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National Instruments Announces 20 Percent Year-Over-Year Revenue Growth in First Quarter 1998

Austin, Texas -- April 21, 1998 -- National Instruments (NASDAQ:NATI) today announced revenues for the first quarter were $65.4 million, up 20 percent from $54.6 million in the first quarter of 1997 (up 24 percent in local currencies).

"Our strong first quarter was consistent with our historical pattern," said Dr. James Truchard, President and CEO. "Our diversity of business across many products, customers, industries, and geographies helped us get 1998 off to a solid start. The highlight of the quarter was the successful launch of LabVIEW 5.0, with more than 80 magazine front covers and thousands of people attending our launch event held in more than 130 cities around the world."

Net income for the quarter was $8.8 million, up 17 percent from $7.6 million a year ago. The Company reported basic earnings per share of $0.27 for the first quarter of 1998 compared to basic earnings per share of $0.23 in the first quarter of 1997. National Instruments reported diluted earnings per share of $0.26 on 34.1 million weighted average shares outstanding for the first quarter of 1998, compared with diluted earnings per share of $0.23 on 33.5 million weighted average shares outstanding in the first quarter of 1997.

Geographically, the breakdown of growth for the quarter was as follows: North America, 21 percent revenue growth; Europe, 27 percent revenue growth (35 percent in local currencies); and Asia/Pacific, 3 percent revenue growth (15 percent in local currencies).

"We are pleased to announce very solid earnings results for the quarter," said Alex Davern, Chief Financial Officer. "Sales of LabVIEW 5.0 set an all-time record in March, surpassing the previous monthly record by more than 20 percent. Our earnings growth rate was impacted by a slight reduction in gross margins due to the release of LabVIEW 5.0 late in the quarter and the delayed release of LabWindows/CVI 5.0, which we expect to begin shipping in the second quarter."

"We executed on two very key elements of our strategy in the first quarter," said Dr. Truchard. "The worldwide launch of LabVIEW and the investment in a record number of new employees have helped strengthen our infrastructure."

National Instruments manufactures software and hardware products that scientists and engineers use to build measurement and automation systems in a variety of applications and industries. National Instruments is traded on the NASDAQ National Market System under the symbol NATI. More information on National Instruments is available from the company's SEC filings or by contacting the company's Investor Relations Department directly at 6504 Bridge Point Parkway, Austin, Texas 78730-5039, (512) 349-5090. General company, product, and financial information can be accessed through the National Instruments web site at www.ni.com

The condensed consolidated statement of income and balance sheets to follow.

Product and company names listed are trademarks or tradenames of their respective companies.

More information on National Instruments trademarks



National Instruments
Condensed Consolidated Balance Sheets
(in thousands)

March 31,
1998
(unaudited)
December 31,
1997
ASSETS
Current assets:
Cash and cash equivalents $ 34,358 $ 31,943
Marketable securities 50,991 51,067
Accounts receivable, net 40,079 37,411
Inventories 15,497 15,505
Other current assets 13,323 13,287
Total current assets 154,248 149,213
Property and equipment, net 54,479 46,805
Intangibles and other assets 8,049 8,472
Total assets $216,776 $204,490
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 848 $ 851
Accounts payable 16,344 16,946
Accrued expenses 23,294 19,274
Total current liabilities 40,486 37,071
Long-term debt 4,992 5,151
Deferred income taxes 514 514
Total liabilities 45,992 42,736
Stockholders' equity:
Common stock 327 326
Additional paid-in capital 47,524 47,160
Retained earnings 125,046 116,215
Accumulated other comprehensive income (2,113) (1,947)
Total stockholders' equity 170,784 161,754
Total liabilities and stockholders' equity $216,776 $204,490

National Instruments
Condensed Consolidated Statements of Income
(in thousands, except per share data)

Three Months
Ended March 31,
(unaudited)
1998 1997
Net sales $65,353 $54,571
Cost of sales 15,569 12,293
Gross profit 49,784 42,278
Operating expenses
Sales and marketing 24,530 19,962
Research and development 7,750 6,477
General and administrative 4,720 4,270
Total operating expenses 37,000 30,709
Operating income 12,784 11,569
Interest income, net 670 698
Net foreign exchange loss (274) (964)
Income before income taxes 13,180 11,303
Provision for income taxes 4,349 3,735
Net income $8,831 $7,568
Basic earnings per share $ 0.27 $0.23
Weighted average shares
outstanding -- basic
32,668 32,475
Diluted earnings per share $ 0.26 $0.23
Weighted average shares
outstanding -- diluted
34,100 33,450

Contact:
Investor Relations
National Instruments
(512) 683-5090

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