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National Instruments (NATI)

Filed: 28 Jan 21, 5:04pm
 Contact: Marissa Vidaurri
Head of Investor Relations
(512) 683-5215

NI Reports Record Quarterly Revenue
Company saw strong sequential growth in revenue and orders in fourth quarter

Q4 2020 Highlights

Revenue of $368 million

Orders up 7 percent year over year

Diluted GAAP EPS of $0.04

Diluted non-GAAP EPS of $0.51

Cash and short-term investments of $320 million as of Dec. 31, 2020

AUSTIN, Texas - Jan. 28, 2021 - National Instruments (Nasdaq: NATI) today announced Q4 2020 revenue of $368 million, up slightly year over year for an all-time quarterly record.

In Q4 2020, the value of the company’s total orders were up 7 percent year over year; orders over $20,000 were up 13 percent year over year; and orders under $20,000 were down 4 percent year over year. As we expand our systems and software offerings, we may see larger differences between bookings and revenue on a quarterly basis.

“This year was a stress test for our strategy and it proved resilient. We delivered a strong close to a challenging year with record quarterly revenue above the high end of guidance," said Eric Starkloff, NI president and CEO. "The areas where we have focused showed strength and momentum increased throughout the year with fourth quarter orders up sequentially across all regions and business units. I believe we enter 2021 in a position of strength and poised to accelerate growth and deliver increased value to all our stakeholders."

Geographic revenue in U.S. dollar terms for Q4 2020 compared with Q4 2019 was down 6 percent in the Americas, up 5 percent in APAC and up 3 percent in EMEA. Excluding the impact of foreign currency exchange, revenue was  down 6 percent in the Americas, up 5 percent in APAC and up 1 percent in EMEA. Historical revenue from these three regions can be found on NI’s investor website at www.ni.com/nati

In Q4, GAAP gross margin was 70 percent and non-GAAP gross margin was 74 percent. Total Q4 GAAP operating expenses were $245 million, up 10 percent year over year, which includes approximately $30 million of restructuring-related charges. Total Q4 non-GAAP operating expenses were $196 million, down 3 percent year over year. GAAP operating margin was 4 percent in Q4, with GAAP operating income of $13 million, down 75 percent year over year. Non-GAAP operating margin was 21 percent in Q4, with non-GAAP operating income of $79 million, down 6 percent year over year.

GAAP net income for Q4 was $5 million, with diluted earnings per share ("EPS") of $0.04, and non-GAAP net income was $67 million, with non-GAAP diluted EPS of $0.51. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortization, was $42 million for Q4. GAAP EPS includes higher restructuring charges than previously expected.

"I believe our strong close to 2020 is proof in our ability to adapt quickly to the global pandemic. We were diligent in managing expenses and achieved the 2020 annual targets shared at our investor conference in August," said Karen Rapp, NI CFO. "We remain committed to our 2023 financial model. In order to accelerate growth, we will continue to align investments to our higher growth opportunities within our four strategic pillars. I believe our strong balance sheet also gives us the opportunity to capitalize on inorganic investments to meet our growth targets faster and deliver shareholder returns."

As of Dec. 31, 2020, NI had $320 million in cash and short-term investments with $181 million in cash generated from operations in 2020. During Q4, NI paid $34 million in dividends and repurchased approximately 275,000 shares of our common stock at an average price of $34.39 per share. For the year, we returned over $185 million to our shareholders through dividends and stock repurchases, including the repurchase of 1.4 million shares at an average price of $35.04 per share. The NI Board of Directors approved a dividend of $0.27 per share payable on March 1, 2021, to stockholders of record on February 8, 2021. This represents an increase of 4 percent per share.
The company’s non-GAAP results exclude, as applicable, the impact of purchase accounting fair value adjustments, stock-based compensation expense, amortization of acquisition-related intangibles, acquisition-related transaction and integration costs, taxes levied on the transfer of acquired intellectual property, foreign exchange loss on acquisitions, restructuring charges, tax reform charges, disposal gains on buildings and related charitable contributions, tax effects related to businesses held for sale, gain on sale of businesses, and capitalization and amortization of internally developed software costs. Reconciliations of the company’s GAAP and non-GAAP results are included as part of this news release.

FY 2020 Highlights

Revenue of $1.29 billion,  down 5 percent year over year

GAAP gross margin of 71 percent

Non-GAAP gross margin of 75 percent

Diluted GAAP EPS of $1.09

Diluted non-GAAP EPS of $1.24

Dividends paid of $137 million, or $1.04 per share

In 2020, GAAP operating expenses were $876 million, up 1 percent year over year, and non-GAAP operating expenses were $759 million, down 5 percent year over year. GAAP net income in 2020 was $144 million, down 11 percent year over year, and non-GAAP net income in 2020 was $164 million, down 24 percent year over year.

Guidance
NI currently expects Q1 revenue to be in the range of $324 million to $354 million and Q1 non-GAAP revenue, which we define as GAAP revenue adjusted to exclude the impact of purchase accounting fair value adjustments (for Q4 2020 these adjustments related to our recently acquired OptimalPlus subsidiary), to be in the range of $325 million to $355 million. The company currently expects that GAAP diluted EPS will be in the range of $(0.05) to $0.09 for Q1, with non-GAAP diluted EPS expected to be in the range of $0.24 to $0.38. For 2021, NI estimates its non-GAAP effective tax rate to be approximately 17  percent to 18 percent.

Conference Call Information
Interested parties can listen to the Q4 2020 earnings conference call with NI management today, January 28, at 4:00 p.m. CT at www.ni.com/call or dial (855) 212-2361 and enter confirmation code 3484087. Replay information is available by calling (855) 859-2056, confirmation code 3484087, shortly after the call through January 31, at 11:59 p.m. CT or by visiting the company’s website at www.ni.com/call.

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 gross profit, gross margin, operating expenses, operating income, operating margin, provision for income taxes, net income, net margin and diluted EPS for the three-month and 12-month periods ending Dec. 31, 2020 and 2019, on a GAAP and non-GAAP basis. In this news release the company has also presented its non-GAAP revenue, and guidance for its Q1 non-GAAP revenue. In this news release revenue is also referred to as net sales, and non-GAAP revenue is also referred to as non-GAAP net sales. In this news release the company has also presented its estimated non-GAAP effective tax rate for 2021. When presenting non-GAAP information, the company includes a reconciliation of the non-GAAP results to the GAAP results. 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. 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 purchase accounting fair value adjustments, stock-based compensation expense, amortization of acquisition-related intangibles, acquisition-related transaction and integration costs, taxes levied on the transfer of acquired intellectual property, foreign exchange loss on acquisitions, restructuring charges, tax reform charges, disposal gains on buildings and related charitable contributions, tax effects related to businesses held-for-sale, gain on sale of businesses, and capitalization and amortization of internally developed software costs 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 and 12-month periods ending Dec. 31, 2020 and 2019. 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.

Forward-Looking Statements
This release contains “forward-looking statements” including statements regarding as we expand our systems and software offerings, we may see larger differences between bookings and revenue on a quarterly basis; the areas where we have focused showed strength and momentum increased throughout the year; I believe we enter 2021 in a position of strength and poised to accelerate growth and deliver increased value to all our stakeholders; I believe our strong close to 2020 is proof in our ability to adapt quickly to the global pandemic; we remain committed to our 2023 financial model; in order to accelerate growth, we will continue to align investments to our higher growth opportunities within our four strategic pillars; I believe our strong balance sheet gives us the opportunity to capitalize on inorganic investments to meet our growth targets faster and deliver shareholder returns; expecting Q1  revenue to be in the range of $324 million to $354 million; expecting Q1 non-GAAP revenue to be in the range of $325 million to $355 million; expecting that GAAP diluted EPS will be in the range of $(0.05) to $0.09 for Q1, with non-GAAP diluted EPS expected to be in the range of $0.24 to $0.38; and estimating its non-GAAP effective tax rate to be approximately 17 percent to 18 percent for 2021. These statements are subject to a number of risks and uncertainties, including risks and uncertainties related to the COVID-19 virus and further economic and market disruptions resulting from COVID-19; further adverse changes or fluctuations in the global economy; further adverse fluctuations in our industry, foreign exchange fluctuations, changes in the current global trade regulatory environment; fluctuations in customer demands and markets; fluctuations in demand for our products including orders from our large customers; component shortages; delays in the release of new products; our ability to effectively manage our operating expenses; manufacturing inefficiencies and the level of capacity utilization; the impact of any recent or future acquisitions or divestitures by NI (including the ability to successfully operate or integrate the acquired company’s business into NI, the ability to retain and integrate the acquired company’s employees into NI, and the ability to realize the expected benefits of the acquisition); our ability to achieve the benefits of employee restructuring plans and possible changes in the size and timing of the related charges; cyber-attacks; expense overruns; and adverse effects of price changes or effective tax rates. Actual results may differ materially from the expected results. The company directs readers to its Form 10-K for the year ended Dec. 31, 2019, its Form 10-Q for the quarter ended Sept. 30, 2020 and the other documents it files with the SEC for other risks associated with the company’s future performance. These documents contain and identify important factors that could cause our actual results to differ materially from those contained in our forward-looking statements.

All information in this release is as of the date above. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.

About NI
At NI, we bring together the people, ideas and technology so forward thinkers and creative problem solvers can take on humanity’s biggest challenges. From data and automation to research and validation, we provide the tailored, software-connected systems engineers and enterprises need to Engineer Ambitiously™ every day. (NATI-F)


National Instruments, NI and ni.com are trademarks of National Instruments. Other product and company names listed are trademarks or trade names of their respective companies.
National Instruments
Condensed Consolidated Balance Sheets
(in thousands)
 December 31,December 31,
 20202019
 (unaudited)  
ASSETS  
Current assets:  
Cash and cash equivalents$260,232  $194,616  
Short-term investments59,923  237,983  
Accounts receivable, net266,869  248,872  
Inventories, net194,012  200,410  
Prepaid expenses and other current assets68,470  65,477  
Total current assets849,506  947,358  
Property and equipment, net254,399  243,717  
Goodwill467,547  262,242  
Intangible assets, net172,719  84,083  
Operating lease right-of-use assets67,674  70,407  
Other long-term assets79,670  44,082  
Total assets1,891,515  1,651,889  
   
LIABILITIES AND EQUITY  
Current liabilities:  
Accounts payable and accrued liabilities51,124  52,192  
Accrued compensation87,068  47,732  
Deferred revenue - current132,151  131,445  
Other lease liabilities - current15,801  13,431  
Other taxes payable48,129  40,607  
Debt - current5,000  —  
Other current liabilities42,578  20,716  
Total current liabilities381,851  306,123  
Deferred income taxes25,287  14,065  
Liability for uncertain tax positions10,868  6,652  
Income tax payable - non-current61,623  69,151  
Deferred revenue - long-term36,335  33,480  
Operating lease liabilities - non-current35,854  40,650  
Debt, non-current92,036  —  
Other long-term liabilities22,789  5,418  
Total liabilities666,643  475,539  
   
Stockholders' equity:  
Preferred stock—  —  
Common stock1,312  1,305  
Additional paid-in capital1,033,285  953,578  
Retained earnings211,101  242,537  
Accumulated other comprehensive loss(20,826) (21,070) 
Total stockholders' equity1,224,872  1,176,350  
Total liabilities and stockholders' equity$1,891,515  $1,651,889  



National Instruments
Condensed Consolidated Statements of Income
(in thousands, except per share data, unaudited)
     
 Three Months Ended Years Ended
 December 31, December 31,
 20202019 20202019
      
Net sales:     
Product$327,714  $332,267   $1,137,603  $1,215,014  
Software maintenance40,124  35,201   149,068  138,201  
Total net sales367,838  367,468   1,286,671  1,353,215  
      
Cost of sales:     
Product105,625  89,308   359,861  329,364  
Software maintenance3,571  1,827   11,260  7,527  
Total cost of sales109,196  91,135   371,121  336,891  
      
Gross profit258,642  276,333   915,550  1,016,324  
 70%75% 71%75%
Operating expenses:     
Sales and marketing134,570  121,052   465,509  473,392  
Research and development73,733  71,471   280,381  272,452  
General and administrative36,883  30,129   129,863  122,768  
Total operating expenses245,186  222,652   875,753  868,612  
Gain on sale of business/asset—  —   159,753  26,842  
Operating income13,456  53,681   199,550  174,554  
      
Other income (expense)1,797  611   (788) 5,990  
      
Income before income taxes15,253  54,292   198,762  180,544  
      
Provision (Benefit) for income taxes10,515  (4,304)  55,103  18,393  
      
Net income$4,738  $58,596   $143,659  $162,151  
      
Basic earnings per share$0.04  $0.45   $1.10  $1.23  
Diluted earnings per share$0.04  $0.45   $1.09  $1.22  
      
Weighted average shares outstanding -     
Basic131,277  130,776   131,082  131,722  
Diluted131,732  131,432   131,799  132,734  
      
Dividends declared per share$0.26  $0.25   $1.04  $1.00  


National Instruments
Condensed Consolidated Statements of Cash Flows
(in thousands)
 Years Ended December 31,
 20202019
 (unaudited) 
Cash flow from operating activities:  
Net income$143,659  $162,151  
Adjustments to reconcile net income to net cash provided by operating activities:  
Depreciation and amortization87,064  73,541  
Stock-based compensation58,376  51,438  
Disposal gain on sale of business/asset(159,753) (26,842) 
Deferred income taxes7,089  (12,680) 
Net change in operating assets and liabilities44,332  (23,203) 
Net cash provided by operating activities180,767  224,405  
   
Cash flow from investing activities:  
Capital expenditures(49,652) (60,857) 
Proceeds from sale of assets/business, net of cash divested160,266  32,492  
Capitalization of internally developed software(4,054) (9,065) 
Additions to other intangibles(1,441) (1,209) 
Acquisitions of equity-method investments(9,761) (13,670) 
Acquisitions, net of cash received(334,981) —  
Purchases of short-term investments(206,330) (185,267) 
Sales and maturities of short-term investments384,652  219,628  
Net cash used by investing activities(61,301) (17,948) 
   
Cash flow from financing activities:  
Proceeds from term loan170,000  —  
Payments of term loan(71,250) —  
Proceeds from revolving line of credit20,000  —  
Payments of revolving line of credit(20,000) —  
Debt issuance costs(1,893) —  
Proceeds from issuance of common stock31,947  33,191  
Repurchase of common stock(48,713) (171,316) 
Dividends paid(136,545) (131,855) 
Other—  (837) 
Net cash used by financing activities(56,454) (270,817) 
   
Impact of changes in exchange rates on cash2,604  (410) 
   
Net change in cash and cash equivalents65,616  (64,770) 
Cash and cash equivalents at beginning of period194,616  259,386  
Cash and cash equivalents at end of period$260,232  $194,616  


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,
 20202019 20202019
Stock-based compensation     
Cost of sales$979  $887   $3,766  $3,475  
Sales and marketing5,462  4,868   22,288  19,612  
Research and development5,129  4,236   17,769  16,265  
General and administrative4,251  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 sales4,313  823   9,892  3,348  
Sales and marketing1,965  485   5,264  1,970  
Research and development 28   94  112  
General and administrative846  —   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 marketing23,309  5,356   32,079  13,646  
Research and development1,184  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,
 20202019 20202019
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 adjustments1,961  —   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 compensation979887 3,7663,475
Amortization of acquisition-related intangibles and fair value adjustments6,274823 13,1523,348
Acquisition transaction and integration costs, restructuring charges and other1,620   1,626  
Amortization of internally developed software costs6,936  7,012   27,931  27,085  
Non-GAAP gross profit$274,451  $285,055   $962,025  $1,050,232  
Non-GAAP gross margin74%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 costs1,248  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 compensation15,821  13,384   58,375  51,438  
Amortization of acquisition-related intangibles and fair value adjustments9,094  1,336   19,356  5,430  
Acquisition transaction and integration costs, restructuring charges and other34,798  10,624   61,358  29,339  
Net amortization of internally developed software costs5,688  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 margin21%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 compensation445  1,433   8,705  9,337  
Amortization of acquisition-related intangibles and fair value adjustments606  127   2,554  703  
Acquisition transaction and integration costs, restructuring charges and other1,328  2,715   4,122  7,136  
Net amortization of internally developed software costs1,195  1,076   5,017  3,784  
Gain on sale of business/assets274  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,
 20202019 20202019
      
Net income, as reported$4,738  $58,596   $143,659  $162,151  
Adjustments to reconcile net income to non-GAAP net income:     
Stock-based compensation15,821  13,384   58,375  51,438  
Amortization of acquisition-related intangibles and fair value adjustments9,218  1,460   19,843  5,839  
Acquisition transaction and integration costs, restructuring charges and other34,989  10,624   61,947  29,339  
Net amortization of internally developed software costs5,688  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 margin18.0%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 compensation0.12  0.10   0.44  0.39  
Amortization of acquisition-related intangibles and fair value adjustments0.07  0.01   0.15  0.04  
Acquisition transaction and integration costs, restructuring charges and other0.27  0.08   0.47  0.22  
Net amortization of internally developed software costs0.04  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), net592  (1,934)  (2,016) (8,089) 
     Tax expense (benefit)10,515  (4,304)  55,103  18,393  
     Depreciation and amortization25,836  18,995   87,064  73,541  
EBITDA$41,681  $71,353   $283,810  $245,996  
      
Weighted average shares outstanding     
Basic131,277  130,776   131,082131,722  
Diluted131,732  131,432   131,799132,734  

Reconciliation of GAAP to Non-GAAP Diluted EPS Guidance
(unaudited)
 Three Months Ended
 March 31, 2021
   
 LowHigh
GAAP Diluted EPS, guidance$(0.05) $0.09  
Adjustment to reconcile diluted EPS to non-GAAP diluted EPS:  
Stock-based compensation0.130.13
Amortization of acquisition-related intangibles and fair value adjustments0.060.06
Acquisition transaction and integration costs, restructuring charges and other0.120.12
Net amortization of internally developed software costs0.05  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, 
 20212020 
 (midpoint) Percent Inc(Dec)
GAAP Net sales, guidance$339,000  $309,381  10%
Impact of purchase accounting fair value adjustments1,000  —   
Non-GAAP Net sales, guidance$340,000  $309,381  10%