National Instruments Reports Record Revenue for a Second Quarter of $319 Million

Net Income up 49% for First Half of 2017

Q2 2017 Highlights

  • Revenue of $319 million, up 4 percent year over year with core revenue up 7 percent year over year
  • GAAP gross margin of 74 percent
  • Non-GAAP gross margin of 75 percent
  • Fully diluted GAAP EPS of $0.19 and fully diluted non-GAAP EPS of $0.27
  • GAAP net income of $25 million
  • Non-GAAP net income of $35 million, a record for a second quarter
  • EBITDA of $46 million
  • Cash and short-term investments of $368 million as of June 30, 2017

AUSTIN, Texas — (BUSINESS WIRE) — July 27, 2017 — National Instruments (Nasdaq: NATI) today announced Q2 2017 revenue of $319 million, up 4 percent year over year with core revenue up 7 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 the year over year change in GAAP revenue to the year over year change in core revenue is included with this news release.

In Q2 2017, NI received $12 million in orders from its largest customer compared with $18 million in orders from this customer in Q2 2016. Excluding NI’s largest customer, the value of the company’s total orders was up 8 percent year over year for the quarter; orders under $20,000 were flat year over year; orders between $20,000 and $100,000 were up 1 percent year over year; and orders above $100,000 were up 42 percent year over year.

GAAP net income for Q2 was $25 million, with fully diluted earnings per share (EPS) of $0.19, and non-GAAP net income was $35 million, a record for a second quarter, with non-GAAP fully diluted EPS of $0.27. Included in NI’s GAAP net income for Q2 is $4 million related to restructuring charges. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortization, was $46 million for Q2.

In Q2, GAAP gross margin was 74 percent and non-GAAP gross margin was 75 percent. Total GAAP operating expenses were $208 million, up 3 percent year over year. Total non-GAAP operating expenses were flat year over year at $194 million. GAAP operating margin was 9 percent in Q2, with GAAP operating income of $29 million, up 5 percent year over year. Non-GAAP operating margin was 14 percent in Q2, with non-GAAP operating income of $44 million, up 15 percent year over year.

“I am pleased with our Q2 performance and execution as we continue to drive toward our revenue and profitability goals with record revenue for a second quarter and 26% year over year non-GAAP net income growth for the first half of 2017,” said Alex Davern, NI president and CEO. “We believe alignment of our product and channel investments toward the growth opportunity in 5G communications, semiconductor test, the connected vehicle, and the Industrial Internet of Things continues to move our platform closer to our users’ challenges, which increases our impact within these applications.”

Karen Rapp, NI CFO, said, “We are encouraged by the strong order growth and improved trends in the industrial economy. Our leadership team is focused on executing to the updated leverage model shared at our recent investor day. We are going to do this through deliberate decision making and discipline in managing our expenses. We believe this focus will keep us on the right path as we strive to meet both our growth and profitability goals this year and in 2018.”

Geographic revenue in U.S. dollar terms for Q2 2017 compared with Q2 2016 was up 6 percent in the Americas, down 1 percent in APAC and up 6 percent in EMEIA. Excluding the impact of foreign currency exchange, revenue was up 6 percent in the Americas, flat in APAC and up 10 percent in EMEIA. Historical revenue from these three regions can be found on NI’s investor website at

As of June 30, 2017, NI had $368 million in cash and short-term investments. During the second quarter, NI paid $27 million in dividends. The NI Board of Directors approved a quarterly dividend of $0.21 per share payable on Sept. 5, 2017, to stockholders of record on Aug. 14, 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, and restructuring charges. Reconciliations of the company’s GAAP and non-GAAP results are included as part of this news release.


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