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Product category: Manufacturing orders, contracts, financial reports
News Release from: National Instruments
Edited by the Manufacturingtalk Editorial Team on 01 August 2006

National Instruments reports Q3 US$160m
revenue

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National Instruments reports record quarterly revenue of US$160 million and revenue for the first half of 2006 was up 16% in US dollars and 20% in 'local currency'.

National Instruments reports record quarterly revenue of US$160 million and revenue for the first half of 2006 was up 16% in US dollars and 20% in 'local currency' National Instruments has reported record revenue in Q2 2006 of US$160 million, a 14% USD increase over Q2 2005 and an equivalent 16% increase in local currency

Generally Accepted Accounting Principles (GAAP) fully diluted earnings per share (EPS) for Q2 2006 was 21 cents with GAAP net income of US$17 million, up 13% from Q2 2005.

Non-GAAP fully diluted EPS was 25 cents with non-GAAP net income of US$20.5 million, up 33% from Q2 2005.

Non-GAAP results exclude the impact of stock-based compensation and the impact of the amortization of acquisition-related intangibles.

A reconciliation of GAAP to non-GAAP results is included as a part of this press release.

For the first half of 2006, the company reported revenue growth of 16% in USD terms and 20% in local currency.

In addition, the company reported GAAP net income of US$29.6 million, up 13%, and non-GAAP net income of US$36.6 million, up 38% year-over-year.

"We are pleased with the results for the first half of 2006, as we saw revenue growth of 20% in local currency with strong operating leverage," said Dr James Truchard, NI president and CEO.

"At NIWeek, Aug 8-10, we will highlight how NI LabVIEW, graphical system design and PXI Express will help further our expansion into key application areas." NI continues to have a very strong balance sheet, with US$211 million in net cash and short-term investments as of June 30, 2006.

The company also announced today a dividend of 6 cents per share on its common stock payable on Aug.

28, 2006, to shareholders of record on Aug.

7, 2006.

Q2 2006 highlights.

* Record quarterly revenue of US$160 million, up 14% year-over-year.

* Quarterly GAAP net income of US$17 million, up 13% year-over-year.

* Quarterly non-GAAP net income of US$20.5 million, up 33% year-over-year.

* GAAP operating margin of 13% and non-GAAP operating margin of 16%.

* Strong sales of software, PXI, modular instruments and distributed I/O products.

* Cash and short-term investments of US$211 million.

"In Q2 last year, we saw very strong sequential growth in both revenue and earnings.

Given these tough compares, we are pleased to have delivered 14% year-over-year revenue growth in US dollar terms and 16% in local currency," said Alex Davern, NI CFO.

"Our goal of driving operating leverage continued to pay off in Q2 with a 33% increase in non-GAAP net income, and we are well-positioned for a significant increase in operating margin for the full year." Geographically, the growth of revenue in US dollar terms for Q2 2006 compared to Q2 2005 was as follows: up 16% in the Americas, up 6% in Europe and up 19% in Asia, equaling overall growth of 14%.

In local currency terms, revenue was up 15% in Europe and up 21% in Asia, for an overall local currency growth of 16%.

Looking at Q2 revenue growth in US dollars in more detail, sales of NI instrument control products were up 10% year-over-year.

Management believes this is indicative of continued improvement in the test and measurement market in Q2.

The first-year impact of acquisitions added US$4.4 million in revenue in Q2.

This is lower than Q1 2006, as NI passed the first anniversary of the acquisition of Measurement Computing Corporation, during the first quarter.

Sales of the rest of the NI product portfolio, in other words, NI virtual instrumentation products, were up 11% year-over-year.

NI growth in Q2 was driven by the success of new products, especially in the areas of software, data acquisition, PXI, modular instruments and distributed I/O.

* Guidance for Q3 2006 - for Q3 2006, NI currently expects revenue to be in the range of US$157 million to US$164 million and non-GAAP gross margins to be approximately 75%.

The company currently expects GAAP fully diluted EPS to be in the range of 16 cents to 21 cents per share and expects non-GAAP fully diluted EPS to be in the range of 21 cents to 26 cents per share.

In Q3 2006, the company expects the impact of stock-based compensation to be 4 cents per share and the impact of the amortization of acquisition-related intangibles to be 1 cent per share.

A reconciliation of the company's Q3 2006 guidance on a GAAP basis to its guidance on its non-GAAP basis is included as part of this press release.

* About National Instruments - for 30 years, National Instruments has been a technology pioneer and leader in virtual instrumentation - a revolutionary concept that has changed the way engineers and scientists in industry, government and academia approach measurement and automation.

Leveraging PCs and commercial technologies, virtual instrumentation increases productivity and lowers costs for test, control and design applications through easy-to-integrate software, such as NI LabVIEW, and modular measurement and control hardware for PXI, PCI, PCI Express, USB and Ethernet.

Headquartered in Austin, Texas, USA, NI has more than 3,900 employees and direct operations in nearly 40 countries.

For the past seven years, 'Fortune' magazine has named NI one of the 100 best companies to work for in America. Request free introductory details about products from National Instruments ...

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