So you can get it there. And it's -- we talked about it at SEMICON West, so it's probably not at all different from there as we finalized the quarter. I don't want to get into the mix of the shipments. We don't typically look at it that way and it all lines up based on when customer request dates are and that's how we end up driving the shipments. So I -- we think a lot about order -- incoming orders from a customer segment perspective. But to our operational guys, it's all about shipping the tool, not necessarily where it's going.

TER

Q2

Mehdi Hosseini

Gregory R. Beecher

I want to go back to the LitePoint. I'm a little bit confused. If the end customer is building finished handset inventory today and into Q3 with the intention of selling those units in Q4, what gives you confidence that there's going to be a pickup in test equipment procurement late in the year?

Mehdi, we believe is as the year goes on, these design wins we're getting in Asia, for example, we think there is going to be the 4G handset build-out now that the towers are getting put in place and the infrastructure. So therefore, we'll get business from that end. In terms of existing customers that have excess capacity, there may be very little extra business we get from them.

GIS

Q1

Eric Katzman

Ken Powell

I have a buy recommendation, but I wouldn’t go that far. Okay. Let’s talk a little bit about sales to start. So you’ve got Annie's, but currency is more of a headwind. So where do you think dollar reported sales given the -- in addition the promotion and the first quarter miss? Where do you see like dollar reported sales coming in using all other things, including M&A?

With M&A, it depends obviously when we are closing Annie's, but I wouldn’t tell you that we signaled through the couple set headwind from a forex standpoint on EPS, so let’s around that to a 1%. You can probably apply that same percent on our net sales if you’re going to get the reported numbers. Annie's is a $200 million, it would be more than that, but then we closed given its growth rate, $1 million business, and we are projecting to close that this calendar year. So we will probably get half a year of sales from that business as well. So add a $100 million for Annie’s or more and take off about a 1% from forex on top of the mid-single-digit guidance that we’ve given you on constant currency. That will probably range in the ballpark.

TGX

Q4

Christine Jacobs

Can you give us a little bit more color on what the nature of the disagreement is between Core and the other party. Because you are taking - you are making the judgment call by laying back and being nice because you had a relationship with Core. You do risk being lower down in the chain if ultimately they have to file for bankruptcy. So you are laying back giving them breathing room for them to be able to work things out with the other party they are interested with. Are you with liberty or can you give us some feel or what is that all about?

Brett Rice - Janney Montgomery Scott

And Brett I guess I could say strategically I want to put some of this in the context we do not tend to be cream puffs back here when it comes to litigation when we go after our do, so we - like Frank said we're walking a rope here because we would like to maintain the units and we want to get paid but I want to bring one thing into strategic focus here is; Core delivered market share which we would not have been able to get at without Core. Their relationship, their agreements with positions, this was market share that we did not have access to and although, we have - we are in a tough spot and we had to take a very tough decision and during a tough time for Core. There is some market share out there that is attractive and I would like to do what it takes to be able to maintain that going forward and so that set the stage maybe for what Frank had explained our actions are.

RDUS

Q4

Greg Harrison

Pepe Carmona

With regards to the TYMLOS price increase, what proportion of that increase do you expect to realize and what is your strategy with respect to balancing the price that reflects the value of the drug with also having -- keeping the lower price in Forteo and trying to use that to grow the market to where it had been previously.

So in terms of what portion of 5.9% goes to net, we haven't guided specifically on that, but we do expect a large portion of it to be reflected in net sales. As always when you have price increases like this and you have contracts with multiple players, you have administration fees, a few things that kick in. So it's going to be a portion of that, but it’s the larger majority of it. From a pricing strategy perspective, we believe that we will continue to take price increases that are responsible to the market. We need to recall we're obviously cost -- this cost increase is from salaries to FDA fees to other things that we will continue to ensure that those are recovered of the business. We are still about far distance from our competitor on reporting to the market. So we don't see this as diminishing the potential of TYMLOS to continue penetrating and becoming market leader.

IM

Q2

Jason Gursky

Gregory M. Spierkel

Okay and then just the follow up. Greg maybe just some qualitative commentary from you on what... where you think the demand in Europe is coming from, just kind of a currency driven phenomenon going on, was there some investment that is now getting caught up that wasn't being made over the past several quarters in the region. Just kind of why you think this demand is now starting to firm up a little bit over there?

That's a good question and it's interesting because about 3.5, 4 years ago we saw pretty good movement of the Euro versus the Dollar and that provided a bit of a catalyst. I think that there is some tailwind in the marketplace in Europe because of the currency situation. It's very hard to measure and know for sure but most components and products are US denominated in terms of cost level and clearly that means for a less or a lower priced Euro base product once it gets sold into that region. So I suspect that's helping, but I wouldn't have any tangible hard numbers to give to you, but we are seeing really in the last month or two some pretty positive signals from the demand and our own progress in most of the countries in Europe. I think also you are getting a situation where Europe is seeing some real growth and a lot of people aren't seeing this yet, but we are hearing a lot of it. As a result of selling and servicing Eastern Europe much like the emerging markets of Asia, the 6 to 8 new countries of Central Europe and Russia are feeding an interesting new business opportunity in growth out of the supplying countries, which is Western Europe. And so there is an export phenomena, and as a result infrastructure spend to support a new business coming out of Eastern-Central Europe is I think helping Western Europe right now. So I think those are the two kind of macro level factors that seem to be providing. What we see on a day-to-day basis, a more positive outlook right now than where we were three, four months ago.

ACAT

Q1

Craig Kennison

Claude Jordan

Okay. That makes sense. And then on the related note, Parts, Garments and Accessories, your outlook for that business is maybe conservative, in my eyes, given the huge opportunity you have with Wildcat to sell PG&A. Can you help us unpack and sort of think through your guidance there?

Yeah, I think that there’s a good guy in there. When you look at our PG&A business, we said we’d be up 1% to 3%. The good guy being the Wildcat side of the equation. There’s no doubt that as people buy Wildcats, they will go ahead and accessorize those. And so we should see a very positive uptick on our accessories for Wildcats. On the other side of the equitation, as we mentioned, the snow industry in retail should be up zero to 2%, but you can see our guidance in terms of shipments, down 4% to 6%. And so, with that, less accessories there. There are less people riding in the fourth quarter and we saw a drop-off in snowmobile parts. So if the dealers still have those parts, then we would’ve expected to see that a little bit soft next year as well. So you have some tradeoffs and some good guys in the Wildcat and then some negatives being impacted from the snow.

ACAT

Q1

Stephen Roseman

Tim Delmore

Do you think it’s possible you could provide some color as to where that is? Because when I look at historical Q3 shipments and the difference between two, literally we’ve never seen that type of difference. I’m trying to have a better understanding of what the product mix difference would have been to get to that order of magnitude difference in units versus dollar sales.

Just one thing, if you’d look at our – I don’t have the pricing in front of me, but there were a higher number of four strokes in our mix, for example...Turbos, a lot higher price points and that would be driving that.

FISV

Q4

Brett Huff

Jeffery Yabuki

And then last question, on the two large clients that are having a little bit slower growth on bill pay, what's the game plan to address that? I mean, how much help can you provide them? What are the others solutions or things around the edges that you can help maybe restart some of that growth? Or is that just an economy or even just a saturation thing?

Well, it's a little bit of a different story for each one. I would say on balance, we try really hard to help point out areas of potential growth. But in the case of our largest client, they're at a penetration rate that is probably 1 to 2x larger, right. They're penetration rate is 1 to 2x that of everyone else. So there's a lot of opportunity for everyone else to get up to their rate. For them to really grow significantly, they would have to do some things that would be fairly different. And unfortunately, right now, given everything that's going on in the economy, I don't think people -- the institutions aren't spending a disproportionately large amount of their time focused on how to do move that forward. So I don't think there's a lot we can do there beyond changing and modifying our own experience to make it even more differentiating than it is today and easier to transact. And that's part of how we think about our own technology in terms of doing that.

SANM

Q4

Bob Eulau

And just to clarify, was the components gross margin above the corporate average this quarter?

So in our new segment, Components, Products & Services, the gross margin is higher than it is in the Integrated Manufacturing Solutions. And the components in the old definition was I believe still below.

VZ

Q2

Michael Rollins

Matthew D. Ellis

Hi. Thanks. And I also like to extend my best wishes to Lowell and congrats to Hans. Just a couple of topics, if I could. First on the strategic side. As I listened to the management commentary over the past year, is the underlying goal for Verizon to become a leading provider of broadband in the home and on-the-go across the country? And if this is the direction, how long would it take and how much can be driven by internal investments versus possible M&A? And then just one thing on the business trends. Postpaid phone growth at the industry level has risen to more than twice the rate of population growth. Do you have any thoughts on what's driving this change? And the sustainability for postpaid phones at this new level of growth? Thanks.

On the postpaid phone, we continue, you know, to see consumer demand there and we believe certainly when you give customers the opportunity to get on the nation's best network and we have the right price plans, we see good things happen there. So I can't comment in terms of the industry volumes overall. But we certainly continue to see good consumer demand and we expect to continue to have postpaid phone net add growth going forward. And we'll see how that plays out across the rest of the industry. But one other comment I'd just add on the network side is, in addition to the broadband piece, as we've talked about the strategy is it's once you have that pace, what we -- the services that we can provide above that connectivity layer are also very important as we go forward, and we think we're in a great place to be able to deliver on that too. So hopefully that helps your questions, Mike.

SYK

Q2

Steven Lichtman

Kevin Lobo

Thank you. Hi guys. Certainly first to talk about your spine business and how you are feeling about the state of that business, so what's your outlook for the underlying growth and what are your latest thoughts and timing on robotics into spine?

Yes, so in terms of underlying growth and we don't break out guidance in terms of as we think about spine, but we do expect that market and that business to continue to accelerate as the recovery happens in the back half of the year. With regards to robotics, I mean, we've talked about this before is of our key areas of focus for robotics and applications that are next. Spine is one of those and so we continue to move down that path with a couple of different options, looking at Mako, but also through our Mobius acquisition and the Cardan Robotics, some opportunities there. We don't have a timeline that we are sharing at this point and so it's something that we'll continue to update you on as we make progress in that area.

SYK

Q2

Lawrence Biegelsen

Kevin Lobo

That's helpful. And from my related robotic question, Kevin, you guys have started talking more publicly about evaluating, having people at Stryker evaluating surgical robotics. So my question is, how important is it for Stryker to participate in this market at some point? And how do you want investors to think about the kind of investment that it might take to be competitive in that market? Thanks for taking the question.

Yes, no problem. Just want to make sure that was clear. I would say there's really no need for us to be in general surgery, robotics. As you can see, we're running a very good business at Stryker. It is a big market that has big growth potential, but it's something that like other adjacencies that are attracted to us be it areas I've spoken about in the past, like neuromodulation, or peripheral vascular, this is in an attractive adjacency. A pathway forward is not obvious and not clear at this time, but something we'll continue to look at, but it's not something we have to be in. But if the right opportunity presents itself, and we think we can build a strong business, we'll certainly make a move, but not obvious at this point.