Matthew McGrew: Maybe Vijay (ph), I’ll take that first, and Rainer can add some color. I would say that as far as the pacing through the quarter goes, I would say that we saw a little bit better start in January and that really did continue through the quarter. So I’m not sure that it was a big inflection in any given month. As far as the exit rate, I still think we’re going to exit here, high-single digits, we’ve talked about that. I don’t think there’s any change to that. And I would not change anything from our initial revenue guidance where we sort of framed that as in order for us to deliver the down low-single digit revenue for the full year, we would need to see every quarter, the book-to-bill in the 0.9s. And so I think we were right in that range here in Q1, and I don’t think that there’s any change for that, and that’s reflective of why we have also not updated or changed anything with the guidance.
Vijay Kumar: Understood. And maybe my follow-up, perhaps for Rainer, on the China and IDT commentary. China, I know you mentioned comps, but there’s been some noise around new loan programs, stimulus, etc. Does that change your view on China? Is this incremental? Does it matter in IDT, I think given some of the business have come up in the BIOSECURE Act. What is IDT’s exposure, if any to China? And I think you mentioned IDT decline in the quarter. Was that China, ex-China? Was the share loss or end market? Any comments would be helpful.
Rainer Blair: Sure. So starting off with China. I mean, we have not changed our perspective for the full year, which we expect to be down high-single digits. And certainly, we are closely following these discussions around the stimulus that’s in play that you know is very broad-based in terms of an equipment replacement program that ranges from agriculture to heavy industry and also includes health care markets like our own. But it’s very early days, and it’s not clear yet how that’s to be implemented, whether that’s via the central government, whether it trickles through to the provinces. So a lot to be seen there. And at this point, we don’t expect that to have a large impact here in 2024, and that’s why we stick with our perspective of a high-single digit decline for the year.
So of course, we’ll keep moderating — monitoring that. Now when it comes to IDT. IDT is a very small exposure in China. And that’s really not the part of the IDT playbook at this point. IDT is doing well, and we’re actually very happy with IDT’s performance, which has been growing mid-teens since we’ve acquired the company and has operating margins over 30%.
Vijay Kumar: Fantastic. Thanks, guys.
Rainer Blair: Thanks, Vijay.
Operator: Thank you. Our next question will come from Doug Schenkel with Wolfe Research. Please go ahead.
Douglas Schenkel: Hey, good morning, guys.
Rainer Blair: Hi, Doug. Welcome back Doug.
Douglas Schenkel: Thanks, Rainer. Good to be here. Good morning and thank you for taking my questions. So Life Sciences, that as a segment, that was better than you guided. You talked about instruments declining mid-singles. You sounded actually pretty good on what was going on reagents and consumables. I guess, what I’m wondering is, were instruments a little weaker than you expected? And then sort of by extension, where reagents and activity stronger than expected? I’m just trying to think about the trends there and kind of what that could mean for the rest of the year?
Rainer Blair: Thanks, Doug. Well, thinking about Life Science tools, which represents just around 10% of our businesses. What we saw in the first quarter is largely consistent with what we’ve seen through the second half of ’23 with core growth in the first quarter down mid-single digits. And to give you a sense, in developed markets, pharma and biotech customers are stable, albeit at a lower level of demand, and academic and applied markets held up better comparatively particularly for our more advanced instrumentation. So we’re actually starting to see improved funnel activity for later in the year, but those haven’t translated to orders yet. So it’s good to see more activity, but it’s not showing up in the order book yet with the cycle times being what they are for that those kind of deals.
Now if you think about China, and that’s an important part of this market. Of course, last year, we’re sort of at the peak of the execution of the stimulus plan in China last year. So the comps are tough here, both in Q1 and Q2. And in addition to that, of course, you’ve got lower end market demand just due to the weaker macro there. And then lastly, and as I mentioned to Vijay, we’re closely following those discussions around the stimulus, but it really is early days here, and we’re not able to include that yet in any view towards the future. So we’ll continue to monitor that as we go forward. And then I’ll just conclude here on the life science tools market that what we’re seeing is as expected, this normalization trend coming off tough comps in the first half of last year.
And we expect that to continue here in the second quarter. But then in the second half, we should see some improvement there.
Douglas Schenkel: Super helpful, Rainer. One very quick unrelated follow-up. I think as we sit here today, Danaher probably has $30 billion, maybe as much as $40 billion if you stretched for the right deal in M&A capacity. I’m just wondering, how you’re feeling about the environment right now, especially given where rates are and where funding is as we sit here today? Thank you.
Rainer Blair: Doug, as you know, our bias for capital allocation is towards M&A. But there’s no doubt that with higher interest rates, the bar is higher. And as active as our funnel work is, we’re not going to compromise on our earnings expectations here, our return on invested capital targets. And that just means that we have to work all the harder here to meet those higher hurdle rates. But nonetheless, we’re very active as we always are, and we’ll continue as we have with great discipline around M&A.
Douglas Schenkel: Great. Thank you very much.
Rainer Blair: Thanks, Doug.
Operator: Thank you. I’ll take our next question from Dan Leonard with UBS. Please go ahead.
