So for a number of tools, we’re still supply constrained. So there you have to determine where is the tool going. And that will only be known once you have a complete picture of all the demand on a global basis. So that’s why it’s too early to make specific predictions is kind of going to be a bit up, is it going to be down. But one thing is for sure, China will remain very strong in our numbers also in 2024.
Sara Russo: Great. That’s really helpful. And maybe as a follow-up, I understand that because in 2024, you’re not expected to be capacity constrained, especially on the EUV side necessarily. Are you — if you’re going to be prebuilding, are you anticipating incurring additional costs around potentially holding those machines for any period of time? Or are you expecting those orders to materialize closer to when the machines will be ready? Or are there any other — is that sort of a drag on margins for 2024 that you’re factoring in?
Roger Dassen: No, I wouldn’t say that the prebuilding is going to be a drag on the gross margin because as a matter of fact, what you’re prebuilding this year, most of the material that you have for the prebuilding is already in, right? So I think from that vantage point, I think there is no big impact on either the cash flow or the gross margin. Of course, the question is you prebuild but then back to Peter’s point. And Peter said what the — in response to the question of the puts and takes from Medi on this year. Of course, we currently look at prebuild. It could be that some of those are pulled into 2024. So I would look at a prebuild more as an opportunity than as a threat to the gross margin.
Operator: And your next question comes from the line of Francois Bouvignies from UBS.
Francois-Xavier Bouvignies: So the first question I wanted to come back a bit to Stephen question on 2025. And you said, Peter, that you thought low end was conservative for 2025. It was 3 months ago when you had the €5 million EUV bookings. And as you know very well, analysts, we are very good like extrapolating trends. So we were very skeptical about these targets of the €500 million of EUV bookings. Now you come this quarter with indeed this huge booking number in terms of EUV which basically puts you in a much better position into 2025. And indeed, it’s clearly supporting your comments 3 months ago. But I would like to know this Q4 orders, we know that it’s very lumpy. It’s always moving from 1 quarter to another very significantly.
To what extent Q4 orders is a pull-in effect? In other words, do you see still a healthy EUV activities? I don’t expect the €5.6 billion every quarter. I’m not saying that. But should we — do you see already in Q1, the activity of EUV fairly healthy and in Q2? Or should we just expect Q4 as an exceptional and it will take a significant post? That’s my first question.
Peter Wennink: I think generally €9.2 billion is pretty exceptional because it was the highest order intake forever. So, that’s — you don’t — you’re right, we would not expect to top that every quarter. Now I think yes, the analysts are very good and extrapolating trends. But I have to warn you that trends in EUV order intake in our business with a few customers might be a very tricky thing to do to actually try to accept it which is actually proven by the order intake in Q3 and in Q4. It’s lumpy, as you said. And it has to do with a couple of things. I mean, in Q4, also clearly, the — as a part of the EV order intake had to do with the obvious technology transitions needed in the [indiscernible] space to support AI. That will continue.
But I think all in all, in 2025, when we look at a recovery of these — of the cycle and have a full year recovery. On top of that, the new fabs. Yes, we need to see a healthy order intake for EUV in the first half of this year of 2024. Just like I said earlier, we have 12 to 18 months or a lead time, so that needs to happen. And I think this is what we need to see. And then, I don’t think that Q4 — yes, it was exceptionally high. It was a very good order intake. But for the good reasons. It’s basically moving the EV orders now into the 2025 delivery time frame, orders that we’re now getting is not for 2024, it’s for 2025. So that will have to continue and in my mind, will continue in the first half of 2024. So yes, may not be €9.2 billion again in Q1 2024.
But yes, in the first half, we need to see healthy further order intake and to support our 2025 view. Absolutely.
Francois-Xavier Bouvignies: Great. And maybe a follow-up to the Memory migration. I mean, this quarter, what is really outstanding is the split of memory within EUV which is like 50%, I mean, roughly which is very high compared to history. So to support exactly the migration you are describing. Now we know that the memory market is — has low utilization rate right now is recovering but still fairly low. So I would assume — I mean, to what extent, given the loitization, they can migrate more, they have it’s many off-line tools so they can migrate, spend a lot of time on it. And to which extent agitation grows, they will put the brakes on the migration? Do you see what I mean? I mean — in other words, should we expect the memory as investing significantly right now but then will slow down as the industry comes back?
