Operator: Please standby for our last question. Our last question comes from Rajvindra Gill with Needham. Your line is now open.
Rajvindra Gill: Yes. Thank you and congratulations on great results. Just a big picture question, Tom. You mentioned obviously that the trend towards reshoring of supply, you guys are instrumental in the CHIPS Act. When you’re discussing contracts with customers, and trying to win share. Are you seeing, kind of, an overarching trend among fabless semiconductor companies to start to, kind of, reshore here in the U.S., with you versus other foundries in Taiwan or elsewhere. Are you actually seeing that kind of tangible trend as we kind of look out for the next several years?
Tom Caulfield: I think we’re starting to see at the beginning of that and I’ll put a context around it. Maybe because it was the end of the year, it was holidays. The NDAA National Defense Authorization Act was passed, I think it was last week of December, if not it was just the second to last week of December. And specifically in there, it highlighted that the U.S. government over the next five years, they want to not have any supply in anything they buy that has CHIPS from snack. And so that’s relatively new event that our customers are starting to comfort and what does that mean. What I see is it’s very difficult for them to want to go and take an existing part number and re-qualified and resource it. But rather looking forward, saying how do they take their new product lines or their new spins of designs and then create a different footprint for that type of sourcing.
And I think this is the year €˜23, €˜24, we’ll start to see some of that business come our way in response to these types of legislation moves. And just in general, to get a more balanced supply chain across the globe and leveraging on our footprint. It will never be a look back in doing — we work over again in the design that already exists. I think it’s about the future designs. I hope that helps.
Rajvindra Gill: Yes, that’s super helpful. And just my follow-up, Dave, if you look at the free cash flow projections potentially for this year. Given kind of the reduction of the CapEx and the cash flow from operations growing this year depending on kind of assumptions. It looks like free cash flow is going to move up significantly into positive territory. So how are you thinking about usage of cash going from 2023 and beyond? As you get more scale in the model and you generate significant more free cash flow? Thank you.
Dave Reeder: You’re right. Based on our cash from operations and our ability to generate cash, as well as our reduced CapEx. And really kind of an envelope of CapEx going forward where we’re essentially at our long-term model or close to our long-term model of roughly 20% of revenue being in CapEx. Obviously, you have the ability to generate increasing and significant free cash flow over time with that model. So as we look at it, right now, we’re very pleased with our cash position. We’re in a net cash position minus our debt. We’re in a position where we can be free cash flow positive this year, which I stated in my prepared commentary. And then as we look to the future, as we go through the first half of this year, look at the demand in the second half and then the subsequent demand in 2024.
We’ll start to formulate those CapEx decisions for the future. And as we do that, I think you’ll see us come out with some type of capital structure and perhaps some type of capital program. That we would release to shareholders. At this time, I’m not willing to go out publicly at this stage in state what our policy will be other than we feel like we’re at our long-term model or very close to our long-term model from a capital intensity perspective. That will enable us to start to generate some meaningful free cash flow and stay tuned for our capital deployment strategy.
Rajvindra Gill: Great. Thank you, Dave.
Operator: I would now like to turn the conference back to Sam Franklin for closing remarks.
Sam Franklin: Thank you, Michelle, and thank you very much everyone for joining us today. Appreciate the questions. We look forward to seeing many of you on the upcoming conference circuit. Thanks again.
Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.
