For 2014, Cray reported total revenue of $561.6 million, which compares with $525.7 million for 2013. Net income for 2014 was $62.3 million, or $1.54 per diluted share, compared to $32.2 million, or $0.81 per diluted share for 2013. Net income results for 2014 benefited from a $52.6 million income tax benefit which resulted from a reduction of substantially all of the valuation allowance held against Cray's U.S. deferred tax assets. This reduction was determined after considering both past financial results and future expectations for profitability.
Non-GAAP net income, which adjusts for selected unusual and non-cash items, such as the reduction of the valuation allowance, was $24.3 million, or $0.60 per diluted share for 2014, compared to $30.3 million, or $0.76 per diluted share for 2013.
Revenue for the fourth quarter was $261.9 million, compared to $307.4 million in the fourth quarter of 2013. The company reported net income for the fourth quarter of $74.6 million, or $1.84 per diluted share, compared to net income of $51.0 million, or $1.27 per diluted share in the prior year period. Non-GAAP net income was $40.3 million, or $0.99 per diluted share for the quarter, compared to non-GAAP net income of $59.2 million, or $1.48 per diluted share for the same period last year.
Overall gross profit margin for 2014 was 33%, compared to 35% for 2013. Total non-GAAP gross profit margin for 2014 was 34%, compared to 36% for 2013. The change in gross profit margin in 2014 was driven primarily by product mix.
Operating expenses for 2014 were $175.2 million, compared to $162.7 million for 2013. Non-GAAP operating expenses for 2014 were $163.7 million, compared to $155.5 million for 2013.
As of December 31, 2014, cash, investments and restricted cash totaled $146 million. Working capital increased $27 million to $362 million, compared to $335 million at the end of 2013.
"We had a great year, highlighted by company records in both revenue and new contract awards", stated Peter Ungaro, president and CEO of Cray. "Our global presence continues to expand, with significant wins in the U.K., Korea, Saudi Arabia and the U.S. We refreshed our entire product line in the second half of the year across supercomputing, storage and analytics, further strengthening our competitive position and targeting ways to leverage our expertise and technology into high-growth markets. As we look to the future, I'm excited about our prospects to continue to grow and drive increased profitability in 2015 and beyond."
For 2015, while a wide range of results remains possible, the company anticipates revenue for the year to be in the range of $715 million. Revenue is expected to ramp quarterly during 2015, with about $80 million in the first quarter and roughly 40-45% of the total year in the fourth quarter. Non-GAAP gross margin for 2015 is expected to be about 35%. Total non-GAAP operating expenses for the year are anticipated to be about $195 million. Based on this outlook, the company expects to improve its GAAP and non-GAAP operating profit margin significantly for 2015.
The company's 2015 effective non-GAAP tax rate is expected to be about 10%. Actual results for any future period are subject to large fluctuations given the nature of Cray's business.
Recent highlights include the following: