Operator
And next we’ll go to Katherine Egbert with Jefferies.
Katherine Egbert - Jefferies & Co
Hi can you hear me?
Vivek Ranadive
Yes.
Katherine Egbert - Jefferies & Co
Hi, I just want to add my congratulations as well, good job. I had a question about the guidance. You’re guiding for flat licenses at the low end of the range. Can you handicap that range for us? I mean why would you guide for flat as sort of things improve or are you just being conservative and what are you assuming as you offer that guidance. Thanks.
Sydney Carey
We’re still taking a conservative view on our close rates and assuming lower than normal close rates as compared to last year. At the lower end of our guidance we’re assuming close rates similar to Q2. So again we’re seeing some of the timing of deals creating an element of uncertainty so feel at this point the broader range is appropriate.
Katherine Egbert - Jefferies & Co
Okay and then a quick follow up, your margins have been ramping quite substantially over the last couple of years. Where do you think they go longer-term? Can you lay out sort of a range for us?
Sydney Carey
At this point in time we’re focused on Q3 guidance and we are seeing even some expansion at the high end of our range there over Q3 of last year and we’ve had good margin so far year to date. So I think that is implying that we’re expanding our margins.
Vivek Ranadive
But I think Murray it would be fair to say that as we approach the billion dollar mark that we’ve historically spoken about a 25% to 30% range being achievable. So I don’t know if you want to comment on that as we’ve said in referencing our past comments.
Murray Rode
Yeah, I think maybe that is a good way to put this in context is we’ve said for a long time we believe as Vivek said, as we get closer to a billion in revenue we should be driving margins above 25%. And so I think some ways you can look at the margin expansion we’ve been experiencing as just sticking with that longer-term goal.
Katherine Egbert - Jefferies & Co
Okay perfect. Thank you.
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