Compuware Earns 10 Cents Per Share in Q2

Net Income Increases 57.8 Percent Before Amortization Expense; License Fees, Maintenance and Services Revenue within Previously Announced Ranges

FARMINGTON HILLS, Mich. -- October 18, 2001 -- Compuware Corporation (Nasdaq: CPWR) today announced financial results for its second quarter ended September 30, 2001.

Compuware reports second quarter revenues of $424.0 million, compared to $486.3 million in the second quarter of the previous fiscal year. Net income before amortization of intangible assets acquired as a result of acquisitions (amortization expense) increased 57.8 percent to $37.3 million from $23.6 million in the same quarter of fiscal 2001. Earnings per share before amortization expense (diluted computation) increased 66.7 percent to 10 cents from 6 cents, based upon 386.7 million and 371.3 million shares outstanding, respectively. Net income including amortization expense increased 105.6 percent to $26.5 million from $12.9 million in the same period of the previous fiscal year. Including amortization expense, earnings per share (diluted computation) increased 133.3 percent to 7 cents per share, from 3 cents per share in the second quarter of fiscal 2001.

During the company's second quarter, software license fees were $86.8 million, compared to $95.6 million in the first quarter of this fiscal year. Maintenance fees were $109.7 million versus $110.8 million during the first quarter of fiscal 2002. Revenue from professional services was $227.5 million, compared with $240.3 million in the first quarter of this fiscal year.

"These are strong results in a difficult environment," said Joe Nathan, President and Chief Operating Officer, Compuware Corporation. "We had cash flow of more than $85 million this quarter and a solid increase in year-over-year earnings. While recent events have demonstrated that economic conditions are difficult to foresee, we believe that we have taken the necessary steps to assure that Compuware will weather any economic turbulence and thrive as conditions improve. We continue to believe that both revenue and earnings will soon grow again."

Second Quarter Fiscal Year 2002 Highlights

During the second quarter, Compuware:

Strengthened its product offerings by joining the Cisco AVVID (Architecture for Voice, Video and Integrated Data) Partner Program as a network and service management solutions partner. Through membership in this program, Compuware has engineered its EcoSCOPE product to manage the performance of e-business voice and video applications for Cisco customers. Joining the AVVID Partner Program represents an opportunity to further tap the large, growing systems and network management market.
Entered into a bundling agreement with Dell Computer Corporation and Cubix Corporation. The deal lets customers economically mix and match Compuware performance management software with various operating platforms by pre-configuring their software and having it shipped with each vendor's server hardware. The agreement offers Compuware customers a number of benefits, including simplified deployment of EcoSCOPE probes and appliance integration to ensure compatibility and reliability.
Earned the Editor's Choice award from IDG publication Natverk and Kommunikation, which is based in Sweden. Compuware QACenter Performance Edition earned the award given in the category of "QA Tools for the Web."

Conference Call Information

Compuware will host a conference call to discuss these results at 5:00 p.m. Eastern time (21:00 GMT). Interested parties calling from the United States should call 877-459-8388. For international access, the conference call number is +1-712-271-3698. The password for the conference call is Compuware. A webcast and conference call replay will also be available. For more information, visit the Compuware Corporation Investor Relations web site at http://www.compuware.com.

Compuware Corporation

Compuware Corporation, a multi-billion dollar company, provides business value through software and professional services that optimize productivity and reduce costs across the application life cycle. Meeting the rapidly changing needs of businesses of all sizes, Compuware's market-leading solutions improve the quality, ease the integration and enhance the performance of distributed, e-business and enterprise software. Compuware employs approximately 13,000 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.

Certain statements in this release that are not historical facts, including those regarding the Company's future plans, objectives and expected performance, are "forward-looking statements" within the meaning of the federal securities laws. These forward-looking statements represent our outlook only as of the date of this release. While we believe any forward-looking statements we have made are reasonable, actual results could differ materially since the statements are based on our current expectations and are subject to risks and uncertainties. These risks and uncertainties are discussed in the Company's reports filed with the Securities and Exchange Commission. Readers are cautioned to consider these factors when relying on such forward-looking information. The Company does not undertake, and expressly disclaims any obligation, to update or alter its forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.