Informix Corporation Announces Third Quarter 2000 Results

Informix Corporation, a technology leader for the new economy, reported results for the third quarter ended September 30, 2000.

Revenue for the third quarter totaled $211.1 million, compared with $261.1 million in the same quarter last year. Included in third quarter 2000 results were charges of $67.2 million, mostly related to the Company's previously announced plans to establish two separate, independent operating companies focused on database and e-Business solutions, respectively. Before these charges, the net loss for the quarter was $18.5 million, or $(0.06) per diluted share, compared to net income in the 1999 third quarter of $25.8 million, or $0.09 per diluted share. Including these charges, Informix reported a net loss of $85.7 million, or $(0.30) per diluted share.

Revenues of the newly-formed Solutions business were $28.9 million, compared with $23.7 million in the same period of 1999, and grew sequentially at a 52% annualized rate from $25.6 million in the second quarter of 2000 fueled by strong business intelligence license sales. Revenues of Informix Software, the Company's Database business, were $182.2 million in the 2000 third quarter, compared with $237.4 million in the comparable period of 1999. The bulk of this decline was in license and services revenue from traditional databases and tools associated with client-server applications, which have experienced lower demand post-Y2K. The change in currency exchange rates had approximately a $10 million negative impact on revenue as well. International sales represented 52% of the Company's revenue during the third quarter of 2000.

Peter Gyenes, Chairman and Chief Executive Officer, commented, "Results in the third quarter came in toward the higher end of our revised expectations. As we commented previously, while we bore the burden of a post-Y2K slowdown in demand of traditional client-server products and weak foreign currencies, the primary cause of the Company's under-performance has been poor execution."

Mr. Gyenes continued, "Nevertheless, the third quarter represents an inflection point for Informix in our efforts to regain the Company's previous stature and momentum. During the quarter, we redefined Informix by creating separate operating companies, one dedicated to the database market and one dedicated to the e-Business solutions markets. We believe that this structure has already brought the necessary focus on each of the markets we serve and has allowed us to properly size and align our resources to maximize each company's opportunities for revenue and market share growth."

Mr. Gyenes concluded, "We look forward to the fourth quarter of 2000 and beyond with optimism and confidence. The markets for our high-performance enterprise database products and e-Business solutions remain very robust. With our newly re-energized organization, we expect to demonstrate sequentially improved results from the third quarter levels. Revenue growth should be generated by the improved productivity of our more focused and maturing sales forces, new product introductions, and enhanced relations with our strategic partners. Profitability is expected to rise as lower operating expenses from our right-sizing initiatives take hold. We now expect to return to profitability in the current quarter, before previously announced charges, and to continue sequential revenue and profitability growth throughout 2001. As we continue to improve the execution of our plans while communicating and demonstrating our strategies, our accomplishments, and our customer commitments to the marketplace, we expect our results to reflect the success of our actions."

Third Quarter Highlights

Informix Corporation achieved the following during the third quarter:

• Began implementing its strategy for realigning the Company. Five former business units were consolidated into two operating companies: Informix Software, which focuses on database management systems optimized for data warehousing, transaction processing, and e-Business environments; and the new Informix e-Business solutions company, to be named by year-end, which is focused on providing database and platform independent software solutions and infrastructure for the e-Business marketplace.
• Announced its intention to create two publicly-traded companies from this structure.
• Established a new senior management team supporting the two operating companies. Peter Gyenes and Jamie Arnold were appointed Chairman and Chief Financial Officer, respectively, of Informix Corporation, the parent company of Informix Software and the newly-created e-Business solutions company. Jim Foy and Pete Fiore were named presidents of Informix Software and the Solutions Company, respectively. Mr. Gyenes continues in his role as president and CEO of Informix Corporation.
• Entered into partnering relationships with PricewaterhouseCoopers; Compaq/Suse; Meridex; S1; i2 Technologies, and Logica.
• Added 236 new customers.
• Ended the quarter with $242.5 million in cash on its balance sheet and no debt.

Informix e-Business solutions company achieved the following during the third quarter:

• Delivered Release 2.0 of the DataStage Extract PACK for SAP R/3 and added 12 new customers for the product during the quarter, including Anheuser-Busch, SC Johnson Wax, and LVMH.
• LVMH and General Motors each selected DataStage as their platform for corporate-wide data integration initiatives.
• Won Internet/Web product of the year for its Informix i.Sell solution, the company's complete end-to-end e-business offering, at the United Kingdom's annual Networking Awards organized by Network News and Miller Freeman.
• Signed new licensing agreements with Merrill Lynch, Commerce Bank, Benetton and Bonneville Power.
• Announced i.Decide Web Success the first end-to-end, business analysis solution that integrates Web data and traditional enterprise data to provide a comprehensive perspective of an e-business. Airtel is the first customer for this product.

Informix Software achieved the following during the third quarter:

• Announced the newest release of XPS and set a world record with the product in the 1000GB TPC-H benchmark on a single node system, underscoring the Company's performance leadership in enterprise-wide data warehousing. The company also extended its relationships with current XPS customers including Galileo, Healtheon/WebMD and Vital Processing Services.
• Announced an agreement to become a Symbian Technology partner to enable enterprise applications for the post-PC wireless age. Further, it has ported its Cloudscape database to the Symbian platform to help enable enterprise applications for users of Symbian-based Smartphones and Communicators.
• Experienced strong demand from the telecommunications market with continuing sales to SBC, Motorola, Lucent, and AT&T.
• Signed a contract with Nokia, the world's largest mobile communications equipment provider, and delivered the initial licenses of Informix technology, which will be embedded within Nokia's mobile infrastructure product.
• Continued its penetration into the new economy with new sales of Foundation2000 at Columbia Tristar, iExchange.com, and Jackpot.com.

About Informix Software

Informix Software, an independent operating business of Informix Corporation, develops and markets database management systems optimized for data warehousing, transaction processing, and e-Business environments. Informix Software is developing a broad network of partner and ISV relationships to expand the portfolio of applications available on its database product line for a range of markets including wireless, e-commerce, and CRM.

About Informix Business Solutions

Informix Business Solutions, an independent operating business of Informix Corporation, develops and markets a suite of next generation software solutions and infrastructure for e-Business that integrate content, eCommerce, and business intelligence. Informix Corporation intends to rename Informix Business Solutions by year end. For more information, contact the nearest sales office or see related press release "Informix Establishes Two Independent Operating Companies," Sept. 19, 2000, at Informix' Web site, www.informix.com.