Businesses have to evolve continuously, and National Instruments (NASDAQ:NATI) has worked hard to try to identify top growth areas it can capitalize on best. Despite the progress that the company has made, growth has been hard to come by, especially as macroeconomic conditions across the globe start to slow.

Coming into Tuesday's fourth-quarter financial report, National Instruments investors were looking forward to solid results from the company. The numbers that it posted weren't everything its shareholders had wanted, but the company's guidance for the beginning of 2019 showed optimism about its near-term future.

Three mobile devices, each showing remote footage of a test burn.

Image source: National Instruments.

National Instruments passes the test

Check out the latest National Instruments earnings call transcript.

National Instruments' fourth-quarter results capped a record year for the company. Revenue of $360 million was up 3% from the same period a year ago, although the growth rate was slower than the 9% that most of those following the stock had anticipated. Adjusted net income jumped 29% to $71 million, and that led to adjusted earnings of $0.53 per share. That was quite a bit better than the consensus forecast among investors for $0.45 per share.

NI was quick to attribute the shortfall in sales to poor performance overseas. In particular, unexpected weakness in the Greater China region was almost entirely responsible for revenue coming in at the lower end of what the company had projected three months ago. Taking China out of the equation, the rest of NI's business was solid.

From an order perspective, growth also slowed, but big customers remained essential. Overall orders were up 2%, but big-ticket orders above $20,000 rose by 6%. That was enough to offset the 2% decline in orders below $20,000, but all the gains were much more modest than they were in recent quarters.

For the first time in a while, National Instruments' home region took the lead in producing higher sales. The Americas saw revenue rise 11%, accelerating from its pace in the third quarter. However, both the Asia-Pacific region and the region that includes Africa, Europe, India, and the Middle East saw declines of 2%. And even after taking adverse currency impacts into account, markets outside the Western Hemisphere failed to generate any growth for NI.

CFO Karen Rapp summed things up operationally: "I am proud of our operating performance this year. We are entering 2019 with a strong balance sheet, which we believe will provide us with strategic flexibility."

What's ahead for NI?

The positive sentiment spread throughout National Instruments' executive suite. CEO Alex Davern pointed to strength in improving margin and bottom-line metrics, and he believes that NI's businesses "enter 2019 in a strong position, and I am confident in our long-term growth opportunity."

Yet guidance for the first quarter was a bit mixed. Sales projections of $305 million to $335 million would be on the low side of the nearly $340 million in revenue that most of those following the stock were expecting to see. However, in comparison with a consensus forecast for just $0.23 per share on the bottom line in the first quarter, NI's call for adjusted earnings of anywhere from $0.23 to $0.37 per share could lead to a blockbuster quarter if things go well.

National Instruments investors didn't have an immediate reaction to the news, and the stock was down only a fraction of a percent in after-hours trading following the announcement. Investors who've followed NI for a while, though, understand that making the most of the company's sales opportunities is important. The progress that National Instruments has made to boost profits is praiseworthy, and a stronger top line would be even better in most investors' eyes.

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