The fourth quarter gross margins were well in access of our long term model of 42 to 44% due to favorable channel and product mix. In addition, the seasonal higher, higher volumes in the fourth quarter provided us a benefit as we amortized our 6 operations costs over a larger number of units.
In the first quarter we continue to expect our gross margins will be at or above our long term target model but we’ll reflect the seasonality and greater concentration of distribution revenue. Accordingly we anticipate our gross margin will be 44.5% plus or minus 50 basis points and at the mid point of 340 basis points from the 41.1% gross margin we recorded in the prior year comparable quarter. We will continue to invest prudently in the people, products and infrastructure necessary to support our growth and our vision. To support our ongoing investments in a broadening family of capture devices, accessories, software and services we anticipate our operating expenses will be $115 million plus or minus $2.5 million with substantially all of the growth coming from RND. Our tax rate is estimated to be at 29% based on fully diluted shares outstanding of about $150 million. Accordingly we anticipate EPS to be in the range of .15 to .17 cents. So with that, let me hand it back over to Nick.
Nicholas Woodman – Chief Executive Officer and Chairman
Thank you, Jack. Before I go further I want to share an announcement related to our executive team. Our Chief Operating Officer, Nina Richardson has decided to leave us to pursue board roles and other opportunities. Nina came to GoPro in 2012 to help us scale operations and product development and she’s been fabulously successful in doing that and more. More than just a terrific executive and leader, Nina is a terrific human being and its been a privilege and a blast to work with her for the past 2 years. Going forward Tony, Jack and I will take up the reins for Nina’s organization. Nina, from all of GoPro, we love you and we appreciate all that you have done for us, a huge thank you.
Nina Richardson – Chief Operating Officer
Nick, thank you for such a nice tribute, I certainly enjoyed my time at GoPro. This has been an executive dream, having the privilege to be part of such great organization, in such an exciting time of growth and expansion. I’m incredibly proud of my team and all they’ve accomplished over the past 2 years, they’re terrific. Each and everyone is a solid, experienced and talented executive and I have full confidence in their ability to continue to excel under the leadership of Tony, Jack and you. Thanks, it’s been really great.
Nicholas Woodman – Chief Executive Officer and Chairman
Alright, thank you Nina. And I want to add that the performance we’ve outlined today is attributable in many ways to the processes and people that Nina has brought to GoPro, again thank you, Nina. Operator, we are now ready for questions.
Operator
Thank you, ladies and gentlemen if you would like to ask a question at this time please signal by pressing *1 on your telephone. If you are using a speaker phone pleas make sure your mute function is turned off to allow your signal to reach our equipment. We ask please that you limit yourself to one question. Again that is *1 for questions and we’ll pause for just a moment. We’ll go first with Paul Coster with JP Morgan.
