And although the yield will be better next year, at the same time, the percentage of revenue contributed by N3 will be bigger. So net-net, worth, we also see some dilution from the N3 next year. But the margin – the guidance will be given out next year.
Randy Abrams: Okay. A quick follow-up to the first question. I think the last few nodes was 2 to 3 points dilution in the first year or 2 of ramp. The factor for it larger, is it the higher capital intensity or something different versus 3 – versus 5 and 7 or it looks like a little bit more dilution?
Wendell Huang: Yes. The increasing process complexity does add on to the challenges of a newer node. However, the other important factor is that our corporate averages has become higher than before. We used to have 50% gross margin. We’re now talking about 53% and higher gross margin, okay?
Randy Abrams: Yes. Okay. And the second question, I wanted to ask how you’re thinking about CapEx, just netting a few things, the geographic expansion, the 3 and then the start of 2-nanometer, the first ramp up or tool move in versus the mixed outlook you’re looking at for macro for a ballpark CapEx into next year? And if I could maybe within it, ask if the Arizona fab delays, does that push out where you mentioned the low end of guidance, push out some of this year to get some lift to next year?
Jeff Su: Okay. So Randy’s second question is on CapEx. He wants to know basically focusing on 2024 CapEx to some of the delays in the Arizona fab push out CapEx from this year to next year, as we expand overseas, as we invest in N2, but at the same time as the macro remains uncertain, how does this impact 2024 CapEx?
Wendell Huang: Yes. Randy, the push out of fabs does push out some part of the CapEx, but that doesn’t affect a big part. For 2024, it’s too early to talk about the overall CapEx. However, our CapEx, if you – as we said before, every year, we spend the CapEx to capture the future growth opportunities. And in the past few years, our CapEx has risen very fast to capture the megatrend. And going forward, the next few years, when we started to harvest those investment, we believe that CapEx will begin to level off in terms of dollar amount and that will lead to – start to lower the capital intensity in the next several years.
Jeff Su: Sorry, Randy. Sorry, do…
Randy Abrams: Yes, my quick follow-up. I think you mentioned that as you could use your 5-nanometer to support the ramp up 3. Given the AI and some of that pickup, do you still see that potential that could help optimize CapEx? Or do you need to keep it for existing node? And that’s my final one. Thank you.
Jeff Su: Yes. So Randy is just also asking then how does tool commonality play a role in our future CapEx?
Wendell Huang: Yes. We always build two commonality between nodes to provide greater flexibility. We mentioned last time the strong multiyear demand from N3, we are able to support that using some of the tools from N5. We’re not going to comment on the CapEx beyond this year. However, as I just mentioned, every year, the CapEx spend to capture the future growth opportunities.
Randy Abrams: Thank you, Wendell.
Wendell Huang: Okay.
Jeff Su: Thank you, Randy. Operator, can we move on to the next participant.
Operator: Next one to ask questions, Laura Chen from Citi.
