These risk factors are described in NCR periodic fillings with the SEC and then our annual report to stockholders. On today’s call we will also be discussing certain non-GAAP financial information such as free cash flow, and result including the impact to pension and other items.Reconciliation with non GAAP financial results we have reported at forecasted GAAP results. And other information concerning such measures are include in our earnings press release and are also available on the investor page of NCR website. The replay of this conference call will be available later today on NCR website, ncr.com. For those listening to the replay of this call please keep in mind that the information discussed is as of July 22 nd, 2010 and NCR assumes no obligation to update or provide the information included in this conference call whether a result of new information were future results. I’ll now turn the call over to Bill. Bill Nuti Thank you Gavin and good afternoon and thank you all for joining us today we are very please to report solid results for the second quarter. Our performance that keeps us on track within our operational and financial objectives for 2010. The second quarter featured positive trends in our core solutions businesses as well as continued execution on the past to maintain our position as our industrial to lowest and most efficient cost structure. Also in the second quarter we've received good news on pension reform legislation, which I’ll cover in just a moment. First to the quarterly results. Orders grew 9% versus a difficult comparison with the prior year and second quarter revenue grew 5% to 1.18 billion which included a one point benefit from our foreign currency translation. Gross margin on a non-GAAP basis include 50 basis points year-over-year. And the excluding investments in our entertainment business. Gross margins improved 90 basis points. And would have been our second best quarter in the last four years.
Non pension operating income or NPOI grew 13% to 88 million after top comparison of 78 million in NPOI in the prior year period. Diluted earnings per share excluding pension expense were $0.35 compared to $0.31 in the last year second quarter.During the second quarter we generated 87 million of cash flow from operations and 42 million of free cash flow. Both significant improvements compared to the prior period. And this improvement in free cash flow is inclusive of our investment and entertainment as well as our on going normal levels of investments in other areas of our business. Our results for the first half of 2010 give us confidence in our guidance and therefore we are reaffirming our 2010 revenue growth and non-GAAP earnings guidance. Well we're pleased with the performance and good overall execution in the quarter and year to date, we feel it is proven to maintain a cautiously optimistic pasture given the uncertain global economic environment. As we turn our attention to the second half of the year, our focus is on improved growth and our core industries. We have experienced further stabilization of NCR’s two core markets, financial and retail. During the second quarter when both businesses experienced growth. In financial services the first half of 2010 and the second quarter in particular presented what we believe will be our toughest comparisons for the year. Even so we feed well and the businesses regaining exporting during Q2 financial orders and revenue accruing and allow to mid single digits. Performance was laid by our overseas markets particularly in Europe and the Asia pacific were intelligent deposit continues to capture gains in China. We've seeing good trends in Europe despite the financial crises, which to this point does not appeared to have had a meaningful impact on bank spending.
And in Latin America orders were up significantly versus last year and we continued shipping from our recently opened Brazil plant during the quarter and supportive several wins in that country including a key win at (inaudible).This is an early but critical milestone as we look to capitalize on our investments and build on our position in this emerging market over the next several years.In the US the intelligent deposit upgrade cycle with several of our large US customers is reaching it’s conclusion in 2010. But we are beginning to see early signs and movement from the mid major and regional banks. Read the rest of this transcript for free on seekingalpha.com