Bracken Darrell: That’s right.
Paul Chung : Okay. And then just a follow-up on OpEx, pretty material cuts. Where do you kind of see it normalizing? I assume more aggressive cuts maybe in the near term. Do we get back to that 25% of sales, or where are you seeing further opportunities to kind of right-size cost while top line is challenged? Thank you.
Nate Olmstead: Paul on that — real quick on that one, I think on a full year basis, you’ll probably see the OpEx be around 25%, which is where it has been. And come back to your earlier comment on gross margin, those things go hand-in-hand. So if we get good confidence in line of sight to gross margin expansion that creates more room for investment if we see good returns available to us to drive growth. So that strategy remains unchanged. Moving away from promotion-driven strategy to one that’s more full driven through increased marketing investments. Certainly, we’re committed to the investment in product innovation, and we think that, that’s key. Bracken, something you’d like to add to that?
Bracken Darrell: No, you got everything. Perfect.
Paul Chung : Both thank you.
Bracken Darrell: Thanks, Paul.
Nate Olmstead: Thanks.
Nate Melihercik: Thanks, Paul. Next up from Morgan Stanley, Erik Woodring. Good morning, Erik.
Erik Woodring: Hey, guys. Good morning. Thank you for taking my questions. I guess, maybe, first, if we take a step back and think about kind of your four major end markets, where do you think some of those are furthest along in terms of kind of facing the brunt of the challenges the world faces today? Meaning, we saw PCs correct earlier perhaps than consumer electronics, which perhaps is corrected earlier than enterprise. And so, just curious where you think you could perhaps see maybe a rebound first relative to other of your end markets? And then I have a follow-up.
Bracken Darrell: Well, that is a really good question. I’m going to hesitate to give you a definitive answer, but I’ll give you kind of a feel. I think it could be that we see it first in Gaming. But it kind of depends, because the Gaming market has also seemed pretty sensitive to promotion this quarter. So that made me a little less — it makes me a little more tentative to say that. I think the enterprise spending kind of comes in later and starts out later. And, I mean, it hangs in longer and then comes out a little later when you go into a softening of the economy, that’s generally the view. And then our personal workspace business, its just somewhere in between. I reserve the right to completely reverse though, because to be honest, the visibility is not what we’d like. It’s really hard for us to see. But I think, the good news on all three is I really feel good about the long term. I do think those secular trends are super solid.
Erik Woodring: Okay. No, that’s helpful. And then, just because you mentioned it, Bracken, I’d love to just maybe get some color from you guys on, maybe, why visibility is different than historically? Is it different purchasing patterns? I know you mentioned the purchasing during promotional-heavy periods in the December quarter. But maybe just taking a step back, are enterprises purchasing at a different cadence than they used to or consumer preferences for purchasing changing? Would just love some more color on just maybe how that visibility has changed and/or when it could improve, and why it might improve? And that’s it for me. Thank you, so much.
Bracken Darrell: Absolutely. Thanks, Erik. I’ll just put those two pieces. On the consumer side, I think you said it all. The consumer demand has been weaker. And in this quarter, we saw it really concentrated in promotion. Now, I hope that — Nate was saying, we’re assuming it could be more promotional as we go through the rest of the year. I hope that that starts to fade at some point soon, because normally, promotion is heaviest during a holiday quarter. Now we may see that in Q4, but we’ll see. But we’re prepared for that, but I hope that it will start to get better from a promotional standpoint. And that is not — that would not be normal to have heavy promotion go on all the way through outside the holiday quarters all the way through the year.
So we’ll see. On the B2B side, it really just comes down to — I think, there’s such a — turmoil may be too strong a term, but there’s a lot of settling that’s happening. And I can’t remember since I’ve been in this job anyway when we’ve had the kind of layoff announcements that we’ve had in just the last 90 days. I think there’s just a lot of construction of spending happening, and I think that automatically drops your visibility. What you think you have in visibility, suddenly, it’s — seems like it’s been pushed out a quarter or two or something. So I think that’s reduced it. I think I like the fact that it’s actually a sharp reduction right now from a business standpoint, because I think that means it might be a faster exit back out again.
And maybe that’s my optimism booking its head up. But I would rather see that and see people kind of gradually easing into something. So I’m sort of feeling good that there’s all this discussion around construction. I don’t feel good about our business, don’t get me wrong, but I feel good about the restriction. I think that suggests that people are making the right steps, and then the clarity will come as we go into next year.
Nate Olmstead: If I could add just a little bit to that, Erik.
Erik Woodring: Yeah. Please, please. Yeah .Please, of course,.
