The effective tax rate for the second quarter of 2017 was 21.3%, compared with 27.7%. The second quarter of 2017 reflected net discrete income tax benefits of $4.6 million, compared with net discrete income tax expense of $5.7 million. The 2017 second quarter net discrete tax benefit includes $8.1 million in income tax benefit related to the release of valuation allowance for which the deferred tax assets are now determined more-likely-than-not to be realizable and $4.6 million in income tax expense related to adjustments for uncertain tax positions. The 2017 amount also included a $1.2 million income tax benefit related to share-based accounting. The net discrete tax expense in 2016 of $5.7 million included $6.7 million in tax expense related to the $17.9 million gain on the sale of a former operating facility, partially offset by $1.0 million in net tax benefits, primarily related to share-based accounting. Excluding the net discrete income tax benefits in both periods and the gain and related taxes on the facility sale in 2016, the effective tax rates would have been 27.4% for the second quarter of 2017 and 26.2% for the second quarter of 2016.

Other

Stock option expense was $3.7 million for the second quarter of 2017, compared with $2.9 million. Pension income was $0.6 million for both the second quarter of 2017 and 2016. Interest expense, net of interest income, was $9.1 million for the second quarter of 2017, compared with $5.9 million and reflected the impact of higher debt levels, primarily due to the acquisition of e2v. Corporate expense increased to $12.5 million for the second quarter of 2017, compared with $10.8 million and reflected higher compensation accruals. Other income and expense was expense of $0.7 million for the second quarter of 2017 compared with income of $17.2 million. Other income in the second quarter of 2016 included a gain of $17.9 million on the sale of a former operating facility.

Outlook

Based on its current outlook, the company’s management believes that third quarter 2017 GAAP earnings per diluted share will be in the range of $1.55 to $1.60, and full year 2017 GAAP earnings per diluted share will be in the range of $5.60 to $5.70. The company’s management believes that third quarter 2017 adjusted earnings per diluted share will be in the range of $1.60 to $1.65, and full year 2017 adjusted earnings per diluted share will be in the range of $6.15 to $6.25, compared to the prior outlook of $5.76 to $5.86. The company’s effective tax rate for 2017 is expected to be 27.7%, before discrete items.