GAAP TO NON-GAAP RECONCILIATION

(Dollars in thousands, except per share data)

(Unaudited)

Third Quarter of

First Three Quarters of

2013

2012

2013

2012

Dollar

% of

Dollar

% of

Dollar

% of

Dollar

% of

Amount

Revenue

Amount

Revenue

Amount

Revenue

Amount

Revenue

GROSS MARGIN:

GAAP gross margin:

$   295,053

53.0%

$   262,868

52.1%

$   884,368

52.4%

$   789,713

51.8%

Restructuring

( A )

8

0.0%

60

0.0%

829

0.0%

139

0.0%

Amortization of purchased intangible assets

( B )

20,402

3.7%

15,728

3.1%

59,938

3.6%

42,145

2.8%

Stock-based compensation

( C )

609

0.1%

502

0.1%

1,816

0.1%

1,480

0.1%

Amortization of acquisition-related inventory step-up

( D )

378

0.1%

547

0.1%

1,505

0.1%

677

0.0%

Non-GAAP gross margin: 

$   316,450

56.9%

$   279,705

55.4%

$   948,456

56.2%

$   834,154

54.7%

OPERATING EXPENSES:

GAAP operating expenses:

$   232,024

41.7%

$   199,398

39.5%

$   699,977

41.4%

$   607,474

39.8%

Restructuring

( A )

(31)

0.0%

(301)

-0.1%

(4,602)

-0.3%

(1,894)

-0.1%

Amortization of purchased intangible assets

( B )

(21,216)

-3.9%

(15,712)

-3.1%

(60,775)

-3.6%

(47,170)

-3.1%

Stock-based compensation

( C )

(8,296)

-1.5%

(7,182)

-1.3%

(24,342)

-1.4%

(22,148)

-1.5%

Acquisition / divestiture items

( E )

(2,891)

-0.5%

(1,804)

-0.4%

(9,285)

-0.5%

(14,385)

-0.9%

Litigation

( G )

(1,335)

-0.2%

-

0.0%

(1,335)

-0.1%

-

0.0%

Non-GAAP operating expenses:

$   198,255

35.6%

$   174,399

34.6%

$   599,638

35.5%

$   521,877

34.2%

OPERATING INCOME:

GAAP operating income:

$     63,029

11.3%

$     63,470

12.6%

$   184,391

10.9%

$   182,239

12.0%

Restructuring

( A )

39

0.0%

361

0.1%

5,431

0.3%

2,033

0.1%

Amortization of purchased intangible assets

( B )

41,618

7.5%

31,440

6.2%

120,713

7.2%

89,315

5.9%

Stock-based compensation

( C )

8,905

1.6%

7,684

1.5%

26,158

1.5%

23,628

1.6%

Amortization of acquisition-related inventory step-up

( D )

378

0.1%

547

0.1%

1,505

0.1%

677

0.0%

Acquisition / divestiture items

( E )

2,891

0.5%

1,804

0.4%

9,285

0.6%

14,385

0.9%

Litigation

( G )

1,335

0.2%

-

0.0%

1,335

0.1%

-

0.0%

Non-GAAP operating income: 

$   118,195

21.2%

$   105,306

20.9%

$   348,818

20.7%

$   312,277

20.5%

NON-OPERATING INCOME, NET:

GAAP non-operating income, net:

$          483

$       3,352

$       2,181

$      8,201

Acquisition / divestiture items

( E )

14

(334)

(846)

(447)

Foreign exchange loss associated with acquisitions

( F )

-

-

-

1,578

Non-GAAP non-operating income, net: 

$          497

$       3,018

$       1,335

$      9,332

GAAP and 

GAAP and 

GAAP and 

GAAP and 

Non-GAAP

Non-GAAP

Non-GAAP

Non-GAAP

Tax Rate %

( I )

Tax Rate %

( I )

Tax Rate %

( I )

Tax Rate %

( I )

INCOME TAX PROVISION:

GAAP income tax provision:

$       8,892

14%

$     13,022

19%

$     28,067

15%

$    33,403

18%

Non-GAAP items tax effected

( H )

7,725

8,088

24,062

22,873

Non-GAAP income tax provision: 

$     16,617

14%

$     21,110

19%

$     52,129

15%

$    56,276

18%

NET INCOME:  

GAAP net income attributable to Trimble Navigation Ltd.

$     54,469

$     53,364

$   158,858

$   157,874

Restructuring

( A )

39

361

5,431

2,033

Amortization of purchased intangible assets

( B )

41,618

31,440

120,713

89,315

Stock-based compensation

( C )

8,905

7,684

26,158

23,628

Amortization of acquisition-related inventory step-up

( D )

378

547

1,505

677

Acquisition / divestiture items

( E )

2,905

1,470

8,439

13,938

Foreign exchange loss associated with acquisitions

( F )

-

-

-

1,578

Litigation

( G )

1,335

-

1,335

-

Non-GAAP items tax affected

( H )

(7,725)

(8,088)

(24,062)

(22,873)

Non-GAAP net income attributable to Trimble Navigation Ltd.

$   101,924

$     86,778

$   298,377

$   266,170

DILUTED NET INCOME PER SHARE:

GAAP diluted net income per share attributable to Trimble Navigation Ltd.

$         0.21

$         0.21

$         0.61

$        0.62

Restructuring

( A )

-

-

0.02

0.01

Amortization of purchased intangible assets

( B )

0.16

0.12

0.45

0.35

Stock-based compensation

( C )

0.03

0.03

0.10

0.09

Amortization of acquisition-related inventory step-up

( D )

-

-

0.01

-

Acquisition / divestiture items

( E )

0.01

0.01

0.03

0.05

Foreign exchange loss associated with acquisitions

( F )

-

-

-

0.01

Litigation

( G )

0.01

0.01

-

Non-GAAP items tax affected

( H )

(0.03)

(0.03)

(0.09)

(0.09)

Non-GAAP diluted net income per share attributable to Trimble Navigation Ltd.

$         0.39

$         0.34

$         1.14

$        1.04

OPERATING LEVERAGE:

Increase in non-GAAP operating income

$     12,889

$     32,317

$     36,541

$     88,859

Increase in revenue

$     51,739

$     87,330

$   164,316

$   315,695

Operating leverage (increase in non-GAAP operating  income as a % of increase in revenue)

24.9%

37.0%

22.2%

28.1%