Our GAAP gross margin, which incorporates only noncash purchase accounting adjustments from our recent acquisitions, was 55.8%, a sequential increase of 290 basis points. In Q4, we don't expect any further noncash purchase accounting adjustments. This quarter, non-GAAP selling, general and administrative expenses were $41 million or 15.8% of sales compared to $40 million or 16% of sales in the prior quarter and compared to $37.3 million or 17.2% of sales reported a year ago. For the next quarter, we expect total SG&A to decrease slightly as a percentage of revenue.
Research and development costs were $44 million or 17% of sales compared to $42.2 million or 16.9% of sales in the prior quarter and compared to $29.6 million or 13.6% of sales reported a year ago. The increase compared to prior year was due primarily in our investment of new product development. For the next quarter, we expect total R&D to decrease slightly as a percentage of revenue.
Our non-GAAP operating income was $60.7 million or 23.4% of sales compared to $54.9 million or 22% of sales in the second quarter and $56.8 million or 26.2% recorded last year. We recorded $8.8 million in non-GAAP interest and other expense compared to $10.1 million last quarter, reflecting a full quarter's impact from the refinancing we completed last quarter. In addition, subsequent to our quarter end, we paid down $30 million of our term debt. This pay-down will allow us to see a decrease in interest and other expense of approximately $200,000 next quarter.
Non-GAAP net income was $48.3 million or $0.55 per diluted share compared to $40.3 million or $0.46 per diluted share last quarter, an increase of 20%, and $42 million or $0.49 per diluted share reported a year ago. Our non-GAAP effective tax rate for the quarter was 7%, reflecting ongoing improvements in our tax structure. We expect this tax rate will continue next quarter.Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV