And of course, in terms of market opportunities, those continue to be healthy in terms of NAND-displacing HDDs in the data center, and Micron having the right products to grow those opportunities in the future. This has been — we have been — with NVMe SSDs and data center, we have been absent in the past, and now we have a healthy product portfolio, and we look forward to growing our opportunities in that space in the future. So NAND overall, in combination with DRAM, enables us to have a strong differentiated value for our customers. And Micron is well positioned with our technology and product roadmap, and certainly, we believe that our supply actions here are prudent.
Operator: And our next question comes from the line of Aaron Rakers from Wells Fargo.
Aaron Rakers: So Mark, I apologize, I just want to go back to the inventory discussion a little bit. Is there any way to bridge the prior comment of the $460 million, again, that Harlan had brought up relative to that? It sounds like $900 million for fiscal ’23. I’m just curious on what’s embedded in the gross margin for underutilization this quarter. And I guess on inventory, is there any risk of obsolescence of inventory? Or is the inventory good, it just gets sold through at a lower cost of goods at this point?
Mark Murphy: Yes, the inventory is still good. It just gets it — the cost basis is lower on the inventories. And then as far as your question on underutilization charges. So we do have, as just bridging it from what we said last time, last time we had total underutilization charges of about $900 million that were incurred in FY ’23, of which we believe that $460 million would pass through to the P&L in FY ’23. And that $460 million was a combination of costs and inventories that clear and then also period costs. Now our view with the increased underutilization, our view is $1.1 billion of costs in FY ’23. And the amount that we believe will pass through in the second half year is $900 million. Again, that is a combination of costs that are in inventory and period costs.
Now the reason it’s a higher percent of the total FY ’23 cost that we saw is because of this write-down accounting where that — those inventory charges are pulled forward. So I hope that clears up the question.
Operator: And our next question comes from the line of Joseph Moore from Morgan Stanley.
Joseph Moore: Sorry if I missed this, and I appreciate the detailed puts and takes on gross margin. With regards to the lower cost or market adjustment, can you walk through the mechanics of how you got to this number for the February quarter? I guess a little over $1.4 billion. Is that — I know you pull the inventory and then you compare that to the market price. How far out in time does that market price assessment take you? And I guess, to the extent that you’re — there’s more than one quarter of sell-through that’s being adjusted, how are you making the determination of what the price will be there?
