Serge Saxonov: So biopharma has been – as you know, biopharma has been a relatively stable fraction of our business in the neighborhood of 20% or so. We have seen some of just like everywhere else, there has been a tightening of budgets in biopharma recently. Again, relatively attenuated effect on our overall business just because it is a small fraction of the business. So we’ll have to see how that plays out in the future. But as far as Connect is concerned, it has its use cases. But we’ve seen sort of the need for automation out there, especially with pharma customers across a range of different applications and across different use cases. And with that in mind, we formed the partnership with Beckman Coulter. We provide a wide range of automation services and this should give us the means of scaling automation solutions to many, many thousands suppliers that use Beckman Coulter and to many others that can adopt it gradually.
Kyle Mikson: Okay, perfect. Thanks for the time guys.
Operator: Thank you for your question. Our next question comes from the line of Dan Brennan with TD Cowen. Your line is live.
Dan Brennan: Great, thank you. Thanks for the questions. Maybe just the first one just on single cell. I think the prior guide was for high single-digit growth for the year. I’m just wondering kind of what that is now? I know, Justin, you gave some math earlier. And Serge, I believe in the prepared remarks, you discussed this more balanced growth as you reallocate resources? Just kind of wondering what that would imply as we look ahead for single cell?
Justin McAnear: Yeah, Dan, I’ll start with talking about single cell. As far as China goes, maybe I’ll start there. On the last call, we shared that we thought that the back half of this year would be roughly flat to Q2. And in Q3, we saw that to be the case. But we are seeing lower demand there. And although we’ve been working at reducing the inventory levels, they still are higher, and we plan to reduce them even more in this next quarter. So, we’re projecting that there’s going to be a decline from Q3 to Q4 there. And then like I said before, for EMEA and AMR right now at the midpoint of the guide, we’re expecting similar seasonality to what we’ve seen in the past. And then, overall, for Chromium growth year-over-year, that’s a single-digit growth rate when you put all of those together, yeah mid-single digits.
Dan Brennan: Great. And then – go ahead, go ahead.
Justin McAnear: So
Dan Brennan: Oh, go ahead. Sorry.
Serge Saxonov: No, I was just going to say kind of taking up what I said earlier in my prepared remarks, we strongly believe in single cell growth and the potential of the Chromium franchise going forward. You’re right, we’re going to be balancing our focus on our resources to put more emphasis relatively speaking, on Chromium. So that should yield results. And we also have a really, really exciting product roadmap that will further take the franchise to the next level and drive more growth.
Dan Brennan: Great. And then maybe just on Spatial. It’s hard. I mean, the feedback we’ve gotten has been really positive, just about the market opportunity and the ultimate size of the market, but it’s always hard to project out into the future and see this kind of growth keep going up and up on placements. So I’m just wondering from what you see today, could you just give us some sense of like the level of like placement, not necessarily a number, but like is it fair to think placements can continue to grow certainly in like ‘24 and ‘25, without putting a number on it like grow year-over-year. Obviously, you’re on the steep ramp now, but just to kind of help us think about how many labs would actually look to adopt Spatial in the future? They’re not cheap boxes, but they are offering some really unique capabilities. Thank you.
Serge Saxonov: So, Dan, I would think in terms of maybe two kind of variables. As I look at this. One is just the trajectory in the moment, which is kind of like you suggested up and to the right, which gives us a good – some amount of confidence going forward. And then I also think in terms of the potential market and the breadth of applications and experiments that people are thinking about. And that also, at this stage, looks very healthy and very robust, which also makes us, I think, bullishly about next year and beyond.
Dan Brennan: Great. Thanks, Serge.
Operator: Thank you for your question. Our next question is from the line of Luke Sergott with Barclays. Your line is live.
Salem Salem: This is Salem on for Luke. Thanks for the questions. Just wanted to start off with Chromium in China. You guys outlined or mentioned some struggles there. That’s certainly not exclusive to 10x. We’ve been hearing that all earnings season. But I just wanted some more color how much exposure in China is kind of biopharma-related, any more color there? And on timing, what do you think is kind of a realistic idea of when those issues will resolve themselves when you’re working with your service providers?
Justin McAnear: Yes, this is Justin. I’ll take that one. As far as our exposure in China, we mostly sell to the academic market, our biopharma exposure. They’re smaller than other companies that we’ve heard from. As far as the demand looking forward, I mentioned earlier that we’re looking at reducing inventory going from Q3 to Q4. We sell through distributors who sell through service providers there, they typically hold inventory. We’ve been working more recently to get closer with those service providers to better forecast the demand and better help them manage the inventory levels and smooth the ordering patterns out going forward. So, I hesitate to call a bottom in what we’re seeing in China. But our expectation in the decline from Q3 to Q4 is mostly driven from the demand signal that we’re seeing with that inventory reduction layered on top of it.
Salem Salem: Great, that’s helpful. Thank you. And then on prioritizing the Xenium launch, it seems like that was kind of at the expense of Chromium. Could you provide a little more color there? Did that come from maybe incentives from the sales force towards placing boxes or any more color there? And then as you kind of balance back out and start to prioritize the Chromium again, what are kind of the risks to Xenium? And then kind of lastly on Xenium orders, how did those kind of trend through the quarter? And did those kind of outpace revenues? And that’s it for me. Thank you.
Serge Saxonov: Yeah. So in terms of the focus on Chromium, so on the commercial – sorry, on Xenium. So on the commercial side, there’s – it’s a number of things. First of all, most directly as their incentives to drive Xenium placements that certainly can direct it ourselves into to spend more attention there. We also – we have careful tracking now of how our commercial team where they spend the time and how they allocate their attention. And we were certainly encouraging them to make sure that the Xenium takes first priority. Also in terms of the resources, in terms of marketing resources, we put a lot of that on Xenium as well. And now going forward, we’re kind of rebalancing these things, both in terms of the resources in terms of attention in terms of incentives.
