Fabrizio Freda: Yes. In terms of the visibility to the guidance, obviously, Tracey and I have given you this guidance, we believe that that’s the — in this moment, is the project of the business. So we have visibility and clarity in terms of our plans. I want, however, to underline that the volatility externally remain very, very high, particularly the volatility in the Chinese market, the volatility in the transition in the TR market from the Daigou to the regular travelers, the transition to the groups traveling. They’ve just been announced in turn are low. The transition, obviously, on the judgment of what the economy recovery will be globally, particularly in the post-pandemic environment, particularly how the economy in China will evolve.
So all these external elements are part, obviously our assumptions of these external elements are part of our guidance. And in the press release, we made an effort to explain all our assumptions in the guidance. And then in terms of our internal plans and in term of the continued leveraging our current trends on the things which are working, we are pretty confident. The real question is, how fast we will be fixing the issues? But the strengths of the current trends of what is working are frankly more easy to predict and to forecast. So net, we believe in our guidance, but will be obviously volatility to be managed in the context of the future, and you will see as much as we will see the evolution in these areas. And then Tracey?
Tracey Travis: Yes, Dara. So I mean, certainly, we are encouraged by some of the signs we see — recent signs that we see in terms of recovery. The return of travelers. We are, as Fabrizio mentioned, in terms of our fiscal 2024, taking actions to pretty dramatically pull back on some of our production so that we can get our inventory levels in line. And that will improve our margin. And I talked about in my prepared remarks that we’re expecting gross margin recovery from some of those actions. As the situation normalizes and more travelers come back to travel retail, we are very confident in the strategy that we’ve had previously. Pre-pandemic, we were well on our way to those 20% operating margins. We don’t see any reason why, once things normalize, that we can’t get back to those 20% margins.
Timing, I can’t give you. I have said in our prepared remarks that we certainly, over the next few years, have plans to accelerate the margin progression well above our historical guidance of 50 basis points of margin improvement, and that does recommend — that does represent a catch-up in margin progression and again, the strategies that we have to do that. But we are incredibly focused as an organization on returning to the margins that are more representative of our growth and our growth potential. I will also underscore the fact that we will not do that at the expense — at the short-term expense of hurting our brands or hurting our markets that are in recovery, so it is a balancing act for us in terms of making sure we’re making the right surgical investments that support not only the recovery and the markets that are further along in recovery, and as well as the long-term investments that we need to continue our growth algorithm of 6% to 8% top line growth and margin expansion.
So again, I can’t — I know that’s not the answer you’re looking for in terms of you want a specific year and a specific number. And hopefully, we will be able to give that to you when we get a bit more clarity on more stabilization in the environment. But right now, you have the commitment of our entire organization that we recognize and have plans to accelerate our margin progression well beyond our historical levels in order to try to catch up.
Operator: Our next question comes from Chris Carey from Wells Fargo Securities. Please go ahead.
Chris Carey: Hi. Good morning, everyone.
Fabrizio Freda: Good morning.
Chris Carey: So just one quick follow-up, and then a kind of a geographic question. Just on the China travel retail inventory dynamic. Fabrizio, you had mentioned that there’s going to be greater collaboration between your teams in mainland and China travel retail. What’s your confidence that some of the things that you may need to do to invest behind clearing your inventory won’t impact brand equities and brand health? And I’m basically just trying to get a sense of the types of actions that you might be taking to clear inventory of — consumption trends are as volatile as you say? And then just the geographic question would be, you had mentioned quite impressive growth rates in India, but also some underperformance in North America. Just over the next 12 months or longer, how do you think about this non-Asia market progressing, with perhaps to touch on what you see in some of these newer faster-growth markets? Thanks so much.
