What was the non-GAAP operating income as a percentage of revenue in Q4 2020 
ompounding the opportunity for selling RF, display driver and power management IC testers, handlers, and contactors. But the Cohu story is not limited to 5G. As mentioned earlier, we're capturing new customer opportunities in RF transceivers, Wi-Fi 6, general IoT, and even application processor test with some of these being new additions to our addressable market. Last year, we saw new U.S. export restrictions to Huawei. I believe everyone understands that smartphone demand is increasing. There has been a redistribution of business that translates into incremental orders for Cohu products from customers where we have greater share in new opportunities, particularly in China.
There are significant positive trends in the Automotive segment, starting with many auto companies suggesting a complete transition to EV technology in the coming decade, and significant government mandates to go carbon-neutral in China, Europe, and the U.S. Another exciting trend is the rapid adoption of ADAS technologies in vehicles, which expands the use of processors, sensors, microcontrollers, displays and RF ICs. We believe our sales growth to the Automotive segment will benefit about equally from IC content growth in a projected vehicle SAR in the mid-teens this year.
With the successful integration of Xcerra now behind us, we held an Analyst and Investor Conference early December describing a new target financial model in the path to 14% revenue CAGR to $940 million and 23% operating income over the mid-term. This comes from enabling testing of new high growth technologies in RF, battery management and ADAS processors, in gaining traction in automated optical inspection.
Now, I'd like to turn it over to Jeff to provide details on fourth quarter results and share first quarter guidance.
Jeffrey D. Jones -- Vice President, Finance and Chief Financial Officer
Thanks, Luis. Before I walk through the Q4 results and Q1 guidance, please note that my comments that follow all refer to non-GAAP figures. Information about the non-GAAP financial measures, including the GAAP to non-GAAP reconciliations and other disclosures are included in the accompanying earnings release and investor presentation which are located on the Investor page of our website.
Now turning to the financial results. Q4 revenue was $202.4 million and $4.9 million higher than the mid-point of our updated guidance range provided on December 1st. Fiscal year 2020 revenue was $636 million, growing 9% over 2019, and with nearly 19% CAGR over the last five years. In Q4 and fiscal year 2020, no customer accounted for 10% or more of sales. In the fourth quarter, Cohu's gross margin was 45%.Operating expenses were $51.7 million and lower than guidance as we continue to optimize our expense structure. COVID-19-driven temporary cost reductions were lifted at the beginning of November.
Fourth quarter non-GAAP operating income was 19.4% of revenue and adjusted EBITDA was 20.9%. Return on invested capital was approximately 54% in the fourth quarter and approximately 26% for the full fiscal year 2020. The Q4 results exceeded our new target model objective to make investments with ROIC of 30% or higher. Cohu's non-GAAP effective tax rate for Q4 was approximately 11% and lower than guidance primarily as a result of losses generated in Europe, combined with U.S. income offset by NOLs. Non-GAAP EPS for the fourth quarter was $0.73 and $1.19 for the full year 2020.
Now turning to the business model. We recently introduced a new mid-term target financial model that delivers higher profitability at all revenue points. Our new target model achieved $3.60 of annual EPS on revenue of $940 million versus $3 of EPS in our previous model. This represents a 20% increase in profitability at target revenue. On a quarterly basis, the new model reflects an increase in EPS of $0.10 growing to $0.15 at target revenue of $235 million.
Gross margin expands with higher revenue and operating expenses are reduced from the previous model, but sufficient to support product development and other business investments. The com
ompounding the opportunity for selling RF, display driver and power management IC testers, handlers, and contactors. But the Cohu story is not limited to 5G. As mentioned earlier, we're capturing new customer opportunities in RF transceivers, Wi-Fi 6, general IoT, and even application processor test with some of these being new additions to our addressable market. Last year, we saw new U.S. export restrictions to Huawei. I believe everyone understands that smartphone demand is increasing. There has been a redistribution of business that translates into incremental orders for Cohu products from customers where we have greater share in new opportunities, particularly in China.
There are significant positive trends in the Automotive segment, starting with many auto companies suggesting a complete transition to EV technology in the coming decade, and significant government mandates to go carbon-neutral in China, Europe, and the U.S. Another exciting trend is the rapid adoption of ADAS technologies in vehicles, which expands the use of processors, sensors, microcontrollers, displays and RF ICs. We believe our sales growth to the Automotive segment will benefit about equally from IC content growth in a projected vehicle SAR in the mid-teens this year.
With the successful integration of Xcerra now behind us, we held an Analyst and Investor Conference early December describing a new target financial model in the path to 14% revenue CAGR to $940 million and 23% operating income over the mid-term. This comes from enabling testing of new high growth technologies in RF, battery management and ADAS processors, in gaining traction in automated optical inspection.
Now, I'd like to turn it over to Jeff to provide details on fourth quarter results and share first quarter guidance.
Jeffrey D. Jones -- Vice President, Finance and Chief Financial Officer
Thanks, Luis. Before I walk through the Q4 results and Q1 guidance, please note that my comments that follow all refer to non-GAAP figures. Information about the non-GAAP financial measures, including the GAAP to non-GAAP reconciliations and other disclosures are included in the accompanying earnings release and investor presentation which are located on the Investor page of our website.
 Now turning to the financial results. Q4 revenue was $202.4 million and $4.9 million higher than the mid-point of our updated guidance range provided on December 1st. Fiscal year 2020 revenue was $636 million, growing 9% over 2019, and with nearly 19% CAGR over the last five years. In Q4 and fiscal year 2020, no customer accounted for 10% or more of sales. In the fourth quarter, Cohu's gross margin was 45%.Operating expenses were $51.7 million and lower than guidance as we continue to optimize our expense structure. COVID-19-driven temporary cost reductions were lifted at the beginning of November.
Fourth quarter non-GAAP operating income was 19.4% of revenue and adjusted EBITDA was 20.9%. Return on invested capital was approximately 54% in the fourth quarter and approximately 26% for the full fiscal year 2020. The Q4 results exceeded our new target model objective to make investments with ROIC of 30% or higher. Cohu's non-GAAP effective tax rate for Q4 was approximately 11% and lower than guidance primarily as a result of losses generated in Europe, combined with U.S. income offset by NOLs. Non-GAAP EPS for the fourth quarter was $0.73 and $1.19 for the full year 2020.
Now turning to the business model. We recently introduced a new mid-term target financial model that delivers higher profitability at all revenue points. Our new target model achieved $3.60 of annual EPS on revenue of $940 million versus $3 of EPS in our previous model. This represents a 20% increase in profitability at target revenue. On a quarterly basis, the new model reflects an increase in EPS of $0.10 growing to $0.15 at target revenue of $235 million.
Gross margin expands with higher revenue and operating expenses are reduced from the previous model, but sufficient to support product development and other business investments. The com