Mark Adams: Well, it’s kind of a loaded question, but I’m going to try to answer, but it’s a tough question being that. The timing of these deployments, when you’re growing like we’ve grown, because we’ve been able to navigate a lot, the timing of somebody’s deployments, not just the budgeting piece upfront with our customers or even the large-scale customers and other allocating budgets, but also just once you get the orders, when those get installed and how they get installed, the supply-chain challenges, I mean, the supply-chain has improved, broadly. But if you look at certain key technologies and networking component of these installations, the GPU availability at the leading-edge GPUs in the industry, I just can’t commit that everything is going to be the same as the prior year, given all the factors that I just went through, lumpiness, concentration, deployment timing, capital budgets, supply-chain.
We are long-term believers. We think we’re in a really good place, but I want to stop short of calling quarters that far in advance.
Tom O’Malley: Really appreciate all the color. Thank you guys.
Mark Adams: Thank you.
Operator: Thank you, Mr. O’Malley. The next question is from the line of Sidney Ho with Deutsche Bank. You may proceed.
Sidney Ho: Thank you. It’s great to hear about the demand strength that you guys have seen in AI. So a couple of quick questions here. One, do you see the demand for these AI servers to be crowding out spending on traditional servers, meaning it’s coming out from the same fixed budget, but that may not be impacting you guys? And the second question I has, if you could — if you can give us an update on your Penguin on demand solution, that would be great. But, what kind of customer appetite are you seeing for consumption model versus the traditional CapEx model, particularly as it relates to HPC and AI market?
Mark Adams: Can you just repeat, restate the first part of the question?
Sidney Ho: Yes, the first part is just trying to figure out, everybody is spending a lot more money in AI and of course, you see a big uptick in the demand strength. But do you see that as the — basically coming from the fixed IT budget that some of the money is being pulled from traditional spending — spending on traditional servers?
Mark Adams: I’m not sure that I can really give you a definitive answer there. I guess, I would say, we have seen in fiscal ‘23 money reallocated when there is commercial success in the deployment in the production side of the house for these type of systems. As far as next year’s budget process and obviously our fiscal years off-cycle with the budget process of our largest enterprise customers, I think If I had to guess, I would say, yes, probably, there would be some shifting of budgets toward this. But, you’re talking about different type of customer environments and the ultra-scale, hyperscale customers, they obviously have a lot of infrastructure, they have to build-out, not just AI, but just pure cloud resource capabilities.
And in some of the more newer verticals, I think the map heads up and we got to remember that we’re not quite out-of-the woods on the overall macroeconomic headwinds. And so I’m guessing that there’ll be money that needs to be shifted appropriately, but it’s just such a broad question that I want to just cautiously answer a little bit. The second thing on [Multiple Speakers] sorry go ahead.
Sidney Ho: Yes, Penguin on demand.
