Compuware Earns Six Cents Per Share in Fiscal Year 2006 First Quarter

Software License Fees Increase Nearly 26 Percent Year-over-year; Total Distributed Products Revenue Increases Nearly 19 Percent Year-over-year

DETROIT--July 21, 2005--Compuware Corporation (NASDAQ: CPWR) today announced financial results for its first quarter, which ended June 30, 2005.

"Compuware delivered a good first quarter, featuring year-over-year increases in software license fees, maintenance fees and total revenues," said Compuware Chairman and CEO Peter Karmanos, Jr. "Further strengthening these results, Compuware’s Q1 numbers contain absolutely no dollars from the IBM settlement. For the remainder of the fiscal year, Compuware’s executive leadership will focus on continuing to improve the company’s growth rate and, through that growth, increasing Compuware’s operating margin."

First Quarter Fiscal 2006 Results

Compuware reports first quarter revenues of $297.3 million, compared to $287.1 million in the first quarter of the previous fiscal year. Net income was $24.6 million compared to $644,000 in the same quarter of fiscal 2005. Earnings per share (diluted computation) were six cents compared to break-even, based upon 389.9 million and 388.4 million shares outstanding, respectively.

During the company’s first quarter, software license fees were $68 million, up 25.7 percent from $54.1 million in the same quarter of the previous year. Maintenance fees were $107.4 million, an increase of 3.7 percent from $103.5 million in the first quarter of fiscal 2005. Revenue from professional services was $121.9 million, compared to $129.4 million in the same quarter last year.

First Quarter Fiscal Year 2006 Highlights

During the first quarter, Compuware:

Acquired Adlex, Incorporated, which pioneered Service Delivery Management technology that enables Internet Service Providers and enterprise customers to diagnose and manage the quality of service that business-critical applications deliver to end-users. This technology complements the Compuware Vantage product line by providing extremely high-capacity, agentless end-user experience monitoring and deep insight into application performance.
Launched Compuware Changepoint 10, the latest version of the company’s integrated IT Governance and Management solution. Changepoint 10 provides visibility across applications, infrastructure and project portfolios, enabling CIOs to more effectively manage the entire business of IT by aligning resource and investment decisions with business priorities.
Announced that the Gartner IT Project Portfolio Management (PPM) Magic Quadrant, published June 22, 2005, positions Compuware in the "Leaders" quadrant in the IT PPM Magic Quadrant. According to Gartner, Leaders are performing well today, have a clear vision of market direction and are actively building competencies to sustain their leadership position in the market.
Announced that its services partnership with SAP America continued to succeed in lowering total cost of ownership and improving application reliability and performance associated with SAP solution implementations. Compuware’s unique, automated offerings for SAP^® solutions enable businesses to maximize the value of their SAP solutions, especially in regard to upgrade implementations, to service pack maintenance and to delivering high quality, end-user experiences.
Introduced Covisint Gateway, a new communications and message management solution that helps businesses consolidate all behind-the-firewall enterprise data messaging, including EDI. Covisint Gateway enables a single external connection that securely funnels information from multiple points within an enterprise to the outside world.
announced the renewal of its agreement with Ford Motor Company for the Covisint Communicate portal service. Ford has used Covisint Communicate since 2001 to provide the Ford Supplier Portal, which improves the sharing of information and collaborative business processes with Ford suppliers globally.
Announced that global automotive supplier Metaldyne Corporation has purchased Covisint Communicate portal services and Covisint Connect hosted integration services. Covisint will help Metaldyne improve the sharing of information and collaborative business processes with suppliers.
Announced a business partnership with eWorld Enterprise Solutions, a provider of enterprise management consulting and IT services. The partnership combines Compuware’s powerful OptimalJ enterprise development environment with eWorld’s expertise in enterprise Java architecture and development to help development teams migrate from legacy systems to the J2EE platform.
Released Compuware OptimalJ 4.0, unveiling new process-modeling functionality and announcing support for the Eclipse open source development platform. The enhancements to OptimalJ 4.0, including a new process model, make it possible for IT organizations to more quickly and productively deliver higher quality enterprise Java applications to the business.
Introduced a joint solution offering with IntelliNet, an enterprise network management service consultancy. Through this solution offering, IntelliNet will deliver enterprise application performance services utilizing Compuware Vantage technology, which helps IT organizations and service providers manage and improve application performance to meet business requirements.
Formally launched its 360 Solutions Partner Program and announced its partner award winners, presenting the awards to leading partners who sell and use Compuware solutions. Compuware made these announcements at the company’s downtown Detroit headquarters during its inaugural Compuware Partner Summit, which attracted nearly 200 Compuware partners from around the world.
Revealed the results of a survey conducted by Forrester Consulting showing that 85 percent of IT executives agree that software quality is critical. However, less than half surveyed claimed to have a formal plan for improving application quality, and most agree that implementing a standard or methodology has a great impact in improving quality. The Compuware Application Reliability Solution (CARS)--combining Compuware's own quality assurance tools and highly skilled professionals with a flexible, proven, risk-based testing methodology--addresses these critical quality issues through a flexible approach to implementing standard processes and practices across the entire IT organization.
Held a worldwide application quality roundtable series focused on the application quality challenges IT organizations face today. The roundtable series introduced Compuware's Application Quality Maturity Model, which has four phases: Quality Control, Quality Assurance, Quality Management and Quality Governance^TM.
Announced enhancements to Compuware Uniface. These enhancements will enable IT organizations to rapidly deploy enterprise applications on HP Integrity servers, based on the Intel^® Itanium^® 2 processor, running the OpenVMS operating system. This solution enables organizations to deploy their mission-critical applications on the latest HP hardware with zero source code changes.
Showcased and demonstrated the integration of its quality solutions--DevPartner and QACenter--with Microsoft Visual Studio 2005 and Microsoft Visual Studio 2005 Team System at Microsoft Tech·Ed.
Announced that Compuware DevPartner Studio Professional Edition and Compuware DevPartner SecurityChecker were each awarded a Visual Studio Magazine Readers Choice Award during Fawcette Technical Publication’s VSLive! 2005 Las Vegas Conference.
Was named to the annual SD Times 100 list, published by BZ Media's SD Times, for the third consecutive year. Compuware was recognized in the "Test and Performance" and "Tools & Environments" categories. The SD Times 100 recognizes the leaders and innovators of the software development industry. Organizations were chosen based on their reputation within the industry and among professional developers and testers.

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/>.

Conference Call Information

Compuware will host a conference call today to discuss these results at 5:00 p.m. Eastern Time (21:00 GMT). Interested parties calling from the United States should call 800-230-1092. For international access, the conference call number is +1-612-332-0720. The password for the conference call is Compuware. A conference call replay will also be available. For more information, visit the Compuware Corporation Investor Relations web site 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.