Oren Shirazi : Yeah, Cody, thank you. So I think this is exactly why because of these types of questions we presented — I presented the long-term financial model. It really show you in the right column of the financial model that the incremental margins are baked in everything. All in, is a 32% gross margin, 30% operational margin. Now, of course, this is better than the current gross and operating margins that we have. And this is lower than the 50% incremental margin that we always discussed about organic growth. So this gives you the answer that while this is a very nice incremental contribution, it is not an organic because it’s not from our existing space. Now, we cannot disclose the exact cost per wafer that we pay to Intel or to ST partnership because this is under, of course, confidentiality.
But you see that in the financial model, these are the results. This is the incremental is mostly because of Intel and — not Intel, because of the capacity corridor and as Agrate fab, as well as other growth in the company.
Cody Acree: All right, thanks. Thank you very much, very helpful.
Russell Ellwanger: Thank you, Cody.
Operator: The next question is from Richard Shannon of Craig Hallum. Please go ahead.
Richard Shannon : Well, great. Thanks, Russell and Oren, for taking my questions. I did want to preface them with two quick things here. Thanks for the investor presentation, I got some of the detail. It’s very helpful to see it that way. And also, if you want to congratulate the promotions here in particular, having got to know Marco over the years, I think it’s a very appropriate promotion, so congratulations on that.
Russell Ellwanger: Thank you.
Richard Shannon: With that said here, a few questions that come to mind. I guess I’ll ask a bottoms up, your questions on the data center market here, where you’re seeing a bit of weakness. And I think if I heard your comments correctly, not necessarily seeing upside here, improving directly, even though we hear from a lot of participants in this market about some great deal of strength here. Maybe you can help us understand, is there some inventory still left to be burned here? And then do you have any visibility into when that ramps? And do you expect that to be more of a ratable ramp or something more — I don’t know if I want to use the word spiky or not, but certainly seeing some of those dynamics in the market. I wonder if we should expect that over time?
Russell Ellwanger: Thank you for the question. I did state that we are seeing inventory levels having burned off quite substantially, and they have, and in particular in the RF space, and particularly with data center, to where our customers and their customer is down now to levels at or before the market, if you would say, went weak. Every time that we’ve experienced the data center market coming back, it is a very steep function when it comes back. It’s a step function. Will that be the case now? I don’t know. That’s hard for me to predict. We do believe it will come back, and we’ll be back within the next quarters, and we’re well prepared to take care of that growth. Now, part of the reason that we’re very optimistic about data center is really our partnerships with the leaders into not just what we have served in the past, but into those technologies that are serving the future.
I mentioned a very strong ramp being forecasted by customers within Silicon Photonics, and additionally, that analyst reports that are fairly recent seem to be very far off on the adoption of 800G, and 800G driving many activities that were not in 100G. So we see that as very, very positive. I stated, and I cannot overstate the importance of the partnership that we have with InnoLight on driving very state-of-the-art solutions with our Silicon Photonics platforms. So we’re pretty bullish on that. If you look at the other activities that we spoke about with, for example, the linear portable optics, we have many things coming into play right now that are technological upsides that have the benefit of the innovation of cost reduction. And those get implemented relatively quickly.
