Does the operating margin profitability guidance of 2.4% still hold?
The company thought it could generate revenue that would exceed over $11.5 billion that it was shooting for 2.4 points of operating profit exiting its fourth quarter. Year-to-date it is about under $6 billion. The company has good chart to meeting the free cash flow objective. The operating margin objective is the most difficult for it. That objective is still out there but the second tends to be more difficult. Solectron is not giving up on that objective, but recognizes that is going to be hard. Would you expect the Lean transition to negatively impact your margins because you are not running your equipment at the same levels of utilization while you are burning down that inventory? As Solectron looks to reduce the inventory there will be less reutilization in its manufacturing facilities. That will put some pressure on margins. That is a dynamic situation because the company is looking at how much it can reduce those inventories and what it means to various skews it has got to ship,
