And I just want to come back to one comment I had before early on, as I responded to Jim Ricchiuti call, I meant to refer Q1 pre-ransomware information relative to Q2. So I just want to kind of clarify that point as well.
Operator: Our next question will come from Joe Quatrochi of Wells Fargo.
Joe Quatrochi : I wanted to understand the gross margin guidance or commentary for 1Q. Maybe if you could unpack that a little bit in terms of just like the moving parts there? Because I would have thought that, I guess, maybe it could have been a little bit better than that given Material Solutions should be a higher percentage of the total company revenue. And I believe that has a higher kind of corporate average gross margin. If you could just help us out there.
Seth Bagshaw: Yes, Joe, I’ll take this, it’s Seth. So in the fourth quarter, we talked about a little favorable impact favorable on the mix for the quarter. That’s why we’re above the high end of the guidance range. And then in the Q1 commentary, $1 billion, most of the impact on the margin is really volume-driven with a slight mix differential there as well. You’re absolutely right on the MSD side, those margins a little bit higher than our corporate average. But fundamentally, that $1 billion commentary has quite a bit of revenue in the Photonics Solutions division as well as with the vacuum solution division as well. So really, the Q1 commentary is primarily volume driven, a little bit more normalized mix.
Joe Quatrochi : Got it. And then just — is there any sort of like cash outlay related to the ransomware attack that we should be aware of, I guess, when you think about that kind of back to your estimating the net leverage?
John Lee: Yes, Joe, I appreciate the question, but we’re really not going to provide any details on the ransomware investigation. Certainly, we are hiring experts to help us recover and those are expenses. But in terms of cash outlay, I think there’s really no comment here.
Operator: Next question will come from Mark Miller of the Benchmark Company.
Mark Miller : I just was wondering between the ransomware issue and also the expected macro slowdown, can you discuss how the back — what happened with the backlog last quarter? And — are — does the backlog indicate it’s going to be a front end, back end or basically an even year in terms of sales?
John Lee: Yes, Mark, it’s John. I would say that, as I said earlier, the guidance we would have given prior to the ransomware of $1 billion, a lot of that is on the strength of the backlog that we have entering Q1. And so we can’t really predict what will happen after that for sure. But certainly, the strength of the backlog allows us to probably we probably would have outperformed many of our peers in Q1 if the ransomware event hadn’t happened.
Mark Miller : And the margin profile, what’s in the backlog, is that similar to what you’ve been seeing recently?
John Lee: Yes, I think there’s no change there, Mark. Same kind of customers. So no real change there on the margin profile for.
Operator: Our next question will come from Steve Barger of KeyBanc Capital Markets.
Steve Barger: You mentioned the 4Q Geode order, and I think a separate multiunit order. Can you talk about pipeline visibility into further orders from legacy ATC customers?
John Lee: Yes, Steve. I would say we were — we talked about the 4Q order. That was a multiunit order. That was — that was not with Atotech’s extra synergy, if you will. There was another order, which we did call out in Q1, which was a long-time Atotech customer that we really didn’t have a relationship with. So that was clearly a synergy. That happened a lot sooner than I was expecting, Steve, so I’ll take it for sure. But we have a long pipeline that’s reviewed with me every month of other potential synergy opportunities going both ways, areas where ESB could help Atotech and vice versa. And these are — you got to look at these as multiyear efforts. You talk to the customer, you get qualified, then they ramp — and that’s the kind of time frame that you should think about. And every one while you get a bluebird like we talked about in the call.
