It’s a new sort of a way for the Chinese government to monitor and manage how the monies are handled by the public hospital system. So, I think, in general, what we’re sensing is a slight, I’d say, loosening up of the environment. And so that’s why we still continue to be able the belief that the second half, we should expect to see things pick up in China.
Shubham Maheshwari: And I can just add there, Anthony, is that you know that there is no specific announcements or there are no sharp cutoff dates or deadlines, that are announced. It is generally as we perceive and hear from our salesforce. So, we just need to be open to that and there can be various interpretations. But in general, we are thinking things will improve because the government does want to spend money on the infrastructure and provide better healthcare facilities and services to its citizens. So, there is the positive pressure there along with, we would say, taking care of the healthcare system for the long-term goodness of the system. So in that way, that’s also positive for the long-term.
Anthony Petrone: And maybe just a quick one there. I mean, is it safe to assume then just the — I guess, the lead time on new deals is maybe slightly longer here because this audit process may be continuously going on in the background? Or are there certain like checks and balances upfront before a deal is closed, whether that’s in the provinces or major coastal cities. Just kind of the mechanics of what’s going on behind the scenes there would be helpful.
Sunny Sanyal: Since we don’t have direct visibility to end user hospital buying, I can’t answer that very accurately for you. But the way we see it is the hospital purchasing just stopped at some point because of — they were in the middle of the audits. But once the audits are completed, the hospitals go back to their normal operating mechanisms. And so, whatever was the deal cycle — the cycle times, we anticipate that, that would come back for those particular hospitals. And for us, the lead times then come back to what would be normal traditional lead times. So as hospitals start taking orders, they might have — I’m sorry — as vendors start — or OEMs start to take orders, they may have three to six-month delivery cycles.
And that’s when we get the indicators for the — for our forecasts and our factory would then build the component. So, I don’t think anything gets extended once it turns on, it just comes back on in the way things were. So the question is, it’s not all at the same time, it’s going to start trickling in. And we’re seeing early signs of a little bit of that happening.
Anthony Petrone: Thanks. And last one for me, I’ll hop back in, is just an update on photon counting on the CT detector side. Just maybe where we are in the cycle, what you’re hearing in terms of demand for conversions on — into photon counting, and how you expect that to play out over the next couple of years? Thanks.
Sunny Sanyal: Yeah. So, it’s safe to say that the technology is here to stay in the sense that there’s — outside of the OEMs and the vendors like us making the noise around the technology itself. The broad-based radiology community has picked up on photon counting as a viable technology and clinically exciting for them. So from that perspective, we believe it’s here to stay. And we are seeing that in the way our medical OEMs are beginning to talk about their future products and the need to incorporate their desire to incorporate photon counting technologies. From a CT perspective, the initial introductions were at the high-end of the spectrum of CTs, but the need in the market is for it to be more in the general tiers that are more broadly available. And we are targeting that type of a market segment and our products are geared towards CTs that would be in that not super ultra-high-end, but things that would be more broad-based.
Operator: Thank you. Our next question comes from the line of Suraj Kalia with Oppenheimer. Please proceed with your question.
Shaymus Contorno: Hi, Sunny and Sam. This is Shaymus on for Suraj. Thank you for taking your questions.
Sunny Sanyal: Hi, Shane.
Shaymus Contorno: Hi. Just looking at kind of outside of China, what are you seeing in terms of the capital equipment environment? And then kind of more specifically, I think you noted in the geographic mix, the Americas was down as well, and EMEA was pretty much flat. I guess, any color you could provide there as to what’s happening to in those regions as well?
Sunny Sanyal: So our perception and our — what we’re picking up is that the hospital environment in the U.S. is — our hospitals are generally doing better from a profitability standpoint, they’re cost structure, labor costs and tie to nursing and clinicians as manpower has gotten better, and so they’re managing it better. So, there’s profitability improved. So that generally bodes well for capital availability for diagnostic imaging. So, we are — we feel positive about the U.S. market. Outside of that, we haven’t noticed any measurable difference in Europe or let’s say, Japan. Those are our two biggest regions. So, I think U.S. continues to be strong. Europe is — and Japan is still to be seen.
Shaymus Contorno: Got it. Thank you. And then looking at it, the Medical segment was down a little bit. I guess, how should we think about the relative health over the next three to four quarters? And where would you describe any soft spots that maybe need to be monitored.
