Operator: Good day, ladies and gentlemen, and welcome to the First Quarter 2011 JDSU Earnings Conference Call. My name is Regina and I will be your operator for today. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, today’s event is being recorded for replay purposes.
I would now like to turn the conference over to your host for today, Ms. Cherryl Valenzuela, Senior Investor Relations Manager. You may proceed, ma'am.
Cherryl Valenzuela - IR: Thank you, Regina, and welcome everyone to JDSU's fiscal 2011 first quarter financial results conference call. Joining me on the call today are Tom Waechter, Chief Executive Officer; and Dave Vellequette, Chief Financial Officer.
I'd like to remind you that this call will include forward-looking statements about the future financial performance of the Company. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from management's current expectations. We encourage you to look at the Company's most recent filings with the SEC, particularly the Risk Factors section of our annual report on Form 10-K filed on August 31, 2010. The forward-looking statements, including guidance provided during this call, are valid only as of today's date, and JDSU undertakes no obligation to update these statements as we move through the quarter.
Please note that all numbers are non-GAAP unless otherwise stated. A detailed reconciliation of these non-GAAP results to our GAAP results as well as a discussion of their usefulness and limitations is included in today's news release announcing our results, which is available on our website, at www.jdsu.com.
As a reminder, the quarterly earnings press release, supplementary slides and historical financial tables are posted at www.jdsu.com/investors under the Financial Information section.
Finally, and as a reminder, this call is being recorded and will be available for replay from the Investors section of our website.
I would now like to turn the call over to Tom.
Thomas Waechter - President and CEO: Thank you, Cherryl, and good afternoon, everyone. I would like to begin by providing an overview of our Q1 financial results followed by highlights of our business achievements in the quarter.
JDSU reported revenue of $411.3 million inclusive of contributions from our NSD acquisition, which represents growth of 37.7% year-on-year and 3.3% sequentially. Book-to-bill for the Company was above 1 for the sixth straight quarter, driven by strong bookings in our Optical Communications business.
Gross profit of $195.1 million or 47.4% of revenue improved from 44% in the prior fiscal year and 45.5% last quarter. In both dollar and percentage terms, this represents the highest level of quarterly gross profit for the Company in the last five year.
JDSU also reported operating income of $44.4 million or 10.8% compared to 3.4% in the prior fiscal year and 9.3% in the prior quarter. This operating margin exceeds our guidance and is the second highest reported by the Company in the last five years. This is within sight of our target operating model of 11% to 14% operating margin when quarterly revenue was greater than $415 million.