Hyperion Solutions Corporation Hyperion Reports Record Fiscal Second Q

Hyperion Solutions Corporation Hyperion Reports Record Fiscal Second Quarter Revenue and Earnings

    Business Editors

    SANTA CLARA, Calif.--(BUSINESS WIRE)--Jan. 25, 2005--

15% License Revenue Growth, 135% Increase in Net Income Highlight Quarter
    Hyperion Solutions (Nasdaq:HYSL), the leading provider of Business Performance Management (BPM) software, today announced record financial results for its fiscal second quarter ended December 31, 2004.
    Total revenues for the quarter increased 13% to a record $177.0 million, compared to $156.1 million for the same period a year ago. Software license revenue increased 15% to $68.5 million, compared to $59.7 million for the same period a year ago, while maintenance and services revenue grew 12% to $108.5 million, compared to $96.4 million in the year-ago period.
    The company's second-quarter net income, as reported in accordance with U.S. generally accepted accounting principles (GAAP), increased 135% to $15.6 million, the highest in the company's history, or $0.38 per diluted share. This compares to net income of $6.6 million, or $0.16 per diluted share, for the second quarter of fiscal 2004.
    Second quarter non-GAAP pro forma net income increased 46% year-over-year to $20.4 million, or $0.50 per diluted share, excluding the impact of charges, net of related tax, for the amortization of purchased intangible assets, the amortization of deferred stock-based compensation, and restructuring costs, including the charge taken for the global headquarters relocation that occurred during the quarter. These results compare to non-GAAP pro forma net income of $14.0 million, or $0.35 per diluted share, for the second quarter of fiscal 2004.
    Hyperion's balance sheet reflects cash and short-term investments totaling $405.0 million at December 31, 2004. This compares to $362.6 million in cash and short-term investments at September 30, 2004. Cash flow from operations for the quarter was $29.7 million. The company used cash of $2.3 million to repurchase stock during the quarter, as part of its $75 million stock repurchase program announced in May 2004. Days sales outstanding (DSO) improved two days to 68 days from year-ago levels.
    "Our second quarter was marked by record results, strong execution, and continued innovation," said Godfrey R. Sullivan, Hyperion's president and chief executive officer. "We generated record revenues, net income, and earnings per share. Demand for our market-leading solutions drove 15% license revenue growth over the same quarter last year and we achieved record pro forma operating margins of nearly 17% during the quarter. Hyperion Performance Suite had a break-out quarter, delivering license revenue growth of more than 50% from year-ago levels. This demonstrates the strong market demand in the Business Intelligence sector for our industry-leading management reporting solutions. In addition, our financial applications had another healthy quarter with double-digit year-over-year growth.
    "It's a very exciting time for the entire Hyperion team," continued Mr. Sullivan. "We're leveraging our management reporting solutions to reach beyond the finance department and into new areas of the enterprise. We're in a great position to lead the next wave of Business Performance Management as we unify Business Intelligence and financial and analytical applications into our BPM System. Hyperion has never been stronger."

    Non-GAAP Financial Measures

    In analyzing its financial results, Hyperion has used non-GAAP pro forma financial measures (excluding adjustments, such as those relating to purchase accounting and restructuring costs) because they provide meaningful information regarding the company's operational performance that excludes certain non-cash and non-recurring expenses. They also facilitate management's internal comparisons to the company's historical operating results and to competitors' operating results. Wherever non-GAAP disclosures have been included in this press release, the company has reconciled them to the appropriate GAAP disclosures.
    The non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. Non-GAAP results should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
    Reconciliation of GAAP to Pro Forma Q2 FY05 and Q2 FY04 Diluted Earnings Per Share

Q2 Q2 FY05 FY04 ------ ------

GAAP Diluted Earnings Per Share $0.38 $0.16

Plus: Deferred maintenance revenue adjustment - 0.02 Amortization of purchased intangible assets 0.05 0.04 Amortization of deferred stock-based compensation 0.01 0.03 Restructuring costs 0.12 0.09 Write-off of in-process research and development - 0.06 Loss on debt redemption - 0.02 Less: Income tax effect of pro forma adjustments (0.06) (0.07) ------ ------ Non-GAAP Pro Forma Diluted Earnings Per Share $0.50 $0.35 ====== ======

    Business Outlook

    Hyperion also reported today its outlook for the third quarter of fiscal 2005. On a GAAP basis, the company currently expects total revenues in the range of $173 million to $178 million and diluted earnings per share in the range of $0.35 to $0.40. This outlook assumes an effective tax rate of 35% and diluted shares outstanding of 42.0 million.
    Excluding the impact of the amortization of purchased intangible assets and the amortization of deferred stock-based compensation, the company expects diluted earnings per share on a non-GAAP pro forma basis for the third quarter in the range of $0.40 to $0.45.

Reconciliation of GAAP to Pro Forma Diluted Earnings Per Share for Business Outlook

Projected Q3 FY05 GAAP Diluted Earnings Per Share $0.35 - $0.40 Plus: Amortization of purchased intangible assets 0.06 Amortization of deferred stock-based compensation 0.01 Less: Income tax effect of pro forma adjustments (0.02) Projected Q3 FY05 Non-GAAP Pro Forma Diluted Earnings Per Share $ 0.40 - $0.45

    Hyperion Acquires Razza Solutions

    In a separate press release today, Hyperion announced that it has acquired Razza Solutions of Austin, Texas, a privately held software company offering a solution for synchronizing master data management across BPM including Business Intelligence (BI) platforms, financial and analytical applications, and transaction systems. Terms of the transaction were not disclosed. Hyperion expects the impact on revenue and earnings will not be material.

    Other Recent Developments

    Other recent company developments include:

--	Won major customer contracts at AB Nynas Petroleum (Sweden), Carl Zeiss AG (Germany), Carlson Companies, CoBank, HBOS (UK), Reed Elsevier (UK), Regus Group Plc (UK), Sanofi-Synthelabo Groupe (France), The School Board of Broward County, Social Security Administration, and the University of Alabama Birmingham Health System.
--	Shipped version 4.0 of its BPM suite of applications, offering a new process-oriented user interface that increases user productivity and is standardized across all suite products. It also includes the new Hyperion Workforce Planning module, which extends Hyperion Planning's domain intelligence to support headcount and salary planning functionality.
--	Shipped version 8.3 of Hyperion Performance Suite, a key development milestone in the company's BI Platform roadmap. The new release combines financial and operational reporting and provides better support for SAP, deeper integration with other Hyperion products, and a new wizard-driven Dashboard Builder.
--	Broke the industry's OLAP benchmark, the industry standard APB-1 benchmark, for the second consecutive year, proving Hyperion Essbase once again to be the fastest and most scalable enterprise analytic server on the market.
--	Announced that Mark Cochran has been appointed as vice president, general counsel and corporate secretary, replacing former general counsel, Russell Wayman, who retired in September 2004.
--	Launched the first-of-its-kind Drive Clean to Drive Change initiative, which aims to help clear the air by reimbursing employees $5,000 toward the purchase of cars achieving 45 miles per gallon or higher.

    Conference Call and Webcast

    Hyperion's executive management will host a conference call at 5:00 p.m. ET today to discuss these financial results. The conference call will be webcast live with access from the Investor Relations section of the Hyperion Web site at www.hyperion.com. A replay of the webcast will also be available from the company's Web site.

    About Hyperion

    Hyperion is the global leader in Business Performance Management software. More than 10,000 customers - including 91 of the Fortune 100 - rely on Hyperion software to translate strategies into plans, monitor execution and provide insight to improve financial and operational performance. Hyperion combines the most complete set of interoperable applications with the leading Business Intelligence platform to support and create Business Performance Management solutions. A network of more than 600 partners provides the company's innovative and specialized solutions and services.
    Named one of the FORTUNE 100 Best Companies to Work For 2004, Hyperion employs approximately 2,500 people in 20 countries. Distributors represent Hyperion in an additional 25 countries. Headquartered in Santa Clara, California, Hyperion generated annual revenues of $622 million for the 12 months that ended June 30, 2004. Hyperion is traded under the Nasdaq symbol HYSL. For more information, please visit www.hyperion.com, www.hyperion.com/contactus or call 800 286 8000 (U.S. only).

    Forward-Looking Statements

    Statements in this press release other than statements of historical fact are forward-looking statements, including, but not limited to, statements concerning expected future financial results, the potential success of anticipated product offerings, the ability to expand the sale of products into new areas of the enterprise, and the potential market opportunities for business performance management software. Such statements constitute anticipated outcomes and do not assure results. Actual results may differ materially from those anticipated by the forward-looking statements due to a variety of factors, including, but not limited to the company's failure to successfully drive increases in software license revenue (by both increasing sales of newer products, and limiting falloff of older product revenue), significant product quality problems, failure to successfully drive partner revenue, failure to continue the successful integration of the Brio business, significant strengthening of the Dollar against key European currencies, the impact of competitive products and pricing, a decline in customer demand, and technological shifts. For a more detailed discussion of factors that could affect the company's performance and cause actual results to differ materially from those anticipated in the forward-looking statements, interested parties should review the company's filings with the Securities and Exchange Commission, including the report on Form 10-K filed on September 13, 2004, and the report on Form 10-Q filed on November 9, 2004. The company does not undertake an obligation to update its forward-looking statements to reflect future events or circumstances.

    "Hyperion," the Hyperion "H" logo and Hyperion's product names are trademarks of Hyperion. References to other companies and their products use trademarks owned by the respective companies and are for reference purpose only.

Hyperion Solutions Corporation Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)

Three Months Ended Six Months Ended December 31, December 31, 2004 2003 2004 2003 --------------------------------------- REVENUES Software licenses $ 68,524 $ 59,701 $125,948 $102,746 Maintenance and services 108,454 96,435 210,568 176,942 --------- --------- --------- --------- TOTAL REVENUES 176,978 156,136 336,516 279,688

COSTS AND EXPENSES Cost of revenues: Software licenses 4,063 3,408 7,355 6,467 Maintenance and services 39,877 37,045 77,218 67,506 Sales and marketing 64,644 58,255 123,377 100,697 Research and development 25,645 23,573 51,359 43,357 General and administrative 15,526 15,950 30,395 28,870 Restructuring charges 5,008 3,516 8,077 3,516 In-process research and development - 2,300 - 2,300 --------- --------- --------- --------- TOTAL COSTS AND EXPENSES 154,763 144,047 297,781 252,713 --------- --------- --------- ---------

OPERATING INCOME 22,215 12,089 38,735 26,975

Interest and other income 1,719 1,123 3,076 2,263 Interest and other expense (11) (420) (23) (1,072) Loss on redemption of debt - (936) - (936) --------- --------- --------- --------- INCOME BEFORE INCOME TAXES 23,923 11,856 41,788 27,230

Income tax provision 8,373 5,238 14,625 10,925 --------- --------- --------- --------- NET INCOME $ 15,550 $ 6,618 $ 27,163 $ 16,305 ========= ========= ========= =========

Basic net income per share $ 0.40 $ 0.17 $ 0.69 $ 0.44 Diluted net income per share $ 0.38 $ 0.16 $ 0.67 $ 0.42

Shares used in computing basic net income per share 39,270 38,544 39,176 37,221 Shares used in computing diluted net income per share 40,898 40,166 40,757 38,976

Hyperion Solutions Corporation Reconciliation of GAAP to Pro Forma Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)

Three Months Ended December 31, 2004 --------------------------------------- GAAP Pro Forma Results Adjustments Results ---------- ---------------- ----------- REVENUES Software licenses $ 68,524 $ - $ 68,524 Maintenance and services 108,454 - 108,454 ---------- ----------- ----------- TOTAL REVENUES 176,978 - 176,978

COSTS AND EXPENSES Cost of revenues: Software licenses 4,063 (1,467)B 2,596 Maintenance and services 39,877 (256)B, C 39,621 Sales and marketing 64,644 (578)B, C 64,066 Research and development 25,645 (80)C 25,565 General and administrative 15,526 (111)C 15,415 Restructuring charges 5,008 (5,008)D - In-process research and development - - - ---------- ----------- ----------- TOTAL COSTS AND EXPENSES 154,763 (7,500) 147,263 ---------- ----------- -----------

OPERATING INCOME 22,215 7,500 29,715

Interest and other income 1,719 - 1,719 Interest and other expense (11) - (11) Loss on redemption of debt - - - ---------- ----------- ----------- INCOME BEFORE INCOME TAXES 23,923 7,500 31,423

Income tax provision 8,373 2,625 G 10,998 ---------- ----------- ----------- NET INCOME $ 15,550 $ 4,875 $ 20,425 ========== =========== ===========

Basic net income per share $ 0.40 $ 0.52 Diluted net income per share $ 0.38 $ 0.50

Shares used in computing basic net income per share 39,270 39,270 Shares used in computing diluted net income per share 40,898 40,898

Three Months Ended December 31, 2003 --------------------------------------- GAAP Pro Forma Results Adjustments Results ---------- ---------------- ----------- REVENUES Software licenses $ 59,701 $ - $ 59,701 Maintenance and services 96,435 657 A 97,092 ---------- ----------- ----------- TOTAL REVENUES 156,136 657 156,793

COSTS AND EXPENSES Cost of revenues: Software licenses 3,408 (1,135)B 2,273 Maintenance and services 37,045 (236)B, C 36,809 Sales and marketing 58,255 (987)B, C 57,268 Research and development 23,573 (238)C 23,335 General and administrative 15,950 (329)C 15,621 Restructuring charges 3,516 (3,516)D - In-process research and development 2,300 (2,300)E - ---------- ----------- ----------- TOTAL COSTS AND EXPENSES 144,047 (8,741) 135,306 ---------- ----------- -----------

OPERATING INCOME 12,089 9,398 21,487

Interest and other income 1,123 - 1,123 Interest and other expense (420) - (420) Loss on redemption of debt (936) 936 F - ---------- ----------- ----------- INCOME BEFORE INCOME TAXES 11,856 10,334 22,190

Income tax provision 5,238 2,973 G 8,211 ---------- ----------- ----------- NET INCOME $ 6,618 $ 7,361 $ 13,979 ========== =========== ===========

Basic net income per share $ 0.17 $ 0.36 Diluted net income per share $ 0.16 $ 0.35

Shares used in computing basic net income per share 38,544 38,544 Shares used in computing diluted net income per share 40,166 40,166

Pro Forma Adjustments:

A) Impact of Brio deferred maintenance revenue write-down.

B) Amortization of acquired intangible assets, consisting of $1,467 in cost of software license revenue, $220 in cost of maintenance and services revenue and $380 in sales and marketing expense for the three months ended December 31, 2004. Amortization of acquired intangible assets, consisting of $1,135 in cost of software license revenue, $183 in cost of maintenance and services revenue and $333 in sales and marketing expense for the three months ended December 31, 2003.

C) Amortization of deferred stock-based compensation, consisting of $36 in cost of maintenance and services revenue, $198 in sales and marketing expense, $80 in research and development expense and $111 in general and administrative expense for the three months ended December 31, 2004. Amortization of deferred stock-based compensation, consisting of $53 in cost of maintenance and services revenue, $654 in sales and marketing expense, $238 in research and development expense and $329 in general and administrative expense for the three months ended December 31, 2003.

D) Restructuring charges.

E) In-process research and development write-off.

F) Loss on redemption of long-term debt.

G) Income tax effect of pro forma adjustments.

Hyperion Solutions Corporation Reconciliation of GAAP to Pro Forma Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)

Six Months Ended December 31, 2004 --------------------------------------- GAAP Pro Forma Results Adjustments Results ---------- ---------------- ----------- REVENUES Software licenses $ 125,948 $ - $ 125,948 Maintenance and services 210,568 194 A 210,762 ---------- ----------- ----------- TOTAL REVENUES 336,516 194 336,710

COSTS AND EXPENSES Cost of revenues: Software licenses 7,355 (2,886)B 4,469 Maintenance and services 77,218 (513)B, C 76,705 Sales and marketing 123,377 (1,392)B, C 121,985 Research and development 51,359 (201)C 51,158 General and administrative 30,395 (472)C 29,923 Restructuring charges 8,077 (8,077)D - In-process research and development - - - ---------- ----------- ----------- TOTAL COSTS AND EXPENSES 297,781 (13,541) 284,240 ---------- ----------- -----------

OPERATING INCOME 38,735 13,735 52,470

Interest and other income 3,076 - 3,076 Interest and other expense (23) - (23) Loss on redemption of debt - - - ---------- ----------- ----------- INCOME BEFORE INCOME TAXES 41,788 13,735 55,523

Income tax provision 14,625 4,807 G 19,432 ---------- ----------- ----------- NET INCOME $ 27,163 $ 8,928 $ 36,091 ========== =========== ===========

Basic net income per share $ 0.69 $ 0.92 Diluted net income per share $ 0.67 $ 0.89

Shares used in computing basic net income per share 39,176 39,176 Shares used in computing diluted net income per share 40,757 40,757

Six Months Ended December 31, 2003 --------------------------------------- GAAP Pro Forma Results Adjustments Results --------------------------------------- REVENUES Software licenses $ 102,746 $ - $ 102,746 Maintenance and services 176,942 657 A 177,599 ---------- ----------- ----------- TOTAL REVENUES 279,688 657 280,345

COSTS AND EXPENSES Cost of revenues: Software licenses 6,467 (1,324)B 5,143 Maintenance and services 67,506 (244)B, C 67,262 Sales and marketing 100,697 (1,058)B, C 99,639 Research and development 43,357 (254)C 43,103 General and administrative 28,870 (431)C 28,439 Restructuring charges 3,516 (3,516)D - In-process research and development 2,300 (2,300)E - ---------- ----------- ----------- TOTAL COSTS AND EXPENSES 252,713 (9,127) 243,586 ---------- ----------- -----------

OPERATING INCOME 26,975 9,784 36,759

Interest and other income 2,263 - 2,263 Interest and other expense (1,072) - (1,072) Loss on redemption of debt (936) 936 F - ---------- ----------- ----------- INCOME BEFORE INCOME TAXES 27,230 10,720 37,950

Income tax provision 10,925 3,115 G 14,040 ---------- ----------- ----------- NET INCOME $ 16,305 $ 7,605 $ 23,910 ========== =========== ===========

Basic net income per share $ 0.44 $ 0.64 Diluted net income per share $ 0.42 $ 0.61

Shares used in computing basic net income per share 37,221 37,221 Shares used in computing diluted net income per share 38,976 38,976

Pro Forma Adjustments:

A) Impact of Brio deferred maintenance revenue write-down.

B) Amortization of acquired intangible assets, consisting of $2,886 in cost of software license revenue, $440 in cost of maintenance and services revenue and $780 in sales and marketing expense for the six months ended December 31, 2004. Amortization of acquired intangible assets, consisting of $1,324 in cost of software license revenue, $183 in cost of maintenance and services revenue and $333 in sales and marketing expense for the six months ended December 31, 2003.

C) Amortization of deferred stock-based compensation, consisting of $73 in cost of maintenance and services revenue, $612 in sales and marketing expense, $201 in research and development expense and $472 in general and administrative expense for the six months ended December 31, 2004. Amortization of deferred stock-based compensation, consisting of $61 in cost of maintenance and services revenue, $725 in sales and marketing expense, $254 in research and development expense and $431 in general and administrative expense for the six months ended December 31, 2003.

D) Restructuring charges.

E) In-process research and development write-off.

F) Loss on redemption of long-term debt.

G) Income tax effect of pro forma adjustments.

Hyperion Solutions Corporation Consolidated Balance Sheets (In thousands, except par value)

December 31, June 30, 2004 2004 ------------- ------------- (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 401,960 $ 365,181 Short-term investments 3,021 2,994 Accounts receivable, net of allowances of $9,021 and $8,758 133,380 133,491 Deferred income taxes 13,804 12,348 Prepaid expenses and other current assets 16,631 18,434 ------------- ------------- TOTAL CURRENT ASSETS 568,796 532,448

Property and equipment, net 75,528 72,020 Goodwill 141,153 139,952 Intangible assets, net 29,382 30,945 Deferred income taxes 26,010 24,279 Other assets 4,690 5,011 ------------- ------------- TOTAL ASSETS $ 845,559 $ 804,655 ============= =============

LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $ 64,678 $ 58,121 Accrued employee compensation and benefits 49,330 51,267 Income taxes payable 11,661 8,557 Deferred revenue 126,819 136,286 Other current liabilities 12,672 4,234 ------------- ------------- TOTAL CURRENT LIABILITIES 265,160 258,465

Other liabilities 25,367 26,619

Stockholders' equity: Preferred stock - $0.001 par value; 5,000 shares authorized; none issued - - Common stock - $0.001 par value; 300,000 shares authorized; 39,855 and 39,408 shares issued and outstanding 40 39 Additional paid-in capital 465,572 434,584 Deferred stock-based compensation (5,808) (7,494) Retained earnings 94,407 93,915 Accumulated other comprehensive gain (loss) 821 (1,473) ------------- ------------- TOTAL STOCKHOLDERS' EQUITY 555,032 519,571 ------------- ------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 845,559 $ 804,655 ============= =============

Hyperion Solutions Corporation Consolidated Statements of Cash Flows (In thousands) (Unaudited)

Six Months Ended December 31, 2004 2003 ------------- -------------- CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 27,163 $ 16,305 Adjustments to reconcile net income to net cash provided by operating activities: Loss on redemption of debt - 936 Loss on sale of assets 21 96 Depreciation and amortization 19,066 16,407 Provision for accounts receivable allowances 2,090 4,226 Deferred income taxes (2,568) 334 Income tax benefit from exercise of stock options 9,977 3,310 In-process research and development - 2,300 Changes in operating assets and liabilities: Accounts receivable 2,988 (3,700) Prepaid expenses and other current assets 2,599 (874) Other assets 473 1,296 Accounts payable and accrued expenses 4,173 (6,027) Accrued employee compensation and benefits (3,560) (5,713) Income taxes payable 3,097 4,145 Deferred revenue (12,720) (13,526) Other current liabilities 8,438 1,707 Other liabilities (1,258) (715) ------------- -------------- Net cash provided by operating activities 59,979 20,507 ------------- --------------

CASH FLOWS FROM INVESTING ACTIVITIES Purchases of investments - (2,104) Proceeds from maturities of investments - 25,434 Purchases of property and equipment (14,794) (8,756) Proceeds from sale of property and equipment 45 47 Purchases of intangible assets (2,647) (971) Payments for acquisitions, net of cash acquired (3,104) (6,494) ------------- -------------- Net cash provided by (used in) investing activities (20,500) 7,156 ------------- --------------

CASH FLOWS FROM FINANCING ACTIVITIES Redemption of debt - (50,683) Purchases of common stock (37,470) (91,967) Proceeds from issuance of common stock 32,139 18,307 ------------- -------------- Net cash used in financing activities (5,331) (124,343)

Effect of exchange rate on cash and cash equivalents 2,631 4,086 ------------- --------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 36,779 (92,594) Cash and cash equivalents at beginning of period 365,181 398,040 ------------- -------------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 401,960 $ 305,446 ============= ==============

SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest $ 17 $ 2,546 Cash paid for income taxes $ 2,886 $ 3,068

Hyperion Solutions Corporation Supplemental Financial Data ($ in thousands) (Unaudited)

Fiscal 2004 ----------------------------------------------------------- Q1 Q2 Q3 Q4 ----------------------------------------------------------- ---------------------------------------------------------------------- Revenue Analysis

Software License Revenue $43,045 35% $59,701 38% $65,108 39% $72,242 41% Maintenance and Services Revenue: Maintenance Revenue 55,310 45% 68,243 44% 70,975 43% 70,338 40% Consulting and Training Revenue 25,197 20% 28,192 18% 30,061 18% 33,788 19% ---------------------------------------------------------------------- Total Maintenance and Services Revenue 80,507 65% 96,435 62% 101,036 61% 104,126 59% ---------------------------------------------------------------------- Total Revenue $123,552 100% $156,136 100% $166,144 100% $176,368 100% ----------------------------------------------------------------------

---------------------------------------------------------------------- Revenue by Geography

Americas $74,942 61% $95,513 61% $100,057 60% $110,382 63% EMEA 41,836 34% 49,839 32% 54,367 33% 53,738 30% APAC 6,774 5% 10,784 7% 11,720 7% 12,248 7% ---------------------------------------------------------------------- Total Revenue $123,552 100% $156,136 100% $166,144 100% $176,368 100% ----------------------------------------------------------------------

---------------------------------------------------------------------- Software License Revenue by Geography

Americas $22,282 52% $34,086 57% $35,383 54% $41,803 58% EMEA 17,322 40% 19,809 33% 23,286 36% 23,813 33% APAC 3,441 8% 5,806 10% 6,439 10% 6,626 9% ---------------------------------------------------------------------- Total Software License Revenue $43,045 100% $59,701 100% $65,108 100% $72,242 100% ----------------------------------------------------------------------

---------------------------------------------------------------------- Software License Revenue by Channel

Direct $32,504 76% $47,475 80% $46,278 71% $57,246 79% Indirect 10,541 24% 12,226 20% 18,830 29% 14,996 21% ---------------------------------------------------------------------- Total Software License Revenue $43,045 100% $59,701 100% $65,108 100% $72,242 100% ----------------------------------------------------------------------

---------------------------------------------------------------------- Transaction and Customer Information

Average Selling Price $139 $116 $122 $133 Number of Software Transactions greater than $500 14 11 20 17 Number of New Customers 127 155 202 278 Percentage of License Revenue from New Customers 42% 26% 24% 19% ----------------------------------------------------------------------

---------------------------------------------------------------------- Selected Balance Sheet and Cash Flow Information

Cash, Cash Equivalents and Short-Term Invest- ments $408,522 $314,507 $338,654 $368,175 Cash Flow from Operations $14,727 $5,780 $38,196 $27,758 Redemption of Convertible Notes $- $50,683 $- $- Repurchases of Common Stock $26,027 $65,940 $32,975 $6,103 Days Sales Outstanding 64 70 62 68 ----------------------------------------------------------------------

---------------------------------------------------------------------- Headcount

Quota- Carrying Sales Represen- tatives (A) 218 276 285 298 ---------------------------------------------------------------------- Americas Headcount 1,560 71% 1,797 70% 1,789 71% 1,752 70% EMEA Headcount 543 25% 601 24% 575 23% 568 23% APAC Headcount 108 5% 155 6% 173 7% 185 7% ---------------------------------------------------------------------- Total Company Headcount 2,211 100% 2,553 100% 2,537 100% 2,505 100% ----------------------------------------------------------------------

----------------------------------------------------- Fiscal 2005 % % Change Change over over Q1 05 Q2 04 --------------------------------------- Q1 Q2 ----------------------------------------------------- ---------------------------------------------------------------------- Revenue Analysis

Software License Revenue $57,424 36% $68,524 39% 19% 15% Maintenance and Services Revenue: Maintenance Revenue 71,430 45% 75,183 42% 5% 10% Consulting and Training Revenue 30,684 19% 33,271 19% 8% 18% ---------------------------------------------------------------------- Total Maintenance and Services Revenue 102,114 64% 108,454 61% 6% 12% ---------------------------------------------------------------------- Total Revenue $159,538 100% $176,978 100% 11% 13% ----------------------------------------------------------------------

---------------------------------------------------------------------- Revenue by Geography

Americas $97,085 61% $106,652 60% 10% 12% EMEA 52,328 33% 57,910 33% 11% 16% APAC 10,125 6% 12,416 7% 23% 15% ---------------------------------------------------------------------- Total Revenue $159,538 100% $176,978 100% 11% 13% ----------------------------------------------------------------------

---------------------------------------------------------------------- Software License Revenue by Geography

Americas $29,510 51% $37,498 55% 27% 10% EMEA 23,435 41% 25,018 37% 7% 26% APAC 4,479 8% 6,008 9% 34% 3% ---------------------------------------------------------------------- Total Software License Revenue $57,424 100% $68,524 100% 19% 15% ----------------------------------------------------------------------

---------------------------------------------------------------------- Software License Revenue by Channel

Direct $41,930 73% $50,978 74% 22% 7% Indirect 15,494 27% 17,546 26% 13% 44% ---------------------------------------------------------------------- Total Software License Revenue $57,424 100% $68,524 100% 19% 15% ----------------------------------------------------------------------

---------------------------------------------------------------------- Transaction and Customer Information

Average Selling Price $110 $119 8% 3% Number of Software Transactions greater than $500 15 18 20% 64% Number of New Customers 274 282 3% 82% Percentage of License Revenue from New Customers 36% 26% -28% 0% ----------------------------------------------------------------------

---------------------------------------------------------------------- Selected Balance Sheet and Cash Flow Information

Cash, Cash Equivalents and Short-Term Investments $362,551 $404,981 12% 29% Cash Flow from Operations $30,320 $29,659 -2% 413% Redemption of Convertible Notes $- $- N/A N/A Repurchases of Common Stock $35,183 $2,287 -93% -97% Days Sales Outstanding 63 68 8% -3% ----------------------------------------------------------------------

---------------------------------------------------------------------- Headcount

Quota-Carrying Sales Representatives (A) 305 297 -3% 8% ---------------------------------------------------------------------- Americas Headcount 1,704 69% 1,702 68% 0% -5% EMEA Headcount 572 23% 589 24% 3% -2% APAC Headcount 209 8% 205 8% -2% 32% ---------------------------------------------------------------------- Total Company Headcount 2,485 100% 2,496 100% 0% -2% ----------------------------------------------------------------------

(A) All quarters have been adjusted to include EMEA telesales reps.

--30--ALX/sf*

CONTACT: Hyperion Solutions Linda Snyder, 408/588-8405 (Investors) Linda_snyder@hyperion.com Robert Schettino, 408/588-8179 (Media) Robert_schettino@hyperion.com

KEYWORD: CALIFORNIA INDUSTRY KEYWORD: BANKING SOFTWARE NETWORKING INTERNET E-COMMERCE EARNINGS CONFERENCE CALLS SOURCE: Hyperion Solutions

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