Mike Dastoor: So, let me just answer that in a slightly different way than you’ve asked it. I expected, and I’ve always expected inventory days to be in the 55 to 60-day range. When inventory goes up, the inventory deposits go up in sync. When inventory days start coming down or normalizing, yes, there is a level of return on the inventory deposits. So, a quick answer to your question is, are we going to see a pop in free cash flow because inventories are going to go down? The answer is no. It’s not a pop in free cash flow. It will still be in the 55 to 60 days. It’s just a matter of the gross number going down and the inventory deposits going down in sync. So, that’s something we’re good at managing. That’s something we have really good relationships with customers, and we’re always working on that particular front. So, no, free cash flow won’t get a pop. It’s already baked into our numbers at that 55, 60, and that’s where it will stay.
Matt Sheerin: Okay. Thank you for that. And then, Kenny, just back to the pre-announcement from a couple of weeks ago. That came a couple of months after you had guided for the November quarter, and then you saw, obviously, a big cut across your customer base, and you seem to be lagging some of your competitors in terms of what they saw, right. We saw some — one of your big competitors a month earlier take down numbers in a similar way. So, what do you think the difference is in terms of — and I know that the supply we were seeing a rolling correction, right, different end markets. But why do you think you’re seeing it later than some competitors? Is it because of end markets or because of other reasons?
Kenny Wilson: Yes. I mean, I think, there’s a little bit of when people report the results and — but from our perspective, we’ve seen that late in our quarter, wherein some of the end markets are nuanced to some degree as of the customers, but generally we’ve seen it broad-based across our customers. And we also see that a lot of our customers report calendar quarters, and it was really the back end of their announcements where they took actions to reduce our outlook. So, I mean, I would push back quite strongly that our visibility into our customer base is disconnected and that we don’t do a good a job of that as our competitors, to be honest. I think, it’s just time and based on — we got that feedback in — toward the back end of our quarter. So, that would be my answer.
Matt Sheerin: Okay. I appreciate it. Yes, I wasn’t suggesting that at all. I was just trying to figure out the perspective. Thank you very much.
Kenny Wilson: You’re welcome.
Operator: Thank you. Next question is coming from Samik Chatterjee from JPMorgan. Your line is now live.
Samik Chatterjee: Hi. Thank you. Good morning. Thanks for taking my questions. If I can just start with one on the end markets and just wanted to confirm first, I know you’re mentioning broad-based weakness that you saw across your end markets, but just trying to rank out of the weakness that you’re seeing and what you’re embedding in that sort of $2.5 billion reduction in the guide, looks like it’s more autos and industrial and semi-cap and going to, one, confirm that I’m sort of interpreting that right? Secondly, how do you — just, overall, you’re describing a lot of the weakness as temporary, but how do you address concerns on the EV market in particular? When I think the average investor out there is thinking that EV penetration looking five years out is now going to be probably a lot lower than what it was expected to be just given sort of the demand profile we are seeing now.
So, any thoughts around how this changes the more sort of long-term growth profile on EVs for you? And I have a quick follow-up after that. Thank you.
Kenny Wilson: Yes. So, let me take the EV one first. And we’ve always — I mean, we’ve grown 40% and we’ve said that that would slow down this year. I mean, we are still bullish on the EV space in the longer term. And remember that although that the demand moves up and down and we look at this in the longer term, five, six, seven, 10-years. And so, from our perspective — and then what we do is, we look at where is the demand patterns? And we’ve got a global footprint. We do things consistently across the globe. So, the fact that there’s growth in Asia and it slows down in other markets means that we’ve got a footprint in each of those regions. We’ve — the customer base that we have is really positive, is really — we’ve got a really good customer base focused in North America, Europe and in Asia.
So, we’re able to adapt to changes in demand cycles. And if you look right now in China, where the demand is picking up, we build EVs in China, we’ve got multiple customers here. So, we think the long-term trend is good there. We think we’re in the right areas. We think we’re in the right markets, and we think we’ve got the right capabilities. So, we think it’s going to be up and to the right. Is it going to be 20%, 30%, 40%? We think we can adapt it to any of those numbers. So, we’re pretty confident in the long-term of our EV strategy. So, in terms of other markets, we’re still growing. I think, we said in prepared remarks that our auto business is going to grow at 11%, healthcare and packaging 6%. So, as Mike mentioned, the areas of our business that we’re really focused on growing with secular tailwinds, we think are — still continue to grow.
Renewables at 7%. So, yes, we think that we’re in a good spot across all of those end markets.
