Tony Balow: Yes, I’ll start. And then, I’ll let Michael and Bernie pick up. So, I think we continue to make progress on diversification of our supply chain globally. And so, I think that is proceeding as planned and I think that we’re set as customers would ask for that capability that we have it ready for them right now. So, I think as based on we said in the past, I would say no change in the expectation there. So, Bernie, Michael anything you want —
Michael Hsing: Yes, we build all these capacities our customer demands there’s a few of them who really demand a lot outside of China. So, we have a more capacity, so that’s the comment, okay.
William Stein: Okay. Let me try a different topic some product types that I know have been ramping maybe over a long period of time one is data converters, which is a category there’s. I think there’s really one very dominant supplier, but you guys have started to get into that area and then the other is the modules that you make when these are much more complex and they have many, many chips I think in each one. If you can talk to us about the recent growth in those newer categories that would be helpful color. Thank you.
Michael Hsing: Yes. Okay. Let me answer the first ones data converters and data converters are it’s a technology that we’re talking about and we developed in the last few years and we won’t design win. We start to shipping products like, I mean, but as however is only one or two products now we’re going to release a family of a product and in a less than a years.
William Stein: Yes.
Michael Hsing: Less than a year time, that will meet a more general market. The other topic that’s what you’re talking about there’s a modules yes so-called e-commerce modules and we actually doing wells and not exactly the e-commerce we talked about 2018 and it’s going over, well, over a $100 million. I mean, but these are multi-chip modules, as a more than $100 million, actually all these are AI’s product that we’re shipping, these are all modules and vertical powers and also the rack powers, we’re shipping all these are modules. So, in the past, I’m saying — as I said, I’m a second tire of a selling silicon only. I want to leverage and monetize our know-how will sell these power modules sell solutions.
Bernie Blegen: And I think that, we’ve sort of hit on one of the strategic differentiators between MPS and a lot of our competitors is that we can offer the most flexible architecture of whether it is delivering a module or a silicon die, so however the customer wants to build our silicon or modules in their end application we have the flexibility to do just that.
William Stein: Thanks, guys.
Operator: Our next question is from Matt Ramsay of Cowen. Matt, your line is now open.
Matt Ramsay: Hey, guys. Good afternoon. I guess is my first question, guys, I wanted you to maybe talk a little bit about the content per socket progression that you see for the company in the AI business in particular as your silicon providers that are driving these platforms make generational transitions there. I think there’s a little bit of confusion that the big primary guy in AI is not just launching one product, but they’re launching three different ones that I expect have slightly different content and you obviously have other customers there in AI, not just in video, but others, so if you could talk generally Michael about just what you’re seeing from a content perspective generation to generation there and maybe Bernie, like, what are the variables on sort of blended content increases that you might see as we move forward. Thanks.
Michael Hsing: Yes, I can’t talk about that. Well, I don’t know, we don’t know how our customers and these are AI GPU providers how they use it. I mean, they sell, they have a different model, they have a different model, they have a different, they have variety of a product. We as long as we know and they use some, they use IC in general for peripheral powers and verticals is all more than 700 watt powers over a 1,000 watt power, so these are from modules and how many modules per CPUs, and we have rough ideas, but we don’t know exact rate.
Bernie Blegen: And to follow up on your second point, it’s a very content-rich environment for us. It also includes memory, for example, and the CPU process, processor, in addition to —
Michael Hsing: Even optical.
Bernie Blegen: And optical as well.
Michael Hsing: Yes.
Bernie Blegen: So, I think it’s really too early to put limits on content availability. In fact, we’re finding new areas in order to deploy.
Michael Hsing: So far, we just want to handle the growth.
Bernie Blegen: Yes.
Michael Hsing: All the demand from a memory side, from opticals, from even the GPU, CPU powers, and this period is really the growth period.
Matt Ramsay: Got it. Now, thank you, guys. That’s helpful. I know there’s a lot of moving parts. I was going to kind of step back and ask a little bit about gross margin trajectory. It comes up a lot in my conversations. I know you’re kind of in that 55% range. I guess, Bernie, what are the puts and takes here? I know that there are big customers ramping in enterprise data, and there are variables around that. There’s also mix between your segments and where you’re sourcing supply from. There’s a lot of variables here. So, what with, I mean, are we kind of at a relative floor in the 55% or slightly above range? And what would be the variables that could drive the margin back higher?
Bernie Blegen: Sure. This is a pretty simple question. So, as the range that we target is between 55% and 60%. We demonstrated that during the post-pandemic stimulus that our margin was able to go to the higher end of that limit. And right now, for the last couple of quarters, as well as our guidance here, we’ve maintained an non-GAAP rate of 55.7%. And really, what will enable us to go up is a change in the mix of business.
Matt Ramsay: All right. Thank you very much, guys.
Bernie Blegen: Yes.
Operator: Our next question is from Gary Mobley of Wells Fargo. Gary, your line is now open.
Gary Mobley: Hey, guys. Congrats, and thank you for consistently seeing the expectation. Most of the interesting questions have been asked and answered, but I wanted to touch on pricing trends. I know you don’t overlap a whole lot with the analog chip market leader, but clearly, they’re being aggressive on price. So, maybe if you can speak to the different product groups or business segments that might be affected by that, and as well, just generally speak about the pricing environment for your broad set of products.
Bernie Blegen: Tony, you want to?
