Michael Sullivan: Thanks, Krish.
Krish Sankar: Great. Thank you, Gary. Thank you.
Operator: Thank you. Our next question comes from the line of Toshiya Hari of Goldman Sachs.
Toshiya Hari: Hi. Good afternoon, and thank you so much for taking the question. I had a follow-up on your ICAPS business, maybe for Brice. So, how big was ICAPS as a percentage of your business in the July quarter? Where do you see that going in the second half of the calendar year? And maybe more importantly, yourself and Gary talked about sustainability in the business. I think the rationale for China makes a ton of sense. How are you thinking about the U.S., Europe and Japan, where your customers, yes, they’re strategic, but they also care about near-term profitability and returns. With some of the end markets slowing, is there fear that the non-China business within ICAPS could slow going forward? Thank you.
Brice Hill: Okay. Thanks, Toshiya. Good afternoon. On the ICAPS, we haven’t articulated exactly how big it is. What we’ve said is, this year, it’s our largest market. It grew very strongly last year. It’s growing strongly again this year. And we’ve said, over the longer term, as you think about the business, it’s probably a third ICAPS, a third leading logic, and a third memory. And that’s about as much. But you can get a feel for it. As we said all year, the ICAPS business growth has been strong enough to offset weakness in NAND and leading logic. So those — that will let you probably get a ballpark. On the regionalization, we do think that regionalization leads to a little bit more spending, globally for ICAPS. But we also look and see whether that’s a sustainable trend from our perspective.
We look at the underlying businesses and the growth rates of all the device types that are being invested, whether it’s China or whether it’s the different markets across the world. And we rationalize that and we think all of the investment that’s being made is consistent with the growth rates of those underlying devices and market. So 6%, 7%, 8%, 9% CAGRs for the different device types that fall into that, like, computer vision, analog, power chips, those sorts of markets. And then, on the last piece. So…
Michael Sullivan: Different geos and profitability.
Gary Dickerson: Yes. One thing I would say on the — Toshiya, this is Gary. Relative to regionalization of the supply, one of the things that is extremely important is some of those ICAPS segments are tied to very large vertical markets in those different regions. So, having a secure supply chain is something that is a big focus for every country. There are hundreds of billions of dollars of incentives there for supporting those different ICAPS markets. So that’s another thing that certainly we’re seeing. And the last thing I’d say is relative to opportunities, the — not only is it systems, but as companies are moving into new locations, that’s a really great opportunity for our Service business, because there is no service infrastructure set up for those companies moving into new regions. And that certainly will help us. We’re on track for the low-double-digit growth in our Service business, but the opportunity is supported by this regionalization.
Brice Hill: Good. And, Toshiya, yeah, I forgot the last piece of your question was on the business — the health of the business today and whether customers are lowering starts or changing their plans. And that certainly happens in the environment. We’ve seen it, but I would just remind you, the way people are doing equipment investments, it’s a two-, three-, four-year planning horizon. So they’re really making investments for what the demand function they see that far out in time, and that makes their purchasing a little bit more stable than whatever the current demand function is.
