NI Reports Record Quarterly Revenue

The following tables provide details with respect to the amount of GAAP charges related to stock-based compensation, amortization of acquisition-related intangibles and fair value adjustments, acquisition-related transaction costs, disposal gains on sale of business/assets and related charitable contributions, tax effects related to businesses held-for-sale, capitalization and amortization of internally developed software costs, and restructuring charges that were recorded in the line items indicated below (unaudited) (in thousands):

 

Three Months Ended

 

Years Ended

 

December 31,

 

December 31,

 

2020

 

2019

 

2020

 

2019

Stock-based compensation

 

 

 

 

 

Cost of sales

$

979

 

$

887

 

 

$

3,766

 

$

3,475

 

Sales and marketing

5,462

 

4,868

 

 

22,288

 

19,612

 

Research and development

5,129

 

4,236

 

 

17,769

 

16,265

 

General and administrative

4,251

 

3,393

 

 

14,552

 

12,086

 

Provision for income taxes

(445)

 

(1,433)

 

 

(8,705)

 

(9,337)

 

Total

$

15,376

 

$

11,951

 

 

$

49,670

 

$

42,101

 

 

 

 

 

 

 

Amortization of acquisition-related intangibles and fair value adjustments

 

 

 

 

 

Net sales

$

1,961

 

$

 

 

$

3,260

 

$

 

Cost of sales

4,313

 

823

 

 

9,892

 

3,348

 

Sales and marketing

1,965

 

485

 

 

5,264

 

1,970

 

Research and development

9

 

28

 

 

94

 

112

 

General and administrative

846

 

 

 

846

 

 

Other expense (income)

124

 

124

 

 

487

 

409

 

Provision for income taxes

(606)

 

(127)

 

 

(2,554)

 

(703)

 

Total

$

8,612

 

$

1,333

 

 

$

17,289

 

$

5,136

 

 

 

 

 

 

 

Acquisition related transaction and integration costs, restructuring charges, and other (1)(2)(3)(4)

 

 

 

 

 

Cost of sales

$

1,620

 

$

 

 

$

1,626

 

$

 

Sales and marketing

23,309

 

5,356

 

 

32,079

 

13,646

 

Research and development

1,184

 

3,266

 

 

6,374

 

4,166

 

General and administrative (1)(4)

8,685

 

2,002

 

 

21,279

 

11,527

 

Gain on sale of business/asset (1)(2)

 

 

 

(159,753)

 

(26,842)

 

Other expense (income)

191

 

 

 

589

 

 

Provision for income taxes (3)

(1,602)

 

(13,477)

 

 

32,364

 

(12,237)

 

Total

$

33,387

 

$

(2,853)

 

 

$

(65,442)

 

$

(9,740)

 

(1): During the third quarter of 2019, the company recognized a gain of $27 million related to the sale of an office building, presented within "Gain on sale of business/assets". The company also recognized a charitable contribution expense of $7 million related to an infrequent donation using a portion of the proceeds from the sale of the building, presented within "General and administrative".

(2): During the first quarter of 2020, we recognized a gain of $160 million related to the divestiture of AWR, presented within "Gain on sale of business/assets".

(3): During the fourth quarter of 2019, we recognized an income tax benefit of $11 million related to the recognition of deferred taxes on the outside basis difference of our AWR business, which was held-for-sale as of December 31, 2019.

(4): During the third quarter of 2020, we recognized $5 million of compensation expense related to the replacement of unvested options acquired from OptimalPlus. These amounts were accounted for as post-combination expense and will be recognized over the required service period.

 

 

 

 

 

 

(Capitalization) and amortization of internally developed software costs

 

 

 

 

 

Cost of sales

$

6,936

 

$

7,012

 

 

$

27,931

 

$

27,085

 

Research and development

(1,248)

 

(1,887)

 

 

(4,043)

 

(9,066)

 

Provision for income taxes

(1,195)

 

(1,076)

 

 

(5,017)

 

(3,784)

 

Total

$

4,493

 

$

4,049

 

 

$

18,871

 

$

14,235

 

 

 

 

 

 

 

 

National Instruments

Reconciliation of GAAP to Non-GAAP Measures

(in thousands, unaudited)

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Years Ended

 

December 31,

 

December 31,

 

2020

 

2019

 

2020

 

2019

Reconciliation of Net sales to Non-GAAP Net sales

 

 

 

 

 

Net sales, as reported

$

367,838

 

$

367,468

 

 

$

1,286,671

 

$

1,353,215

 

Impact of acquisition related fair value adjustments

1,961

 

 

 

3,260

 

 

Non-GAAP net sales

$

369,799

 

$

367,468

 

 

$

1,289,931

 

$

1,353,215

 

 

 

 

 

 

 

Reconciliation of Gross Profit to Non-GAAP Gross Profit

 

 

 

 

 

Gross profit, as reported

$

258,642

 

$

276,333

 

 

$

915,550

 

$

1,016,324

 

Stock-based compensation

979

887

 

3,766

3,475

Amortization of acquisition-related intangibles and fair value adjustments

6,274

823

 

13,152

3,348

Acquisition transaction and integration costs, restructuring charges and other

1,620

 

 

1,626

 

Amortization of internally developed software costs

6,936

 

7,012

 

 

27,931

 

27,085

 

Non-GAAP gross profit

$

274,451

 

$

285,055

 

 

$

962,025

 

$

1,050,232

 

Non-GAAP gross margin

74%

78%

 

75%

78%

 

 

 

 

 

 

Reconciliation of Operating Expenses to Non-GAAP Operating Expenses

 

 

 

Operating expenses, as reported

$

245,186

 

$

222,652

 

 

$

875,753

 

$

868,612

 

Stock-based compensation

(14,842)

 

(12,497)

 

 

(54,609)

 

(47,963)

 

Amortization of acquisition-related intangibles and fair value adjustments

(2,820)

 

(513)

 

 

(6,204)

 

(2,082)

 

Acquisition transaction and integration costs, restructuring charges and other

(33,178)

 

(10,624)

 

 

(59,732)

 

(29,339)

 

Capitalization of internally developed software costs

1,248

 

1,887

 

 

4,043

 

9,066

 

Non-GAAP operating expenses

$

195,594

 

$

200,905

 

 

$

759,251

 

$

798,294

 

 

 

 

 

 

 

Reconciliation of Operating Income to Non-GAAP Operating Income

 

 

 

Operating income, as reported

$

13,456

 

$

53,681

 

 

$

199,550

 

$

174,554

 

Stock-based compensation

15,821

 

13,384

 

 

58,375

 

51,438

 

Amortization of acquisition-related intangibles and fair value adjustments

9,094

 

1,336

 

 

19,356

 

5,430

 

Acquisition transaction and integration costs, restructuring charges and other

34,798

 

10,624

 

 

61,358

 

29,339

 

Net amortization of internally developed software costs

5,688

 

5,125

 

 

23,888

 

18,019

 

Gain on sale of business/assets

 

 

 

(159,753)

 

(26,842)

 

Non-GAAP operating income

$

78,857

 

$

84,150

 

 

$

202,774

 

$

251,938

 

Non-GAAP operating margin

21%

23%

 

16%

19%

 

 

 

 

 

 

Reconciliation of Provision for income taxes to Non-GAAP Provision for income taxes

 

 

 

Provision for income taxes, as reported (1)

$

10,515

 

$

(4,304)

 

 

$

55,103

 

$

18,393

 

Stock-based compensation

445

 

1,433

 

 

8,705

 

9,337

 

Amortization of acquisition-related intangibles and fair value adjustments

606

 

127

 

 

2,554

 

703

 

Acquisition transaction and integration costs, restructuring charges and other

1,328

 

2,715

 

 

4,122

 

7,136

 

Net amortization of internally developed software costs

1,195

 

1,076

 

 

5,017

 

3,784

 

Gain on sale of business/assets

274

 

10,762

 

 

(36,486)

 

5,101

 

Tax reform charge (benefit)

 

 

 

 

(2,774)

 

Non-GAAP provision for income taxes (1)

$

14,363

 

$

11,809

 

 

$

39,015

 

$

41,680

 

(1): The income tax effect related to each non-GAAP item is calculated based on the tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment, and considers the current and deferred tax impact of those adjustments.

 

Reconciliation of GAAP Net Income and Diluted EPS to Non-GAAP Net Income, Non-GAAP Diluted EPS, and EBITDA

(in thousands, except per share data, unaudited)

 

 

 

 

 

 

 

Three Months Ended

 

Years Ended

 

December 31,

 

December 31,

 

2020

 

2019

 

2020

 

2019

 

 

 

 

 

 

Net income, as reported

$

4,738

 

$

58,596

 

 

$

143,659

 

$

162,151

 

Adjustments to reconcile net income to non-GAAP net income:

 

 

 

 

 

Stock-based compensation

15,821

 

13,384

 

 

58,375

 

51,438

 

Amortization of acquisition-related intangibles and fair value adjustments

9,218

 

1,460

 

 

19,843

 

5,839

 

Acquisition transaction and integration costs, restructuring charges and other

34,989

 

10,624

 

 

61,947

 

29,339

 

Net amortization of internally developed software costs

5,688

 

5,125

 

 

23,888

 

18,019

 

Gain on sale of business/asset

 

 

 

(159,753)

 

(26,842)

 

Income tax effects and adjustments (1)

(3,848)

 

(16,113)

 

 

16,088

 

(23,287)

 

Non-GAAP net income

$

66,606

 

$

73,076

 

 

$

164,047

 

$

216,657

 

Non-GAAP net margin

18.0%

19.9%

 

12.7%

16.0%

 

 

 

 

 

 

Diluted EPS, as reported

$

0.04

 

$

0.45

 

 

$

1.09

 

$

1.22

 

Adjustment to reconcile diluted EPS to non-GAAP diluted EPS

 

 

 

 

 

Stock-based compensation

0.12

 

0.10

 

 

0.44

 

0.39

 

Amortization of acquisition-related intangibles and fair value adjustments

0.07

 

0.01

 

 

0.15

 

0.04

 

Acquisition transaction and integration costs, restructuring charges and other

0.27

 

0.08

 

 

0.47

 

0.22

 

Net amortization of internally developed software costs

0.04

 

0.04

 

 

0.18

 

0.14

 

Gain on sale of business/asset

 

 

 

(1.21)

 

(0.20)

 

Income tax effects and adjustments (1)

(0.03)

 

(0.12)

 

 

0.12

 

(0.18)

 

Non-GAAP diluted EPS

$

0.51

 

$

0.56

 

 

$

1.24

 

$

1.63

 

(1): The income tax effect related to each non-GAAP item is calculated based on the tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment, and considers the current and deferred tax impact of those adjustments.

 

 

 

 

 

 

Net income, as reported

$

4,738

 

$

58,596

 

 

$

143,659

 

$

162,151

 

Adjustments to reconcile net income to EBITDA:

 

 

 

 

 

Interest expense (income), net

592

 

(1,934)

 

 

(2,016)

 

(8,089)

 

Tax expense (benefit)

10,515

 

(4,304)

 

 

55,103

 

18,393

 

Depreciation and amortization

25,836

 

18,995

 

 

87,064

 

73,541

 

EBITDA

$

41,681

 

$

71,353

 

 

$

283,810

 

$

245,996

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

Basic

131,277

 

130,776

 

 

131,082

131,722

 

Diluted

131,732

 

131,432

 

 

131,799

132,734

 

 

Reconciliation of GAAP to Non-GAAP Diluted EPS Guidance

(unaudited)

 

Three Months Ended

 

March 31, 2021

 

 

 

 

Low

High

GAAP Diluted EPS, guidance

$

(0.05

)

$

0.09

 

Adjustment to reconcile diluted EPS to non-GAAP diluted EPS:

 

 

Stock-based compensation

0.13

 

0.13

 

Amortization of acquisition-related intangibles and fair value adjustments

0.06

 

0.06

 

Acquisition transaction and integration costs, restructuring charges and other

0.12

 

0.12

 

Net amortization of internally developed software costs

0.05

 

0.05

 

Income tax effects and adjustments (1)

(0.07

)

(0.07

)

Non-GAAP Diluted EPS, guidance

$

0.24

 

$

0.38

 

(1): The income tax effect related to each non-GAAP item is calculated based on the tax laws and statutory income tax rates applicable in the tax jurisdiction(s) of the underlying non-GAAP adjustment, and considers the current and deferred tax impact of those adjustments.

 

Reconciliation of GAAP Net Sales to Non-GAAP Net Sales, Guidance

(unaudited)

 

Three Months Ended

 

 

March 31,

 

 

2021

2020

 

 

(midpoint)

 

Percent Inc(Dec)

GAAP Net sales, guidance

$

339,000

 

$

309,381

 

10%

Impact of purchase accounting fair value adjustments

1,000

 

 

 

Non-GAAP Net sales, guidance

$

340,000

 

$

309,381

 

10%


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