Chuck Robbins: Yes. Thanks, Ittai. I’ll give you a little color and then I’ll let Scott comment again, too. A lot of this is — we’ve made this transition to — virtually our entire enterprise networking portfolio now is a subscription model. And so that contributes. And Scott can talk about the year-over-year contribution that we’ve seen. But I mean we have $35 billion in RPO. And I think it’s an important thing because when you think about market share and some of the concerns that people have had, you have to remember that we put a reasonable amount of each order in our core networking portfolio on the enterprise side goes into RPO and doesn’t get reported as revenue. It’s ratable. So it’s a headwind to market share. And the other thing that I would point out is that we had a record year at $50 billion — almost $57 billion at a time where we were building RPO to $35 billion and we have the backlog that we have.
So there, we’ve had a lot of solid customer demand. I’d say in Q4, we certainly saw a fair amount of the enterprise networking. As we ship those products, we saw that software come out of backlog as we’ve talked about and moved into RPO. We saw a lot of these enterprise agreements that we did with our customers in enterprise contributed to it as well. Those were reasonably large deals. And Scott, I’ll let you comment anything — any more you want to comment on?
Scott Herren: Yes. You specifically asked about duration. There’s not much change in duration overall, Ittai. So that’s not it. Q4 typically is a quarter where we have more large multiyear transactions. We talk about enterprise agreements and whole portfolio agreements. And so you typically will see a little bit of a bump in Q4 driven by that and then a little bit of a — I’m sorry, an RPO in Q4. And then in Q1, the typically — the typical pattern would see it come down just slightly as we work our way through those. I think the other thing to just bear in mind, we’ve got net RPO growth this year of $3.3 billion, of which product had a net growth of $1.7 billion. If you looked at our current RPO when we began the year, it was about $16.8 billion, which means all of that came out of RPO.
And yet on top of that — yes, short-term. On top of that, we added $1.7 billion. So we added quite a bit of current year sales into that RPO balance. Back to Chuck’s point, that’s revenue that many of our competitors recognize immediately as they ship it. For us, we have the advantage of recognizing it over time, which makes us more predictable, and it gives us greater visibility into where things are headed.
Ittai Kidron: Appreciate the color. Thank you.
Marilyn Mora: Move to the next question.
Operator: Matthew Niknam with Deutsche Bank. You may go ahead sir.
Matthew Niknam: Hey, thank you for taking the question. Two-parter, if I could. First, as we think about fiscal ’24, so you’re forecasting 1% top line growth and about 4% non-GAAP EPS growth with a fairly strong exit rate on gross margin. So is it fair to assume the lift from gross margins may get offset somewhat by some OpEx reinvestment? Just trying to think about the puts and takes there. And then broadly, at the Analyst Day a couple of years ago, I think, Scott, you laid out a 5% to 7% target for both top and bottom line. I’m just wondering if that’s evolved at all in light of some of the greater emphasis on operating leverage that you’re talking about today. Thanks.
