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The forward-looking statements discussed today represent Oclaro’s views as of the date of this conference call, and subsequent events and developments may cause Oclaro’s views to change. Oclaro does not intend, and is not required to update any forward-looking statements as a result of future developments.In addition, we will be discussing non-GAAP financial measures. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. A table that outlines the reconciliation between the non-GAAP financial measures to GAAP financial measures is included in our earnings release, which we have filed with the SEC. I refer investors to this release. I’d now like to turn the call over to Jerry. Jerry Turin Thanks, Jim. Our results for the December quarter, which ended January 1, 2011 and our guidance for the upcoming March quarter are consistent with expectations established previously. Our revenues for this recently completed quarter were $120.3 million compared to $121.3 million in the previous quarter. Our revenues from Huawei were 17% of our revenues in the quarter, CNA Nortel was 12% of our revenues, Alcatel-Lucent was a11% of our revenues. Out of our total revenues, our Advanced Photonic Solutions business was 12 million or 10% of revenues, down $1.5 million from $13.5 million or 11% of revenues in the prior quarter. If I look back to the March quarter of last year, APS had been 14% of our revenues. This is before the short-term flatness and declines we’ve seen as a result of tight inventories during completion of a Fab transfer ramp, as well as of excellent inventory trend by our largest customers with our product. We are moving beyond the transfer and the inventory correction and the book-to-bill on APS was strong with customer engagements progressing nicely. For the March quarter we expect growth to resume to telecom levels, but we do remain relatively conservative as to APS expectations in that quarter.
Our telecom revenues were relatively steady quarter-on-quarter, up slightly at a $108.3 million versus $107.8 million last quarter. This was consistent with the inventory correction and related guidance we provided coming out of the prior quarter.We believe our revenues from products deployed in 40-gig or higher networks in the December quarter were over 30% of our telecom revenues. This is not a metric, we will be reporting on a regular basis. However, this result was consistent with an expectation we put out last quarter. So, I wanted to make this achievement clear. Our gross margins for the quarter were 30%, compared to 29% in the previous quarter. We were able to increase gross margins even while our mix of high margin APS products declined, and as our revenues from former Mintera 40-gig products increased, albeit prior to implementation of all the cost improvement that are expected to transition these former Mintera products from lower than an average margins to higher margins in the future. For the March quarter, we are guiding to a range of non-GAAP gross margins relatively consistent with December, even while absorbing the impact of new pricing, the majority of which takes effect at the start of the March quarter. As many of you know, the majority of our pricing is reset January 1, based on annual negotiations with many of our major customers. On an annualized basis, we historically see in the range of 12% to 15% price declines. This year we believe the annualized effect of the new prices to be closer to the bottom of that range. These negotiations also include annual allotments of products, and this year’s negotiations also included the setting of initial prices on a number of key new product introductions for us in calendar 2011. We were pleased with the results of the pricing and with our allotments, and in particular we are gratified by the strategic tones of the negotiation processes.
Our R&D for the quarter was $15.7 million or 13% of revenues compared to $13.7 million in the previous quarter. We expect R&D to continue to range in the neighborhood of 13% of revenues. Our SG&A for the quarter was $15.1 million compared to $14.8 million in the previous quarter. Our restructuring and merger related expense was $900,000 compared to $700,000 in the previous quarter.Read the rest of this transcript for free on seekingalpha.com