Bren Higgins: Yeah. No, you’re right in terms of the math, right? As we look at the first half of this year, which is, we’ll call maybe slightly down versus the second half of ’23 and then an acceleration in the second half would put you somewhere in the, I’ll call it, high-single digit growth. That assumes that WFE is marginally up more or less from 2023. And so against that backdrop, with slight improvement in memory, I would expect our process control intensity to be roughly flat. So we were in the seven depending on your WFE number, but assuming $87 billion to $88 billion and WFE in ’23, about 7.6% or so. So I would expect it to be similar as we move into ’24. And as we expect to see more growth in leading edge investment as we move into ’25, then we’ll start to see favorability in terms of leading edge dynamics that tend to drive our business and higher process control intensity overall. So I think that’s how to think about it right now.
Brian Chin: Okay. Thanks. And then just given that emphasis this year on memory conversions and upgrade activity, can you comment on the areas where KLA benefits and how meaningful a benefit that this sort of spending represents?
Bren Higgins: You mean in terms of just where we benefit in memory investment or we expect to see — I mean, certainly, you’ve got the — in DRAM with more DRAM investment with the introduction of EUV, that tend to be a positive dynamic for our business. We saw process control intensity increases as we saw EUV introduced into DRAM. So that’s probably one of the bigger positives for us. So you’re right, as you start to do technology conversions, instead of new capacity will be a little bit more muted investment. But we would expect to see our customers continue to invest in the — in their leading edge development for the next nodes. And so I think that will be the biggest driver for our business.
Brian Chin: Thank you.
Operator: Our next question will come from Chris Caso with Wolfe Research.
Chris Caso: Yes. Thank you. Good evening. I guess the first question is kind of looking beyond the 2024. And obviously, you don’t expect you to provide any guidance there, but take any opinion that you have. Some of the other equipment suppliers that have had longer lead times were starting to express a little more confidence on a turn on ’25. I don’t expect that you’ve seen that in your order book yet, but interested to see what your customers may be talking about.
Richard Wallace: It’s a great question. And we have definitely had those conversations. I think that customers are looking at from a couple of perspectives. One, we do have long lead on the most advanced optical tools, but there’s also a lot of development that we’re doing right now to make those tools even better for the advanced logic ramps that are coming. So we’re actually engaged quite a bit in R&D and in pilot with those customers. So we have a pretty good sense. They’re all bullish about ’25. I can’t think of a customer that we have on a leading edge that isn’t bullish about ’25. But as you say, we’re not going to see the orders for those yet. But we’re certainly having those conversations. But more importantly, we’re seeing the discussions happen around capability that we’re demonstrating as they do pilot.
The other thing is, we’re seeing a trend toward more designs, and we talked about this for the past several years. One of the leading indicators for us is the advanced designs because that’s an indicator of how broad a node is going to be. And we’re seeing that continue and that will drive both business but also as a good leading indicator for the strength of ’25. That’s why one of the objectives for the company is to prepare for growth in leading edge because that’s what we believe will happen over the next 24 months. As Bren indicated, not the next six months, we should start to see the green shoots of that toward the end of the year, and then we’ll see it in ’25 as the way we’re modeling the business and our investment right now.
Chris Caso: Got it. That’s very helpful. As a start-up, with regard to the foundry logic business, would you characterize and I guess what you talked about your WFE assumptions is some kind of slight growth this year. Is it safe to say that, that growth is tied to new node deployments and kind of technology upgrades and such as opposed to capacity at this point?
Richard Wallace: It’s a little bit of capacity, too. I mean ’23 was down, right? And so we’re seeing some expansion of capacity. The big node ramps aren’t really happening as much this year, which is part of why the WFE gets driven up. And you heard TSM’s call, and I think they are fairly bullish on their forecast, but we’d have to see what happens in the early parts of ’25 for those ramps on, especially the newest technologies.
Bren Higgins: And we would expect the legacy business non-China to be lower in ’24 than ’23. So there’s — so it’s being offset. You’ve got some improvement with the leading edge investment offset by some of the non-China legacy falling off a bit. So that’s how we get to our forecast. And we’ll see as we start — we’re having these conversations with customers. We’re certainly planning for it from a capacity point of view, and we’ll see as we progress through the year as we start to firm up when those shipments will actually start to take place.
Operator: Thank you. Our next question comes from Joe Moore with Morgan Stanley.
Joe Moore: Great. Thank you. You talked about memory utilization remaining low. And I guess I feel like you guys kind of talked about that relatively early, and then you saw it kind of static. We’ve heard from memory customers, all kinds of things about different times that they brought it down and see like some of them bought it up. I just want to confirm that you’re seeing that as kind of a steady trend? And then can you talk about how that affects your, the services revenue you can get from those guys?
