Compuware Earns 20 Cents Per Share in FY ‘05, Up More Than 53 Percent From FY ‘04

DETROIT--May 5, 2005--Compuware Corporation (NASDAQ: CPWR) today announced financial results for its fourth quarter and fiscal year ended March 31, 2005.

"Compuware produced a sound fiscal year with full-year earnings increasing more than 53 percent and operating cash flow of more than $240 million," said Compuware Chairman and CEO Peter Karmanos, Jr. "For fiscal 2006, I expect Compuware to again increase earnings by at least 50 percent, resulting in 30 to 35 cents in EPS. I also expect that Compuware will continue to generate strong operating cash flow of more than $200 million in fiscal 2006."

Fiscal Year 2005 Results

During the fiscal year ended March 31, 2005, revenues were $1.23 billion. Net income was $76.5 million for fiscal 2005, increasing from $49.8 million in fiscal 2004. Earnings per share (diluted computation) were 20 cents, compared to 13 cents in fiscal 2004, based upon 388.5 million and 384.6 million shares outstanding, respectively.

During fiscal 2005, software license fees were $305.2 million, up from $296.6 million in the prior fiscal year. Maintenance revenue was $425.3 million in fiscal 2005, up from $408.2 million in fiscal 2004. Professional services fees for fiscal year 2005 were $501.3 million.

Fourth Quarter Fiscal 2005 Results

Compuware reports fourth quarter net income of $26.7 million on revenues of $318.8 million. Earnings per share (diluted computation) were seven cents, based upon 389.2 million shares outstanding.

During the company’s fourth quarter, software license fees were $86.4 million. Maintenance fees were $108.4 million during the quarter, and fourth quarter revenue from professional services was $124.0 million.

Fourth Quarter Fiscal Year 2005 Highlights

During the fourth quarter, Compuware:

Entered into a software, services and technology relationship with IBM and settled all outstanding litigation between the enterprises. According to the agreement, IBM will enter into license and maintenance arrangements for $140 million of Compuware software over four years and offer to purchase $260 million of Compuware services over four years.
Announced it was evaluated for its vision and its ability to execute in the application quality marketplace by leading technology analyst firm Gartner. The Gartner Application Quality Ecosystem, published in March 2005, positions Compuware in the "Leaders" quadrant in the Application Quality Ecosystem Magic Quadrant, 2005: Leaders and Challengers report.
Was again named to the "Top 30 Companies for Executive Women" list sponsored by the National Association for Female Executives.
Announced the release of the latest new version of its IT governance solution, Compuware Changepoint, which delivers the industry’s broadest integrated IT governance and management capabilities through integrations across Compuware’s development, quality and service management offerings.
Announced a strategic partnership with CAST, whereby Compuware will integrate and resell CAST Quality Assessment Suite as a complement to the Compuware Application and Reliability Solution (CARS), which is Compuware’s comprehensive approach to Quality Management.
Along with SteelTrace, Ltd., announced that the companies had combined their industry-leading solutions for model-driven development and requirements definition/management. This means that Compuware OptimalJ and SteelTrace Catalyze are now integrated to fully leverage requirements management information throughout the application development life cycle.
Announced the general availability of two new DevPartner products--Compuware DevPartner Fault Simulator and Compuware DevPartner SecurityChecker. These products significantly extend the DevPartner product line’s longstanding advisory capability to deliver a broader and deeper view into application quality issues, enabling project teams to establish best practices for building quality software across the application development life cycle.
Announced new support for Java with Compuware DevPartner Java Edition 3.3, a suite of productivity and profiling tools that speeds the deployment of reliable, high-performance Java applications and components.
Released Compuware OptimalJ 3.3, which extends OptimalJ’s automation capabilities to further speed development, simplify legacy reuse through service-enablement and ease development team collaboration.
Unveiled Compuware Vantage Analyzer for J2EE, a significant extension to the Compuware Vantage service management solution that helps IT operations staff deliver higher levels of service to their business at lower cost. Specifically, customers running enterprise Java applications can now use Compuware Vantage to more quickly identify and isolate performance and availability problems.
Announced the general availability of CARS 5.0, which introduces Quality Governance™. CARS 5.0 optimizes a quality assurance organization’s ability to deliver reliable business applications that provide maximum business value through the implementation of effective governance models and includes integration with Compuware Changepoint.
Introduced Compuware Strobe 3.2 and Compuware iStrobe 2.1, new versions of its application performance management solution.
· Released enhancements to the automated functional and performance testing suites, Compuware QACenter Enterprise Edition and Compuware QACenter Performance Edition.
Announced enhancements to the Compuware File-AID product line, which help IT organizations save time and reduce the level of complexity associated with generating confidential test data without exposing sensitive customer information.
Inaugurated, along with Wipro Technologies, a dedicated Center of Excellence that will provide training and Proofs-of-Concept on Compuware’s automated testing and service management solutions for the Wipro Interop Solutions Horizontal.
Announced it would host a data privacy webinar titled "Implementing Data Privacy Assurance in the Application Testing Environment" in April.

Compuware Corporation

Compuware Corporation (NASDAQ: CPWR) maximizes the value IT brings to the business by helping CIOs more effectively manage the business of IT. Compuware solutions accelerate the development, improve the quality and enhance the performance of critical business systems while enabling CIOs to align and govern the entire IT portfolio, increasing efficiency, cost control and employee productivity throughout the IT organization. Founded in 1973, Compuware serves the world's leading IT organizations, including more than 90 percent of the Fortune 100 companies. Learn more about Compuware at <http://www.compuware.com/>.

Certain statements in this press release and announcement may constitute forward-looking statements. These forward-looking statements involve a number of known and unknown risks, uncertainties and other factors that may cause such forward-looking statements not to be realized and that could cause actual results to differ materially from Compuware's expectations in these statements. For more information about other risks that could affect the forward-looking statements herein, please see Compuware's most recent quarterly report on Form 10-Q, annual report on Form 10-K and other filings made with the Securities and Exchange Commission. Compuware expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any changes in expectations, or any change in events or circumstances on which those statements are based, unless otherwise required by law.