And you should expect a number of new centers opening in the fourth quarter, but the utilization is what surprised me. The utilization growth within the served centers in Europe continues to be impressive, which speaks to the performance of the platform.
Dan Brennan: And then specific to Investor Day, Joanne, which is coming up here on September 20 for us, I would expect to see what you’ve seen in past investor days. You’ll see the team give us a sense of what we think we can do with our financial goals over the next three years. So a formula, it’s worked pretty well for us in our past Investor Days and I would look for us to do the same here in September.
Joanne Wuensch: Thank you very much.
Operator: Our next question comes from Rick Wise with Stifel. Please go ahead.
Frederick Wise: Good morning, Mike. Hi, Dan. Maybe focusing on the excellent margin performance. Operating margins were particularly stand out and the divisional performance, I mean, MedSurg up 410 basis points, cardiovascular up 240 basis points. Help us understand maybe a little more detail the drivers. Is it volume, is it mix? And to what extent did price play a role? And I’m not quite sure I’m understanding your commentary, Dan, about second half margins as well? Thanks so much.
Dan Brennan: Sure. Let me try and put a finer point on that, Rick. So for the first half, we ended at 26.2% operating margin with a real strong 26.8% in the second quarter, which puts us in a good spot for our full year target, which is the 26.4%. Specific to Q2 and the 26.8%, for us, it’s always about achieving the overall operating margin goals. And I think history would show that we manage all lines of the P&L pretty well to accomplish that objective. So in any given period, you may see one area of the P&L might contribute more or less. But the ultimate goal is, obviously, to get to that bottom line. And then really specific to Q2, I’m really happy that we got to that 26.8% adjusted operating margin. It’s 160 basis points better than last year.
And we were also able to accelerate some key SG&A investments to ensure the success of some of those upcoming transformational launches that we have starting here, hopefully, this year with our Cryo launch. So for us, it’s always about all areas of the P&L can contribute to the overall operating margin story. Relative to first half, second half, the gross margin, which was a little north of 71% for the first half should be lower in the second half, should be more in line with where we were in the second half of last year, kind of in that 70.5% range for the second half. But the operating margin for the second half will get us — will be higher than it was in the first half and obviously get us to that 26% goal for the year. The reason for the gross margin being lower in the second half, as we’ve said, is the FX movements in 2022.
So as you go forward, I think lower gross margin in the second half, but higher operating margin in the second half to get to that 26.4%. And one little slight quarterly nuance is, I would expect to see a step down in Q3 relative to that 26.8% that we posted in Q2 and then a step up in Q4 to get to the overall number to get to 26.4% for the year. So hopefully, that gives you a little bit of flavor of how we were thinking about it in Q2 and what the second half would bring to get us to that 26.4% for the year.
