Stephanie Davis: Okay, thanks. I’ll hop back in the queue.
Operator: Your next question comes from Bill Sutherland with The Benchmark Company. Please go ahead.
BillSutherland: Thanks. Good morning, everybody. Randy, you just mentioned make or buy. I was actually going to ask you what your – any thoughts on the capital deployment side, particularly with the cash building quite nicely.
Randall Lipps: Yes. I’ll let Nchacha come in on the refinancing of the debt, but I should have said that we probably won’t be looking at acquisitions until we get sort of the debt side of it addressed here. And that’s not too far off in the distant future. I don’t know, Nchacha, wound you want to say anything else about that.
Nchacha Etta: Yes. We continue to be mindful of the upcoming 2025 much already of the convertible senior notes and we are considering various options to maintain strategic flexibility for our company and in an effort to minimize any potential dilution to our stockholders.
BillSutherland: Got it. Nchacha, the quarterly cadence, particularly on earnings, non-GAAP earnings from the Q1 guidance for the full year, quite a lift. Is it going to be kind of a – should we think of it kind of ratably improving? Or is it more back half loaded?
Nchacha Etta: I’ll say back half loaded to a certain extent.
BillSutherland: Okay. And then, Randy, you said not too long ago in a conference that the regulatory headwinds, which are state by state on IVX, you kind of thought that most of the important states, at least, would work through during the course of this year. I think that’s what you said. Is that the case, so that we can really expect IVX to be taking off in ’25?
Randall Lipps: We’ll have to see how it goes, but I think ’25 is going to be a much better year for IV just because we’ll get through some of those states. Some of the things that impacted the IV is what drugs you can mix on site and how long the stability was. And so our original thesis for some of our sites where we were making proposals, the ROIs were as high, so we had to go back and reformulate those and then get hospitals to get engaged on those again. So I think we’ll have worked through most of that by the end of this year.
BillSutherland: Okay. That’s all I have. Thanks very much.
Operator: Your last question comes from Jessica Tassan with Piper Sandler. Please go ahead.
Jessica Tassan: Hi, guys. Thank you for the question. I thought the new deck was really helpful. Slide 14, especially. So I wanted to just get kind of clarity on the enhancement of the XT cycle via console versus the upgrade cycle. I guess, what’s the thought process on launching the new console during the end of the XT cycle as opposed to just introducing the new console and cabinet kind of bundled together as a new product cycle entirely?
Randall Lipps: Well, this has just been our tradition, and it’s also been part of our brand is that if you buy a frame from us, it’s good for 10 years, but it includes an upgrade of the console about halfway through to get new enhancements and really replacement of the old hardware or the interface console. So customers kind of expect it, and it generates good revenue for us, and it extends the life of their asset. It makes sense for them to purchase and it keeps customers engaged with us as we move on to product transitions and product rollouts of new products and services. So I would say half of our customers in the last, I don’t know, three years have just installed our XT. So it’s not the timing to come up with a new piece of hardware, total frame at this point.
And so this would be the next logical move for us in our go-to-market. As well historically, this makes a lot of sense. And that’s probably the reason we’ve kind of had this dip as we’ve tailed off in the XT and we’re taking off on the console upgrades is we probably had some of those XT cabinet sales were pooled in through the pandemic process. And so it really created a slack in the rope. And now that we’re getting the console going, which is what people expect about this time, it should help us even out and move forward on a more consistent basis to drive revenue and profit.
Jessica Tassan: Okay. Got it. That’s helpful. So the customers who have already implemented the XT have not paid for the console yet, but they’ve agreed ostensibly or implicitly to upgrading the console whenever it gets released. Is that fair? And is this kind of an incremental market share driver or a way to drive revenue on the existing XT base?
Randall Lipps: This is all for the XT base, and it’s quite large for us, right, because of our footprint that we’ve gained over the last three or four years. So this is a sale into our captured customers’ XT base that we have today.
Jessica Tassan: Okay. Got it. And then I just wanted to quickly follow up on your commentary about the bookings miss in ’23 versus the preliminary guide, so about $150 million at the midpoint. If we imagine that the majority of that is attributable to a miss in central dispensing and the IV compounding robot, it just suggests that there were pretty significant expectations for those two products in the ’23 bookings guide. Have you guys thought about or changed your philosophy around guidance for those new products in ’24. Just kind of increase the level of conservatism given that they are new products, but…
