Operator: And we will take our next question from Ruplu Bhattacharya with Bank of America. Your line is open.
Ruplu Bhattacharya: Hi. Good morning. Thank you for taking my questions. Rich, it looks like you had another strong quarter for advanced solutions and that probably also benefited margins. So how much did advanced solutions benefit from backlog reduction in the quarter? And what do orders look like? And if advanced solutions weakens in the second half, what would the margin trajectory look like? And do you see the need for incremental cost structure changes?
Rich Hume: Lots of questions there. So let me take it one at a time. First, certainly, I do believe that as the backlog has been running down that it has assisted in our growth for advanced solutions. Second, when you think about when advanced solutions really began to have higher growth rates overall, it approximately was in the back half of last year. So therefore, the comparison in the back half will be a bit more challenging for advanced solutions. So we would expect that the growth rates wouldn’t be as they were previously. As it relates to cost actions, we’ve talked on the last couple of calls relative to us being very, very focused in every region of the world to make sure that we’re being very prescriptive as it relates to all of our discretionary spend, all of our new hires spend and ensuring that every single dollar is measured.
We look at and think about our cost structure on a continuous basis. And we’ll look forward to understand the ebb and flow of economic change and adjust accordingly, as we think about the back half of the year. So that’s the way, Ruplu, we think about it. And thanks for the question.
Ruplu Bhattacharya: Okay, Rich. Thanks for the details there. Marshall, I have a question for you on ROIC. But before I ask that, I just wanted to ask a clarification. Maybe I missed this, but last quarter, you had talked about full year 2023 revenue growth to be 3% to 5% on a reported basis. Did you confirm that also in this quarter? I may have missed that, if you can just clarify that. And then my question on ROIC is I guess you’ve reported 10.6% this quarter. A year ago, it looks like it was in the mid teens. It may not be an apples-to-apples because maybe it wasn’t on a combined company basis. So the target of 2% to 4% above WACC, what needs to happen for you to get to the high end of that ROIC range? And how should we think about ROIC in the long term? Thanks.
Marshall Witt: Sure. I’ll address the ROIC first, Ruplu. The mechanics around how that’s calculated is we do a five quarter average so that as we have come further away from the merger, investment capital continues to grow, the denominator is growing, which is expected. So the 10.6 is in line with our expectations. To your question on WACC, clearly, interest rates have increased. So that has increased our WACC. We’re at a WACC of roughly around 8.5% to 9%, and a lot of that again is just due to rising interest rates. It hasn’t changed our overall requirement of returning 200 to 400 basis points above our weighted average cost of capital. That continues to be the threshold that we look at when we make investments in the business and we make investments externally in terms of M&A opportunity.
To touch on the question about what we gave guidance for and what we didn’t, you’re right. We did not give guidance for revenue for the second half of the year. A lot of that has to do with what Rich said in his prepared remarks just around the uncertainty and volatility that we’re currently experiencing. We certainly want to see this quarter play out, see how it does and then come back with a rethought for our guidance as we get into the end part of Q2 and into Q3.
Ruplu Bhattacharya: Okay. Thank you for all the details. I appreciate it.
Operator: And we will take our next question from Adam Tindle with Raymond James. Your line is open.
Adam Tindle: Okay. Thanks. Good morning. Marshall, I want to expand on that guidance point that you just made. I understand maybe not expanding on the revenue piece of it, but stripping out gross versus net and all that sort of stuff and just looking at the actual earnings of the company, I think you would have come to a conclusion of an earnings for around $12 for the year based on your comments of 3% to 5% growth, 2.6% to 2.8% operating margin, that’s kind of where we all landed for the year. Obviously, you’re tracking below that on a year-over-year basis for the first half of this year. So just wondering, maybe if we could switch that question to more of an earnings question to see what has changed since you last gave that guidance? And if we look at the current run rates, we’re probably going to be closer to low 11s in terms of earnings for the year. Is that something that makes more sense to you based on what you’re seeing right now? Thanks.
