“And now going into first quarter, we're taking that adjustment further. So the first quarter adjustment on underutilization will be bigger.”

In context

“asis points. Even if I strip out depreciation, it's down about 100 basis points for March. So it seems like utilization is coming down a bit. And CapEx also came in a little bit lower too for December. So the first question on that is, can you talk about loadings? Is March going to be the bottom in loadings and we should see inventory begin to come down also in March? And then I had a follow-up on that too. Rafael Lizardi: Yes, so, no, thanks for the question. So step back in third quarter, at the end of third quarter, we talked about this. As we have near our inventory levels, then we have adjusted our factory loadings accordingly. So in third quarter, we did some of that and that had an impact on gross margins on underutilization. Fourth quarter adjustment was bigger than third quarter. And now going into first quarter, we're taking that adjustment further. So the first quarter adjustment on underutilization will be bigger. But we continue to have an upward bias on inventory as we continue to build the right buffers for the right parts to be ready on the other side of the cycle. So, follow-up? Timothy Arcuri: I did, yes. So then on CapEx, can you talk about that? It was a little lower. It's running actually quite a bit below the $5 billion run right now. So are you actually cutting CapEx now since you're bringing down factory loading? Thanks. Rafael Lizardi: No, we're not. In fact, CapEx came in as expected $5.1 billion, and we've been talking about $5 billion per year. So it was right on target. And you should expect, and we expect, to continue running at about $5 billion per year through 2026 as we complete the investment plans that we've been talking about. Dave Pahl: Great. Thanks, Tim. We'll go to the n”