But we think that many of our competitors still have access. I believe that there will still be some discounting going on in the channel mostly in gaming peripherals for the next 1 or 2 quarters. And we will do what we can to maintain our market share but most of the discounting tends to happen in the entry level. And we’re okay to lose a little bit of market share in the entry level, if it would then cause us to be in a loss position. So hopefully, that makes sense. So we think that the promotional environment will be still going on for the next 6 months — 3 to 6 months. And I hope by the second half, it will go away as everyone’s inventory clears up back to a normal level.
Unidentified Analyst: Got it. Perfect. That’s helpful. And just as a quick follow-up. I know you’ve recently announced several upgrades to some of your existing product lines and you’ve also launched, obviously, some new products as well. So as you look at 2023, how are you planning on splitting your development resources between upgrades and new product launches? Is it pretty split pretty evenly?
Andy Paul: No, it’s not. I mean we’ve obviously got different sizes of businesses across the board. Some of the businesses we’re in, like Elgato streaming for example, has got a very heavy software content and so the products are just a lot more complicated and for that reason, higher margins. We’ve also — so there’s a lot of resources going into that. We’ve got a pretty big software ecosystem which requires resources. We have a much bigger TAM that we’re addressing in gaming peripherals and so there’s a lot more products coming out there. In terms of the gaming components and products that we use to build gaming systems, that’s the biggest part of our revenue now. And so obviously, we keep having to upgrade those. Most recently, what we’ve had to do is upgrade all of our power supplies to higher wattage levels because the new graphics cards from Nvidia and AMD come to that are using a lot more power or more powerful.
I’m sure you’ve seen that in the news. So there’s a general upgrade across the board. But I’d say, look, in general, the R&D budget is more geared towards products that require a lot more software and complexity. But that doesn’t necessarily tie up with the revenue of each product line. I think in terms of longer-term market share expansion, we’d expect there’s a lot more opportunity for us to grow in the gaming peripheral and the Elgato streaming area because those are newer. We’re quite well established in memory sales and other components are going to self-build PCs and we have very high market share.
Unidentified Analyst: Got you. Perfect. And congrats on the quarter. Really nice performance.
Operator: Next question comes from Doug Creutz with Cowen & Company.
Doug Creutz: If I take the midpoint of your guidance ranges, you’re sort of suggesting you’re going to earn close to 7% EBITDA margins which is basically where you were pre pandemic. If I think about what the pathway is to get to, let’s say, 10% EBITDA margins, is that just a function of creating operating leverage from top line growth? Or are there still things going on in the market or with you that are structurally impacting your margins that you think will get resolved over time?
