“At this point -- when we gave our guidance back in May, we said we expected it to be around 65.25%. And at this point, we're expecting it to be about 65.50%.”

In context

“ture, strategy and capabilities in our global operations and supply chain. That will all help gross margin. And as you get down the P&L, we're really focused on getting leverage from SG&A and excited about stabilizing and then improving the margins over time. Ryan Weispfenning: Okay. Thanks Chris. We’ll take the next question please, Brad. Brad Welnick: The next question comes from Jayson Bedford at Raymond James. Jayson, please go ahead. Jayson Bedford: Good morning. Can you hear me okay? Geoff Martha: Yeah, Jayson. We can hear you. Jayson Bedford: All right. Thanks. So not to make this a call all around gross margin, but I did have a question. You mentioned stabilization. I just wanted to put a little context around that. What is the expected gross margin for fiscal '24? Karen Parkhill: At this point -- when we gave our guidance back in May, we said we expected it to be around 65.25%. And at this point, we're expecting it to be about 65.50%. We've seen some improvement in the first quarter, and we're carrying some of that through. Jayson Bedford: Okay. And just, Karen, the drop down for the rest of the year versus first quarter levels, revenue is higher. Is this just strictly a function of the VBP impact hitting more in the back half? Karen Parkhill: Yes, it's both VBP and currency. And you're right, higher revenue growth clearly helps on the margin front. But we have seen some timing on VBP that we talked about. We also have some timing on FX. It was a little bit better than we expected down the P&L in the first quarter, and we expect to give some of that back as we look at the currency impact going forward. Jayson Bedford: Thank you. Ryan Weispfenning: Thanks, Jayson. Brad, I think we have time for two more questions. Brad”