The second the second very important application also connected to the welding I already mentioned that we would like not to present the set of components to our customer but we would like to produce to our customer final solutions their problem it means kappa because it’s for the application kappa welding is very important for different applications and the situation. Aluminium welding also is very important different kind of configurations and so on and we propose to our customer the final solutions for us it’s absolutely new business model and we would like to promote this business model for our future expansion or a laser system for different kind of applications it comes on to drying to drying applications today we are shipping only lasers but of course we are in the closed contact with our potential and existing customers and also start to think how we can develop the gain not the final system because final system much more complicated but again some solution for our customers we are working with the directions definitely.
James Ricchiuti: Okay thank you for clarifying by the way on the drying side last question for me is just on the medical portion of the business how would you characterize the outlook as you look at Q1 and perhaps further into 2024 on the medical side of the business?
Timothy Mammen: So in Q1 actually Jeremy our medical is going to be after a strong Q4 a little bit weaker with one of our main OEM on the surgical side as well adjusting some of their inventories down for the full year we expect medical to basically be flat-ish this and then we’re introducing a just not a lot two or three new applications and devices at the end of this year working with an additional partner as well on one of our main applications so we then expect the medical to start to pick up much more meaningfully into 2025.
Operator: Thank you next question is coming from Scott Graham from Seaport Researcher Line is now live.
Scott Graham: Hi thank you for taking my follow questions the first quarter operating expenses guidance I guess I was a little bit surprised that it was at that level and maybe you can’t get to it in the first quarter but what are you doing around operating expenses in 2024 to bring those down as percent of sales?
Timothy Mammen: I’d say the first thing is doing targeting getting revenue back up that’ll bring them down a bit but we are focused on looking at the total level of expenses one of the things that happens at the beginning of the year though is that we have an annual operating plan that’s out there and last year we would be low that annual operating plan not surprisingly given the results so some of your variable compensation accruals do change when you have a reset on the annual operating plan. There is there is though we don’t believe we want to take a lot of investment we mentioned some of the investment on selling expenses is very important because we’re not just focused on this year but we’re trying to drive growth out of a wide range of new applications.
We’re also trying to accelerate bringing some of the newer product to market so for example on continuing to invest and develop our ultrafast and UV lasers which will substantially open up some more of the micro processing market which again is a fast growing area. On the GNA side there’s a limited amount of expense that we can take out there so it’s really a question of trying to optimize them as best as possible but certainly not cutting back on areas where we think we should be investing in for the long-term growth and benefit of the company. My personal view and the view we’ve held at IPG for a long time is that cutting R&D and some of these investments just because you’re in what you think is a relatively temporary downturn is the wrong thing to do.
The longer term returns are had on continuing to make those investments
Scott Graham: Understood thank you. Just my last question would be around your commentary that some of this de-stocking might ease in the second quarter and you feel that second half revenues can be up year-over-year is that is that customer feedback is that trade press where is that coming from that those views?
Timothy Mammen: No we direct discussions with all of our main OEM customers on the cuttings knife. It’s not like just trade news or PMI data it’s more specific feedback than that.
Operator: Thank you we’ve reached end of our question-and-answer session I’d like to turn the floor back over for you further closing comments.
Eugene Fedotoff: Thank you for joining us this morning and your continued interest in IPG. As always we will be participating in a number of investor events this quarter and looking forward to speaking with you soon. Have a great day everyone.
Operator: Thank you that does include today’s teleconference and webcast. Give me just connect your lines at this time and have a wonderful day. We thank you for your participation today.
