Guidance

NI currently expects Q2 revenue to be in the range of $305 million to $335 million, up 5 percent year-over-year at the midpoint. Based on current exchange rates, the company expects that the impact of foreign exchange will reduce the company’s year-over-year dollar revenue growth rate by approximately 1 percent in Q2. The company currently expects that GAAP fully diluted EPS will be in the range of $0.12 to $0.26 for Q2, with non-GAAP fully diluted EPS expected to be in the range of $0.19 to $0.33. Included in our Q2 2017 GAAP EPS guidance is approximately $3 million of restructuring charges. For the second half of 2017, NI estimates the restructuring charges impacting net income to be approximately $1 million to $2 million. For 2017, NI estimates its non-GAAP effective tax rate to be approximately 21 percent.

Non-GAAP Presentation

In addition to disclosing results determined in accordance with GAAP, NI discloses certain non-GAAP operating results and non-GAAP information that exclude certain charges. In this news release, the company has presented its year-over-year change in core revenue, gross profit, gross margin, operating expenses, operating income, operating margin, income before income taxes, provision for income taxes, net income and basic and fully diluted EPS for the three-month periods ending March 31, 2017 and 2016, on a GAAP and non-GAAP basis. NI is also providing guidance on its non-GAAP fully diluted EPS and expected effective tax rate. The company is not able to provide guidance on its GAAP tax rate or a related reconciliation without unreasonable efforts since its future GAAP tax rate depends on its future stock price and related information that is not currently available.

When presenting non-GAAP information, the company includes a reconciliation of the non-GAAP results to the GAAP results. Management believes that including the non-GAAP results assists investors in assessing the company’s operational performance and its performance relative to its competitors. The company presents these non-GAAP results as a complement to results provided in accordance with GAAP, and these results should not be regarded as a substitute for GAAP. Management uses these non-GAAP measures to manage and assess the profitability and performance of its business and does not consider stock-based compensation expense, amortization of acquisition-related intangibles, acquisition-related transaction costs, taxes levied on the transfer of acquired intellectual property, foreign exchange loss on acquisitions, acquisition-related fair value adjustments, and restructuring charges in managing its operations. Specifically, management uses non-GAAP measures to plan and forecast future periods; to establish operational goals; to compare with its business plan and individual operating budgets; to measure management performance for the purposes of executive compensation, including payments to be made under bonus plans; to assist the public in measuring the company’s performance relative to the company’s long-term public performance goals; to allocate resources; and, relative to the company’s historical financial performance, to enable comparability between periods. Management also considers such non-GAAP results to be an important supplemental measure of its performance.

This news release discloses the company’s EBITDA for the three-month periods ending March 31, 2017 and 2016. The company believes that including the EBITDA results assists investors in assessing the company's operational performance relative to its competitors. A reconciliation of EBITDA to GAAP net income is included with this news release. This news release also discloses the year-over-year change in the company's core revenue for the three-month periods ending March 31, 2017. The company believes that including its core revenue assists investors in assessing the company’s operational performance. A reconciliation of GAAP revenue to core revenue is included with this news release.

Conference Call Information and Availability of Presentation Materials

Interested parties can listen to the Q1 2017 earnings conference call with NI management today, April 27, at 4:00 p.m. CT at www.ni.com/call. Replay information is available by calling (855) 859-2056, confirmation code 92725892, shortly after the call through April 30 at 11:59 p.m. CT or by visiting the company’s website at www.ni.com/call. Presentation materials referred to on the conference call can be found at www.ni.com/nati.

Forward-Looking Statements

This release contains “forward-looking statements” including statements regarding excellent execution and focus on growth, improving industrial economy and a sharp focus on key growth areas, that we will be disciplined in our focus and execution to achieve our growth and profitability goals, being encouraged by the strong order growth, improved operating margin and the positive signs we are seeing in the macroeconomic environment, leveraging our investments to drive sustained revenue growth and being confident in our ability to continue to make process toward our non-GAAP target of 18 percent operating margin, expecting Q2 revenue to be in the range of $305 million to $335 million, that the impact of foreign exchange will reduce the company’s year-over-year dollar revenue growth rate by approximately 1 percent in Q2, that our Q2 2017 GAAP EPS guidance includes approximately $3 million of restructuring charges, for the second half of 2017 NI estimates the restructuring charges impacting net income to be approximately $1 million to $2 million, expecting non-GAAP effective tax rate to be approximately 21 percent for 2017, and our guidance for GAAP fully diluted EPS and non-GAAP fully diluted EPS for Q2. These statements are subject to a number of risks and uncertainties, including the risk of adverse changes or fluctuations in the global economy, foreign exchange fluctuations, fluctuations in demand for NI products including orders from NI’s largest customer, component shortages, delays in the release of new products, the company’s ability to effectively manage its operating expenses, manufacturing inefficiencies and the level of capacity utilization, the impact of any recent or future acquisitions by NI, expense overruns, adverse effects of price changes or effective tax rates. Actual results may differ materially from the expected results.