Operator: Our next question is from Nam Kim with Arete Research.
Nam Kim: I have 2 questions. One, I think the market shift to DDR5 seems happening much faster than expected. Can you share your latest view on DDR5 crossover timing? And then second question, also demand for DDR5 Gen 2 is picking up recently. And also you mentioned the PMIC qualification on DDR5 Gen 2. Can you give us some color on how you can compare with the existing big PMIC suppliers such as TI, Samsung, MPS, what’s your selling point really here versus others?
Luc Seraphin: Thank you for your questions. So we still see the crossover in the market to happen in the first half of 2024 for servers. We do see a slow burn of DDR4 inventory at our customer side, but it’s still a slow burn. Obviously, as far as we are concerned, our shipments of DDR5 compared to DDR4 into the market has passed that crossover point, as you noticed in our Q2 and Q3 results, but the cost of the point in the market is going to happen in the first half of 2024. That’s still our view DDR5 Gen 2 is gaining some momentum. We are shipping some volumes to our customers as they buy them. We will go through the same process and cadence as with other generations. People are going to prebuild systems, settle those previous systems to the market.
we’re going to go through the standard qualification process. And we still believe Gen 2 will start in earnest in the second half of 2024. That’s for Gen 2. With respect to your question regarding PMIC, PMIC has been a challenge for the ecosystem in general in that first generation. This is — this has explained some of the hiccups of the ramp of DDR5. We have built a team for PMIC some months ago. and have worked on a solution. We have sampled the solutions to our customers. And the feedback from our customers is very positive at this point in time. So I think — the initial feedback is about the quality and robustness of the solution. Now of course, we have to go through the standard process of validating that solution into the market. And as I said earlier in the prepared remarks, we expect to hit the market towards the second half of 2024 with that product, but we’re actively working with customers as we speak.
Operator: Our next question is from Sidney Ho with Deutsche Bank.
Sidney Ho: Great. It sounds like the timing of the DDR4 inventory digestion hasn’t really changed much from a quarter ago. What gives you that confidence that timing is not moving out? Any tangible data points can you can share with us? And a follow-up to that is if you look at 2024, not looking for guidance here, but what should we think about the split between DDR4 and DDR5 in product revenue for the entire year?
Desmond Lynch: Sidney, thanks for your question. With regards to DDR4 inventory at our customers that did come down in the September quarter, which is the second quarter in a row. We are encouraged to see that all customers saw an inventory decline in the September quarter versus the June quarter. from there. And really from our discussions with customers, we do expect the inventory digestion to be substantially complete by year-end. It really is a sort of a fluid situation just now and we’re really working with the customers on the timing of the DDR4 reordering pattern, which we expect to take place across Q1 and Q2 next year. But our visibility is limited with regards to this just now, but we do expect that DDR4 will continue to have a long tail of demand from there.
