So we are seeing some of the yield and total volume of product produced in Poland, for example, has increased over the third quarter that costs have started to come down. It’s still not quite at the target price we want them to be of a fiber block, but they’re certainly making a meaningful contribution. So that would be some of the improvement. Italy has done very well in getting their total manufacturing and their cost to an initial level that we wanted them to do so. But there’s other work going on at the moment on product cost initiatives to take significant cost out of some of the higher power lasers in the next 6 months or so, new generations of diodes. But other stuff, the mix in terms of — it was weaker in terms of total revenue, but some of the mix rate related to the medical applications welding being a good share of total revenue, we had a strong quarter in Korea and Japan where pricing is a lot more resilient that can help with margins as well.
So there’s a lot of things that go in there. But I think what this really shows is that you can get back into that higher than 45% gross margin that we haven’t walked away from you.
Operator: Our next question comes from James Ricchiuti with Needham & Company.
James Ricchiuti: Had to — I would like to follow up a little bit more about what you’re seeing in the 3D printing space. It’s an area you guys have been talking about more positively over the past year. And I’m wondering is the demand you’re seeing, is this mainly coming from the hardware vendors in China? And are these primarily for consumer electronics applications, at least that’s what we seem to be hearing about more?
Timothy Mammen: There is — Jim, there’s good demand coming out of the hardware vendors in China. The European additive had been fairly good through the first couple of quarters, I think it was sort of flattish in Q3. Nobody has any visibility into any of the consumer electronic stuff at the moment. So a lot of the stuff in China is still aerospace. Dr. Scherbakov on his visit actually saw a very large system with — I think you said 50 lasers…
Eugene Scherbakov: 50 lasers simultaneously users is growing very large part of metal.
Timothy Mammen: So we don’t have any visibility into the consumer electronics potential demand. I don’t think anybody has yet.
James Ricchiuti: And a while back, Tim, I have to try to find it somewhere in my notes, but you guys did size the 3D printing business. And I’m wondering, where are you in relation to where it was at the peak a few years ago when you were seeing quite a bit of activity at least encouraging activity early on?
Eugene Scherbakov: Definitely some years ago, it was the [indiscernible] activity in the 3D printing or additive manufacturing. But at this time, it was definitely was overestimated in this market. And then it was, of course, went down. And now I think it’s a much more realistic estimation of such kind of a technology for our future industrial laser applications. And from this point of view, of course, IPG has a very strong position, why? Because for such kind of application customers have to use a very stable laser. Very stable means for some parts, they have to use laser more than 1 month on the continuous operations. And it must be absolutely stable, not only this power but also beam distribution. This is why because our product is a very [indiscernible].
Up to now, we have a very strong position also for the Chinese market. And especially when we introduce a new AM laser with adjustable mode, adjustable power and much more stable. And in this case, our customer has opportunity to increase productivity of such kind of technology, but it’s very important, very important. This is why they’re using up to 50 simultaneous working laser. And they couldn’t improve — they couldn’t — only increase power. It’s not possible. They’re using — as usually, they’re using 500, 700 watts, the maximum power [indiscernible] because if you only increase power to 1 kilowatt you can evaporate this metal. It’s not optimal solution. Only optimal solution to use simultaneous in parallel many lasers mainly stable by quality lasers for this application.
