National Instruments Reports Record Quarterly and Annual Revenue
Q4 2010 Highlights
- Revenue of
$250 million , up 24 percent year-over-year and up 13 percent sequentially - GAAP gross margin of 77.5 percent
- Non-GAAP gross margin of 78.0 percent
- GAAP and non-GAAP operating income and net income reached all-time record
- Fully diluted GAAP EPS of
$0.48 - Fully diluted non-GAAP EPS of
$0.53 - EBITDA reached a record of
$56 million , or$0.71 per share, and was up 22 percent year-over-year - Cash and short-term investments of
$351 million and no debt as ofDec. 31, 2010
GAAP and non-GAAP operating income were all-time quarterly records, and operating margins improved significantly over Q4 2009. Net income for Q4 2010 was
In Q4, GAAP gross margin increased 60 basis points year-over-year to 77.5 percent. Non-GAAP gross margin increased by 50 basis points year-over-year to 78.0 percent.
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.
"I am extremely pleased with the significant demand we saw for our products through 2010," said Dr.
NI virtual instrumentation and graphical system design product sales were up 24 percent year-over-year. NI instrument control product sales were up 20 percent year-over-year in Q4. Product revenue was
Geographically, revenue in US dollar terms for Q4 2010 compared to Q4 2009 was up 16 percent in the
As of
FY 2010 Highlights
- Record revenue of
$873 million , up 29 percent year-over-year - GAAP operating margin of 14.7 percent
- Non-GAAP operating margin of 17.3 percent
- Fully diluted GAAP EPS of
$1.38 - Fully diluted non-GAAP EPS of
$1.58 - Record annual revenue for NI CompactRIO, RF and PXI modular instruments
- Record cash flow from operating activities of
$145 million - Record EBITDA of
$165 million or$2.08 per share - NI named to FORTUNE magazine's 100 Best Companies to Work For list for 12th consecutive year
Full-year 2010 revenue was
Guidance for Q1 2011
"We are extremely pleased by our impressive finish to 2010, and this increases our confidence in aggressively investing in long-term growth," said
NI expects strong Q1 year-over-year revenue growth, with revenue expected to be between
In Q1 2011, the company anticipates that the GAAP to non-GAAP EPS adjustment will be approximately
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 gross profit, operating expenses, operating income, income before income taxes, provision for income taxes, net income and basic and fully diluted EPS for the three- and 12-month periods ending
Conference Call Information
Interested parties can listen to the Q4 2010 conference call today,
Forward-Looking Statements
This release contains "forward-looking statements," including statements related to significant new opportunities for NI, our belief that customers are seeing great value in our platforms, our confidence in aggressively investing in long-term growth, our budget for R&D, field sales and overall headcount, that the incremental cost of our headcount additions will be partially offset by a reduction in variable compensation in 2011, our Q1 guidance for revenue and GAAP and non-GAAP EPS, our expected GAAP to non-GAAP adjustment for Q1 and our anticipated non-GAAP effective tax rate for 2011. These statements are subject to a number of risks and uncertainties, including the risk of adverse changes or fluctuations in the global economy, component shortages, delays in the release of new products, fluctuations in customer demand for NI products, the company's ability to continue to control its
operating expenses, manufacturing inefficiencies and foreign exchange fluctuations. Actual results may differ materially from the expected results. The company directs readers to its Form 10-K for the fiscal year ended
About
CompactRIO, LabVIEW,
National Instruments | |||||
Consolidated Balance Sheets | |||||
(in thousands) | |||||
December 31, | |||||
2010 | 2009 | ||||
(Unaudited) | |||||
Assets | |||||
Current assets: | |||||
Cash and cash equivalents | $ | 219,447 | $ | 201,465 | |
Short-term investments | 131,215 | 87,196 | |||
Accounts receivable, net | 127,214 | 103,957 | |||
Inventories, net | 117,765 | 86,515 | |||
Prepaid expenses and other current assets | 36,239 | 36,523 | |||
Deferred income taxes, net | 18,838 | 16,522 | |||
Total current assets | 650,718 | 532,178 | |||
Property and equipment, net | 160,410 | 153,265 | |||
Goodwill, net | 70,278 | 64,779 | |||
Intangible assets, net | 52,816 | 43,390 | |||
Other long-term assets | 25,460 | 19,417 | |||
Total assets | $ | 959,682 | $ | 813,029 | |
Liabilities and Stockholders' Equity | |||||
Current liabilities: | |||||
Accounts payable | $ | 33,544 | $ | 23,502 | |
Accrued compensation | 27,734 | 14,934 | |||
Deferred revenue | 71,650 | 57,242 | |||
Accrued expenses and other liabilities | 16,538 | 8,560 | |||
Other taxes payable | 16,846 | 14,181 | |||
Total current liabilities | 166,312 | 118,419 | |||
Deferred income taxes | 29,477 | 25,012 | |||
Liability for uncertain tax positions | 14,953 | 11,062 | |||
Other long-term liabilities | 4,395 | 4,116 | |||
Total liabilities | $ | 215,137 | $ | 158,609 | |
Stockholders' equity: | |||||
Preferred stock | - | - | |||
Common stock | 786 | 774 | |||
Additional paid-in capital | 408,106 | 336,446 | |||
Retained earnings | 336,363 | 303,655 | |||
Accumulated other comprehensive income | (710) | 13,545 | |||
Total stockholders' equity | $ | 744,545 | $ | 654,420 | |
Total liabilities and stockholders' equity | $ | 959,682 | $ | 813,029 | |
National Instruments | |||||||||
Consolidated Statements of Income | |||||||||
(in thousands, except per share data) | |||||||||
Three Months Ended | Year Ended | ||||||||
December 31, | December 31, | ||||||||
(Unaudited) | (Unaudited) | ||||||||
2010 | 2009 | 2010 | 2009 | ||||||
Net sales: | |||||||||
Product | $ | 233,973 | $ | 188,388 | $ | 807,386 | $ | 623,736 | |
Software maintenance | 15,990 | 13,209 | 65,834 | 52,858 | |||||
Total net sales | 249,963 | 201,597 | 873,220 | 676,594 | |||||
Cost of sales: | |||||||||
Product | $ | 55,278 | $ | 45,466 | $ | 195,096 | $ | 164,700 | |
Software maintenance | 1,021 | 1,150 | 4,987 | 5,184 | |||||
Total cost of sales | 56,299 | 46,616 | 200,083 | 169,884 | |||||
Gross profit | $ | 193,664 | $ | 154,981 | $ | 673,137 | $ | 506,710 | |
Operating expenses: | |||||||||
Sales and marketing | $ | 86,440 | $ | 70,178 | $ | 319,606 | $ | 269,267 | |
Research and development | 43,237 | 33,722 | 158,149 | 132,974 | |||||
General and administrative | 17,368 | 15,100 | 67,069 | 57,938 | |||||
Total operating expenses | $ | 147,045 | $ | 119,000 | $ | 544,824 | $ | 460,179 | |
Operating income | $ | 46,619 | $ | 35,981 | $ | 128,313 | $ | 46,531 | |
Other income (expense): | |||||||||
Interest income | $ | 340 | $ | 294 | $ | 1,391 | $ | 1,629 | |
Net foreign exchange gain (loss) | (110) | (567) | (2,585) | 734 | |||||
Other income, net | 23 | 372 | 993 | 1,351 | |||||
Income before income taxes | $ | 46,872 | $ | 36,080 | $ | 128,112 | $ | 50,245 | |
Provision for income taxes | 8,844 | 33,714 | 18,996 | 33,160 | |||||
Net income | $ | 38,028 | $ | 2,366 | $ | 109,116 | $ | 17,085 | |
Basic earnings per share | $ | 0.48 | $ | 0.03 | $ | 1.40 | $ | 0.22 | |
Diluted earnings per share | $ | 0.48 | $ | 0.03 | $ | 1.38 | $ | 0.22 | |
Weighted average shares outstanding - | |||||||||
basic | 78,426 | 77,589 | 77,982 | 77,520 | |||||
diluted | 79,335 | 78,325 | 79,048 | 78,026 | |||||
Dividends declared per share | $ | 0.13 | $ | 0.12 | $ | 0.52 | $ | 0.48 | |
National Instruments | |||||
Consolidated Statements of Cash Flows | |||||
(in thousands) | |||||
Year Ended | |||||
December 31, | |||||
(Unaudited) | |||||
2010 | 2009 | ||||
Cash flow from operating activities: | |||||
Net income | $ | 109,116 | $ | 17,085 | |
Adjustments to reconcile net income to net cash provided | |||||
by operating activities: | |||||
Depreciation and amortization | 37,872 | 38,365 | |||
Stock-based compensation | 18,795 | 20,299 | |||
Tax expense from deferred income taxes | 3,668 | 17,196 | |||
Tax expense (benefit) from stock option plans | (96) | 1,450 | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable | (22,923) | 17,591 | |||
Inventories | (30,930) | 20,843 | |||
Prepaid expenses and other assets | (20,411) | 12,740 | |||
Accounts payable | 9,630 | (7,374) | |||
Deferred revenue | 14,408 | 11,728 | |||
Taxes and other liabilities | 25,929 | (14,272) | |||
Net cash provided by operating activities | $ | 145,058 | $ | 135,651 | |
Cash flow from investing activities: | |||||
Capital expenditures | (28,397) | (20,847) | |||
Capitalization of internally developed software | (15,759) | (12,583) | |||
Additions to other intangibles | (4,151) | (4,602) | |||
Acquisitions, net of cash received | (4,218) | - | |||
Purchases of short-term investments | (126,691) | (93,087) | |||
Sales and maturities of short-term investments | 82,672 | 19,204 | |||
Net cash (used by) investing activities | $ | (96,544) | $ | (111,915) | |
Cash flow from financing activities: | |||||
Proceeds from issuance of common stock | 51,852 | 21,672 | |||
Repurchase of common stock | (41,862) | (34,585) | |||
Dividends paid | (40,618) | (37,308) | |||
Tax expense (benefit) from stock option plans | 96 | (1,450) | |||
Net cash (used by) financing activities | $ | (30,532) | $ | (51,671) | |
Net change in cash and cash equivalents | 17,982 | (27,935) | |||
Cash and cash equivalents at beginning of period | 201,465 | 229,400 | |||
Cash and cash equivalents at end of period | $ | 219,447 | $ | 201,465 | |
Detail of GAAP Charges Related to Stock-Based Compensation and | |||||||||
Amortization of Acquisition Intangibles | |||||||||
(Unaudited) | |||||||||
Three Months Ended | Year Ended | ||||||||
December 31, | December 31, | ||||||||
2010 | 2009 | 2010 | 2009 | ||||||
Stock-based compensation | |||||||||
Cost of sales | $ | 331 | $ | 309 | $ | 1,345 | $ | 1,284 | |
Sales and marketing | 1,851 | 2,148 | 7,911 | 8,774 | |||||
Research and development | 1,774 | 1,887 | 6,903 | 7,236 | |||||
General and administrative | 645 | 717 | 2,636 | 3,005 | |||||
Provision for income taxes | (1,549) | 1,523 | (5,971) | (3,765) | |||||
Total | $ | 3,052 | $ | 6,584 | $ | 12,824 | $ | 16,534 | |
Amortization of acquisition intangibles | |||||||||
Cost of sales | $ | 921 | $ | 852 | $ | 3,486 | $ | 3,445 | |
Sales and marketing | 75 | 126 | 386 | 503 | |||||
Research and development | - | - | - | - | |||||
General and administrative | 15 | - | 15 | - | |||||
Provision for income taxes | (298) | (277) | (1,202) | (1,111) | |||||
Total | $ | 713 | $ | 701 | $ | 2,685 | $ | 2,837 | |
National Instruments | |||||||||
Reconciliation of GAAP to Non-GAAP Measures | |||||||||
(in thousands, except per share data) | |||||||||
(unaudited) | |||||||||
Three Months Ended | Year Ended | ||||||||
December 31, | December 31, | ||||||||
2010 | 2009 | 2010 | 2009 | ||||||
Reconciliation of Gross Profit to Non-GAAP Gross Profit | |||||||||
Gross profit, as reported | $ | 193,664 | $ | 154,981 | $ | 673,137 | $ | 506,710 | |
Stock-based compensation | 331 | 309 | 1,345 | 1,284 | |||||
Amortization of acquisition intangibles | 921 | 852 | 3,486 | 3,445 | |||||
Non-GAAP gross profit | $ | 194,916 | $ | 156,142 | $ | 677,968 | $ | 511,439 | |
Reconciliation of Operating Expenses to Non-GAAP Operating Expenses | |||||||||
Operating expenses, as reported | $ | 147,045 | $ | 119,000 | $ | 544,824 | $ | 460,179 | |
Stock-based compensation | (4,270) | (4,752) | (17,450) | (19,015) | |||||
Amortization of acquisition intangibles | (90) | (126) | (401) | (503) | |||||
Non-GAAP operating expenses | $ | 142,685 | $ | 114,122 | $ | 526,973 | $ | 440,661 | |
Reconciliation of Operating Income to Non-GAAP Operating Income | |||||||||
Operating income, as reported | $ | 46,619 | $ | 35,981 | $ | 128,313 | $ | 46,531 | |
Stock-based compensation | 4,601 | 5,061 | 18,795 | 20,299 | |||||
Amortization of acquisition intangibles | 1,011 | 978 | 3,887 | 3,948 | |||||
Non-GAAP operating income | $ | 52,231 | $ | 42,020 | $ | 150,995 | $ | 70,778 | |
Reconciliation of Income Before Income Taxes to Non-GAAP Income Before Income Taxes | |||||||||
Income before income taxes, as reported | $ | 46,872 | $ | 36,080 | $ | 128,112 | $ | 50,245 | |
Stock-based compensation | 4,601 | 5,061 | 18,795 | 20,299 | |||||
Amortization of acquisition intangibles | 1,011 | 978 | 3,887 | 3,948 | |||||
Non-GAAP income before income taxes | $ | 52,484 | $ | 42,119 | $ | 150,794 | $ | 74,492 | |
Reconciliation of Provision for Income Taxes to Non-GAAP Provision for Income Taxes | |||||||||
Provision for income taxes, as reported | $ | 8,844 | $ | 33,714 | $ | 18,996 | $ | 33,160 | |
Stock-based compensation | 1,549 | (1,523) | 5,971 | 3,765 | |||||
Amortization of acquisition intangibles | 298 | 277 | 1,202 | 1,111 | |||||
Non-GAAP provision for income taxes | $ | 10,691 | $ | 32,468 | $ | 26,169 | $ | 38,036 | |
Reconciliation of GAAP Net Income, Basic EPS and Diluted EPS to Non-GAAP Net Income, Basic EPS and Diluted EPS | |||||||||
(unaudited) | |||||||||
Three Months Ended | Year Ended | ||||||||
December 31, | December 31, | ||||||||
2010 | 2009 | 2010 | 2009 | ||||||
Net income, as reported | $ | 38,028 | $ | 2,366 | $ | 109,116 | $ | 17,085 | |
Adjustments to reconcile net income to non-GAAP net income: | |||||||||
Stock-based compensation, net of tax effect | 3,052 | 6,584 | 12,824 | 16,534 | |||||
Amortization of acquisition intangibles, net of tax effect | 713 | 701 | 2,685 | 2,837 | |||||
Non-GAAP net income | $ | 41,793 | $ | 9,651 | $ | 124,625 | $ | 36,456 | |
Basic EPS, as reported | $ | 0.48 | $ | 0.03 | $ | 1.40 | $ | 0.22 | |
Adjustment to reconcile basic EPS to non-GAAP | |||||||||
basic EPS: | |||||||||
Impact of stock-based compensation, net of tax effect | $ | 0.04 | $ | 0.08 | $ | 0.17 | $ | 0.21 | |
Impact of amortization of acquisition intangibles, net of tax effect | $ | 0.01 | $ | 0.01 | $ | 0.03 | $ | 0.04 | |
Non-GAAP basic EPS | $ | 0.53 | $ | 0.12 | $ | 1.60 | $ | 0.47 | |
Diluted EPS, as reported | $ | 0.48 | $ | 0.03 | $ | 1.38 | $ | 0.22 | |
Adjustment to reconcile diluted EPS to non-GAAP | |||||||||
diluted EPS: | |||||||||
Impact of stock-based compensation, net of tax effect | $ | 0.04 | $ | 0.08 | $ | 0.16 | $ | 0.21 | |
Impact of amortization of acquisition intangibles, net of tax effect | $ | 0.01 | $ | 0.01 | $ | 0.04 | $ | 0.04 | |
Non-GAAP diluted EPS | $ | 0.53 | $ | 0.12 | $ | 1.58 | $ | 0.47 | |
Weighted average shares outstanding - | |||||||||
Basic | 78,426 | 77,589 | 77,982 | 77,520 | |||||
Diluted | 79,335 | 78,325 | 79,048 | 78,026 | |||||
Reconciliation of Net Income and Diluted EPS to EBITDA and EBITDA Diluted EPS | |||||||||
(unaudited) | |||||||||
Three Months Ended | Year Ended | ||||||||
December 31, | December 31, | ||||||||
2010 | 2009 | 2010 | 2009 | ||||||
Net income, as reported | $ | 38,028 | $ | 2,366 | $ | 109,116 | $ | 17,085 | |
Adjustments to reconcile net income to EBITDA: | |||||||||
Interest income | (340) | (294) | (1,391) | (1,629) | |||||
Taxes | 8,844 | 33,714 | 18,996 | 33,160 | |||||
Depreciation and amortization | 9,652 | 9,829 | 37,872 | 38,365 | |||||
EBITDA | $ | 56,184 | $ | 45,615 | $ | 164,593 | $ | 86,981 | |
Diluted EPS, as reported | $ | 0.48 | $ | 0.03 | $ | 1.38 | $ | 0.22 | |
Adjustment to reconcile diluted EPS to EBITDA | |||||||||
Interest income | $ | (0.00) | $ | (0.00) | $ | (0.02) | $ | (0.02) | |
Taxes | $ | 0.11 | $ | 0.43 | $ | 0.24 | $ | 0.42 | |
Depreciation and amortization | $ | 0.12 | $ | 0.12 | $ | 0.48 | $ | 0.49 | |
EBITDA diluted EPS | $ | 0.71 | $ | 0.58 | $ | 2.08 | $ | 1.11 | |
Weighted average shares outstanding - Diluted | 79,335 | 78,325 | 79,048 | 78,026 | |||||
National Instruments | ||||||
Reconciliation of GAAP to Non-GAAP EPS Guidance | ||||||
(unaudited) | ||||||
Three months ended | ||||||
March 31, 2011 | ||||||
Low | High | |||||
GAAP Fully Diluted EPS, guidance | $ | 0.33 | $ | 0.41 | ||
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 | $ | 0.01 | $ | 0.01 | ||
Non-GAAP diluted EPS, guidance | $ | 0.38 | $ | 0.46 | ||
Contact: | Veronica Garza | |
Investor Relations | ||
(512) 683-6873 | ||
SOURCE
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