The sequential quarter gross margin increase was primarily due to having less PC and consumer mix in Q1, which carries a lower gross margin percentage than our consolidated average. During the quarter PC and consumer volume decreased more than 25% sequentially due to the channel inventory reductions and weaker end customer demand.
We’ve been talking about margin expansion through a better mixture of products and we are starting to see some early signs of traction. As we look forward four to six quarters, we continue to target gross margins in the range of 38% to 40% as a run rate.
Non-GAAP operating expenses were $11.3 million for Q1 compared with $11.2 million last quarter. We will continue to tightly manage our spending until we have signs of a recovery and revenue returned for a normal run rate at a minimum. The non-GAAP effective tax rate was 36% for Q1 compared with 34% last quarter. The Q1 tax rate remain high primarily due to the mixture of domestic versus foreign income. In addition, we have some foreign entities that have losses for which we cannot offset against income.
Non-GAAP net income was $1.8 million, or $0.07 per share, for Q1 compared with $3.6 million, or $0.14 per share, last quarter. Most of the net income decline resulted from the lower revenue volume.Now turning to the balance sheet. Our balance sheet remained in excellent shape and the cash generation of our business remained strong. We exited Q1 with $124 million of cash including both short and long-term investments and marketable securities, which equated to $5.06 per diluted share. Cash decreased by $3 million from last quarter due to the final PTI acquisition payment, and also we repurchased 456,000 shares for $3.5 million at an average price of $7.67 per share. The repurchase price was approximately $2 below our book value of $9.71 per share for Q1. And starting the buyback program back in 2007, we have repurchased over 4.5 million shares for $46 million.Read the rest of this transcript for free on seekingalpha.com
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