Now, let me turn to discussion of our business segments. First, our microcontroller business unit: Revenues were $120 million for the fourth quarter, down 8% sequentially and down 1% from the same period last year. For the full year, microcontrollers grew 14% reaching a record $523 million for 2008, compared to $458 million for 2007. AVR revenues declined 8% sequentially in Q4 but grew 15% in 2008, and our expanding 32-bit microcontroller business grew 14% sequentially in Q4 and 30% for the full year 2008, as compared to 2007.

We want to be clear about the ongoing market share gains we are achieving in the microcontroller marketplace. I think no one would dispute that we are taking market share in the 8-bit MCU space with our advanced AVR microcontrollers which are being used in both 8-bit and 16-bit applications due to their unmatched performance and low power efficiency.

In addition, our 32-bit microcontroller business, which grew 30% year-over-year is gaining substantial market share as well in the 32-bit space. If we evaluate our overall microcontroller revenues, as compared to others in the industry, our microcontroller business substantially outperformed them in Q4 and for the full-year 2008 as well.

Although, our Q4 microcontroller revenues declined sequentially by 8%, we note that Freescale’s microcontroller revenues declined sequentially by 26% and Microchip’s by as much as 28%. For the full-year 2008, we made substantial progress in closing the gap between ourselves and Microchip. As our microcontroller revenues, rose by 14%, Microchip’s appear to have declined by approximately 3% if we exclude the impact of the one-time conversion of European distributors to a sell-through model from a sell-in model. Microcontroller revenues for the fourth quarter were $123 million and $540 million for the full-year 2008.

As we enter 2009, we are aggressively pursuing new MCU designs in such high growth areas, like single and multiple touch screen, buttons, slider and wheel applications, as well as ZigBee low power and energy efficient applications, and also power management areas.

We continue to deliver new devices and on the XMEGA platform, which has been a major market success and is expected to be a significant growth driver beginning in 2009 for designs, by both existing as well as new customers, for the full year 2009, despite the very difficult macroeconomic environment. We expect that our micro controller revenues will grow year-on-year significantly out pacing the market.

In addition to driving outstanding revenue growth, we are taking significant steps to drive gross margin improvement. For the full year 2008, micro controller gross margins were 46% up from 39% in 2007 and we expect gross margins to increase substantially in 2009.

Turning to our ASIC business segment, revenues for the ASIC segment were $104 million for the fourth quarter down 9% sequentially and down 21% for the same period last year. For the full year, ASIC revenues were $455 million, declining 8% compared to $496 million for 2007.

For the fourth quarter our bright spot was our aerospace business, which grew 48% sequentially and 21% compared to the same quarter last year. The ASIC business decline was primarily due to reduced smart card shipments as we reduced our exposure to a lower margin telecom market segment.

For our Non-Volatile Memory segment, revenues were $65 million for the fourth quarter down 29% sequentially and down 38% from the same period last year. For the full year, 2008 Non-Volatile Memory revenues were $339 million, declining 10% compared to $377 million for 2007.

As we commented in our last call, we experienced softness in the global memory business driven primarily by general weakness in the consumer markets and lower than expected booking activity in China. This indeed was the situation as consumer and PC vendors continue to lower their forecast and as a result ordering activity.

Turning to our RF and Automotive segment, revenues were $46 million for the fourth quarter, down 28% sequentially and down 32% from the year ago quarter. Full year 2008 revenues were $250 million, a decline of 19% from $309 million in 2007. However, excluding the CDMA foundry business, our RFA business segment in 2008 was down 5% from the previous year.

In December, we completed the sale of our Heilbronn manufacturing operation to TSH Limited reducing the number of our wafer manufacturing facilities from four at the beginning of 2008 to two. Approximately 260 Atmel employees directly associated with fab operations and other support functions are now part of TSH. Also to ensure a seamless transition for our customers, Atmel and TSH entered into a three year supply agreement.

Turning to our revenues by geography for the fourth quarter; Asia, continued to be our largest ship to location, representing approximately 43% of revenues down from 50% of revenues last quarter, while Europe represented approximately 41% as compared to 36% in Q2, and the Americas represented over 16% of total revenues pretty consistent with the last quarter.

I am now going to turn to Atmel's operational efficiencies. As you may remember, we targeted $80 million to $95 million of cost savings for 2008, as a result of our previously announced restructuring initiatives and we actually achieved savings in excess of $125 million.

During the fourth quarter, we completed the previously announced headcount reduction activities in France and implemented additional cost reduction actions in North America for a combined $32 million of annualized savings.

In response to the severe macroeconomic conditions, we are taking numerous actions to reduce our expenses and our cash breakeven point. We are proposing to accelerate activities to consolidate some of our backend test operations during 2009 to further reduce our manufacturing cost i.e. we have instituted tighter control over discretionary spending, and selective hiring for critical positions only.