Aart de Geus: It’s a very good question, and I understand why it’s difficult because a lot of these things are written in terms of hard to understand technology. And so of course, whenever there’s a change, we look solidly at all the changes, as is the impact. And actually, I think we explicitly communicated that our assessment showed that it was not material in the financial terms. We highlight that we have factored in, to the best of our ability, exactly what the situation is today in our forecast. And moreover, we have put a lot of emphasis on making sure that we are 100% compliant with all the rules so that we act in a clean fashion. I would add only one more thing, which is China is a very broad market, and so there are many technologies that are not anywhere close to being touched by the advanced restrictions.
So we see continued great opportunity, but we understand with you that it’s an area to keep watching and to make sure that we grow in other parts of the world as well.
Charles Shi: Thank you Aart. Maybe the second question, maybe this is for you, Trac. First off, congratulations on the retirement done. But I want to ask you, I think one year ago, when you gave the guidance about fiscal 2022, you guided fiscal 2022, maybe like first half, slightly first half loaded over second half. But your fiscal 2023 guidance, if I hear you correctly, you’re guiding second half likely to be higher than first half. And your number seems to imply that every quarter needs to be somewhere 4% to 5% higher than the preceding quarters throughout the entire 2023. I wonder where exactly the assumptions there for steady growth into the year and that you have assumptions like maybe the semiconductor industry needs to have a rebound or recovery out of the downturn to the second half of your fiscal year.
And if possible, can you give us some color what exactly driving the second half rebound, I mean the growth into the second half, which one will be the primary driver. It’s EDA? Is it IP? Is it hardware? Or is it the SIG part of the business? Thank you.
Trac Pham: Sure, Charles. Let me zoom out a little bit because over the last couple of years, we’ve had some unusual profiles coming into the year, right? So 2020 was very back end — 2021 was back-end loaded. Heading into 2022, we said it would be very front-end loaded. When we look at the profile this year, keep in mind that it’s based on backlog that we have scheduled out for our software business, IP and hardware. So, there’s good visibility into how it lays out throughout the year. And when you look at the profile, you’re right, it’s slightly to the back half, but just marginally so. And if you look at the first half comparison — first half, second half comparison for 2023 and you go back in time, it’s just actually in line with what we have historically seen, which is kind of unusual but nice to get back to that profile.
And it does imply that there is incremental increases in the business as we progress throughout the year. The basis for the forecast, as I said, is grounded very much on visibility of the backlog, but also what we expect to book in the year. And we are playing the year based on what we can execute, similar to what we have said in the past. So it’s not a stretch to assume that it’s dependent on major market forces or anything out of our control. We want to give guidance in terms of the outlook for the business, both top line and bottom line. That really is heavily dependent on our ability to execute. And at this point, given our visibility, the portfolio that we have and the — our confidence in our execution, we feel really good about the 14% to 15% growth and driving 16% EPS growth.
Charles Shi: Thank you, Trac.
Trac Pham: You’re welcome.
Operator: We’ll take our next question from Jay Vleeschhouwer with Griffin Securities.
Jay Vleeschhouwer: Thank you. Good evening. Aart, for you first, a product question since the term road map came up a couple of times. I’m wondering if there is some potential development of catalysts that you might be able to bring to market. For example, would it make any sense or would it be feasible for you to increasingly connect SIG with hardware-based prototyping? Along the lines of an earlier question, you haven’t mentioned silicon lifecycle management or SLM, but would it make some sense there to connect it increasingly to your sign-off business and so forth and other kinds of intracompany integrations that could be differentiators or new catalysts for product growth? And then my final question for Trac. With regard to SIG, could you comment on the results that you’ve been seeing for your investments in international expansion for SIG over the last number of years, including, in particular, your investments in security consulting outside of the US?
Aart de Geus: So, let me zoom out a little bit on your question because generically, I think you’re pushing absolutely on the right buttons, which is that while many of the things we’ve done in the past have been sort of point efforts, point tools and so on, for the last decade, we have started to integrate many tools more forcefully together because that’s the only way of solving problems of complexity where power and speed and thermal and locations and reliability strongly intersect. Then if you move to the next level up, we have already mentioned the fact that there are strong interconnectivity between software and hardware because the hardware has one mission, make the software faster. And the software has one mission, make the hardware work harder for it.
