“We also expect spending to increase as a percentage of revenue as investments in headcount infrastructure and other support area s catch-up to the growth of the business.”

In context

“opment and regulatory activities. We also expect supply issues to result in higher production costs. Pro forma operating expenses increased 21% compared with the third quarter of 2020, and increased 2% compared with last quarter. The increase, compared to the prior year, reflects costs associated with higher headcount, increased variable compensation, and increased spending in areas impacted by COVID. Third quarter spending was below our expectations due to delays in headcount hiring and lower spending on activities restricted by COVID, including clinical development, marketing events, and travel costs. In addition, COVID delayed some R&D work resulting in under spend on prototypes. We expect spending on activities restricted by COVID to increase as the impacts of the pandemic decline. We also expect spending to increase as a percentage of revenue as investments in headcount infrastructure and other support area s catch-up to the growth of the business. Finally, we expect to continue to invest in expanding and accelerating our ecosystem of products and capabilities. Jamie will provide spend guidance later in this call. Our pro forma effective tax rate for the third quarter was approximately 24%. We recorded expense of 11 million associated with periods prior to 2020 related to guidance recently provided by the IRS associated with stock-based compensation. We expect our pro forma tax rate for the fourth quarter to be approximately 21.5%. Our actual tax rate will fluctuate with changes in geographic mix of income, changes in taxation made by local authorities, and with the impact of one-time items. Our third quarter pro forma net income was 435 million, or $1.19 per share, compared with 334 million, or $0.92 per share, for the third quar”