EX-99.1 2 ex99-1.htm PRESS RELEASE
Contact:
  
Marissa Vidaurri
   
Investor Relations
   
(512) 683-6873

National Instruments Reports Q4 2016 Revenue of $329 Million
Company Guides to 4.5% Year-Over-Year Revenue Growth in Q1 at Midpoint of Guidance


Q4 2016 Highlights
· Revenue of $329 million, down 2 percent year over year with core revenue up 3 percent year over year
· GAAP gross margin of 75 percent, up 80 basis points year over year
· Non-GAAP gross margin of 76 percent, up 60 basis points year over year
· Fully diluted GAAP EPS of $0.26 and fully diluted non-GAAP EPS of $0.34
· Currency volatility in Q4 that resulted in a $3.2 million loss on foreign exchange or $0.02 loss on EPS
· GAAP net income of $34 million
· EBITDA of $65 million
· Cash and short-term investments of $358 million as of Dec. 31, 2016

AUSTIN, Texas – Jan. 26, 2017 – National Instruments (Nasdaq: NATI) today announced Q4 2016 revenue of $329 million, down 2 percent year over year with core revenue up 3 percent year over year. The company's definition of core revenue is GAAP revenue excluding the impact of NI's largest customer and the impact of foreign currency exchange. A reconciliation of GAAP revenue to core revenue is included with this news release.

In Q4 2016, the impact of foreign currency exchange reduced our year-over-year order growth by 2 percent. NI received $2 million in orders from its largest customer compared with $9 million in orders from this customer in Q4 2015. Excluding NI's largest customer, the company's total order growth was up 2 percent year over year for the quarter; orders under $20,000 were down 2 percent year over year; orders between $20,000 and $100,000 were up 4 percent year over year; and orders above $100,000 were up 8 percent year over year.

GAAP net income for Q4 was $34 million, with fully diluted earnings per share (EPS) of $0.26, and non-GAAP net income was $44 million, with non-GAAP fully diluted EPS of $0.34. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortization, was $65 million.

In Q4, GAAP gross margin was 74.8 percent and non-GAAP gross margin was 75.8 percent. Total GAAP operating expenses were $197 million, down 1 percent year over year. Total non-GAAP operating expenses were flat year over year at $190 million. GAAP operating margin was 15 percent in Q4, with GAAP operating income of $49 million. Non-GAAP operating margin was 18 percent in Q4, with non-GAAP operating income of $60 million.

"As I start in my new role as CEO, I am committed to our vision and to strengthening our relationships with our customers," said Alex Davern, NI president and CEO. "Looking to 2017, my top priorities will be growing revenue, leveraging our investments in our platform and people, and improving our operating margins."

John Roiko, NI interim CFO, said, "While we were disappointed that we missed the midpoint of our revenue guidance in Q4, we did deliver three percent core revenue growth, maintained our strong gross margins, and kept our non-GAAP operating expenses and EPS flat year-over-year. With an increased focus on growing revenue and improving our operating margin, we are budgeting for a headcount reduction in 2017 for the first time since 2014."

Geographic revenue in U.S. dollar terms for Q4 2016 compared with Q4 2015 was up 2 percent in the Americas, up 1 percent in APAC, and down 7 percent in EMEIA. Excluding the impact of foreign currency exchange, revenue was up 2 percent in the Americas, up 1 percent in APAC, and relatively flat in EMEIA. Historical revenue from these three regions can be found on NI's investor website at www.ni.com/nati. 
 
As of Dec. 31, 2016, NI had $358 million in cash and short-term investments. During the quarter, NI paid $26 million in dividends. The NI Board of Directors approved a 5 percent increase to the quarterly dividend to $0.21 per share payable on Mar. 6, 2017, to stockholders of record on Feb. 13, 2017.
 
The company's non-GAAP results exclude the impact of stock-based compensation, amortization of acquisition-related intangibles, acquisition-related transaction costs, taxes levied on the transfer of acquired intellectual property, foreign exchange loss on acquisitions, acquisition-related fair value adjustments, and restructuring charges. Reconciliations of the company's GAAP and non-GAAP results are included as part of this news release.

FY 2016 Highlights
· Revenue of $1.23 billion,
· Core revenue up 3 percent year over year
· Fully diluted GAAP EPS of $0.68
· Non-GAAP fully diluted EPS of $0.97
· GAAP net income of $87 million
· EBITDA of $188 million
· Dividends paid of $103 million, or $0.80 per share

Guidance for Q1 2017
NI currently expects Q1 revenue to be in the range of $285 million to $315 million, up 4.5 percent year-over-year at the midpoint. Based on current exchange rates, the company expects that the impact of the strengthening U.S. dollar will reduce the company's year-over-year dollar revenue growth rate by approximately 1 percent in Q1. For 2017, NI estimates its non-GAAP effective tax rate to be approximately 21 percent. The company currently expects that GAAP fully diluted EPS will be in the range of $0.05 to $0.19 for Q1, with non-GAAP fully diluted EPS expected to be in the range of $0.11 to $0.25.
Non-GAAP Presentation
In addition to disclosing results determined in accordance with GAAP, NI discloses certain non-GAAP operating results and non-GAAP information that exclude certain charges. In this news release, the company has presented its year-over- year change in core revenue, gross profit, gross margin, operating expenses, operating income, operating margin, income before income taxes, provision for income taxes, net income and basic and fully diluted EPS for the three- and twelve-month periods ending Dec. 31, 2016 and 2015, on a GAAP and non-GAAP basis. NI is also providing guidance on its non-GAAP fully diluted EPS and expected effective tax rate. The company not able to provide guidance on its GAAP tax rate or a related reconciliation without unreasonable efforts since its future GAAP tax rate depends on its future stock price and related information that is not currently available.
When presenting non-GAAP information, the company includes a reconciliation of the non-GAAP results to the GAAP results. Management believes that including the non-GAAP results assists investors in assessing the company's operational performance and its performance relative to its competitors. The company presents these non-GAAP results as a complement to results provided in accordance with GAAP, and these results should not be regarded as a substitute for GAAP. Management uses these non-GAAP measures to manage and assess the profitability and performance of its business and does not consider stock-based compensation expense, amortization of acquisition-related intangibles, acquisition-related transaction costs, taxes levied on the transfer of acquired intellectual property, foreign exchange loss on acquisitions, acquisition-related fair value adjustments, and restructuring charges in managing its operations. Specifically, management uses non-GAAP measures to plan and forecast future periods; to establish operational goals; to compare with its business plan and individual operating budgets; to measure management performance for the purposes of executive compensation, including payments to be made under bonus plans; to assist the public in measuring the company's performance relative to the company's long-term public performance goals; to allocate resources; and, relative to the company's historical financial performance, to enable comparability between periods. Management also considers such non-GAAP results to be an important supplemental measure of its performance.
This news release discloses the company's EBITDA for the three- and twelve- month periods ending Dec. 31, 2016 and 2015. The company believes that including the EBITDA results assists investors in assessing the company's operational performance relative to its competitors. A reconciliation of EBITDA to GAAP net income is included with this news release. This news release also discloses the year over year change in the company's core revenue for the three- month and 12-month periods ending Dec. 31, 2016.  The company believes that including its core revenue assists investors in assessing the company's operational performance. A reconciliation of GAAP revenue to core revenue is included with this news release.
Conference Call Information and Availability of Presentation Materials
Interested parties can listen to the Q4 2016 earnings conference call with NI management today, Jan. 26, at 4:00 p.m. CT at www.ni.com/call. Replay information is available by calling (855) 859-2361, confirmation code 42870302, shortly after the call through Jan. 29 at 11:00 p.m. CT or by visiting the company's website at www.ni.com/call. Presentation materials referred to on the conference call can be found at www.ni.com/nati.

Forward-Looking Statements
This release contains "forward-looking statements" including statements regarding being committed to our vision and to strengthening our relationships with our customers, top priorities will be growing revenue, leveraging our investments in our platform and people, and improving our operating margins, being encouraged by growth in bookings, increased focus on growing revenue and improving our operating margin, budgeting for a headcount reduction in 2017, expecting Q1 revenue to be in the range of $285 million to $315 million, up 4.5 percent year over year at the midpoint, that the impact of the strengthening of the U.S. dollar will reduce the company's year-over-year dollar revenue growth rate by approximately 1 percent in Q1, expecting non-GAAP effective tax rate to be approximately 21 percent for 2017, and our guidance for GAAP fully diluted EPS and non-GAAP fully diluted EPS for Q1.  These statements are subject to a number of risks and uncertainties, including the risk of adverse changes or fluctuations in the global economy, foreign exchange fluctuations, fluctuations in demand for NI products including orders from NI's largest customer, component shortages, delays in the release of new products, the company's ability to effectively manage its operating expenses, manufacturing inefficiencies and the level of capacity utilization, the impact of any recent or future acquisitions by NI, expense overruns, adverse effects of price changes or effective tax rates. Actual results may differ materially from the expected results.

The company directs readers to its Form 10-K for the year ended Dec. 31, 2015, its Form 10-Q for the quarter ended Sept. 30, 2016; and the other documents it files with the SEC for other risks associated with the company's future performance.

About NI
Since 1976, NI (www.ni.com) has made it possible for engineers and scientists to solve the world's greatest engineering challenges with powerful, flexible technology solutions that accelerate productivity and drive rapid innovation. Customers from a wide variety of industries – from healthcare to automotive and from consumer electronics to particle physics – use NI's integrated hardware and software platform to improve the world we live in. (NATI-F)

National Instruments, NI and ni.com are trademarks of National Instruments. Other product and company names listed are trademarks or trade names of their respective companies.

 

National Instruments
Condensed Consolidated Balance Sheets
(in thousands)
 
  
December 31,
    
December 31,
 
  
2016
    
2015
 
          
Assets
          
Current assets:
          
Cash and cash equivalents
  
$
285,283
    
$
251,129
Short-term investments
    
73,117
      
81,789
Accounts receivable, net
    
228,686
      
216,244
Inventories, net
    
193,608
      
185,197
Prepaid expenses and other current assets
    
54,056
      
65,381
Total current assets
    
834,750
      
799,740
 
              
Property and equipment, net
    
260,456
      
257,853
Goodwill
    
253,197
      
257,718
Intangible assets, net
    
108,663
      
108,196
Other long-term assets
    
39,601
      
30,349
Total assets
  
$
1,496,667
    
$
1,453,856
 
              
Liabilities and Stockholders' Equity
              
Current liabilities:
              
Accounts payable
  
$
48,800
    
$
50,970
Accrued compensation
    
27,743
      
27,956
Deferred revenue - current
    
115,577
      
112,283
Accrued expenses and other liabilities
    
32,289
      
11,756
Other taxes payable
    
34,958
      
37,250
Total current liabilities
    
259,367
      
240,215
 
              
Long-term debt
    
25,000
      
37,000
Deferred income taxes
    
41,733
      
44,673
Liability for uncertain tax positions
    
11,719
      
11,974
Deferred revenue - long-term
    
29,752
      
27,708
Other long-term liabilities
    
10,413
      
10,565
Total liabilities
    
377,984
      
372,135
 
              
Stockholders' equity:
              
Preferred stock
    
-
      
-
Common stock
    
1,292
      
1,275
Additional paid-in capital
    
771,346
      
717,705
Retained earnings
    
380,883
      
400,831
Accumulated other comprehensive loss
    
(34,838
)
    
(38,090)
Total stockholders' equity
    
1,118,683
      
1,081,721
Total liabilities and stockholders' equity
  
$
1,496,667
    
$
1,453,856

National Instruments
  
Condensed Consolidated Statements of Income
  
(in thousands, except per share data, unaudited)
  
 
                  
 
  
Three Months Ended
    
Years Ended
  
 
  
December 31,
    
December 31,
  
 
  
2016
    
2015
    
2016
    
2015
  
 
                        
Net sales:
                        
Product
  
$
300,218
    
$
306,350
    
$
1,116,703
    
$
1,113,590
  
Software maintenance
    
28,314
      
27,989
      
111,476
      
111,866
  
Total net sales
    
328,532
      
334,339
      
1,228,179
      
1,225,456
  
 
                                
Cost of sales:
                                
Product
    
81,468
      
85,575
      
306,730
      
311,226
  
Software maintenance
    
1,264
      
1,200
      
6,391
      
5,730
  
Total cost of sales
    
82,732
      
86,775
      
313,121
      
316,956
  
 
                                
Gross profit
    
245,800
      
247,564
      
915,058
      
908,500
  
 
    
74.8
%
    
74.0
%
    
74.5
%
    
74.1
%
Operating expenses:
                                
Sales and marketing
    
115,006
      
116,348
      
461,236
      
452,262
  
Research and development
    
57,461
      
56,670
      
235,706
      
225,131
  
General and administrative
    
24,082
      
24,544
      
98,390
      
93,935
  
Total operating expenses
    
196,549
      
197,562
      
795,332
      
771,328
  
 
                                
Operating income
    
49,251
      
50,002
      
119,726
      
137,172
  
 
                                
Other income (expense):
                                
Interest income
    
335
      
314
      
1,122
      
1,403
  
Net foreign exchange loss
    
(3,162
)
    
(5,110
)
    
(4,632
)
    
(7,075
)
Other income (expense), net
    
471
      
(1,014
)
    
(1,581
)
    
(221
)
 
                                
Income before income taxes
    
46,895
      
44,192
      
114,635
      
131,279
  
 
                                
Provision for income taxes
    
13,065
      
12,058
      
27,220
      
36,017
  
 
                                
Net income
  
$
33,830
    
$
32,134
    
$
87,415
    
$
95,262
  
 
                                
Basic earnings per share
  
$
0.26
    
$
0.25
    
$
0.68
    
$
0.74
  
Diluted earnings per share
  
$
0.26
    
$
0.25
    
$
0.68
    
$
0.74
  
 
                                
Weighted average shares outstanding -
                                
basic
    
129,108
      
127,341
      
128,453
      
127,997
  
diluted
    
129,503
      
127,798
      
129,008
      
128,668
  
 
                                
Dividends declared per share
  
$
0.20
    
$
0.19
    
$
0.80
    
$
0.76
  



National Instruments
  
Condensed Consolidated Statements of Cash Flows
  
(in thousands, unaudited)
  
   
Years Ended December 31,
  
   
2016
    
2015
  
       
Cash flow from operating activities:
            
Net income
  
$
87,415
    
$
95,262
  
Adjustments to reconcile net income to net cash provided by operating activities:
                
Depreciation and amortization
    
73,390
      
73,329
  
Stock-based compensation
    
25,832
      
25,489
  
Tax expense/(benefit) expense from deferred income taxes
    
(22,751
)
    
11,019
  
Tax benefit from stock option plans
    
(442
)
    
(967
)
Acquisition-related fair value adjustments
    
1,585
      
-
  
Net change in operating assets and liabilities
    
30,811
      
(41,495
)
Net cash provided by operating activities
    
195,840
      
162,637
  
                 
Cash flow from investing activities:
                
Capital expenditures
    
(44,425
)
    
(33,987
)
Capitalization of internally developed software
    
(31,859
)
    
(31,356
)
Additions to other intangibles
    
(2,342
)
    
(2,811
)
Acquisitions, net of cash received
    
(549
)
    
(125,612
)
Purchases of short-term investments
    
(39,097
)
    
(36,063
)
Sales and maturities of short-term investments
    
47,769
      
151,437
  
Net cash used by investing activities
    
(70,503
)
    
(78,392
)
                 
Cash flow from financing activities:
                
Proceeds from revolving line of credit
    
15,000
      
54,000
  
Principal payments on revolving line of credit
    
(27,000
)
    
(17,000
)
Proceeds from issuance of common stock
    
28,907
      
27,785
  
Repurchase of common stock
    
(5,635
)
    
(75,255
)
Dividends paid
    
(102,897
)
    
(97,643
)
Tax benefit from stock option plans
    
442
      
967
  
Net cash used by financing activities
    
(91,183
)
    
(107,146
)
                 
Net change in cash and cash equivalents
    
34,154
      
(22,901
)
Cash and cash equivalents at beginning of year
    
251,129
      
274,030
  
Cash and cash equivalents at end of year
  
$
285,283
    
$
251,129
  




The following tables provide details with respect to the amount of GAAP charges related to stock-based compensation, amortization of acquisition intangibles, acquisition related transaction costs, restructuring charges, foreign exchange loss on acquisitions, taxes levied on the transfer of acquired intellectual property, and acquisition-related fair value adjustments that were recorded in the line items indicated below (unaudited)
  
                         
                         
   
Three Months Ended
    
Years Ended
  
   
December 31,
    
December 31,
  
                         
   
2016
    
2015
    
2016
    
2015
  
Stock-based compensation
                        
Cost of sales
  
$
568
    
$
509
    
$
2,210
    
$
1,936
  
Sales and marketing
    
2,636
      
2,701
      
11,057
      
11,003
  
Research and development
    
2,131
      
2,240
      
8,876
      
9,004
  
General and administrative
    
859
      
888
      
3,623
      
3,544
  
Provision for income taxes
    
(1,125
)
    
(1,870
)
    
(7,322
)
    
(7,289
)
Total
  
$
5,069
    
$
4,468
    
$
18,444
    
$
18,198
  
                                 
Amortization of acquisition intangibles
                                
Cost of sales
  
$
1,725
    
$
3,080
    
$
9,346
    
$
10,938
  
Sales and marketing
    
497
      
740
      
2,638
      
2,039
  
Research and development
    
273
      
316
      
1,088
      
1,299
  
Other income, net
    
-
      
93
      
-
      
542
  
Provision for income taxes
    
855
      
(1,398
)
    
2,162
      
(4,867
)
Total
  
$
3,350
    
$
2,831
    
$
15,234
    
$
9,951
  
                                 
Acquisition transaction costs, restructuring charges, and other
                                
Cost of sales
  
$
74
    
$
296
    
$
327
    
$
1,269
  
Sales and marketing
    
42
      
123
      
183
      
123
  
Research and development
    
170
      
198
      
818
      
198
  
General and administrative
    
50
      
593
      
367
      
1,035
  
Foreign exchange loss 1
    
-
      
3,111
      
94
      
3,111
  
Other income (loss), net2
    
-
      
1,000
      
2,475
      
1,000
  
Provision for income taxes
    
(94
)
    
(1,453
)
    
(1,452
)
    
(1,843
)
Total
  
$
242
    
$
3,868
    
$
2,812
    
$
4,893
  
(1) Foreign exchange losses on acquisitions were $94 and $3,111 for the years ended December 31, 2016 and 2015, respectively
  
(2) Taxes levied on the transfer of acquired intellectual property were $2,475 and $0 for the years ended December 31, 2016 and 2015, respectively. Impairment charges recognized on a cost-method investment were $0 and $1,000 for the years ended December 31, 2016 and December 31, 2015 respectively.
  
 
                       
Acquisition-related fair value adjustments
                      
Net sales1
  
$
904
    
$
-
    
$
904
    
$
-
Cost of sales1
    
681
      
-
      
681
      
-
Provision for income taxes
    
(567
)
    
-
      
(567
)
    
-
Total
  
$
1,018
    
$
-
    
$
1,018
    
$
-
(1) Acquisition-related fair value adjustments includes effects of our finalization of the business combination accounting for our Micropross acquisition including reduction in revenue and increase in cost of sales due to the respective write-down of acquired deferred revenue and step-up of acquired inventory


                         
National Instruments
  
Reconciliation of GAAP to Non-GAAP Measures
  
(in thousands, unaudited)
  
 
                        
   
Three Months Ended
    
Years Ended
  
   
December 31,
    
December 31,
  
   
2016
    
2015
    
2016
    
2015
  
Reconciliation of Net Sales to Non-GAAP Net Sales
                        
Net sales, as reported
  
$
328,532
    
$
334,339
    
$
1,228,179
    
$
1,225,456
  
Acquisition-related fair value adjustments
    
904
      
-
      
904
      
-
  
Non-GAAP net sales
  
$
329,436
    
$
334,339
    
$
1,229,083
    
$
1,225,456
  
                                 
Reconciliation of Gross Profit to Non-GAAP Gross Profit
                  
Gross profit, as reported
  
$
245,800
    
$
247,564
    
$
915,058
    
$
908,500
  
Stock-based compensation
    
568
      
509
      
2,210
      
1,936
  
Amortization of acquisition intangibles
    
1,725
      
3,080
      
9,346
      
10,938
  
Acquisition transaction costs and restructuring charges
    
74
      
296
      
327
      
1,269
  
Acquisition-related fair value adjustments
    
1,585
      
-
      
1,585
      
-
  
Non-GAAP gross profit
  
$
249,752
    
$
251,449
    
$
928,526
    
$
922,643
  
Non-GAAP gross margin
    
75.8
%
    
75.2
%
    
75.5
%
    
75.3
%
                                 
Reconciliation of Operating Expenses to Non-GAAP Operating Expenses
                  
Operating expenses, as reported
  
$
196,549
    
$
197,562
    
$
795,332
    
$
771,328
  
Stock-based compensation
    
(5,626
)
    
(5,829
)
    
(23,556
)
    
(23,551
)
Amortization of acquisition intangibles
    
(770
)
    
(1,056
)
    
(3,726
)
    
(3,338
)
Acquisition transaction costs and restructuring charges
    
(262
)
    
(914
)
    
(1,368
)
    
(1,356
)
Non-GAAP operating expenses
  
$
189,891
    
$
189,763
    
$
766,682
    
$
743,083
  
                                 
Reconciliation of Operating Income to Non-GAAP Operating Income
                  
Operating income, as reported
  
$
49,251
    
$
50,002
    
$
119,726
    
$
137,172
  
Stock-based compensation
    
6,194
      
6,338
      
25,766
      
25,487
  
Amortization of acquisition intangibles
    
2,495
      
4,136
      
13,072
      
14,276
  
Acquisition transaction costs and restructuring charges
    
336
      
1,210
      
1,695
      
2,625
  
Acquisition-related fair value adjustments
    
1,585
      
-
      
1,585
      
-
  
Non-GAAP operating income
  
$
59,861
    
$
61,686
    
$
161,844
    
$
179,560
  
Non-GAAP operating margin
    
18.2
%
    
18.5
%
    
13.2
%
    
14.7
  
                                 
Reconciliation of Income before income taxes to Non-GAAP Income before income taxes
                  
Income before income taxes, as reported
  
$
46,895
    
$
44,192
    
$
114,635
    
$
131,279
  
Stock-based compensation
    
6,194
      
6,338
      
25,766
      
25,487
  
Amortization of acquisition intangibles
    
2,495
      
4,229
      
13,072
      
14,818
  
Acquisition transaction costs and restructuring charges
    
336
      
5,321
      
1,695
      
6,736
  
Acquisition-related fair value adjustments
    
1,585
      
-
      
1,585
      
-
  
Foreign exchange loss on acquisitions
    
-
      
-
      
94
      
-
  
Taxes levied on transfer of acquired intellectual property
    
-
      
-
      
2,475
      
-
  
Non-GAAP income before income taxes
  
$
57,505
    
$
60,080
    
$
159,322
    
$
178,320
  
                                 
Reconciliation of Provision for income taxes to Non-GAAP Provision for income taxes
                  
Provision for income taxes, as reported
  
$
13,065
    
$
12,058
    
$
27,220
    
$
36,017
  
Stock-based compensation
    
1,125
      
1,870
      
7,322
      
7,289
  
Amortization of acquisition intangibles
    
(855
)
    
1,398
      
(2,162
)
    
4,867
  
Acquisition transaction costs, restructuring charges, and other
    
94
      
1,453
      
1,452
      
1,843
  
Acquisition-related fair value adjustments
    
567
      
-
      
567
      
-
  
Non-GAAP provision for income taxes
  
$
13,996
    
$
16,779
    
$
34,399
    
$
50,016
  

Reconciliation of GAAP Net Income, Basic EPS and Diluted EPS to Non-GAAP Net Income, Non-GAAP Basic EPS and Non-GAAP Diluted EPS
(in thousands, except per share data, unaudited)   
 
      
 
                      
 
  
Three Months Ended
    
Years Ended
 
  
December 31,
    
December 31,
 
  
2016
    
2015
    
2016
    
2015
 
                      
Net income, as reported
  
$
33,830
    
$
32,134
    
$
87,415
    
$
95,262
Adjustments to reconcile net income to non-GAAP net income:
                              
  Stock-based compensation, net of tax effect
    
5,069
      
4,468
      
18,444
      
18,198
  Amortization of acquisition intangibles, net of tax effect
    
3,350
      
2,831
      
15,234
      
9,951
  Acquisition transaction costs, restructuring, and other, net of tax effect
    
242
      
3,868
      
2,812
      
4,893
   Acquisition-related fair value adjustments, net of tax effect
    
1,018
      
-
      
1,018
      
-
Non-GAAP net income
  
$
43,509
    
$
43,301
    
$
124,923
    
$
128,304
 
                              
Basic EPS, as reported
  
$
0.26
    
$
0.25
    
$
0.68
    
$
0.74
Adjustment to reconcile basic EPS to non-GAAP
                              
basic EPS:
                              
  Impact of stock-based compensation, net of tax effect
    
0.04
      
0.04
      
0.14
      
0.14
  Impact of amortization of acquisition intangibles, net of tax effect
    
0.03
      
0.02
      
0.12
      
0.08
  Impact of acquisition transaction costs, restructuring, and other, net of tax effect
    
0.00
      
0.03
      
0.02
      
0.04
  Impact of acquisition-related fair value adjustments, net of tax effect
    
0.01
      
-
      
0.01
      
-
Non-GAAP basic EPS
  
$
0.34
    
$
0.34
    
$
0.97
    
$
1.00
 
                              
 
                              
Diluted EPS, as reported
  
$
0.26
    
$
0.25
    
$
0.68
    
$
0.74
Adjustment to reconcile diluted EPS to non-GAAP diluted EPS
                              
  Impact of stock-based compensation, net of tax effect
  
$
0.04
    
$
0.04
      
0.14
      
0.14
  Impact of amortization of acquisition intangibles, net of tax effect
    
0.03
      
0.02
      
0.12
      
0.08
  Impact of acquisition transaction costs, restructuring, and other, net of tax effect
    
0.00
      
0.03
      
0.02
      
0.04
   Impact of acquisition-related fair value adjustments, net of tax effect
    
0.01
      
-
      
0.01
      
-
Non-GAAP diluted EPS
  
$
0.34
    
$
0.34
    
$
0.97
    
$
1.00
 
                              
Weighted average shares outstanding -
                              
Basic
    
129,108
      
127,341
      
128,453
      
127,997
Diluted
    
129,503
      
127,798
      
129,008
      
128,668


National Instruments
Reconciliation of Net Income to EBITDA
(in thousands, unaudited)
 
              
 
Three Months Ended
  
Years Ended
 
December 31,
  
December 31,
 
2016
  
2015
  
2016
  
2015
Net income, as reported
  
$
33,830
    
$
32,134
    
$
87,415
    
$
95,262
Adjustments to reconcile net income to EBITDA:
                              
     Interest income, net
    
(155
)
    
(167
)
    
(349
)
    
(1,099)
     Tax expense
    
13,065
      
12,058
      
27,220
      
36,016
     Depreciation and amortization
    
18,226
      
18,933
      
73,390
      
73,329
EBITDA
  
$
64,966
    
$
62,958
    
$
187,676
    
$
203,508
Weighted average shares outstanding - Diluted
    
129,503
      
127,798
      
129,008
      
128,668
 
                              
 
 
          
Reconciliation of GAAP to Non-GAAP EPS Guidance
(unaudited)
 
Three Months Ended
 
March 31, 2017
 
          
 
  
Low
    
High
GAAP Fully Diluted EPS, guidance
  
$
0.05
    
$
0.19
Adjustment to reconcile diluted EPS to non-GAAP
              
diluted EPS:
              
  Impact of stock-based compensation, net of tax effect
    
0.04
      
0.04
  Impact of amortization of acquisition intangibles, net of tax effect
    
0.02
      
0.02
Non-GAAP diluted EPS, guidance
  
$
0.11
    
$
0.25


National Instruments
Reconciliation of GAAP Revenue Growth to Core Revenue Growth
(unaudited)
 
    
 
  
Three Months Ended,
 
  
December 31,
 
  
2016
YoY GAAP revenue growth, as reported
  
$
-2.0%
Effect of excluding our current largest customer
    
2.0%
YoY GAAP revenue growth, excluding our largest customer
    
0.0%
Effect of excluding the impact of foreign currency exchange
    
3.0%
YoY Core revenue growth
  
$
3.0%
 
      
 
  
Year Ended,
 
  
December 31,
 
    
2016
YoY GAAP revenue growth, as reported
  
$
0.0%
Effect of excluding our current largest customer
    
0.0%
YoY GAAP revenue growth, excluding our largest customer
    
0.0%
Effect of excluding the impact of foreign currency exchange
    
3.0%
YoY Core revenue growth
  
$
3.0%

National Instruments
Reconciliation of GAAP Revenue Growth Guidance to Core Revenue Growth Guidance
(unaudited)
 
    
 
  
Three Months Ended
 
  
March 31,
 
  
2017
Estimated YoY GAAP revenue growth, as reported
  
$
5.0%
Estimated effect of excluding our current largest customer
    
2.0%
Estimated YoY GAAP revenue growth, excluding our largest customer
    
7.0%
Estimated effect of excluding the impact of foreign currency exchange
    
1.0%
Estimated YoY Core revenue growth
  
$
8.0%