Shreyas Patil: Hey, thanks so much for taking my question. Just thinking about it, as we look out the next few years, you’ve previously talked about your BMS business growing to about $600 million of revenue by 2026. I’m curious, as you map that out, have you taken into account any conservatism around some of the volume expectations that underpin that kind of revenue? And similarly, with this award that you just won on power electronics, obviously, there’s a lot of concern in the market regarding legacy automakers and some of the volume aspirations that they have with regards to EVs.
Sachin Lawande: Yes, very good question, Shreyas. So what I would start with is that the $600 million for 2026 that we have talked about previously, I would like to reiterate that we have already lowered that number from what our customers are telling us in terms of their demand. So it’s already a number that we have taken down, factoring all these concerns that we have about the ramp-up and the speed of the ramp-up. I do believe that over time that we will see higher levels of sales, but I think it is prudent for now to be a little more conservative than we would normally be, especially this is – considering that it’s new product for our customers and the industry at large. So we are comfortable with the 2026 target of $600 million.
Is there an upside to it? If some of these customers do better than what we think they would, especially if they come anywhere close to their own stated objectives, yes, there is an upside to that. Now, the specific BMS win that we talked about, it actually launches in the second half of 2026. So it’s not going to be material to the 2026 targets but is usually important going forward to continue our growth in this category. However, the other BMS extensions that we have reported also this first half, I would say about one-third of our BMS – or electrification wins in the first half are accounted by this junction box and BMS product. 2/3 of it is extensions of our existing BMS business. That will help in terms of our mid-term targets and us either achieving or hopefully exceeding our mid-term target.
Shreyas Patil: Okay, understood. And maybe, Jerome, just a quick question on how to think about engineering and SG&A for the second half. I apologize if you commented on this already, but just trying to think about that, both in dollars and as a percent of revenue.
Jerome Rouquet: Yes, a good point. So we’ve – at a very high level, H2 will look very similar to H1 for engineering – net engineering as well as for SG&A. So, in percentage of sales, we have 6% for H1 for net engineering and 4.5% for SG&A. The dollar amount will stay stable in the second half. But obviously, as volume ramps, we’ll have an improvement in the percentage for both net engineering as well as SG&A, and we are essentially tracking in line with what we had in mind when we first issued guidance back earlier this year.
Shreyas Patil: Okay, great. Thank you.
Jerome Rouquet: Thank you.
Operator: And we will take our next question from Dan Levy with Barclays. Your line is open.
Dan Levy: Hi, good morning. Thank you for taking the questions. I know you’ve noted – you’ve talked to maybe one of the slower ramps on the EV front. Just wondering as far as BMS goes, if the ramp is slower, how should we think about the impact on margins? Meaning, how much upfront R&D has there been? And if it’s a slower ramp of revenue, what is the impact on margins from that?
