And then I mentioned, just before we also believe OpEx are on the operating margin line is another leverage points for us. So that’s how we think about those powerful incrementals. So I think you should just think of it as we will march up as our sales grow from 37%.
Unidentified Analyst: Okay. I guess, just another way to think about it is, as that $3 billion comes through early, I think 40% has typically been your target. Has that changed or is that where you think – is that still what you are think you can get to?
Wendell Weeks : Yes, so, I think we can get there, but just as a reminder, the 40, if you go back in time, we’ve absorbed a significant amount of inflation and raised price, which brings our margin percentage down. So, 38% is sort of the new 40% in old math. But I still think despite that new base, we can get back to that 40% level as we accrete our sales up.
Unidentified Analyst: Got it. Thanks.
Ann Nicholson : Thanks, James. Next question.
Operator: Our next question comes from the line of Steven Fox with Fox Advisors. Your line is now open.
Steven Fox: Hi, good morning. I guess, I was just wondering on the Specialty Materials business, if you can provide some more detail. From my seat, it looks like it did much better than I would have thought for Q1. How much of that was due to grow glass? How do you sort of look at the rest of the year given sort of mixed results in Q1 on the phone side? Like what kind of seasonality et cetera are we looking at? Thanks.
Ed Schlesinger: Yeah, I think, it was more or less in line with how we would have expected it. I think it’s a business that will grow as we add more Corning content. That’s the way we think about it for the year. We don’t see smartphone market being up that much in units, maybe you point or two for the year. There certainly can be some growth in the IT space, but even that is single-digit, maybe mid-single-digit level. So, I think the growth catalyst here is for us to add content into the market.
Wendell Weeks : And we just don’t see a lot of that happening this year. Steve, will be this is – most of our newest innovation will be aided to model year following this. So, we’re not looking at MC has been a big catalyst for near term growth in terms of versus Q1 right, for this year. But in future it will be.
Steven Fox: That’s helpful. Thank you.
Ann Nicholson : Super. We’ve got time for another question.
Operator: Our next question comes from the line of George Notter with Jefferies. You’re line is now open.
George Notter: Hi, there. Thanks very much guys. I guess, I’m curious about your comments on display. I think you mentioned an appropriate level of profitability at – I get with that is, but when you go out and re-up the hedging portfolio, obviously there’s a cost that comes with that. Do you still anticipate – I think if I go back in the past, you guys looked at the hedging portfolio as being pretty neutral in terms of cost between what you were long and what you were short. Is that still going to be the case as we re-up the hedges going forward? And then when you talk about an appropriate level of profitability, are you including the cost of that hedging program when you make that statement? Thanks.
Wendell Weeks : The appropriate level of profitability would include any cost of hedging. We’re long yen, right? And so the you’ve heard an hedge reporting on sort of over the sweep of time generated. We are on the order of $2.5 billion of cash – positive cash arising from our hedges right? That or us hedging that long yen position. And the way we think about this is, that position is coming from the fact we sell in yen. And so, we will resolve this either in the currency markets should the yen come back to more sort of reasonable levels, right? And we’ll be opportunistic about that. But if not, our customers are picking up that the gain in terms of lower cost glass, because we sell in yen. And so, what we will do is just raise our price in yen to share some of that volatility that we’re seeing in the yen. But does that make sense, George?
George Notter: It does. I assume it’s still fair to say is it the cost of the hedging program is pretty minimal to shareholders or pretty balanced in terms of the two sides?
Wendell Weeks : Yes.
George Notter: Thanks a lot. Appreciate it.
Ann Nicholson: Thanks, George, and thank you, everybody for joining us today. Before we close I wanted to let you know that we will hold our Annual Meeting of Shareholders on May 2nd. In addition, we’ll also attend the JP Morgan Technology Conference on May 21st. And finally, we’ll be hosting management visits to investor offices in select cities. There will be a web replay of today’s call on our site starting later this morning. Thank you all for joining us. Shannon, that concludes our call. Please disconnect the call lines.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
