Compuware Corporation Reports Second Quarter Earnings

FARMINGTON HILLS, Mich. -- October 19, 2000 -- Compuware Corporation (Nasdaq: CPWR) today announced financial results for its second quarter ended September 30, 2000.

Compuware reports second quarter revenue of $486.3 million, compared with $568.1 million during the same quarter last year. Income from operations was $21.9 million, compared to $146.9 million in the second quarter of the previous fiscal year.

Software license fees were $103.5 million compared with $211.6 million in the second quarter of the previous fiscal year. Maintenance fees grew to $114.3 million from $103.0 million during the same period last year. Professional services fees increased to $268.5 million from $253.5 million during the second quarter of the previous fiscal year.

Net income before special charges and amortization expense was $23.6 million compared to $109.0 million. Before special charges and amortization expense, earnings per share (diluted computation) were 6 cents compared to 28 cents in the same quarter last year based upon 371.3 million and 384.9 million shares outstanding, respectively.

"We said that this fiscal year would be tough. In reality, it is turning out to be even tougher than we thought," said Beth Chappell, Executive Vice President of Corporate Communications and Investor Relations. "The market has changed, so our business must change. We remain committed to maintaining our competitive edge in the mainframe software market as we transform our distributed software business. We expect these changes to reap significant benefits over the longer term.

"Our professional services business continues to improve. This quarter marks the return to profitability. We expect these positive trends to continue. We remain a financially strong company with robust software products and professional services. The fiscal year will be a year of transition and will position us to return to healthy growth rates during fiscal year 2002," she said.

Compuware Corporation

With fiscal 2000 revenues of more than $2.2 billion, Compuware is a world leader in the practical implementation of enterprise and e-commerce solutions. Compuware software products and professional services help 14,000 of the world's largest corporations more efficiently maintain and enhance their most critical business applications. Compuware products and services improve quality, lower costs and increase the speed at which systems can be developed, implemented and supported, providing an immediate and measurable return on information technology investments. Compuware employs more than 15,000 information technology professionals worldwide. For more information about Compuware, please contact the corporate offices at 800-521-9353. You may also visit Compuware on the World Wide Web at http://www.compuware.com.