Shai Terem: Sure, I would say our focus is on industrial production, Troy, as we discussed before. And usually in industrial production, we are trying to replace metal parts. Some of these parts, we replace with advanced composites and some of them will have to be metal steel, especially if they need to go through very high temperatures or very high strength, that you cannot get with advanced composites. Of this still the majority of our solution today is in advanced composites. So still most of our customers come with a metal problem and we are able to solve it with advanced composites. But as you can see from our portfolio, metal is still very, very important part of it. And with the PX100, we intend to increase maturity our solution and application into the metal side of it, especially when we talk about high volume production in hundreds or thousands of parts.
That you need to produce in a very reliable way, and still need to be very, very precise with minor kind of fancy or work after that for post processing. So, metal is still very, very important. It’s a very big element of our solution. And because, we are going right into the manufacturing floor, sometimes advanced composites is the best solution, sometimes it’s metal.
Troy Jensen: Hi, Shai, can you remind me, I didn’t see it on your new investor slides, but does that Digital Metal had its own furnace too or you just work with partners?
Shai Terem: We work with partners on that front. We currently produce and develop the printing technology and some of the work before and after the print, for the preparation of the powder, et cetera, and the center is the pocket.
Troy Jensen: Okay, perfect. Then switching gears to just a follow-up on FX20. Is it currently just two materials that are qualified on the platform?
Shai Terem: No, we have more than that. We have some of the Onyx materials. We have the ULTEM. We have continuous Fiber. And we will continue to add more materials.
Troy Jensen: I guess, I guess, something in high-temp specifically outside of ULTEM?
Shai Terem: You will please allow me to share with you, the – but I can tell you that we did not stop releasing new materials into the FX20 and because it’s a hard chamber and has a lot of potential. So some of them will be high time materials.
Troy Jensen: Okay. Understood. Good luck guys.
Shai Terem: Thanks, Troy.
Mark Schwartz: Thank you so much, Troy.
Operator: Thank you. Our next question is from Jim Suva with Citigroup. Please proceed with your question.
Jim Suva: Thank you. On your prepared comments, you mentioned some gross margin challenges associated with the rollout I believe you said it was the FX20. Can you help us understand why was that, was that like you had to expedite the end product for shipping or parts were in shortage and you had to go to the extra market, scalpel market or secondary market? Or was it like reworking or acceptances or installations or what were the challenges with the FX20?
Shai Terem: Yes. Thanks for the question. I think first, there’s definitely the combination because in the beginning of 2022, supply chain was still a big challenge. And even just to get the parts, we had to go through bidding wars, and pay a lot more than usual for the parts. But I think more than that, usually in the new product introduction, it takes time until you stabilize the product and that’s why you produce in smaller batches. And using smaller batches, you don’t get the scale, you don’t get the scale and the cost efficiency, which we expect to see building up through 2023. So I think that’s the majority of it, I would say, going into 2023. But we already see the light from that perspective.
