National Instruments Announces Record Quarterly Revenues and Earnings

AUSTIN, Texas -- Jan. 27, 2000 -- National Instruments (NASDAQ:NATI), a leading supplier of computer-based measurement and automation products, today announced record revenues of $93.4 million and record earnings of $14.0 million for its fourth quarter of 1999.

Revenues for the fourth quarter were $93.4 million, up 28 percent from $73.2 million in the fourth quarter of 1998. For the year ended Dec. 31, 1999, revenues were $330 million, compared with $274 million in 1998, a 20 percent increase.

"We are pleased with our 28 percent growth in the fourth quarter and our 20 percent growth for 1999," said Dr. James Truchard, CEO and President of National Instruments. "In the past two years, our fourth quarter revenues have grown 42 percent, which significantly outpaces the growth of our industry."

The company's strong performance in Q4 was driven by very strong growth in many of its newer product areas. The company's PXI, FieldPoint, motion control, and machine vision product lines all had record sales with growth well above the company's overall rate. In addition, increased interest from customers looking to leverage the Web in their measurement and automation systems created strong demand for the company's growing portfolio of Web-enabled products.

According to Dr. Truchard, "The Internet explosion has enabled us to not only enhance our direct business model, but also to truly take measurement and automation out of the traditional box and distribute it anywhere in the world. We are investing heavily to fully leverage the Web -- both in our business model, and in our products."

Net income for the quarter increased by 30 percent to $14.0 million, or $0.28 basic earnings per share, compared to net income of $10.8 million, or $0.22 basic earnings per share, in the fourth quarter of 1998. Fully diluted earnings per share was $0.27 compared to $0.21 in the fourth quarter of 1998.

Results for the year ended Dec. 31, 1999 included a 21 percent increase in net income to $45.2 million, or $0.91 basic earnings per share, compared to $37.4 million for 1998, or $0.76 basic earnings per share. The Company reported fully diluted earnings per share of $0.87 for 1999 compared to fully diluted earnings per share of $0.73 for 1998.

"Our history of aggressive investments in R&D and the Web were key factors in our accelerated growth," according to Alex Davern, National Instruments Chief Financial Officer. "Sales through ni.com were up 90 percent sequentially and validate the strategic advantages of our direct business model."

National Instruments manufactures hundreds of software and hardware products that leverage industry-standard computers and Internet technology for measurement and automation applications.

National Instruments stock is traded on the Nasdaq National Market System under the symbol NATI. Investment information may be obtained from the company's Investor Relations Department at (512) 683-5090 or by sending e-mail to nati@ni.com or on the Web at www.ni.com/nati

On Thursday, January 27, 2000 at 4:00 p.m. CDT, interested parties may listen to the National Instruments quarterly conference call live on the Web by registering on the Company's Web site at www.ni.com/nati Beginning Thursday, January 27, 2000 at 7:00 p.m. CDT through Thursday, February 3, 2000 at 12:00 a.m. CDT, interested parties may also listen to a replay of the National Instruments quarterly conference call by visiting the company's Web site at www.ni.com/nati or by calling (719) 457-0820; confirmation code #831261.

This release may contain "forward-looking statements" (as defined under securities laws), which are subject to a number of risks and uncertainties. Actual results may differ materially from the expected results. The Company directs you to documents filed with the SEC for risks associated with the company's future performance.

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

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