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National Instruments Announces Record Fourth Quarter and Fiscal Year 1996 Revenues, Earnings


Net Income Up 47 Percent Over Prior Year

Austin, Texas -- Jan. 28, 1997 -- National Instruments (NASDAQ: NATI) today announced record revenues and earnings for the fourth quarter of fiscal year 1996 and for the year ended Dec. 31, 1996.

Revenues for the fourth quarter were $54.4 million, up 23 percent from $44.4 million in the fourth quarter of 1995, and up 9 percent from the $49.7 million reported in the third quarter of 1996. Net income in the quarter was $8.2 million, up 52 percent from $5.4 million a year ago, and up 30 percent from the $6.4 million reported in the immediately prior quarter. National Instruments reported earnings per share of $0.37 on 22.2 million weighted average shares outstanding, compared with earnings per share of $0.25 on 21.7 million weighted average shares outstanding in the fourth quarter of 1995 and $0.29 on 22.1 million weighted average shares outstanding in the third quarter of 1996.

For the year ended Dec. 31, 1996, revenues were $201 million, compared with $165 million in 1995, a 22 percent increase. For the year ended Dec. 31, 1996, income from operations was $37 million, compared with $26 million in 1995, a 42 percent increase. Results for the year ended Dec. 31, 1996 included net income of $25 million or $1.16 per share on 22 million weighted average shares outstanding, compared with $17 million and $0.83 per share on 21 million weighted average shares outstanding for 1995. Net income increased 47 percent from the year ended Dec. 31, 1995. Excluding $1.5 million written off during 1996 in conjunction with the acquisition of Georgetown Systems in the second quarter of 1996 and another software acquisition during the third quarter of 1996, income from operations for the year would have been $39 million with net income of $27 million resulting in earnings per share of $1.19.

The balance sheet remained strong, with cash and equivalents and short-term investments totaling $79 million, compared with $50 million at Dec. 31, 1995; total assets stood at $169 million at Dec. 31, 1996 compared with $137 million at Dec. 31, 1995.

"1996 was the best year ever for National Instruments," declared Dr. James Truchard, President and CEO. "We passed the $200 million mark for sales and saw significant improvement in our profitability. We introduced a record 96 exciting new products and expanded into several new product areas, such as industrial automation software, fieldbus interfaces, and image acquisition and analysis."

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.

For More Information
For more information, contact:

National Instruments
6504 Bridge Point Parkway
Austin, Texas 78730-5039

tel (512) 794-0100, toll free in the U.S. and Canada (800) 258-7022, fax (512) 794-8411, e-mail info@ni.com. General company and financial information is available on the company's web site at /

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



National Instruments
Condensed Consolidated Balance Sheets
(in thousands)

December 31,
1996
December 31,
1995
ASSETS
Current assets:
Cash and cash equivalents $ 30,211 $ 12,016
Marketable securities 48,956 37,765
Accounts receivable, net 33,442 28,789
Inventories 11,778 15,295
Other current assets 7,198 6,788
Total current assets 131,585 100,653
Property and equipment, net 32,184 32,596
Intangibles and other assets 5,456 3,853
Total assets $169,225 $137,102
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 1,517 $ 2,137
Accounts payable 11,430 9,783
Accrued expenses 19,344 14,187
Total current liabilities 32,291 26,107
Long-term debt 9,175 11,603
Deferred income taxes 806 656
Total liabilities 42,272 38,366
Stockholders' equity:
Common stock 216 215
Additional paid-in capital 44,396 41,277
Retained earnings 82,590 57,104
Other (249) 140
Total stockholders' equity 126,953 98,736
Total liabilities and stockholders' equity $169,225 $137,102

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

Three Months
Ended December 31,
(unaudited)
Years
Ended December 31,
1996 1995 1996 1995
Net sales $54,387 $44,376 $200,715 $164,819
Cost of sales 13,104 10,950 49,755 39,525
Gross profit 41,283 33,426 150,960 125,294
Operating expenses
Sales and marketing 18,959 16,070 72,067 63,733
Research and development 6,148 4,891 24,387 19,991
General and administrative 4,166 4,113 17,129 15,071
Total operating expenses 29,273 25,074 113,583 98,795
Operating income 12,010 8,352 37,377 26,499
Interest income, net 491 262 1,561 760
Foreign exchange (loss) gain, net (203) (214) (899) 150
Income before income taxes 12,298 8,400 38,039 27,409
Provision for income taxes 4,058 2,952 12,553 9,986
Net income $8,240 $5,448 $25,486 $17,423
Earnings per share $ 0.37 $0.25 $ 1.16 $0.83
Weighted average shares
outstanding
22,201 21,668 21,962 20,949

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

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