Nate Olmstead: Yeah. No, I think €“ listen, I think the thing that we probably all learned over the last few years with COVID is it’s a little hard to predict. So I’ve made some assumptions that, there could be some disruptions on supply in the quarter. We’re working hard on those things. We may have opportunities through expedited freight, and so forth to recover some of that. But still a fluid situation, Asiya. So there’s not really a specific number, I would say, we called out. We just tried to factor in a range of possibilities in the outlook. And so that was one of the things that caused us to adjust the full year outlook.
Bracken Darrell: Yeah, I would just add to that. I think we’re in the €“ we’re probably in the middle of the most uncertain period right now, because it’s €“ the New Year just started. All of our factory people went back to their homes. And it’s anybody’s guess on what that’s going to do to COVID rates, and whether we’ll have a problem getting people back or some of our suppliers. So we’re in this kind of uncertain period now. But I think, it will settle out over the next few months. It’s not an unlimited risk. So we bracketed it pretty well, I think, in our outlook.
Nate Olmstead: I think the other thing that we’ve done certainly over the last couple of years through investment has been increasing the amount of automation in the factory. So, we can’t fully offset the risk of labor disruptions and things like that. But we have improved the company’s ability to do that versus a couple of years ago by driving up that automation in the factory, which has somewhat reduced the reliance on labor, but still something that we’ve got to really manage tightly.
Asiya Merchant: Great. And then just in terms of growth outlook beyond the March quarter, you guys obviously have a target model out there. Any indication on when we should expect that growth? Are we at a point where post the March quarter, we can return to kind of the growth rates that you guys have outlined just given the macro trends that you’re so confident on will continue?
Bracken Darrell: Certainly, we’re planning Analyst and Investor Day. We’ll have the date out there shortly. I think, it’s too early for us to tell you what next year is going to look like and €“ but hopefully, we’ll have a clear picture of that when we come into March. I don’t think €“ I can’t imagine that, we’re going to see a snapback in the macroeconomic picture in a quarter. So I wouldn’t expect it to, our fiscal year to end and then things suddenly get better. But I think €“ I’m pretty optimistic about somewhere out there in the next €“ over the next year or so that you’ll see the market come back, but I think everybody on this call has an opinion on how long this is going to last.
Asiya Merchant: Okay. Thank you.
Bracken Darrell: Thank you.
Nate Olmstead: Thanks, Asiya.
Nate Melihercik: Great. Next up will be Paul Chung from JPMorgan. Good morning, Paul.
Bracken Darrell: Hello, Paul.
Nate Olmstead: Hey, Paul.
Paul Chung : Thanks for taking my questions. Just on gross margins, as we kind of think about a couple of quarters down the line, how do we think about pricing increases you’ve done kind of lapping some FX headwinds, lapping some component inflation and lower shipping costs. Can we rebound comfortably into your kind of target of 39% to 44% in a couple of quarters?
Nate Olmstead: I’ll go ahead and take that one, Bracken. Yes, I mean, Paul, this quarter, we had eight points of headwinds year-over-year, very similar factors in the sense that we had currency was the largest. We also did have some headwind this quarter from the increased promotional mix, and then we also had the inflation. As I mentioned last quarter, I mean, I think we feel good about some of the trends on the inflation side, start to see some of the costs come down. Ocean freight, we continue to make some progress on the rates there. And currency looks a little bit more favorable than it did last quarter. So good trends, but we didn’t really see any of that really flow through yet this quarter. And I think next quarter, I really don’t expect to see a lot of that favorability yet.
It takes a little bit of time with the inventory being a little bit higher. We’ve got to work that down to start seeing some of those benefits come through as well. But yes, I think into next year, I think some of these tailwinds could probably become — excuse me, some of these headwinds could probably become tailwinds. I think I misspoke earlier. Those are obviously headwinds. Some of those headwinds could become tailwinds. And I think in terms of the pricing, I think it’s good that we took action early this year to increase prices across a number of categories. That’s helped offset some of these pressures. And we’ll see with the promo environment, what kind of promo environment unfolds over the next few quarters and whether we can hold those or not.
So lots of moving pieces, Paul. But I do think that we’ve been absorbing a lot of those headwinds this year, and I do expect some of those to begin to reverse into next year.
Bracken Darrell: Maybe, Paul, I’ll add one more piece of perspective. I think the thing that makes me feel the best about this year is the incredible amount of headwind we’re facing from a gross margin standpoint. Exactly when that reverses is a little unclear. I mean clearly, currency is on its way now. We’re not seeing it yet, but it’s caught on hedges and natural hedges and technical hedges, et cetera. But I’m super excited that we have 800 basis points of a headwind because that’s going to come back out. Again, we’re not going to see 800 basis points of improvement. But getting out of range again, I would sure hope we do it next year.
Paul Chung : So by next year, you mean next fiscal year, I assume? So maybe by 2Q?
