“The one dynamic in '25 is this kind of margin pressure around product like Lunar Lake. That probably pulls the range down to probably something more like in the 40% to 60% fall-through is probably the right way to think about it just for that dynamic.”

In context

“question please. Timothy Arcuri : Thanks a lot. Dave, I also wanted to ask about gross margin. I think the message you were saying is that it's kind of 60% incremental, and that was kind of off of the [39.5%] (ph) that you guided for Q4, but obviously, you came in, you had these one-timers and now we're down to March. So can you just sort of level set us for kind of how to think of the incrementals from here? David Zinsner : Incrementals from Q -- in other words, into [Q2, Q3 and Q4] (ph). Is that what you're saying? Timothy Arcuri : Yes. Yes. Just kind of like is it off of [39.5%] (ph), is about [ 36.5%] (ph). David Zinsner : Yes. The rule of thumb has generally been 60% in this period of what I call catch up. Obviously, we think we can do better fall-through, as we get more stabilized. The one dynamic in '25 is this kind of margin pressure around product like Lunar Lake. That probably pulls the range down to probably something more like in the 40% to 60% fall-through is probably the right way to think about it just for that dynamic. Now we get into '26 and you start to see a lot more 18A volume through Panther Lake, I think we are in the 60%-plus range at that level. John Pitzer : Tim, do you have a follow-up question? Timothy Arcuri : I do. Yes, Dave, also, so you took the CapEx to the low end, but there's $1.2 billion outflow that's in the financing section of the cash flow statement. What is that? I guess I'm trying to figure out just on an apples-to-apples basis, is like CapEx really coming down this year? And is that a line item in the financing section, is that going to keep getting bigger this year? Thanks. David Zinsner : Yes. No -- let's see, let me go back on the CapEx. If you look at CapEx for '25, the $20 billion forecast, what's driving that lower is really a function of better utilizing assets under con”