Question-and-Answer Session
Operator
(Operator Instructions) It appears our first question will come from the line of Bryan Alexander with Raymond James.
Bryan Alexander - Raymond James
Thanks. Just on the gross margin decline sequentially, Tom, I know you referenced high velocity segments a couple of times during the call, could you just be a little bit more specific on what those segments were that drove that sequential decline, and I think roughly flat year-over-year performance? And going forward, do you expect to stay in the mid 5s from a gross margin perspective or do you think we can migrate back to the high 5s and potentially 6%?
Thomas C. Alsborg
Sure, Bryan. So yes, our gross margin -- first of all, I’ll just step back and just say as we have said in previous calls, of course, there’s a dozen different things that drive your gross margin in one quarter to the next and as we said, in some quarters they will lean or skew your gross margin up or down one way or the other. In this case, the skew was toward a more contracted gross margin driven primarily by mix. Still I’d point out first of all that most important to us is driving operating margin and we continue to do a very good job about driving the operating margin up and to the right over time, and that is -- that continues to be our goal.
We don’t guide on gross margin but the contraction that you saw in the current quarter again primarily by mix with certain customers, certain programs -- you know, one example of one program is in the government sector but then again, within the government sector, it was only one particular program and one particular customer so generally it’s just more higher volume products that we were selling through in this particular quarter that drove this. We also had, as I think I made mention of, some new business that we were ramping up -- this is new business that we invest in. There are start-up costs associated with this and over time, as we have done in the past, this is our MO is as that business ramps up it continues to grow in terms of its profitability as well.
So to get to your main point, there is no change in the direction of our business, a change in our strategy. We are still investing in higher margin areas overall. That’s our target area for growth. With existing customers when we have good velocity or good demand, we’re going to take that because it drives our operating margin or EPS and our ROIC.
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