Gene Sheridan: Yeah, good question. Thanks for focusing on that. Appliance is maybe not as sort of exciting or set [ph] as some of the other segments, but really promising progress. I highlighted four major wins just in the last quarter, one of which includes that leading European hair care product that’s still on track at the end of the year and that’s expected to be $10 million a year as it ramps starting this year and throughout next year. But we also added the dishwasher, a leading dishwasher name. These guys don’t want us to release the name yet, we’ll release them as soon as we can, but you can probably guess at some of these. And two really top pump and motor leaders in Europe, not surprisingly Europe tends to be leading in high energy efficiency home appliances.
So that business actually is pretty stable, we didn’t highlight it too much in the short-term, but we did say going into Q2 is pretty stable. And then, I think, we’re going to see a nice growth towards the end of the year and definitely next year. That pipeline by the way was $360 million in December and has grown since then. So we’re pretty bullish on home appliance and industrial markets.
Nicholas Dillon: Thanks. And for my follow-up, gross margin guide come in just a little bit weaker, is that entirely driven by mix, driven by the mobile being a little bit better like you talked about in the comments?
Janet Chou: Thank you for your question. You’re absolutely right, our gross margins heavily dependent on mix. We see very strong momentum going on in the mobile space. But higher mix in mobile actually is margin diluted. We do anticipate margin expansion once we see growth in higher margin markets like EV, industrial and data center.
Nicholas Dillon: Thanks.
Operator: Your next question comes from the line of [Richard Gold with Gold Tactical.] [ph] Please go ahead.
Unidentified Analyst: Hi. I just wanted to drill into the customer pipeline a little bit more. If I recall about a year ago, I think that pipeline was a few $100 million, and then into the summer it got up to, I think, $760 million, and then by your December 12th investor meeting in Torrance, California, it was $1.2 billion. I think last quarter you said it was north of that, and now at $1.6 billion, it’s really pretty remarkable. I was wondering if you could give a little bit of detail of how you scrub that and if you have any sense of what the conversion is ultimately into revenues.
Gene Sheridan: Yeah, good question. Thanks, Richard, for bringing it up. So, first of all, on definition, pipeline has a few important criteria. One is that it’s a valid committed production program. There’s a lot of R&D going on out there, especially on gallium nitride and silicon carbide. So we always scrub it to make sure it’s really a valid committed program. Number two, we see a good technical fit for what they require for GaN or silicon carbide or for our products to make sure the technical fit is there. And then third is the value prop and a strong opportunity and motivation from the customer to use the product. It’s not confirmed design wins, it’s not a contract. But we consider those to be qualified opportunities.
And we track on qualified ones, but we don’t report them in the $1.6 billion. They have to meet that. And then within that $1.6 billion of qualified opportunities, we’re tracking them by stage as they go through evaluation, system design, design validation, preproduction, and then into production. In terms of conversion, it’s a little too early to call. I think on mobile, where we’ve seen mobile, our conversion rates have been pretty high, 30% or higher, sometimes 40%. On the other markets, which are really just forming, some of those take 2 years to come to market, or 18 months or 36 months, we’re still seeing that roll out. So we’ll be able to judge conversion rates a lot better on data center, solar and EV later this year and into next year.
Unidentified Analyst: And then, when you – of the $1.6 billion, I guess you put that $1.6 billion in different buckets. One bucket would be purchase orders and production. And then it goes from there all the way to perhaps just some new program that’s just kind of been talked about, but you haven’t really – no, I guess if it’s committed, it’d have to be committed to be part of the qualified, right?
Gene Sheridan: No, qualified as to meet [ph] the criteria set. So it’s a committed production program, not committed to us, but the customer is committed to going to production. We have a good technical fit. We have a strong value prop and high interest to use our product. But let me clarify too, it’s a development pipeline. So once the products go to production, we actually remove them from the pipeline. So it’s from the first qualification stage, committed production with high interest in technical fit to our product through to preproduction. Once it goes to production, we then count that in our production forecast. So for that number to grow, the number of additional programs going into the pipeline needs to exceed those products that are going from the pipeline into production.
Unidentified Analyst: Okay. Yeah, that’s remarkable. Thanks so much.
Gene Sheridan: One other clarification too, Richard, it’s a lifetime estimate. So that’s not an annual revenue. The lifetime of these programs were trying to be super conservative. Some could in theory last 5 or 10 years, but we don’t want to be too optimistic. So we generally assume about a 3- or 4-year lifetime for the more industrial markets, and mobile consumer we assume they run for about one year. So you have to factor in the lifetime of the product when you’re thinking about how that might translate into our revenue in future periods.
Unidentified Analyst: Great. It’s great. Thank you.
Gene Sheridan: You bet. Thanks, Richard.
Operator: Your next question comes from the line of Richard Shannon with Craig-Hallum. Please go ahead.
Richard Shannon: Hi, guys. Thanks for taking my question as well. Maybe I’ll focus on one of the markets that’s doing relatively better right now being in the mobile space here. I think a couple of quarters ago, or maybe it was more than two, you talked about a couple of your charger customers committing to like 30% usage of GaN here with higher levels of power. Your conversations you’re having with both aftermarket guys and I guess, more importantly, on the OEM side here, what do you think in terms of commitment to ramp with the higher 65-watt and above? I mean, I can tell you from my perspective having multiple Navitas gifted chargers in my possession looking at one of them right here, I mean the value proposition is so high, it seems like it would be a fairly fast conversion. So what do you get in a sense in terms of those conversations and what’s their pushback or delay in committing to something like that?
