Dean Butler: Yeah. So I’ll just take the last part of your question, Chris, which was around the scrap at a large customer. So we did enter into a one-time scrap agreement, which is a cost of goods charge to scrap a bunch of parts that are specific for their use. Does that answer is happy for you?
Christopher Rolland: Okay. Yeah.
Michael Hurlston: It was on a module. I mean, your question sort of led to a module, it was a separate non-module customer. We are burning inventory in our large module customer. That’s more of an inventory situation and then as Dean talked to the scrap situation is a direct customer.
Christopher Rolland: Yeah. I see now. Okay. Thank you for that clarification. And then pricing pressure, was that — I wasn’t quite sure what that, was that just Automotive Touch, was that all of Touch when you were talking about pricing pressure and then pricing pressure, are there other parts of your business where you’ve seen this, for example, in conductivity with this extra kind of inventory out there? I think everyone on the conductivity side has seen a downtick with over inventorying. Are you seeing pricing pressures there or any other part of your business? Thanks.
Michael Hurlston: Yeah. So, Chris, the comment in the prepared remarks was very specifically pointed at automotive and we’re certainly seeing some pricing pressure in our automotive business, which is actually held up really, really well for us, but these are designs that would be shipping in multiple years in order to bid and win on those designs. We’re seeing quite a bit of price pressure. But to your question, we’re certainly seeing some pricing pressure, as you alluded to on Wi-Fi and a bit on our Touch technology. But overall, remember as we’ve sort of characterized on previous calls, our IoT business is largely pockets of strength, where we were sole sourced in many instances and we have some pricing power in areas that are more competitive, like the Wi-Fi, like the Touch and Mobile, we’re definitely seeing some pricing pressure.
Christopher Rolland: Fantastic. Thank you, Michael.
Operator: Thank you. Please hold for our next question. Our next question comes from Nick Doyle of Needham.
Nick Doyle: Hey, guys. Thanks for taking my question. For the COGS charge. Did you guys quantify the impact to the margins and do you anticipate any further write downs for other parts?
Michael Hurlston: Yeah. Nick, so we didn’t quantify, I mean, there’s, obviously, lots of moving pieces. I wouldn’t focus so much on what the COGS charge is for the scrap portion, the largest piece of the movement around gross margin, which I think is the thing that you want to just sort of get focused on is really around the imbalance of the mix of the products, specifically with some of the enterprise focused customers actually driving that mix, even within IoT a little bit more unfavorable. So that is probably what I would sort of guide you to.
Nick Doyle: Appreciate that. Yeah. I was trying to get a little sense there. When you’re talking about the Broadcom deal, there was a line that said, you’re trying to focus on the broad market part of the roadmap, can you just expand on what products that is?
Michael Hurlston: Yeah. I mean, today, our product line is very much targeted to high performance. I think we’ve discussed it on — in previous calls, where, for the most part, we’re moving video from one device to another and that requires very high bandwidth, it requires quite high performance. Where we’re aiming our roadmap over the next couple of years is a more basic connectivity, simple point-to-point connections, whether that be over Bluetooth, whether that be over Zigbee technology, whether that be over Wi-Fi, there is a kind of a margin rich and high TAM area there that we have totally not tackled. So our engineering investment right now is very much geared toward retuning our roadmap to go after that broad market.
Eventually, we think that there’s going to be opportunities for us to bring in our SOCs, our processors and either through integration or through a bundling type of scenario where you can pull through a lot more content in that broad market area.
Operator: Thank you. Please hold for our next question. Our next question comes from Hadi Orabi of TD Cowen. Please go ahead.
Hadi Orabi: Hey, guys. This is Hadi for Chris. Congrats on signing the deal with Samsung. Pretty interesting. It seems that the three has been trending more towards foldable phones, especially in Android. So can you remind us about Synaptics opportunity there, like, what percentage of mobile revenues go to foldable phones and whether the competitive environment is different there than regular phones? And I have another question please.
Michael Hurlston: Yeah. Hadi, I don’t know if we actually break out the specific revenue that’s attached to a foldable. I don’t know if I have it on hand. But what I would say is, we’re very much on the flexible OLED displays, which are 100% of the fold market and of the flip market, if you will. So more and more attach is coming into the — flexible OLED is becoming a much bigger portion of the market and that’s why I think we’re doing unusually well. On the Samsung deal, in particular, as we mentioned on the — in the prepared remarks, we actually ship to Touch ICs, one for the front panel and then one is it flips out and opens up into the full panel. We’re not in the fold today. It represents an opportunity for us as we look out at the landscape and we agree that there definitely is a trend line to more of these foldable phones, which play to our strengths, for sure.
Hadi Orabi: Got it. Thanks, Michael. And just on the Bluetooth 6 IP. First, just clarification, do you have a standalone Bluetooth product today for the Bluetooth 5? And second, you talked about Bluetooth 6 expanding product line to the enterprise handset market. Are there any other new markets that Wi-Fi7 and Bluetooth 6 can open for you, like in healthcare, industrial, et cetera? Thanks.
Michael Hurlston: Yeah. I mean, the — your question is a good one. So today before this particular transaction, we had no standalone Bluetooth offering. We still need to work on the Bluetooth engine to make it truly, truly competitive. We can ship into certain markets today. HIDs, human interface devices, we can ship into remote controls. We can ship into — it opens up a bunch of new markets for us. But to get into industrial and into medical and some of these other things, we are — this is where we intend to go. We have now with the Bluetooth 6 technology. We’re already much closer to our competitors today than we were before this deal. So we’ve actually really close the gap on Bluetooth. We will continue to evolve that and our intent is to open up some of the markets that you alluded to, the industrial, medical, gaming, there’s a lot of things that we think we can do with standalone Bluetooth that today we do not do.
Hadi Orabi: Thanks, Michael. And just a quick follow-up, competitors in this market would be Silicon Labs and Nordic Semi, right?
