Mike Stephen: Okay. Got it. And I mean, this is — this will be, at least based on your guidance, the second year where your EPS growth has lagged your revenue growth. So just stepping back and looking a little longer term, I mean, can you get back to driving operating leverage or at least growing your earnings in line with revenue? Or is this going to be a continual theme, where we see earnings growth slower than revenue growth because of these investments. I’m talking in like ’24 and beyond.
Moshe Mizrahy: Well, I believe ’24 and beyond, once the Empower and the Envision will position themselves as leaders in the market, leader products in the market like all of our aesthetic portfolio, we will continue to bring product to the wellness in the ENT, urology, erection dysfunction and other. And therefore, I believe 2024 might be the same because with new products and new category and new territories will require additional investment in marketing, R&D, et cetera. I don’t think the numbers that we’re investing on R&D, on marketing are higher than any one of our competitors or any other company in the medical devices. I believe we are below the average. As far as G&A, we’re in between 1% and 2%. We’re still keeping that, try to be lean and mean. Gross margin, I believe, will continue to be in the same range of 83% to 85%. But if you ask me about 2024, it probably will be similar to 2023.
Mike Stephen: Okay. And then just on Envision. So I think when I spoke to you guys at our growth conference earlier this year, you mentioned that the timing on the dry eye clearance was expected to be in the — FDA clearance, sorry, was expected to be in the third quarter. So it sounds like you’re going to be launching the product before you have dry eye cleared. Is that right? And then how big of a deal is that for the kind of initial quarter or two, selling it without that? It seems like it’s sort of a key feature on the product, but maybe the ophthalmologists understand that, hey, if I buy this thing, I’ll get this feature in a couple of months or whatever. But…
Moshe Mizrahy: Well, you are right. We’re in the process to get indication from the FDA for dry eye. But I have to say that the two hand pieces involved with Envision, the Forma Eye and the Lumecca, the IPL, they are cleared for other indications and also for around the eyes. So, we have the right to launch the product. In addition, we already have a study which was published. So, we are showing some good results to the doctor and to the optometrist. And hopefully, in the third quarter, once we will return — or the second half of the year, once we get the indication from the FDA, it will increase the momentum.
Operator: Next question will be from Jeff Johnson of Baird. Please go ahead.
Jeff Johnson: Just a couple of questions here for me. One, Moshe, I just want to go back and clarify as you were talking about 2024 operating margin or EBIT margin, you said kind of the same, but then you also talked about incremental investments. So, do you feel like this 45% level that we’re going to be added in 2023, 44.5% to 45%, that should stay consistent from here? When you say the same? Is that kind of moving into 2024 can hold that mid-40% range? Just want to make sure that’s what you were meaning there.
Moshe Mizrahy: I believe, for your financial model, if you use 45% EBIT for 2023 and 2024 that will be correct. I don’t want to give any guidance to 2025 because this is too far away, this is two years away. We’ll see how these two years will develop, and we’ll give a guidance some time in 2024.
Jeff Johnson: Yes, understood. That’s helpful. And then Yair, just now that the profit and all the cash on the balance sheet is unencumbered from a tax perspective in that just how to think about use of free cash flow. Obviously, I think you guys have talked a little bit about some early stage looking at some M&A opportunities. Any other uses of cash there around buyback or anything else we should be thinking about?
Yair Malca: So, now all the options are absolutely on the table. We removed any restrictions or any tax — additional tax requirement whatsoever. We are looking at all directions. The main thing we are looking right now, as Moshe mentioned, is some M&A opportunities. But buybacks or dividend or combination of buybacks with M&As, they are always an option.
Moshe Mizrahy: But we don’t have any approved plan by the Board right now to do any of the buyback or dividend. This is just ideas that, in case we will not find any complement acquisition, we will consider it. But it’s not on the table right now for 2023.
Jeff Johnson: Understood. Last question. I think I asked you guys this every year on the fourth quarter call. And historically, we’ve tried to track kind of your penetration rates in the U.S. plastics and derm markets, things like that. With the success you’ve had on Empower, that’s getting harder to do. I think as the Company has matured here, I don’t know yet if you’re in the stage of replacing some systems. But when I look at that almost 8,000 placements cumulatively that you have in the U.S. now, any way to help us out on where you are, penetration in kind of your core plastic and derm offices? How much penetration room do you think is left in those markets over the next several years? Just help us think about kind of that core business on the AccuTite BodyTite, FaceTite, Morpheus8 and all that. How much more can that penetrate into certain offices here in the U.S.?
Moshe Mizrahy: I would defer this question to Shakil and maybe I’ll comment after.
Shakil Lakhani: Yes, certainly. So again, we’ve talked about this before, but we still have a very large runway in terms of what we’re looking at because we have so many different platforms. Not every platform has been put into each office. But as we continue to help our practitioners implement some of these devices into their practices and basically become successful with them, we have a lot of great traction in terms of returning customers, buying their second, third, fourth units, so on and so forth. So I still think in terms of penetration, we have a long ways to go, a lot of physicians out there. And then again, with Empower, I think we we’re going to start seeing some more traction in the core markets as we put more focus on it. And with the soft launch of Envision, transitioning from the soft launch to full launch, we’ll start seeing some good upside there.
Jeff Johnson: Shakil, can I push you on that? I mean just — sorry, but just a Shakil here on the call. Just — do you — would you put your penetration in core plastic and derm offices? Does it have a one handle on it? A two handle a three-handle, 10%, 15%, 20%, 25%? Are we pushing 30% yet? Just of the offices you could go into there, just help us ballpark kind of where you are.
