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Acme Packet Management Discusses Q2 2012 Results - Earnings Call Transcript

We added 93 new customers in the second quarter, including 37 service providers and 56 enterprise. Our solutions are now deployed at 89 of the Top 100 service providers and 45 of the Fortune 100 companies. Upon detailed review of our core SBC markets with our global sales organization, our win rate in the first half of 2012 appears to be in line with the last 12 quarters.

I want to share a more detailed look at what is happening in our markets and the trends that are impacting our business. The North American service provider business continues to be impacted by an overall pause in spending. Our original plan for 2012 assumes no growth from our top 2 North American Tier 1 service provider customers. We now estimate that our bookings for our top 2 North American Tier 1 service provider businesses will be down approximately 25% in 2012.

Looking at the North American service provider market as a whole, while many of our customers are engaged in projects related to Voice over LTE, or VoLTE, we believe that it will be 2013 before it has any meaningful impact on our business.

Second, we believe that various M&A activities in North America in 2011 are continuing to have an impact on our market. In contrast, our North American enterprise business performed well in the first half of the year, building off of strong growth in 2011. It grew 28% in the first half of 2012 compared to the first half of 2011, primarily reflecting increased demand for SIP trunking.

Moving beyond North America, I want to share a few observations in the rest of the world. In EMEA, we are seeing cautious spending fueled by the region's uncertain economic environment. Additionally, some of our service provider customers in EMEA are telling us that traditional IMS as it relates to VoLTE is just too expensive to expand current networks or deploy new ones in developing markets.

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