We’re excited about that. And you should start thinking about the PC business, almost like the auto business. We’re focused on next generation PCs, not existing PCs, and as those windows started to switch to Windows AI and our platform launches. it create opportunity for us to start gaining scale. Specifically to your question. Microsoft has been very active together with us of bringing a lot of applications natively through the platform. I think we had, a significant progress made across consumer in commercial applications. You continue to see announcements and Windows 11 can also run every, x86, 32, and 64 bit to the Microsoft emulation. We also made significant strides in the emulation performance. So, I think Snapdragon X Elite represents the results of this Microsoft Qualcomm collaboration.
And I’ll finish the answer by saying, if you look at the announcements of other computing companies talking about having an ARM based PC preprocessor, that is validation that that’s our TAM now. It is going to be part of the expansion of TAM for Qualcomm. We’re a new player and we look at this as a growth opportunity. We’re excited about it.
Operator: Our next question comes from the line of Mike Walkley with Canaccord Genuity. Please proceed with your question.
Mike Walkley: Great. Thanks. A quick question for Akash. I think a strong cost execution coming in ahead of plan for exiting the fiscal ‘23, and flattish into the start to Q1. How should we think about OpEx level plan for the year? Is there more areas to cut or you think your main kind of flattish for the year from the good start?
Akash Palkhiwala: Yes, thanks, Mike, for the question. Yes, we’re very happy that we set a target for fiscal ‘23 of a reduction of 5% relative to the ‘22 exit rate. And we came in at 7%. As we’ve continued to mention, we, we have recommitting to operating discipline and we did implement additional actions this quarter proactively. And the way we are managing our portfolio is really while we are reducing cost, we want to ensure that we continue to invest, appropriately in technology leadership and diversification in some of the areas that Cristiano just went through. So that’s the balance we are trying to strike. And, and as we look at the rest of the year, again, we’re committed to maintaining operating as we move forward. I think we’re in a very good place from an OpEx perspective. We are investing in the right areas and we’ll, we’ll focus on those, that scale.
Mike Walkley: Great. Thanks. And kind of building on that, my follow-up question to you, Cristiano. Just to follow-up on the on-device, Gen AI opportunity, how should we think about the increased dollar content per device for Qualcomm or increased ASPs relative to your high-end Snapdragon shipped today? Thank you.
Cristiano Amon: Look, let me start and see if, Akash wants to add any, something else to the answer. The way we think about this is let, you rather than provide a specific dollar content is, it has a mix improvement and it will drive towards a richer mix of higher in premium tier devices. It has an ASP increase, especially because of the accelerated performance for AI. And we’re combining that with significant advancements in CPU and GPU as well. And it has the opportunity to drive units, whether it’s a new upgrade cycle, or share gains. Akash, I don’t know if you want to add anything.
Akash Palkhiwala: Well, and maybe just the other thing to keep in mind is outside handsets as we talk about PC opportunity. Of course, our AI leadership becomes extremely important there. And then also within IoT, we think about Gen AI as something that’s going to be a key technology going forward. It’ll expand our addressable market, expand the dollars we make per device on, in that area as well. So, it’s a much broader play for us, including automotive with ADAS, IoT and PC.
Operator: Our next question comes from the line of Stacy Rasgon with Bernstein Research. Please proceed with your question.
Stacy Rasgon: Hi guys. Thanks for taking my questions. For my first one, I want to ask the March quarter seasonality question a little more directly. And Akash, can you just give us some of the puts and takes on that March quarter seasonality? I mean, we’ve got a strong Apple quarter presumably in December that rolls off. We’ve got Samsung that launches, although we can question what the share is. We’ve got other things going on. Just how do we think about that seasonality in the context of everything that’s going on, which we’ll be expecting?
Akash Palkhiwala: All right. Sure. So let me maybe try to address, shape of the year as a broader comment. I mean, we do expect the first quarter and the fourth quarter to be the strongest quarters within the year. And then third quarter, as you know, is typically the lower quarter because we don’t have a flagship phone launch that happens during the quarter. But, when you step back and kind of look at as we enter fiscal 2024, we’re very happy with kind of the early signs of stabilization in the global handset market. And so we are cautiously optimistic as we go forward with that stabilizing and the normalization of Android channel inventory, we are on a strong trajectory as we go through the year.
Stacy Rasgon: Got it. That’s helpful. For my second question, I want to ask about the new Apple agreement. So you put that out a little while ago. You’re modeling 20% share now in the phone that launches in ‘26. So that’ll be primarily a fiscal ‘27 issue. How should we think about, the shape of that in ‘24 and the launches that happened in ’24 and ‘25? Do we assume that you’ve got close to 100% of the majority of the units there and then it drops down for modeling purposes to 20% on the ‘26 launch or like, what does that look like?
Akash Palkhiwala: Yes. So the way you should think about the new agreement with our kind of going into specifics, the framework is very consistent with the previous agreement. It covers three launches. So, the launch in ‘24, launch in ‘25, and launch in ‘26. And, again, the framework is consistent with what we had before. For financial planning purposes, we’re taking the same approach as we did with last agreement, and that’s 20% you mentioned where in the last year, we are planning as if we’re going to get 20% share. But you know, to the extent that we get more than that, that’d be upside for our plan.
Operator: Our next question is from the line of Ross Seymore with Deutsche Bank. Please proceed with your questions.
Ross Seymore: Hi guys. Thanks for letting me ask a question. I just wanted to dive a little bit into the automotive and IoT sides of things. Just a clarification for your fiscal fourth quarter guide, Akash. I believe you said they’d be somewhat similar to last year. I just wondered what you meant by that. And then a bigger cyclical question, we’ve heard a number of different companies talk about inventory burn in those two markets. You guys highlighted it in IoT, so I wondered where we were there. And are you seeing anything in automotive?
