Non-GAAP cost of revenue exclusive of depreciation and amortization was 35% of total revenue compared to 40% in the fourth quarter of last year. The full year was 37% compared to 40% in the prior year. The gross margin increase was primarily due to our decision to stop waiving the eCheck fee and operational improvements. As a percent of revenue, combined sales and marketing, R&D, and G&A fell to 37% in the fourth quarter of 2023 from 58% in the fourth quarter of 2022 due to growth in revenue and our collective focus on operational efficiency. For the full year, operating expenses as a percentage of revenue declined to 46% from 55% in 2022. Sales and marketing expenses as a percentage of revenue decreased from 21% in Q4 2022 to 12% this quarter.
For the full year, sales and marketing decreased from 21% to 16%. By optimizing operations and maintaining discipline in our investments, we improved R&D expenses as a percentage of revenue from 21% in the fourth quarter of the prior year to 17% this quarter. For the full year, R&D increased from 20% to 21%. Our G&A expenses as a percentage of revenue decreased from 15% in the fourth quarter of the prior year to 8% this quarter. For the full year, G&A decreased from 14% to 10%, reflecting our sustained focus on streamlining operations for greater efficiency. Overall, our non-GAAP operating margin in the fourth quarter of this year grew to 24.3% compared to a loss of 2.7% in the same quarter of last year. Through disciplined execution of our planned strategies, we delivered a non-GAAP operating margin of 12.2% for the full year, which was a significant improvement from the operating loss of 0.6% in 2022.
Free cash flow margin this quarter was 19.9% compared to 1% in the same quarter last year. Full year free cash flow margin was 11.9% compared to a loss of 0.9% in 2022. In 2024, we expect growth in card usage for rent payments to normalize and total payments revenue to moderate in the second half of the year with the anniversary of our decision to stop waiving eCheck fees. Additionally, beginning in the second quarter, we plan to reduce certain transaction fees associated with card-based rent payments, which will further impact revenue growth. For all other value-added services, we expect seasonality to remain consistent with historical trends. Our 2024 guidance for annual revenue is $755 million to $765 million, which implies a full year growth rate of 23% based on the mid-point of this range.
We expect full year cost of revenue as a percentage of revenue to be slightly lower than 2023 as we continue to drive additional efficiencies. Our 2024 ending headcount is projected to grow as we continue to invest in high-priority initiatives that enable us to achieve our strategic objectives. However, we expect the rate of headcount growth to be less than revenue growth as we maintain our focus on operational excellence. In 2024, we expect to deliver non-GAAP operating margin between 21% and 23% of revenue, while generating free cash flow of between 17% and 19% of revenue. Diluted weighted-average shares outstanding are expected to be approximately 37 million shares for the full year. Our fourth quarter and full year results demonstrates our continued commitment to being a healthier, more focused business, fueling our ability to serve customers and power the future of the real estate industry.
Thank you all for joining us today. We look forward to seeing you soon. Operator, this concludes today’s call.
Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.
End of Q&A:
