NI is announcing Q3 revenue of $314 million, up 8 per cent year-over-year. The company’s orders under $20,000 grew 3 per cent year-over-year; orders between $20,000 and $100,000 increased 9 per cent year-over-year; and orders above $100,000 increased 10 per cent year-over-year. In Q3 2014, NI recognised $17 million in revenue from its largest customer, compared with $4 million recognised in Q3 2013. Year-to-date, through Oct. 30, the company has received $56 million in orders from this customer, compared to $35 million at this point last year.
GAAP net income for Q3 was $40 million, with fully diluted earnings per share (EPS) of $0.31, and non-GAAP net income was $47 million, with non-GAAP fully diluted EPS of $0.37. As discussed in the NI earnings call on 29 July 2014, the company recognised a tax benefit of $14 million in Q3 related to a settlement with the Internal Revenue Service of the examination of US income tax returns for 2010 and 2011. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortisation, was $51 million, or $0.40 per share in the third quarter.
In Q3, GAAP gross margin was 74 per cent and non-GAAP gross margin was 75 per cent, up 40 basis points from Q3 2013. Total GAAP operating expenses were $198 million, up 3 per cent year-over-year. Total non-GAAP operating expenses were $192 million, up 4 per cent year-over-year.
GAAP operating margin was 11 per cent in Q3, with GAAP operating income of $34 million, up 67 per cent year-over-year. Non-GAAP operating margin was 14 per cent in Q3, with non-GAAP operating income of $45 million, up 38 per cent year-over-year.
The company’s non-GAAP results exclude the impact of stock-based compensation, amortisation of acquisition-related intangibles and acquisition transaction costs and restructuring charges. Reconciliations of the company’s GAAP and non-GAAP results are included as part of this news release.
Dr James Truchard, NI president, CEO and cofounder, say: “I am pleased with the record revenue delivered in the third quarter and the significant progress made toward improving our operating margin. I remain optimistic about our long-term position in the industry, with new products released in Q3 adding capability to our platform to further differentiate our approach in automated test and address new opportunities in areas such as the Industrial Internet of Things.”
Geographic revenue in US dollar terms for Q3 2014 compared with Q3 2013 was up 2 per cent in the Americas, up 8 per cent in Europe, up 34 per cent in East Asia and down 14 per cent in Emerging Markets. In local currency terms, revenue was up 5 per cent in Europe, up 33 per cent in East Asia and down 12 per cent in Emerging Markets.
As of 30 September, NI had $448 million in cash and short-term investments, up $46 million from Q2 2014. The company paid $19 million in dividends in the third quarter. The NI Board of Directors also approved a quarterly dividend of $0.15 per share on the company’s common stock payable on Dec. 8, 2014 to stockholders of record on 17 November 2014.
Q3 2014 highlights:
- Quarterly revenue of $314 million, up 8 per cent year-over-year
- Record Q3 revenue for CompactRIO, PXI, and data acquisition products
- GAAP operating income up 67 per cent year-over-year
- Non-GAAP operating income up 38 per cent year-over-year
- Fully diluted GAAP EPS of $0.31 and fully diluted non-GAAP EPS of $0.37
- EBITDA of $51 million or $0.40 per share
- Cash and cash equivalents of $448 million
- up $46 million from Q2 2014
Guidance for Q4 2014
Alex Davern, NI COO and CFO, says: “I am pleased with the operating leverage we have delivered so far this year and we expect to continue to deliver year-over-year revenue growth and operating leverage in Q4. Looking forward we are working hard to take advantage of our opportunity and remain committed to driving organic growth.”
Gross margins are expected to be up sequentially in Q4. NI currently expects revenue for Q4 2014 to be between $312 million and $342 million, up 9 per cent year-over-year at the midpoint. NI expects fully diluted EPS to be in the range of $0.23 to $0.35 for Q4, with non-GAAP fully diluted EPS expected to be in the range of $0.29 to $0.41.
For further information please go to www.ni.com.