Jeff Dossett: Yeah. Good question. Thanks, Chris. The answer to your question is yes, absolutely, yes. We’ve talked about at least one feature on our products, our Protected Mode, which allows a retailer to make a tag invisible at point of sale to protect consumer privacy. We believe that feature will have value in GDP going forward. We have introduced other features in the M800 that we haven’t spoken to publicly yet, but we will overtime, that we think will drive enhanced performance in Enterprise Solutions, to make those solutions work better and drive preference for Impinj Endpoint ICs. It’s not all I can say on that topic at this point in time. Just know that, as we migrated to a more advanced process mode, cost of digital logic came down.
We took advantage of that effective savings to introduce features in the IC that we believe will solve previously unsolvable enterprise problems as well as going forward, give us an opportunity to address GDP, as we said in our prepared remarks.
Chris Kapsch: I appreciate the color.
Jeff Dossett: Thanks, Chris.
Operator: Thank you. The next question comes from Scott Searle with ROTH MKM. Please go ahead.
Scott Searle: Hi. Good afternoon. Thanks for taking my questions. Congrats on the quarter and nice to see the inventory and the channel normalizing at this point in time. Hey, I apologize, I joined the call late, but on the systems front, I was wondering if you could provide a little bit of color looking into 2024, what you’re seeing from a pipeline opportunity perspective and linearity perspective? I think there were some larger contracts or projects that were reaching a conclusion or at least a phase of conclusion. I’m wondering what the visibility on that front is and how that pipeline is shaping up?
Cary Baker: Yeah. Hey Scott, this is Cary. I can take a start at that, and then Jeff can jump in. So looking to the first quarter, we expect similar systems revenue in the fourth quarter. Looking a little bit further out than that first half systems revenue benefits from the Indy reader IC last time shipments related to that product’s end of life. Additionally, Phase 3 of the Europe, visionary European retailers’ Loss Prevention Deployment will conclude in the second quarter. So we’ve got some benefit in there. There is more opportunities beyond Phase 3, but we’re taking a conservative approach right now, because they may not line up perfectly Phase 4 that it may not line up perfectly with the conclusion of Phase 3. We had the similar situation back when we knew Phase 2 was completing, but we didn’t know when Phase III would kick off.
And then I would just add maybe a final thought on the systems outlook, we’ve historically seen that after economic downturns, our endpoint IC business recovers before our systems business. So good color on the first half of the year, we’re in kind of a little bit of a wait-and-see mode to see how systems recover’s in the back half of the year.
Scott Searle: Very helpful.
Jeff Dossett: This is Jeff. Go ahead, Scott.
Scott Searle: No, no, please continue, Jeff. Thanks.
Jeff Dossett: Thanks very much. I was just going to add that our systems pipeline remains strong. I think what’s encouraging to me and our team is that we and our partners are seeing increased sales activity, increased detailed project planning, increasing the number of proof of concepts that are activating at this time. And really, it’s in the context of our customers and our partners increasingly understanding the importance of end-to-end supply chain visibility and process digitization, to that ability to sort of digitize and optimize the entire flow of everything they manufacture, transport, sell and even process back into the business in returns or other forms of circularity. So we’re encouraged, but the pace and timing of these deployments is always determined by the individual end customers. So as we get more visibility, we’ll integrate that into our guidance each quarter.
Scott Searle: Great. Very helpful. And if I could for a follow-up, on the DPP front, it sounds like you had some comments, so I apologize if this is redundant. I can take it offline. But I thought the initial discussion was contribution may be starting in 2025, not in 2024, but the opportunity to spread to not only different categories but other geographies. So I’m wondering if you framed it at all in terms of the opportunity as we start to go into ’25 and ’26 kind of permeating not just within the EU, but into other geographies? Thanks.
Chris Diorio: Yeah. So Scott, we did see some more about BPP. And I personally am very excited about DPP, what it means for our business going forward. There’s two aspects that I would really focus on for DPP. Number one, requirement for retailers initially other enterprises and other markets going forward to provide true traceability through a product life cycle from really initially at the time of manufacturing through point of sale, that visibility requires what the laws are going to require, what those customers need to be able to show and do. And the fact that I believe Rainer can provide all the data they need and we can do it in a proper way. Second aspect — and actually, we see retailers already today, and we’re going to see it more from other customers as well.
See retailers today are already planning for DPP speaking with us about it, talking about integration, talking about their needs. So it truly is an opportunity for us. The second aspect that I find very exciting is that DPP doesn’t end at point of sale. It ends at an item’s end of life. So, as it ends at an item’s end of life, it will, I believe, open-up the opportunity for us in post-purchase consumer use cases. Initially focus on recyclability at end of life, but there’s more. Because when you have an IC that lasts for the life of an item, it’s embedded in the item, and it becomes part of the item for recycling of end of life. It opens up consumer use cases that today, our market and our industry has touched. We as a company have been very excited about the opportunity for consumer use cases.
