Revenues from 2.5G were $8.8 million down 7% from the last quarter. As we have stated before, we are treating our MVAS business as a cash flow. During the third quarter, we optimized profitability by emphasizing margin improvement through product mix over topline growth. I will speak more about mobile gross margin in a bit.
Turning to gross margin, our non-GAAP gross margin, which excludes stock-based compensation and intangible asset amortization for the third quarter of 2009 was 60%, compared to 58% last year and 56% last quarter.
We saw gross margin improvement for our online advertising business where non-GAAP gross margin increased three percentage point from last year and last quarter to 62%.
Lower advertising gross margin from last year was related to the acquisition of Olympic content, while sequential advertising gross margin improvement was due to revenue growing faster than the cost of advertising revenues.
Gross margin for our wireless business was 54% in the quarter, compared to 53% last year and 50% from last quarter. On a quarter-over-quarter basis, MVAS gross margin may fluctuate due to the mix of product lines, which have different margins depending on the collective revenue-sharing arrangements.
Over the longer term, we believe MVAS gross margin will gradually trend downwards due to the competitive nature of the business.
Turning to operating expenses, our non-GAAP operating expenses for the third quarter of 2009 was $35.6 million, a decrease of 3% from the same period last year and an increase of 6% from last quarter.
Turning to operating income, non-GAAP operating income for the third quarter of 2009 was $21.7 million, a decrease of 10% from the same period last year and an increase of 24% from last quarter.
Turning to non-operating income, interest and other income for the third quarter of 2009 was $1.8 million, compared to $4.1 million last year and $2.1 million last quarter. The year-over-year increase -- the year-over-year decrease in interest and other income was mainly due to lower interest rate on our cash, cash equivalents and short-term investments, despite a net year-over-year balance increase of $37.2 million.
Turning to taxes, provision for income taxes for the third quarter of 2009 was $3.3 million, compared to $4.4 million last year and $2 million last quarter. We''ve provided provision for income taxes for the third quarter of 2009 assuming an annual effective tax rate of 12% for our China operations.
Turning to net income and earnings per share, our non-GAAP net income attributed to shareholders for the quarter, which excludes stock-based compensation and amortization of intangible assets was $20.1 million, compared to $23.7 million in the same period last year and $17.1 million last quarter.
Non-GAAP diluted EPS attributed to shareholders for the quarter was 34%, down 12% year-over-year and up 17% quarter-over-quarter.
Turning to balance sheet and cash flow, as of September 30, 2009, our cash, cash equivalents and short-term investments were slightly below $600 million, up $37.2 million from last year and up $17.7 million from the end of last quarter.
Cash flow from operating activities for the third quarter of 2009 was $29.1 million, compared to $24 million from the same period last year and $18.8 million from last quarter.
Now let me turn to our guidance for the fourth quarter of 2009. As Charles mentioned, we spun off our real estate business and merged it with CRIC up on its initial public offering in October 2009.
Upon the merger and CRIC''s IPO, SINA became CRIC''s second largest shareholder with approximately 33% of total outstanding shares. We expect to account for our interest in CRIC using the equity method of accounting starting from October 1, 2009 and expect to realize a material gain in the fourth quarter from the closing of the merger with CRIC.
Adjusting the advertising revenue forecast for the fourth quarter of 2009 to reflect the carve out of our advertising revenues from the SINA real estate business and assumptions made using the terms under the amended and restated advertising agency agreement, which is disclosed in CRIC''s F-1 filing.
Our forecast for the fourth quarter of 2009 is as follows, total revenues to be between $93 and $96 million, advertising revenues to be between $61 and $63 million, and non-advertising revenues to be between $32 and $33 million.
Under the adjusted basis, advertising revenue for the first quarter, second quarter and third quarter of 2009 would have been $37 million, $48.1 million and $53.9 million respectively.
If the advertising revenue for the SINA real estate business had not been carve out, the forecast advertising revenue for the fourth quarter of 2009 would have been between $74 and $76 million. The forecast of total revenues for the fourth quarter of 2009 would have been $106 million and $109 million.
Under the carve out assumption, excluding contribution from SINA real estate business, stock-based compensation and amortization of intangibles, non-GAAP operating income for the first quarter, second quarter and third quarter of 2009 would have been $10.3 million, $12.4 million and $16.7 million respectively.
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