Sunny Sanyal: Let me clarify. Tubes has been down. So that’s what’s led China to the decline in sales for us. However, when we ask our customers, where are these going? It’s – we are not sensing a strong placement of new systems. So our understanding is this is mostly going into replacement and wherever there might have been a smaller percentage of those than normal for new systems. So hard for us to tease this apart. But the general sense is that new business or new systems, placements is down and replacements have continued, but tubes overall have been down as a result.
Anthony Petrone: That’s helpful. And then maybe just when you think about the global manufacturing footprint, new disclosure tonight on India, how does that play with Wuxi is? Is Wuxi only going to exclusively supply to China? Will India supply to India? What happens to Salt Lake over time? Or will India and Wuxi become just larger global hubs? Thanks again.
Sunny Sanyal: Yes. So China and Wuxi was – our footprint in Wuxi was set up for China. So we optimized it for the specific products that are – were needed in China. And to the extent, particularly for detectors, the detectors that we make in China, we’ve also been shipping to other places where we needed lower cost detectors. So from that perspective, Wuxi is mainly for China. India, the capacity that we’re adding to India actually moves out some capacity from Salt Lake, frees up Salt Lake for some other products. Salt Lake is running the tubes. Production at Salt Lake is running at very high capacity levels. So this frees up space here. And then the production in India is initially intended, Phase 1 is intended for global sales.
And these will be at a lower cost with lower cost supply chain over the last three years during the COVID phase, and since then we have been diversifying our supplier base and one of the things we did was qualified a lot of suppliers in India. So this is – this gives us access to lower cost supply chain, lower manufacturing costs, and makes us more competitive. That’s the intention. And then for many of the newer tubes, the innovation and some of the high end tubes, we will use up the capacity freed up in Salt Lake for that.
Anthony Petrone: Thanks again.
Sunny Sanyal: Thanks, Anthony.
Operator: There are no further questions in the queue. I’d like to hand the call back to management for closing remarks.
Christopher Belfiore: Great. Thank you for your questions. Sunny, do you have any final comments?
Sunny Sanyal: Yes. It’s a short comment. Thanks, Chris. So in closing, we’re really pleased with the results we achieved in fiscal 2023. And as always, I’d really like to thank our employees all over the world for their efforts during this – during the year. Everyone worked really hard to contribute to our results. And thank you for taking the time to join us today and for your continued interest in Varex.
Christopher Belfiore: Thank you, Sunny, and thank you all for participating in our earnings conference call for the fourth quarter of fiscal year 2023. The webcast and supplemental slide presentation will be archived on our website. A replay of this quarterly conference call will be available through November 28 and can be accessed at vareximaging.com/investorrelations. Thank you and have a great evening.
Operator: Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.
