“I'd say fourth quarter, we start to go back to what would be more of our typical fall-through range, somewhat muted by the fact that we are still going through 5 nodes in 4 years... it's probably like a 60% fall-through.”

In context

“he year. And I think at that event, you said next year is going to be up but probably not a couple of hundred basis points. So did you mean off of the Q4 run rate or do you mean off of the 43% for the year? And can you kind of shape that for us throughout the year? David Zinsner: Yes. Well, let me just -- if you don't mind, let me step back. I want to talk a little bit about Q3 for a second because Q3, I was really proud of the team's performance in terms of gross margins for Q3 coming in just shy of 46%. It was great execution in terms of spending from the team. They also did work on the underloading, which helped, and we were able to sell through some previously reserved inventory, and so that really helped propel the gross margin. So we had phenomenal fall-through in the third quarter. I'd say fourth quarter, we start to go back to what would be more of our typical fall-through range, somewhat muted by the fact that we are still going through 5 nodes in 4 years. There is spend associated with that, which kind of mutes us. So we're probably a little bit higher normally in terms of fall-through, but with that, it's probably like a 60% fall-through. That's kind of the normal range we think of, and that's what we're guiding for the fourth quarter. Beyond that, we'll save the rest of the commentary for next year when we close out '23. I would just say just on a longer-term basis, Pat has talked a lot about gross margins of 60%. And I feel like we are even more confident around our ability to hit that 60% threshold for a number of reasons. One, the execution that Pat talked about on five nodes in four years. When we get through that, of course, we eliminate the headwind on margins, but it turns around to a tailwind because when you're a process leader, you get better gross margins. Also as pr”