The Q3 geographic distribution was as follows: Asia, 89%, US 7% and Europe was 4%. Our channel sales mix was international distribution 59%, contract manufacturers 25%, OEM’s 12% and US distribution was 4%.
Consolidated non-GAAP gross profit was $12.9 million for Q3 compared with $14.8 million last quarter and $13 million last year. Non-GAAP gross margin for the third quarter was $32.6% and was 3.7% lower than last quarter’s $36.3% and 3% lower than year’s 35.6%. The sequential gross margin decrease was primarily due to higher absorption charges that results from lower production volume.
Non-GAAP operating expenses were $10.6 million for Q3 compared with $10.5 million last quarter and $9.5 million last year. The Q3 operating income on a non-GAAP basis was $2.2 million or 6% of revenue compared with $4.2 million or 10% of revenue last quarter and $3.6 million or 10% of revenue for the same period last year. The sequential decrease was primarily due to the 3.7% decline in gross margin.
Interest and other income was $1.3 million for Q3 compared with $.8 million last quarter and $1.2 million last year. The sequential increase of $.5 million was mostly due to a $.3 million of currency exchange gain in Q3 compared with a $.1 million exchange loss last quarter.Income before tax was $3.6 million on a non-GAAP basis for Q3 compared with $5.1 million last quarter and $4.8 million last year. On a non-GAAP basis, the effective tax rate was 31% for Q3 compared with 21% last quarter and 33% for the same period last year. The Q3 sequential tax rate increase was primarily due to the mixture of domestic versus foreign income and year to date true ups. Non-GAAP net income was $2.5 million or $0.10 per share for Q3 compared with $4.1 million or $0.16 per share last quarter and $3.8 million or $0.15 per share for the same period last year. Read the rest of this transcript for free on seekingalpha.com
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