Russell Low: Yes. Tom, just to kind of add to that, so as we talked about, there is a transition from 150-millimeter to 200-millimeter, there is also a transition going from, say, planar to trench. And you will see that this year, as people have gone from kind of like pilot lines I think to high volume, we are seeing that all of the Purion Power product portfolio is being ordered in pretty much equal revenue. So, we have got the Purion M, the Purion XE, the Purion H200, and they are basically equal this year. So, you are – and then clearly, the Purion XE is very much needed for the trench applications, which are the kind of more advanced devices.
Tom Diffely: Great. Thank you for your time this morning.
Russell Low: Thanks Tom.
Operator: Thank you very much. [Operator Instructions] Our next question comes from Duksan Jang of Bank of America Securities. Your line is open.
Duksan Jang: Hi. Good morning. Thank you for taking the question. So, I want to go back to the silicon carbide business. I understand it’s well diversified. It’s kind of a global customer base. You have strong backlogs, but EV weaknesses have been pretty well known. So, I am wondering if you are seeing any signs of stabilizing demand here? And how do we know if these backlogs were not part of a potential double ordering? Thank you.
Doug Lawson: Okay. So, I think if we look at our demand relative to silicon carbide and silicon in the power side, as I have said before, it continues to grow. Our customer base needs to continue to innovate to enable the automakers to be able to do the EV programs they want to do. While there has been some delays, especially in the U.S., it’s well publicized. That’s not all – that’s not necessarily the case globally. And so we see still quite a bit of activity in China, even though some of the percentage growth rate may have slowed, it’s still very high. And the car companies there are continuing to innovate even with new battery technology. So, we expect, Duksan, to see continued growth relative to that device market as customers continue to innovate and get the cost down. So anyway, that’s how we see it.
Duksan Jang: Got it. And then a follow-up to an earlier DRAM question. A lot of your WFE peers have had incremental shipments to China this quarter. They have also seen kind of broader strength in DRAM overall. So, I just want to understand why there is a difference between their business and Axcelis? Do you not have any exposure to these customers at all?
Doug Lawson: Yes. So, in the case of this quarter, that’s very much tied to a specific customer that we do have less exposure to. We do see future opportunities for DRAM in China, and we see growth in the more traditional DRAM base as we get into next year. So, that is the difference between some of our peers. They have less exposure to silicon carbide. And that’s pushed our exposure or our China business up to 35%. The mature markets where we are all – we all participate, those have been down a little bit for the general mature, and that’s brought our – this quarter’s exposure down from a high last year – last quarter of 50% down to 35%.
Duksan Jang: Thank you.
Operator: Thank you. [Operator Instructions] Next question comes from David Duley of Steelhead Securities. David, your line is open.
David Duley: Yes, just a couple of follow-ups for me. Could you update us on your progress in the Japanese market and the advanced foundry logic business? And then also just could you just talk a little bit about – I think you have mentioned how the cost curve in silicon carbide is coming down. That should drive adoption in other markets. Could you just perhaps give some commentary about what other markets might be starting to adopt silicon carbide?
Russell Low: Yes. Hi Dave, it’s Russell. So, regarding Japan, we are actually quite pleased with the progress we are making in Japan. So, really for us, it’s about the power market in Japan and also the image sensor market in Japan, which we have very specialized tools that have huge value that it’s a natural place for us to want to go. And we are getting some traction. So, we have just recently shipped an EXE silicon carbide tool into Japan. We have got multiple other power series products going into Japan, and we are seeing a lot of demand for those particular power tools, as I have said, because they are highly differentiated, and we are definitely seen as a leader of silicon carbide power.
Doug Lawson: And as far as the advanced logic market goes, Dave, that – I guess we would describe that as similar to Japan. We are patiently working on penetration. In the case of advanced logic, the path is through R&D. And so we have a Purion Dragon in evaluation, and then as an evaluation system that’s at an advanced logic customer. That same customer has Purion Hs in production in advanced logic. And then recently, we announced shipment of a Purion Dragon revenue tool to an advanced research center that’s focused on advanced logic transistor definition and process technology that feeds all of the customers in this area. So, the path into advanced logic is one of patience and penetration through R&D. As far as your silicon carbide question in other markets beyond automotive, there is lots of opportunity.
Silicon carbide represents some significant performance advantages over silicon in terms of switching speeds, cleanliness, switching heat dissipation, all of those kinds of things, weight. And so automotive is a volume application, and that volume application will bring down the overall cost of materials and ultimately, the cost of the components. Beyond that market, there are several industrial markets, the data center market, which ties directly to AI could be a big beneficiary over time. The clean energy and smart grid, there is a lot of applications there, as well as in some communications applications. So, the key is getting the cost down. And I think that’s something that’s really important to understand is that we have kind of – we are kind of over a little bit of a hill in terms of people now have the capacity in place to make the substrates, get the yields up, get the cost down, and that will open up the other markets.
David Duley: Thank you.
Operator: Thank you. This concludes the question-and-answer session. I would now like to turn it back to Doug Lawson, who will make a few closing remarks.
Doug Lawson: Thank you for joining us today. We have a very busy investor calendar in the coming months. We will be at the D.A. Davidson Tech Summit on November 16th in New York City, the 7th Annual Wells Fargo TMT Summit on November 28th in Los Angeles, the New York City Summit on December 12th and the 7th Annual Needham TMT Summit on January 17th in New York City. We hope to see you at one of these events and for you to have the opportunity to meet Jamie in person. Thank you.
Operator: Thank you for your participation in today’s conference. This concludes today’s program. You may now disconnect.
