National Instruments

NI Reports Q3 Revenue of $184.4 Million

News Release from: National Instruments
29/10/2007

National Instruments has reported record quarterly revenue of $184.4 million in the third quarter ended Sept. 30, 2007, up 12.4 percent as compared to Q3 2006. Diluted earnings per share (EPS) for Q3 2007 was 27 cents. This is above the midpoint of NI guidance of 24 cents to 29 cents per share. Net income was $21.5 million, up 15 percent from Q3 2006. For Q3 2007, operating margin and net margin were 13.3 percent and 11.7 percent, respectively.

Non-GAAP (Generally Accepted Accounting Principles) diluted EPS in Q3 2007 was 32 cents. This is above the midpoint of NI guidance of 29 cents to 34 cents per share. Non-GAAP net income was $25.8 million, up 17 percent from Q3 2006. For Q3 2007, non-GAAP operating margin and non-GAAP net margin were 16.3 percent and 14.0 percent, respectively. The company’s non-GAAP results exclude the impact of both stock-based compensation and the amortization of acquisition-related intangibles. Reconciliations of the company’s GAAP and non-GAAP results are included as part of this news release.

“The release of LabVIEW 8.5 in Q3 marked another major milestone in our vision of graphical system design. The inherent parallelism of LabVIEW 8.5 makes it uniquely positioned to leverage multicore processors with little to no change in the way users develop their code,” said Dr. James Truchard, NI president and CEO. “I believe our graphical system design approach for test, industrial and embedded applications has defined a unique and defensible position for National Instruments.”

NI virtual instrumentation and graphical system design products, which constitute the vast majority of the company’s product portfolio, had 14.3 percent year-over-year revenue growth in Q3 2007. This represents another strong quarter of revenue growth from NI virtual instrument products. NI believes this continued strong growth validates the company’s strategy of increased investment in R&D to drive new product success.

In contrast, sales of NI instrument control products which now represent less than 10 percent of our revenue were down 3 percent year-over-year in Q3, compared to an 8 percent decline in Q2 2007. The decline in the company’s instrument control product sales was related to weakness of the Global PMI during the quarter.

“On reviewing Q3, we are particularly pleased that the success of our system-level platforms has enabled us to deliver record revenue and solid earnings growth despite a significant decline in the global PMI in Q3,” said Alex Davern, NI CFO.