Michael Hurlston: Yeah. Perfect. Perfect compare, Hadi.
Hadi Orabi: Got it. Thanks a lot, Michael.
Operator: Thank you. Please hold for our next question. Our next question comes from Gary Mobley of Wells Fargo.
Gary Mobley: Hey, guys. Thanks for taking my question. Dean, in your earlier comments, you mentioned that you made shift to the actual customer end demand by, I believe you said the fourth calendar quarter of 2024. Did you mean the fourth calendar — fourth of fiscal year 2024, because I think that’s what you previously communicated? And I just want to confirm, what’s normal when you actually begin to ship to actual customer end demand? Is that roughly in the ballpark of $325 million, $330 million in revenue?
Dean Butler: Yeah. Gary, I think you have a right. I think it’s yet to be seen exactly what that trajectory looks like and what quarter marks that you’ll return to sort of full, normal end consumption. We’re already starting to see we’re getting pretty darn close on the PC side and the Mobile side. It looks like a lot of that inventory is sort of now work through. PCs specifically looks like that’s probably behind us. Mobile still sort of a little bit volatile, bumping around a bit. IoT, though, is going to take a few more quarters, as you indicate, Gary, and like we talked about last quarter on — on last quarters call. So I think what you’ll see is inventory burn, right for the next couple of quarters somewhere around the current range. And then you’ll start to see as inventory sort of gets depleted, topline start moving back as you approach end of through — end demand over the subsequent quarters.
Gary Mobley: Okay. Thanks, Dean. With respect to gross margin. So your guidance implies that you’re going to run about 350 basis points below your long-term view and I get the mix within the mix headwind in IoT. But is there also a factor playing here in that, maybe it’s a little bit more difficult to pass along price inflation from your foundry partners. And in a world where your enterprise IoT business bounces back to its previous level? Do you still feel see 57% as a long-term gross margin target?
Michael Hurlston: Yeah. And I don’t even think it’s that necessarily far out. Where we are today, midpoint of the guide, actually, I think, is the bottom of the gross margin. It — this incorporates probably the worst amount of mix that we’ve been confronted with, specifically these enterprise sort of facing customers, which come with a little bit better gross margin for the company. We will actually move back up toward that long-term rate of 37% gross margin, really as we get through this inventory burn and as the mix sort of writes itself. There’s actually an interesting chart, if you want to take a look at it, Gary, in our supplemental slides…
Dean Butler: Slides.
Michael Hurlston: … posted on the investor website, that actually gives a history of sort of how gross margins do, in fact track with the product mix of the company. And therefore, I’m not really concerned about gross margins and sort of their return as IoT mix returns.
Gary Mobley: Okay. And as far as offsetting higher founder quotes, I’ve imagined, that’s not much of an issue any more or less of an issue, but maybe you can just talk about that, that ability to pass along price increases?
Michael Hurlston: Yeah. I mean, it’s lesser, Gary. And I think that sort of coming from our historic 60% run rate to 57% contemplates that. So I agree with what you said. We were running I think for the year, Dean gave the number of 60%, as we think about long-term, 57% contemplates input prices changing and it contemplates a much less ability. We do have pricing power, as I mentioned to a previous questioner, but I think our ability to pass on a significant majority of those increases, those days have gone.
Gary Mobley: Thanks, guys. Appreciate it.
Michael Hurlston: Yeah. Thanks, Gary.
Operator: Thank you. Please hold for our next question. Our next question comes from Martin Yang of OpCo.
Martin Yang: Hi. Good afternoon. Thank you for taking the question. My question is on a sign of recovery and the timing for recovery across different sectors. Definitely understand the PC dynamic where it could stay in bottom for longer time. Do you see mobile recovering from the current bottom are normalized inventory much faster than the other two?
