Dave Regnery: Yes, I really don’t. I think last year the EPA came out and kind of clarified so you can manufacture to the end of this year and then you have a complete through 2025 to do the sell through. We see that as all that was a good ruling by the EPA. We support that it gives the channel time to do proper sell through. So, we see that all as possible. I don’t see any different dynamic there on the light unitary and I’m defining light unitary as less than 25 tons. So it’ll really be the same dynamic that we’re seeing in res.
Andrew Obin: And how big is under 25 tons for you?
Dave Regnery: It’s a large portion of our unitary business, but we also have this great applied business, Andrew, that’s even bigger.
Andrew Obin: I appreciate it. Thank you.
Dave Regnery: All right. Thanks.
Operator: Our last question today will come from Noah Kaye from Oppenheimer. Please go ahead. Your line is open.
Noah Kaye: Appreciate it. Thanks. Since you talked earlier about some of the digital investments you’re making this year, and you appointed a Chief Digital Officer in December, which seemed like a pretty significant milestone. Just to help us understand, is there more of a digital transformation opportunity internally over the next few years, or is this more about adding offerings to your quiver? Maybe you can get a little bit deeper into some of the focus areas for those digital investments, cyber, digital twin, et cetera.
Dave Regnery: Yes. I would tell you we’ve been in the digital space for a long time. Okay? So digital twins are not new to us. Connected solutions are not new to us. I think that bringing Riaz on board, which is he’s just a fantastic talent and early days, is just doing a great job. It’s just creating a huge focus, and we believe that digitalization is a big part of our future, and Riaz is going to help us see the opportunities that exist. You take with Riaz, You take the Nuvolo that we’ve added on, you think about what we’re doing with digital twins. There’s a lot of opportunities there. And you think about the level that we’re seeing in our service business today, the growth rates we’re seeing. Just think of that even getting stronger with a digital application in the future.
Noah Kaye: Appreciate that Dave, maybe the last question. I think around this time last year, you shared with us your view of where backlog would end. You said greater than $6 billion exiting 2023. $6.9 billion. So, you clearly surpassed that. Can you share with us today where you see it ending 2024?
Dave Regnery: Yes, I would just say that expect our backlog to remain elevated for several periods. Look, we’re at $6.9 billion right now. It’s the same level we were at when we entered 2023. So it’s very strong. I think one thing I would say is that the composition of the backlog is changing quite a bit. And as we went through 2023, it’s now like 90% plus commercial HVAC. And think of that as applied systems, which has that long service tail associated with it. So a lot of demand in the verticals, data centers, et cetera, that really require applied systems. So, we’re very happy with our performance.
Noah Kaye: Appreciate that, caller. Thank you.
Dave Regnery: Sure.
Operator: This concludes today’s Q&A session. I would like to turn the call back over to Zac Nagle for closing remarks.
Zac Nagle: Thanks, operator. I’d like to thank everyone for joining today’s call. As always, we’ll be around to answer any questions you have in the coming days and weeks. We’ll also be attending a number of the upcoming conferences as we enter the big conference season, and we hope to have the opportunity to connect with many of you there soon. Have a great day, and we’ll talk to you soon.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
