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National Instruments Announces Record Revenues


National Instruments Corporation Declares 3-for-2 Stock Split

Austin, Texas -- Oct. 21, 1997 -- National Instruments (Nasdaq: NATI) today announced record revenues for the third quarter of fiscal year 1997. National Instruments Corporation also announced that its Board of Directors authorized a 3-for-2 stock split with an effective record date of October 28, 1997. This will increase the number of outstanding shares of Common Stock from approximately 21.7 million to approximately 32.6 million shares.

Revenues for the third quarter were $60.6 million, up 22 percent (28 percent in local currencies) from $49.7 million in the third quarter of 1996, and up 1 percent from the $60.1 million reported in the second quarter of 1997. Geographically, the breakdown of growth for the quarter was as follows: North America, 27 percent revenue growth; Europe, 10 percent revenue growth (28 percent in local currencies); and Asia/Pacific, 26 percent revenue growth (36 percent in local currencies).

Net income for the quarter increased by 20 percent to $7.6 million, or $0.34 per share, compared to net income of $6.4 million, or $0.29 per share, in the third quarter of 1996. The foregoing amounts include a $1.4 million and a $0.5 million charge for the write-off of in-process research and development for the third quarter of 1997 and 1996, respectively. Excluding these charges, third-quarter net income would have been $8.6 million, or $0.38 per share and $6.7 million, or $0.30 per share in 1997 and 1996, respectively. This would have resulted in a 28 percent increase in net income from the third quarter of 1996 to the third quarter of 1997.

Including the acquisition charge, net income for the third quarter of 1997 decreased 11 percent from $8.6 million, or $0.38 per share, reported in the immediately prior quarter. Excluding the acquisition charge, net income for the third quarter of 1997 remained steady at $8.6 million when compared to the prior quarter.

For the nine months ended September 30, 1997, revenues were $175.3 million, compared with $146.3 million for the nine-month period a year earlier, a 20 percent increase (25 percent in local currencies). Results for the nine-month period ended September 30, 1997 included a 38 percent increase in net income to $23.7 million, or $1.06 per share, compared to $17.2 million, or $0.79 per share, for the nine months ended September 30, 1996.

"We are pleased with our rebound in the Pacific rim during the third quarter," said Dr. James Truchard, President and CEO of National Instruments. "That success, combined with another strong quarter in the U.S., led to record revenues for National Instruments." Truchard continued, "Our challenge to continue growing will hinge on our ability to recruit. We are aggressively laying the foundation by targeting the best and brightest engineers from top schools around the world."

National Instruments, a leading supplier of computer-based measurement and automation products, was founded in 1976. The company manufactures hundreds of software and hardware products which, combined with industry-standard computers, are used to replace and/or communicate with traditional instrumentation to acquire, analyze, and display data and to monitor and control processes. These computer-based instrumentation systems are used for test, measurement, and industrial 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) 349-5090 or by sending e-mail to nati@ni.com.

Upcoming Events
National Instruments will be an official presenter at the AEA conference November 3-4 in San Diego. In addition to our scheduled presentations, we plan to have a private suite for conducting demonstrations to give you a more in-depth look at our products.

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)

September 30
1997
(unaudited)
December 31
1996
ASSETS
Current assets:
Cash and cash equivalents $ 34,208 $ 30,211
Marketable securities 51,682 48,956
Accounts receivable, net 36,683 33,442
Inventories 13,801 11,778
Other current assets 7,902 7,198
Total current assets 144,276 131,585
Property and equipment, net 39,084 32,184
Intangibles and other assets 7,247 5,456
Total assets $190,607 $169,225
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 851 $ 1,517
Accounts payable 15,077 11,430
Accrued expenses 17,215 19,344
Total current liabilities 33,143 32,291
Long-term debt 5,423 9,175
Deferred income taxes 808 806
Total liabilities 39,374 42,272
Stockholder's equity:
Common stock 217 216
Additional paid-in capital 45,878 44,396
Retained earnings 106,338 82,590
Other (1,200) (249)
Total stockholders' equity 151,233 126,953
Total liabilities and stockholders' equity $190,607 $169,225

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

Three Months
Ended September 30
(unaudited)
Nine Months
Ended September 30
(unaudited)
1997 1996 1997 1996
Net sales $60,595 $49,679 $175,258 $146,328
Cost of sales 14,214 12,623 40,516 36,651
Gross profit 46,381 37,056 134,742 109,677
Operating expenses
Sales and marketing 21,817 17,466 63,260 53,108
Research and development 9,172 6,412 23,307 18,239
General and administrative 4,675 4,401 13,488 12,963
Total operating expenses 35,664 28,279 100,055 84,310
Operating income 10,717 8,777 34,687 25,367
Interest income, net 759 499 2,162 1,070
Foreign exchange loss, net (134) (31) (1,404) (696)
Income before income taxes 11,342 9,245 35,445 25,741
Provision for income taxes 3,743 2,887 11,697 8,495
Net income $7,599 $6,358 $ 23,748 $17,246
Earnings per share $ 0.34 $0.29 $ 1.06 $0.79
Weighted average shares outstanding 22,500 22,061 22,355 21,872

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

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