Kevin Rottinghaus - Cleveland Research

Okay.

Stephen Cumming

But really probably, we really take our ops in 2010. It will begin now and have an impact in the second half of this year.

Kevin Rottinghaus - Cleveland Research

Did you say which segment was impacted by the distributor bad debt expense?

Steve Laub

We did not.

Stephen Cumming

I don't think it's across all of our products, shipping into that distributor. So, it's not specific to any given segment.

Kevin Rottinghaus - Cleveland Research

Okay, and that charge is, we won't see any recurring impact from that?

Stephen Cumming

No, no that's the expectation is no further charges.

Kevin Rottinghaus - Cleveland Research

Okay, did they have to return products to you or what exactly happened?

Stephen Cumming

Well, the US government added to the [right products] list and in a situation where we were unable to ship them any further products. And we were a significant supplier to them which already has a limit business to operate going forward and caused significant cash flows for the company. So, that's basically what the situation is.

Kevin Rottinghaus - Cleveland Research

Okay. Thank you very much.

Steve Laub

Thank you.

Operator

Our final question is from the line of Edwin Mok with Needham.

Edwin Mok - Needham

It's a quick follow-up on the gross margin guidance. You guys have pretty strong margin in the last quarter and but you're telling about backed out of $4 million the one-time item that you talk about, is still higher than you outlook for the first quarter. Is it or just from fixed cost assumption in the coming quarter or are you guys expecting some inventory write-down. How do we look at that?

Stephen Cumming

The revised number yet, we passed out the one-time pension number, Edwin. We were about 120 basis points lower. Part of that was due to the fact that we shutdown our North Tyneside facility and leveraged that vastly into our Rousset and Colorado fabs. And obviously, we saw the continual growth of our micros or the change in mix of our micros in relations with the rest of our business and that also contributed to the overall improvement.

Edwin Mok - Needham

Right! But what about for the first quarter guidance, I mean, the guidance range is lowered or not, what do you guys have recorded in the fourth quarter range. Is that one, fixed cost assumption or is that higher costs…

Stephen Cumming

As we deal back our capacity a little bit more, we’re moving outside of our normal ranges and unfortunately carried expense, some of those charges and that's causing us to take a bit of a dropdown.

Edwin Mok - Needham

I see. So, it sounds like is more relative fab production utilization or--

Stephen Cumming

Exactly, yeah!

Edwin Mok - Needham

I see. Great, that's all I have. Thanks.

Operator

I would now like to turn the call back over to Mr. Pursel for any closing remarks.

Robert Pursel

Thank you, Julia. During the first quarter Atmel, we'll be participating in several investor conferences. On February 9th, Atmel will be presenting at the Thomas Weisel Partners Technology & Telecom Conference in San Francisco and on February 25th at the Goldman Sachs Technology and Internet Conference in Las Vegas. And finally on March 2nd, Atmel will be in San Francisco for the Morgan Stanley Technology Conference. Webcast information for these events will be published in the company’s Investor Relations website.

Thank you for joining us today. This concludes our conference call.

Operator

This concludes our conference call. You may now disconnect.

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