Tom Sweet: Hey Aaron, it’s — let me sort of try and unpack that for you a bit, right? So look, as Chuck — Chuck has already highlighted what we saw from a pricing environment perspective. Obviously, we talked about the fact in Q2 — in our Q2 call that to the extent that we saw that we’re in a component cost deflationary environment, we tend to do reasonably well from a margin perspective, given that we don’t move pricing as much as costs come down or the pacing of that is different. And I think that’s what we saw this quarter. So, we had lower input costs from component costs as well as logistics costs. We obviously priced for FX and some of the other dynamics that we saw in the environment. As a result of that, given the configuration and the amount of memory and storage we’re putting on the servers particularly led to some better-than-anticipated margins, I would say.
And so, our ability to hold on to that — over time, you obviously have to adjust pricing for some of those market commodities. But again, that’s only one element of the pricing stack and you get into things like mix and configuration as other impacts. I don’t know if Jeff — maybe add anything.
Jeff Clarke: Maybe to add to that back to our model and inventory. We have a lower inventory model, one of the benefits of how we run the company since beginning. And it gave us availability to the lower cost component, I think, earlier than most. Our supply chain has executed well through this time. We had fewer mismatch sets. So, we were able to convert the demand shipments and the backlog shipments throughout the quarter. And as a result of that, we were able also to take advantage, as Tom said, lower freight rates, lower expedites, lower supplier premiums, and we’ve obviously benefited from that throughout the quarter.
Operator: We’ll take our next question from Sidney Ho with Deutsche Bank. Please go ahead.
Sidney Ho: My question is on cash flow. So, I noticed your first three quarters of the year in aggregate, free cash flow was negative. And you talked about building some strategic inventory in the last quarter. How do you think about Q4, by definition, for the rest of the year? And as we think through next year, do you expect cash flow to exceed your net income? I guess I am asking how long do you think it would take working capital to get back to normalized levels. Thanks.
Tyler Johnson: This is Tyler. I’ll take that one. So look, I think maybe just to start, if you think about the last couple of years, right, cash has been really strong, right? So, we were seeing that build given that negative cash conversion cycle, and we obviously benefit from that. I think what we’re seeing now is the opposite of that, right? And there’s two things happening, and you talked about it, right? So, we’ve got the contraction in the P&L, which is impacting cash and then working capital. And our intent, obviously, is to drive those working capital balances down, but we also don’t want to miss opportunities and you saw us take advantage of that this quarter, which impacted cash. Now, as I’m thinking into Q4, and I’m thinking it next year and recognize we don’t provide guidance, I think you have to keep that in context that, one, Tom has talked about that there will be some pressure in the P&L, and that will impact cash.
But at the same time, we do have opportunities in working capital, and it’s quite substantial, right? So, we’ll be focused on driving that down. And obviously, that’s something we know how to do, and we’ll be smart about it. But that’s how I’m thinking about it.
