UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

____________________

FORM 8‑K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

July 30, 2019
____________________

National Instruments Corporation
(Exact name of registrant as specified in its charter)

Delaware
 
000-25426
 
74-1871327
(State or other jurisdiction of incorporation)
 
(Commission File Number)
 
(IRS Employer
Identification No.)

11500 North MoPac Expressway
Austin, Texas 78759
(Address of principal executive offices, including zip code)

(512) 683-0100
(Registrant’s telephone number, including area code)

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value
NATI
The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company
 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 

Item 2.02
Results of Operations and Financial Condition.

Attached hereto as Exhibit 99.1 and incorporated by reference herein is the text of the press release of National Instruments Corporation (“NI”), dated July 30, 2019, regarding financial results for NI’s second fiscal quarter ended June 30, 2019.

The information in the press release attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.

Item 9.01
Financial Statements and Exhibits

(d)  Exhibits.

Exhibit No.
 
Description
     
99.1
 



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

   
NATIONAL INSTRUMENTS CORPORATION
     
 
By:
/s/ Alex M. Davern
 
   
Name:  Alex M. Davern
Title:  Chief Executive Officer

Date:  July 30, 2019
Contact:
 
Marissa Vidaurri
   
Head of Investor Relations
   
(512) 683-5215


National Instruments Reports Second Quarter Revenue of $334 Million
Company delivers strong cash flow from operations of $264 million for trailing twelve months

Q2 2019 Highlights

Revenue of $334 million, down 2 percent year over year and up 7 percent sequentially

GAAP gross margin of 75 percent

Non-GAAP gross margin of 77 percent

Fully diluted GAAP EPS of $0.22 and fully diluted non-GAAP EPS of $0.35

GAAP net income of $29 million, down 8 percent year over year

Non-GAAP net income of $46 million, up 3 percent year over year

GAAP net income down 6 percent year over year through first six months

Non-GAAP net income up 11 percent year over year through first six months

EBITDA of $49 million

Cash and short-term investments of $440 million as of June 30, 2019

Cash flow from operating activities of $264 million for the twelve months ended June 30, 2019, up 11 percent year over year

1.1 million shares of common stock repurchased at an average price of $41 per share

AUSTIN, Texas - July 30, 2019 - National Instruments (Nasdaq: NATI) today announced Q2 2019 revenue of $334 million, down 2 percent year over year and up 7 percent sequentially from Q1 2019.

In Q2 2019 the value of the company's total orders was down 4 percent year over year; orders under $20,000 were down 6 percent year over year; and orders over $20,000 were down 2 percent year over year.

In Q2, GAAP gross margin was 75 percent and non-GAAP gross margin was 77 percent. Total GAAP operating expenses were $218 million, down 2 percent year over year. Total non-GAAP operating expenses were down 4 percent year over year at $203 million. GAAP operating margin was 10 percent in Q2, with GAAP operating income of $32 million, down 13 percent year over year. Non-GAAP operating margin was 17 percent in Q2, with non-GAAP operating income of $56 million, up 1 percent year over year. For the first half of 2019, GAAP operating expenses were $430 million, flat year over year, and non-GAAP operating expenses were $403 million, down 4 percent year over year. GAAP operating income for the first half of 2019 was $56 million, down 14 percent year over year, and non-GAAP operating income for the first half of 2019 was $99 million, up 6 percent year over year.

GAAP net income for Q2 was $29 million, with fully diluted earnings per share (EPS) of $0.22, and non-GAAP net income was $46 million, with non-GAAP fully diluted EPS of $0.35. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortization, was $49 million for Q2.

“I am pleased with our execution this quarter despite external disruptions in our industry. Revenue came in at 98 percent of the midpoint of our guidance and we delivered an all-time record non-GAAP net income for a second quarter,” said Alex Davern, NI CEO. “We are on a journey to position NI for long-term growth and I believe we have an opportunity to deliver significant operating leverage when the market dynamics recover. I remain optimistic about our opportunity for growth and delivering 18 percent non-GAAP operating margin through the cycle.”

“In Q2, we delivered record non-GAAP net income for a second quarter, due to our increased scalability and strong culture of operational efficiency. In addition, we returned $80 million to shareholders through dividends and share repurchases,” said Karen Rapp, NI CFO. “Our commitment to delivering long-term shareholder value remains a priority.”

Geographic revenue in U.S. dollar terms for Q2 2019 compared with Q2 2018 was down 1 percent in the Americas, up 5 percent in APAC and down 10 percent in EMEIA. Excluding the impact of foreign currency exchange, revenue was flat in the Americas, up 8 percent in APAC and down 6 percent in EMEIA. Historical revenue from these three regions can be found on NI’s investor website at www.ni.com/nati.

As of June 30, 2019, NI had $440 million in cash and short-term investments. During the second quarter, NI paid $33 million in dividends and repurchased 1.1 million shares of our common stock at an average price of $41. The NI Board of Directors approved a quarterly dividend of $0.25 per share payable on September 3, 2019, to stockholders of record on August 12, 2019.

The company’s non-GAAP results exclude, as applicable, 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, restructuring charges, tax reform charges, and capitalization and amortization of internally developed software costs. Reconciliations of the company’s GAAP and non-GAAP results are included as part of this news release.

Guidance

NI currently expects Q3 revenue to be in the range of $325 million to $355 million. The company currently expects that GAAP fully diluted EPS will be in the range of $0.30 to $0.44 for Q3, with non-GAAP fully diluted EPS expected to be in the range of $0.36 to $0.50. Included in the company’s Q3 2019 GAAP EPS guidance is approximately $0.03 of restructuring charges and approximately $0.12 related to disposal gains from the pending sale of an office building less a charitable contribution using a portion of the sale proceeds.

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, 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 six months ended June 30, 2019 and 2018, on a GAAP and non-GAAP basis. NI is also providing guidance on its non-GAAP fully diluted EPS.

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, restructuring charges, tax reform charges, and capitalization and amortization of internally developed software costs 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 six months ended June 30, 2019 and 2018. 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.

Conference Call Information and Availability of Presentation Materials
Interested parties can listen to the Q2 2019 earnings conference call with NI management today, July 30, at 4:00 p.m. CT at www.ni.com/call or by dialing (855) 212-2361 and entering confirmation code 7489827 ten minutes prior to the call start time. Replay information is available by calling (855) 859-2056, confirmation code 7489827, shortly after the call through August 2 at 10:00 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 our journey to position NI for long-term growth, believing we have an opportunity to deliver significant operating leverage when the market dynamics recover, remaining optimistic about our opportunity for growth and delivering 18 percent non-GAAP operating margin through the cycle, increased scalability and strong culture of operational efficiency, that our commitment to delivering long-term shareholder value remains a priority, expecting  Q3 revenue to be in the range of $325 million to $355 million, expecting that GAAP fully diluted EPS will be in the range of $0.30 to $0.44 for Q3, with non-GAAP fully diluted EPS expected to be in the range of $0.36 to $0.50, and including in our Q3 EPS guidance approximately $0.03 of restructuring charges and approximately $0.12 of disposal gains from the pending sale of an office building and a charitable contribution using a portion of the sale proceeds.  These statements are subject to a number of risks and uncertainties, including the risk of adverse changes or fluctuations in the global economy, further adverse fluctuations in our industry, foreign exchange fluctuations, fluctuations in demand for NI products including orders from NI’s large customers, 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, and 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, 2018, its Form 10-Q for the quarter ended March 31, 2019 and the other documents it files with the SEC for other risks associated with the company’s future performance.

About NI
NI (ni.com) develops high-performance automated test and automated measurement systems to help you solve your engineering challenges now and into the future. Our open, software-defined platform uses modular hardware and an expansive ecosystem to help you turn powerful possibilities into real solutions. (NATI-F)

LabVIEW, 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)
 
   
June 30,
   
December 31,
 
   
2019
   
2018
 
   
(unaudited)
       
             
Assets
           
Current assets:
           
Cash and cash equivalents
 
$
191,761
   
$
259,386
 
Short-term investments
   
247,892
     
271,396
 
Accounts receivable, net
   
222,565
     
242,955
 
Inventories, net
   
206,851
     
194,146
 
Prepaid expenses and other current assets
   
66,021
     
54,337
 
Total current assets
   
935,090
     
1,022,220
 
                 
Property and equipment, net
   
233,900
     
245,201
 
Goodwill
   
263,984
     
264,530
 
Intangible assets, net
   
97,612
     
110,783
 
Operating lease right-of-use assets
   
70,799
     
 
Other long-term assets
   
38,088
     
28,501
 
Total assets
 
$
1,639,473
   
$
1,671,235
 
                 
Liabilities and Stockholders' Equity
               
Current liabilities:
               
Accounts payable and accrued expenses
 
$
54,966
   
$
48,388
 
Accrued compensation
   
39,613
     
45,821
 
Deferred revenue - current
   
128,787
     
127,288
 
Operating lease liabilities - current
   
15,735
     
 
Other current liabilities
   
12,665
     
25,913
 
Other taxes payable
   
33,517
     
35,574
 
Total current liabilities
   
285,283
     
282,984
 
                 
                 
Deferred income taxes
   
27,903
     
25,457
 
Liability for uncertain tax positions
   
8,329
     
9,775
 
Income tax payable - long-term
   
67,046
     
74,546
 
Deferred revenue - long-term
   
32,937
     
32,636
 
Operating lease liabilities - non-current
   
38,495
     
 
Other long-term liabilities
   
4,906
     
7,479
 
Total liabilities
   
464,899
     
432,877
 
                 
Stockholders' equity:
               
Preferred stock
   
     
 
Common stock
   
1,319
     
1,327
 
Additional paid-in capital
   
924,801
     
897,544
 
Retained earnings
   
264,484
     
356,418
 
Accumulated other comprehensive loss
   
(16,030
)
   
(16,931
)
Total stockholders' equity
   
1,174,574
     
1,238,358
 
Total liabilities and stockholders' equity
 
$
1,639,473
   
$
1,671,235
 


National Instruments
 
Condensed Consolidated Statements of Income
 
(in thousands, except per share data, unaudited)
 
                   
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2019
   
2018
   
2019
   
2018
 
                         
Net sales:
                       
Product
 
$
299,798
   
$
306,780
   
$
577,500
   
$
587,139
 
Software maintenance
   
34,433
     
34,229
     
67,805
     
65,767
 
Total net sales
   
334,231
     
341,009
     
645,305
     
652,906
 
                                 
Cost of sales:
                               
Product
   
81,741
     
79,806
     
155,929
     
152,122
 
Software maintenance
   
2,025
     
2,353
     
3,912
     
4,560
 
Total cost of sales
   
83,766
     
82,159
     
159,841
     
156,682
 
                                 
Gross profit
   
250,465
     
258,850
     
485,464
     
496,224
 
     
74.9%

   
75.9%

   
75.2%

   
76.0%

Operating expenses:
                               
Sales and marketing
   
120,868
     
127,138
     
238,419
     
247,255
 
Research and development
   
68,257
     
66,908
     
134,423
     
128,751
 
General and administrative
   
29,044
     
27,892
     
56,927
     
55,170
 
Total operating expenses
   
218,169
     
221,938
     
429,769
     
431,176
 
                                 
Operating income
   
32,296
     
36,912
     
55,695
     
65,048
 
     
9.7%

   
10.8%

   
8.6%

   
10.0%

Other income (expense):
                               
Interest income
   
2,023
     
1,290
     
4,257
     
2,305
 
Net foreign exchange loss
   
(1,611
)
   
(2,105
)
   
(1,245
)
   
(1,126
)
Other income (loss), net
   
143
     
(1,095
)
   
119
     
(1,613
)
                                 
Income before income taxes
   
32,851
     
35,002
     
58,826
     
64,614
 
                                 
Provision for income taxes
   
4,159
     
3,948
     
6,914
     
9,292
 
                                 
Net income
 
$
28,692
   
$
31,054
   
$
51,912
   
$
55,322
 
                                 
Basic earnings per share
 
$
0.22
   
$
0.24
   
$
0.39
   
$
0.42
 
Diluted earnings per share
 
$
0.22
   
$
0.23
   
$
0.39
   
$
0.42
 
                                 
Weighted average shares outstanding -
                               
Basic
   
132,062
     
131,877
     
132,156
     
131,504
 
Diluted
   
132,973
     
133,054
     
133,172
     
132,838
 
                                 
Dividends declared per share
 
$
0.25
     
0.23
     
0.50
     
0.46
 


National Instruments
 
Condensed Consolidated Statements of Cash Flows
 
(in thousands, unaudited)
 
   
Six Months Ended June 30,
 
   
2019
   
2018
 
       
Cash flow from operating activities:
           
Net income
 
$
51,912
     
55,322
 
Adjustments to reconcile net income to net cash provided by operating activities:
               
Depreciation and amortization
   
35,984
     
35,098
 
Stock-based compensation
   
24,662
     
17,936
 
Deferred income taxes
   
2,268
     
1,766
 
Net change in operating assets and liabilities
   
(26,189
)
   
(11,270
)
Net cash provided by operating activities
   
88,637
     
98,852
 
                 
Cash flow from investing activities:
               
Capital expenditures
   
(26,048
)
   
(19,764
)
Capitalization of internally developed software
   
(4,497
)
   
(11,344
)
Acquisitions, net of cash received
   
(9,784
)
   
 
Additions to other intangibles
   
(487
)
   
(3,936
)
Purchases of short-term investments
   
(91,777
)
   
(137,275
)
Sales and maturities of short-term investments
   
117,108
     
47,634
 
Net cash used by investing activities
   
(15,485
)
   
(124,685
)
                 
Cash flow from financing activities:
               
Proceeds from issuance of common stock
   
17,645
     
16,622
 
Repurchase of common stock
   
(92,375
)
   
 
Dividends paid
   
(66,067
)
   
(60,575
)
Net cash used by financing activities
   
(140,797
)
   
(43,953
)
                 
Impact of changes in exchange rates on cash
   
20
     
(2,759
)
                 
Net change in cash and cash equivalents
   
(67,625
)
   
(72,545
)
Cash and cash equivalents at beginning of period
   
259,386
     
290,164
 
Cash and cash equivalents at end of period
 
$
191,761
     
217,619
 


The following tables provide details with respect to the amount of GAAP charges related to stock-based compensation, amortization of acquisition-related intangibles, acquisition-related transaction costs, restructuring charges, and capitalization and amortization of internally developed software costs, that were recorded in the line items indicated below (unaudited) (in thousands)
 
                         
                         
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
                         
   
2019
   
2018
   
2019
   
2018
 
Stock-based compensation
                       
Cost of sales
 
$
890
   
$
846
   
$
1,683
   
$
1,571
 
Sales and marketing
   
5,140
     
3,617
     
9,515
     
6,956
 
Research and development
   
4,379
     
3,255
     
7,929
     
5,773
 
General and administrative
   
3,219
     
2,013
     
5,535
     
3,636
 
Provision for income taxes
   
(3,940
)
   
(2,955
)
   
(5,776
)
   
(4,663
)
Total
 
$
9,688
     
6,776
     
18,886
     
13,273
 
                                 
Amortization of acquisition intangibles
                               
Cost of sales
 
$
841
   
$
846
   
$
1,692
   
$
1,747
 
Sales and marketing
   
494
     
533
     
993
     
1,070
 
Research and development
   
28
     
28
     
56
     
56
 
Other income (loss), net
   
162
     
     
162
     
 
Provision for income taxes
   
(192
)
   
(178
)
   
(386
)
   
(370
)
Total
 
$
1,333
     
1,229
     
2,517
     
2,503
 
                                 
Acquisition transaction costs, restructuring charges, and other
                               
Cost of sales
 
$
   
$
   
$
   
$
29
 
Sales and marketing
   
3,153
     
3,033
     
5,296
     
4,678
 
Research and development
   
311
     
893
     
656
     
1,103
 
General and administrative
   
616
     
553
     
1,528
     
1,165
 
Other income (loss), net
   
     
709
     
     
709
 
Provision for income taxes
   
(1,010
)
   
(1,630
)
   
(1,850
)
   
(2,183
)
Total
 
$
3,070
   
$
3,558
   
$
5,630
   
$
5,501
 
   
Capitalization and amortization of internally developed software costs
                               
Cost of sales
 
$
6,537
   
$
6,494
   
$
13,119
   
$
12,324
 
Research and development
   
(2,218
)
   
(3,676
)
   
(4,497
)
   
(11,343
)
Provision for income taxes
   
(907
)
   
(592
)
   
(1,811
)
   
(206
)
Total
 
$
3,412
   
$
2,226
   
$
6,811
   
$
775
 


National Instruments
 
Reconciliation of GAAP to Non-GAAP Measures
 
(in thousands, unaudited)
 
                         
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2019
   
2018
   
2019
   
2018
 
                         
Reconciliation of Gross Profit to Non-GAAP Gross Profit
             
Gross profit, as reported
 
$
250,465
   
$
258,850
   
$
485,464
   
$
496,224
 
Stock-based compensation
   
890
     
846
     
1,683
     
1,571
 
Amortization of acquisition intangibles
   
841
     
846
     
1,692
     
1,747
 
Acquisition transaction costs and restructuring charges
   
     
     
     
29
 
Amortization of internally developed software costs
   
6,537
     
6,494
     
13,119
     
12,324
 
Non-GAAP gross profit
 
$
258,733
   
$
267,036
   
$
501,958
   
$
511,895
 
Non-GAAP gross margin
   
77.4
%
   
78.3
%
   
77.8
%
   
78.4
%
                                 
Reconciliation of Operating Expenses to Non-GAAP Operating Expenses
                 
Operating expenses, as reported
 
$
218,169
   
$
221,938
   
$
429,769
   
$
431,176
 
Stock-based compensation
   
(12,738
)
   
(8,885
)
   
(22,979
)
   
(16,365
)
Amortization of acquisition intangibles
   
(522
)
   
(561
)
   
(1,049
)
   
(1,126
)
Acquisition transaction costs and restructuring charges
   
(4,080
)
   
(4,479
)
   
(7,480
)
   
(6,946
)
Capitalization of internally developed software costs
   
2,218
     
3,676
     
4,497
     
11,343
 
Non-GAAP operating expenses
 
$
203,047
   
$
211,689
   
$
402,758
   
$
418,082
 
                                 
Reconciliation of Operating Income to Non-GAAP Operating Income
                 
Operating income, as reported
 
$
32,296
   
$
36,912
   
$
55,695
   
$
65,048
 
Stock-based compensation
   
13,628
     
9,731
     
24,662
     
17,936
 
Amortization of acquisition intangibles
   
1,363
     
1,407
     
2,741
     
2,873
 
Acquisition transaction costs and restructuring charges
   
4,080
     
4,479
     
7,480
     
6,975
 
Net amortization of internally developed software costs
   
4,319
     
2,818
     
8,622
     
981
 
Non-GAAP operating income
 
$
55,686
   
$
55,347
   
$
99,200
   
$
93,813
 
Non-GAAP operating margin
   
16.7
%
   
16.2
%
   
15.4
%
   
14.4
%
                                 
Reconciliation of Income before income taxes to Non-GAAP Income before income taxes
                 
Income before income taxes, as reported
 
$
32,851
   
$
35,002
   
$
58,826
   
$
64,614
 
Stock-based compensation
   
13,628
     
9,731
     
24,662
     
17,936
 
Amortization of acquisition intangibles
   
1,525
     
1,407
     
2,903
     
2,873
 
Acquisition transaction costs and restructuring charges
   
4,080
     
5,188
     
7,480
     
7,684
 
Net amortization of internally developed software costs
   
4,319
     
2,818
     
8,622
     
981
 
Non-GAAP income before income taxes
 
$
56,403
   
$
54,146
   
$
102,493
   
$
94,088
 
                                 
Reconciliation of Provision for income taxes to Non-GAAP Provision for income taxes
                 
Provision for income taxes, as reported
 
$
4,159
   
$
3,948
   
$
6,914
   
$
9,292
 
Stock-based compensation
   
3,940
     
2,955
     
5,776
     
4,663
 
Amortization of acquisition intangibles
   
192
     
178
     
386
     
370
 
Acquisition transaction costs, restructuring charges, and other
   
1,010
     
1,630
     
1,850
     
2,183
 
Net amortization of internally developed software costs
   
907
     
592
     
1,811
     
206
 
Non-GAAP provision for income taxes
 
$
10,208
   
$
9,303
   
$
16,737
   
$
16,714
 
                                 



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
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2019
   
2018
   
2019
   
2018
 
                         
Net income, as reported
 
$
28,692
   
$
31,054
   
$
51,912
   
$
55,322
 
Adjustments to reconcile net income to non-GAAP net income:
                               
  Stock-based compensation, net of tax effect
   
9,688
     
6,776
     
18,886
     
13,273
 
  Amortization of acquisition intangibles, net of tax effect
   
1,333
     
1,229
     
2,517
     
2,503
 
  Acquisition transaction costs, restructuring, and other, net of tax effect
   
3,070
     
3,558
     
5,630
     
5,501
 
  Net amortization of internally developed software costs, net of tax effect
   
3,412
     
2,226
     
6,811
     
775
 
Non-GAAP net income
 
$
46,195
   
$
44,843
   
$
85,756
   
$
77,374
 
                                 
Basic EPS, as reported
 
$
0.22
   
$
0.24
   
$
0.39
   
$
0.42
 
Adjustment to reconcile basic EPS to non-GAAP
                               
basic EPS:
                               
  Impact of stock-based compensation, net of tax effect
   
0.07
     
0.05
     
0.15
     
0.10
 
  Impact of amortization of acquisition intangibles, net of tax effect
   
0.01
     
     
0.02
     
0.02
 
  Impact of acquisition transaction costs, restructuring, and other, net of tax effect
   
0.02
     
0.03
     
0.04
     
0.04
 
  Impact of net amortization of internally developed software costs, net of tax effect
   
0.03
     
0.02
     
0.05
     
0.01
 
Non-GAAP basic EPS
 
$
0.35
   
$
0.34
   
$
0.65
   
$
0.59
 
                                 
                                 
Diluted EPS, as reported
 
$
0.22
   
$
0.23
   
$
0.39
   
$
0.42
 
Adjustment to reconcile diluted EPS to non-GAAP diluted EPS
                               
  Impact of stock-based compensation, net of tax effect
   
0.07
     
0.05
     
0.14
     
0.10
 
  Impact of amortization of acquisition intangibles, net of tax effect
   
0.01
     
0.01
     
0.02
     
0.02
 
  Impact of acquisition transaction costs, restructuring, and other, net of tax effect
   
0.02
     
0.03
     
0.04
     
0.04
 
  Impact of net amortization of internally developed software costs, net of tax effect
   
0.03
     
0.02
     
0.05
     
 
Non-GAAP diluted EPS
 
$
0.35
   
$
0.34
   
$
0.64
   
$
0.58
 
                                 
Weighted average shares outstanding -
                               
Basic
   
132,062
     
131,877
     
132,156
     
131,504
 
Diluted
   
132,973
     
133,054
     
133,172
     
132,838
 


National Instruments
 
Reconciliation of Net Income to EBITDA
 
(in thousands, unaudited)
 
                         
   
Three Months Ended
   
Six Months Ended
 
   
June 30,
   
June 30,
 
   
2019
   
2018
   
2019
   
2018
 
Net income, as reported
 
$
28,692
   
$
31,054
   
$
51,912
   
$
55,322
 
Adjustments to reconcile net income to EBITDA:
                               
     Interest income, net
   
(2,012
)
   
(1,253
)
   
(4,232
)
   
(2,180
)
     Tax expense
   
4,159
     
3,948
     
6,914
     
9,292
 
     Depreciation and amortization
   
17,972
     
17,662
     
35,984
     
35,098
 
EBITDA
 
$
48,811
   
$
51,411
   
$
90,578
   
$
97,532
 
Weighted average shares outstanding - Diluted
   
132,973
     
133,054
     
133,172
     
132,838
 
                                 


Reconciliation of GAAP to Non-GAAP EPS Guidance
 
(unaudited)
 
   
Three Months Ended
 
   
September 30, 2019
 
             
   
Low
   
High
 
GAAP Diluted EPS, guidance
 
$
0.30
   
$
0.44
 
Adjustment to reconcile diluted EPS to non-GAAP diluted EPS:
               
Impact of stock-based compensation, net of tax effect
   
0.09
     
0.09
 
Impact of amortization of acquisition intangibles, net of tax effect
   
0.01
     
0.01
 
Impact of acquisition transaction costs and restructuring charges, net of tax effect
   
0.03
     
0.03
 
Impact of disposal gains and other(1), net of tax effect
   
(0.12
)
   
(0.12
)
Impact of net amortization of software development costs, net of tax effect
   
0.03
     
0.03
 
Impact of tax reform-related adjustments
   
0.02
     
0.02
 
Non-GAAP Diluted EPS, guidance
 
$
0.36
   
$
0.50
 
(1) Includes adjustments for $(0.16) related to disposal gain from sale of office building and $0.04 related to charge for charitable contribution of a portion of the sale proceeds.