Lothar Maier
I think you got it pretty much right on. We are tooled up to do around $400 million. We can grow beyond that without having to do any sort of brick-and-mortar type of expansion so it would just be capital equipment and people that would be added so the cost will be sort of gradualist as we grow beyond it and the margins as we approach that number will continue to improve.
Paul Coghlan
Well, if you look back and the are similar seasonality quarters in 2011 and ’12, I think, when our sales were reduced by amount similar to last quarter, impact on gross margin was similar about six-tenths of a point, so I do not think there was anything unusual in gross margin that happened in the quarter just ended.
William Stein
That is helpful. Thanks, Paul. Maybe I can just follow up with one on your outlook for communications, equipment and wireless base stations in particular. You noted it was — certainly didn’t fall of a cliff, but it was slightly weaker in the quarter. I am wondering if you have any outlook for the full-year and if you have any color by region that would be helpful. Thank you.
Paul Coghlan
I am impressed you have asked us that question because our historical accuracy in predicting what is going to happen in communications infrastructure is not to be proud of, although comparatively with the rest of the industry maybe we are equally as poor, so for us it is really hard to tell. I mean, I think China as you know tends to be sporadic on their implementation of the infrastructure build-out. My guess is that negatives you hear out of China are that demand is weakening a bit, although still strong comparatively with other regions, although I would think lower oil prices are probably going to help China in the near-term and maybe spur some available spending for them and who knows, maybe that will play into that market.
William Stein
Thanks for that outlook and congrats on the good outlook.
Paul Coghlan
Thank you.
Operator
We will take our next question from Tore Svanberg. Go ahead. Your line is open.
Tore Svanberg, Stifel, Nicolaus and Company
Yes. Thank you. The first question, if I look at the calendar year ’14, your sales were up 9% year-over-year. As you look at the puts and takes of the economy this year, I mean I know and I recognize it is early on and you don’t give annual guidance, but is there anything out there that would suggest why you would not be able to at least repeat that again here this year?
Paul Coghlan
Well, we are going into the strongest half of our year, which is the first half of the calendar year. The guidance we have given you, the midpoint of that guidance would have us growing 7% year-over-year, up from 5% the previous quarter. Our hope is, long-term our goal is to continue to grow roughly 10%, So we grew last year, last calendar year 9%. So it is still early to look at 2015, we think the March quarter will be off for us to a reasonable start as we have guided, so for us right now we don’t forecast for the year as you said, but we would hope we would do something similar at this stage until last year.
Tore Svanberg
Very good and Paul, based on your comments about operating margin being up modestly in the March quarter, should we infer that OpEx will be flat sequentially or will the improvement come primarily from sales and gross margin?
Paul Coghlan
The improvement would come primarily from sales and gross margin. Operating expense will be up a bit. We will not have to shutdown in the March quarter. We did have a shutdown in the December quarter. Now the first week of the March quarter was the week between Christmas and New Year, so there were some extra vacation there, that will soften a little bit, the shutdown impact going into the March quarter but I think the primary game will be the percentage follow-through from the increase in sales.
