PALO ALTO, CA--(Marketwire - Sep 20, 2012) - TIBCO Software Inc. (NASDAQ: TIBX) today announced results for its third fiscal quarter, which ended on Sunday, September 2, 2012.

Total revenue for the third quarter of fiscal 2012 was $255.0 million and net income was $26.1 million, or $0.15 per diluted share. This compares to total revenue of $229.0 million and net income of $23.5 million, or $0.14 per diluted share, as reported for the third quarter of fiscal 2011. 

On a non-GAAP basis, net income for the third quarter of fiscal 2012 was $45.9 million or $0.27 per diluted share, compared with $39.4 million or $0.23 per diluted share for the third quarter of fiscal 2011. Non-GAAP operating income for the third quarter of fiscal 2012 was $68.8 million, an increase of 19% over non-GAAP operating income of $57.6 million in the third quarter of fiscal 2011. Non-GAAP results exclude amortization of acquired intangible assets, stock-based compensation expense, acquisition related and other expenses, restructuring activities and non-cash interest expense related to convertible debt, and assume a non-GAAP effective tax rate of 27% and 30% for the third quarter of fiscal years 2012 and 2011, respectively.

"We continue to steadily build our business, with total revenue and license revenue up by 18% and 14% respectively over the prior year period, after adjusting for currency movements," said Vivek Ranadivé, TIBCO's chairman and CEO. "By marrying mobile, social, cloud and on-premise data streams, our infrastructure software platform provides the backbone for data-in-motion, the ability to make sense of data-at-rest, and the powerful context needed in the 21^st century. TIBCO is in a strategic position to benefit as IT shifts to event-driven architectures and business looks for its two-second advantage -- or the ability to anticipate change and opportunity before and as it happens."

Third Quarter Fiscal 2012 Highlights

• Record Q3 total revenue was $255.0 million, up 11% over last year on a reported basis and up 18% on a constant currency basis;
• Record Q3 license revenue was $99.1 million, up 9% over last year on a reported basis and up 14% on a constant currency basis;
• Q3 non-GAAP operating margin was 27%;
• Q3 non-GAAP EPS was $0.27, up 19% over last year;
• Repurchased 1.2 million shares;
• Q3 total deferred revenue was $280.1 million, up 21% over last year and up 10% over Q2 of 2012;
• Diversified mix of business, with eight different industries comprising 5% or more of business, including Financial Services, Communications, Life Sciences, Energy, Manufacturing, Government, Transportation & Logistics, and Retail.
• TIBCO closed 134 deals over $100k and had 16 deals over $1 million.

Conference Call Details

TIBCO has scheduled a conference call for 4:30 pm ET / 1:30 pm PT today to discuss its third quarter results. The conference call will be hosted by InterCall and may be accessed over the internet at www.tibco.com or via dial-in at 877-293-9114 or 706-758-2055. Please join the conference call at least 10 minutes early to register. A replay of the conference call will be available until midnight PT on October 20, 2012 at www.tibco.com or via dial-in at 800-585-8367 or 404-537-3406. The pass code for both the call and the replay is 28093687.

About TIBCO

TIBCO Software Inc. (NASDAQ: TIBX) is a provider of infrastructure software for companies to use on-premise or as part of cloud computing environments. Whether it's optimizing claims, processing trades, cross-selling products based on real-time customer behavior, or averting a crisis before it happens, TIBCO provides companies the two-second advantage™ -- the ability to capture the right information at the right time and act on it preemptively for a competitive advantage. More than 4,000 customers worldwide rely on TIBCO to manage information, decisions, processes and applications in real time. Learn more at www.tibco.com.

TIBCO, two-second advantage, and TIBCO Software are trademarks or registered trademarks of TIBCO Software Inc. in the United States and/or other countries. All other product and company names and marks mentioned in this document are the property of their respective owners and are mentioned for identification purposes only.

About Non-GAAP Financial Information

This press release includes non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), please see the section entitled "About Non-GAAP Financial Measures" and the accompanying table entitled "Reconciliation of GAAP to Non-GAAP Measures." 

Legal Notice Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the "safe harbor" provisions of the federal securities laws. The final financial results for third quarter of fiscal year 2012 may differ materially from the preliminary results presented in this release due to factors that include, but are not limited to, risks associated with the final review of the results and preparation of financial statements. In addition, forward-looking statements such as statements regarding TIBCO's ability to continue to build its business, TIBCO's ability to benefit from a shift to event-driven architectures with its infrastructure software platform, and TIBCO's belief that this shift will remain a priority that creates opportunities for TIBCO in up markets and down, are subject to risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These risks include but are not limited to: risks arising from adverse changes and uncertainty in domestic and global economies, TIBCO's ability to develop products that address changing market demands, the impact of competition from alternative business models and new product introductions, TIBCO's ability to offer differentiated products that capitalize on current technology trends, and the impact of competition from companies that are larger or have greater resources than TIBCO. Additional information regarding potential risks is provided in TIBCO's filings with the SEC, including its most recent Annual Report on Form 10-K for the year ended November 30, 2011 and Quarterly Report on Form 10-Q for the quarter ended June 3, 2012. TIBCO assumes no obligation to update the forward-looking statements included in this release.

TIBCO Software Inc.
Condensed Consolidated Balance Sheets
(unaudited)
(in thousands)
				September 2, 2012				November 30, 2011
ASSETS
Current assets:
	Cash and cash equivalents			$	675,274			$	308,148
	Short-term investments				196				225
	Accounts receivable, net				206,985				196,419
	Prepaid expenses and other current assets				72,704				61,864
		Total current assets			955,159				566,656
Property and equipment, net					94,862				89,871
Goodwill					530,779				451,821
Acquired intangible assets, net					131,904				97,258
Long-term deferred income tax assets					115,393				78,656
Other assets					71,586				48,676
		Total assets		$	1,899,683			$	1,332,938
LIABILITIES AND EQUITY
Current liabilities:
	Accounts payable			$	25,940			$	25,802
	Accrued liabilities				127,462				129,168
	Accrued restructuring costs				1,139				6,792
	Deferred revenue				257,302				210,234
	Current portion of long-term debt				36,323				2,397
		Total current liabilities			448,166				374,393
Accrued restructuring costs, less current portion					666				1,050
Long-term deferred revenue					22,826				14,876
Long-term deferred income tax liabilities					58,224				4,540
Long-term income tax liabilities					26,513				20,772
Other long-term liabilities					2,883				2,445
Long-term debt, less current portion					-				65,711
Convertible debt					520,715				-
		Total long-term liabilities			631,827				109,394
		Total liabilities			1,079,993				483,787
Total equity					819,690				849,151
		Total liabilities and equity		$	1,899,683			$	1,332,938

TIBCO Software Inc.
Condensed Consolidated Statements of Operations
(unaudited)
(in thousands, except net income per share)
				Three Months Ended								Nine Months Ended
				September 2, 2012				August 28, 2011				September 2, 2012				August 28, 2011
Revenue:
	License			$	99,103			$	90,853			$	273,999			$	242,912
	Service and maintenance				155,918				138,120				454,087				387,823
		Total revenue			255,021				228,973				728,086				630,735
Cost of revenue:
	License				11,368				6,929				29,809				25,566
	Service and maintenance				60,881				56,425				177,417				152,462
		Total cost of revenue			72,249				63,354				207,226				178,028
Gross profit					182,772				165,619				520,860				452,707
Operating expenses:
	Research and development				39,354				36,041				115,280				104,902
	Sales and marketing				76,803				72,182				231,444				203,614
	General and administrative				17,906				15,170				52,908				43,660
	Amortization of acquired intangible assets				4,640				4,632				14,841				14,553
	Acquisition related and other				845				863				2,170				1,686
	Restructuring adjustment				72				143				(447	)			110
		Total operating expenses			139,620				129,031				416,196				368,525
Income from operations					43,152				36,588				104,664				84,182
	Interest income				366				246				842				1,176
	Interest expense				(8,713	)			(940	)			(14,573	)			(2,937	)
		Other income (expense), net			(1,306	)			(503	)			242				(1,929	)
Income before provision for income taxes and noncontrolling interest
					33,499				35,391				91,175				80,492
Provision for income taxes					7,400				11,800				17,900				19,796
Net income					26,099				23,591				73,275				60,696
Less: Net income attributable to noncontrolling interest					13				62				56				168
Net income attributable to TIBCO Software Inc.				$	26,086			$	23,529			$	73,219			$	60,528
Net income per share attributable to TIBCO Software Inc.:
	Basic			$	0.16			$	0.15			$	0.46			$	0.37
	Diluted			$	0.15			$	0.14			$	0.43			$	0.35
Shares used to compute net income per share attributable to TIBCO Software Inc.:
	Basic				159,308				161,876				160,402				161,430
	Diluted				169,165				172,957				169,836				173,703

TIBCO Software Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
					Nine Months Ended
					September 2, 2012				August 28, 2011
Cash flows from operating activities:
	Net income				$	73,275			$	60,696
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation of property and equipment				10,992				9,801
		Amortization of acquired intangible assets				26,719				26,788
		Amortization of debt discount and transaction costs				6,820				579
		Stock-based compensation				45,130				36,186
		Deferred income tax				(20,183	)			3,406
		Tax benefits related to stock benefit plans				14,455				11,773
		Excess tax benefits from stock-based compensation				(20,612	)			(31,506	)
		Other non-cash adjustments, net				905				85
	Changes in assets and liabilities:
		Accounts receivable				(12,079	)			15,887
		Prepaid expenses and other assets				(8,975	)			(8,962	)
		Accounts payable				159				(492	)
		Accrued liabilities and restructuring costs				(5,576	)			(8,380	)
		Deferred revenue				54,285				28,273
			Net cash provided by operating activities			165,315				144,134
Cash flows from investing activities:
	Acquisitions, net of cash acquired					(132,209	)			(22,579	)
	Purchases of property and equipment					(16,366	)			(7,458	)
	Restricted cash pledged as security					(1,169	)			(3,978	)
	Other investing activities, net					376				1,365
			Net cash used in investing activities			(149,368	)			(32,650	)
Cash flows from financing activities:
	Proceeds from issuance of convertible debt, net					584,450				-
	Proceeds from revolving credit facility, net					116,648				-
	Principal payments on debt					(151,785	)			(1,690	)
	Proceeds from issuance of common stock					25,390				42,402
	Repurchases of the Company's common stock					(220,265	)			(145,216	)
	Withholding taxes related to restricted stock net share settlement					(17,383	)			(17,472	)
	Excess tax benefits from stock-based compensation					20,612				31,506
			Net cash provided by (used in) financing activities			357,667				(90,470	)
Effect of foreign exchange rate changes on cash and cash equivalents						(6,488	)			7,212
Net change in cash and cash equivalents						367,126				28,226
Cash and cash equivalents at beginning of period						308,148				243,989
Cash and cash equivalents at end of period					$	675,274			$	272,215

About Non-GAAP Financial Measures

TIBCO provides non-GAAP measures for operating income, net income and net income per share data as supplemental information regarding TIBCO's business performance. TIBCO believes that these non-GAAP financial measures are useful to investors because they exclude non-operating charges. TIBCO's management excludes these non-operating charges when it internally evaluates the performance of TIBCO's business and makes operating decisions, including internal budgeting, performance measurement and the calculation of bonuses and discretionary compensation, because these measures provide a consistent method of comparison to historical periods. Moreover, management believes these non-GAAP measures reflect the essential revenue generation activities of TIBCO. Accordingly, management excludes stock-based compensation related to employee stock options, amortization of acquired intangible assets, costs related to formal restructuring activities, acquisition-related and other expenses, non-cash interest expense related to convertible debt, gains and losses on equity investments, and the income tax effects of the foregoing, as well as adjustments for the impact of changes in the valuation allowance recorded against TIBCO's deferred tax assets when making operational decisions.

TIBCO believes that providing the non-GAAP measures that management uses to its investors is useful to investors for a number of reasons. The non-GAAP measures provide a consistent basis for investors to understand TIBCO's financial performance on a trended basis across historical periods. In addition, it allows investors to evaluate TIBCO's performance using the same methodology and information as that used by TIBCO's management.

Non-GAAP measures are subject to material limitations as these measures are not in accordance with, or a substitute for, GAAP and thus TIBCO's definition may be different from similar non-GAAP measures used by other companies and/or analysts. However, TIBCO's management compensates for these limitations by providing the relevant disclosure of the items excluded in the calculation of non-GAAP operating income, non-GAAP net income and non-GAAP net income per share. In addition, some items such as restructuring charges that are excluded from non-GAAP net income and non-GAAP earnings per share can have a material impact on cash flows and stock compensation charges can have a significant impact on earnings. Management compensates for these limitations by evaluating the non-GAAP measure together with the most directly comparable GAAP measure. TIBCO has historically provided non-GAAP measures to the investment community as a supplement to its GAAP results, to enable investors to evaluate TIBCO's business performance in the way that management does.

The non-GAAP adjustments, and the basis for excluding them, are outlined below:

Amortization of Intangible Assets

TIBCO has incurred amortization of intangible assets, included in its GAAP financial statements, related to various acquisitions TIBCO has made. Management excludes these items, for the purposes of calculating non-GAAP operating income, non-GAAP net income and non-GAAP net income per share. TIBCO believes that eliminating this expense from its non-GAAP measures is useful to investors, because the amortization of intangible assets can be inconsistent in amount and frequency and is significantly impacted by the timing and magnitude of TIBCO's acquisition transactions, which also vary substantially in frequency from period to period.

Stock-based Compensation

TIBCO incurs stock-based compensation expense. TIBCO excludes this item for the purposes of calculating non-GAAP operating income, non-GAAP net income and non-GAAP net income per share because it is a non-cash expense that TIBCO believes is not reflective of its business performance. The nature of the stock-based compensation expense also makes it very difficult to estimate prospectively, since the expense will vary with changes in the stock price and market conditions at the time of new grants, varying valuation methodologies, subjective assumptions and different award types, making the comparison of current results with forward-looking guidance potentially difficult for investors to interpret. The tax effects of stock-based compensation expenses may also vary significantly from period to period, without any change in underlying operational performance, thereby obscuring the underlying profitability of operations relative to prior periods. Finally, TIBCO believes that non-GAAP measures of profitability that exclude stock-based compensation are widely used by analysts and investors in the software industry.

Acquisition-related and Other Expenses

TIBCO incurs acquisition-related and other expenses which consist of costs incurred after the issuance of a definitive term sheet for a particular transaction (whether or not such transaction is ultimately completed, remains in process or is not completed) and include legal, banker, accounting and other advisory fees of third parties and severance costs for employees of the acquired company that are terminated within 90 days of the acquisition date. Management excludes these items, for the purposes of calculating non-GAAP operating income, non-GAAP net income and non-GAAP net income per share. TIBCO believes that eliminating these expenses from its non-GAAP measures is useful to investors, because it generally would not have otherwise incurred such expenses in the periods presented as part of its continuing operations. The acquisition-related and other expenses are not recurring with respect to past transactions, can be inconsistent in amount and frequency from period to period and are significantly impacted by the timing and magnitude of TIBCO's acquisitions. While these expenses are not recurring with respect to past transactions, TIBCO generally will incur these expenses in connection with any future acquisitions.

Restructuring Activities

TIBCO incurs restructuring expenses, included in its GAAP presentation of operating expense, primarily due to workforce related charges such as payments for severance and benefits and estimated costs of exiting and terminating facility lease commitments related to a formal restructuring plan. TIBCO excludes these items, for the purposes of calculating non-GAAP operating income, non-GAAP net income and non-GAAP net income per share, when it evaluates the continuing business performance of TIBCO. TIBCO believes that these items are not consistently recurring and do not necessarily reflect expected future operating expense, nor does TIBCO believe that they provide a meaningful evaluation of current versus past business results or the expense levels required to support TIBCO's operating plan.

Non-Cash Interest Expense Related to Convertible Debt

TIBCO is required to recognize non-cash interest expense related to its 2.25% convertible senior notes issued in April 2012 as an imputed interest expense. Management excludes this incremental non-cash interest expense for purposes of calculating non-GAAP operating income, non-GAAP net income and non-GAAP net income per share. Under the relevant accounting guidance, TIBCO is required to separate the conversion option as an equity component from the debt and account for the debt in a manner that reflects TIBCO's non-convertible debt borrowing rate. This results in the debt component of the convertible notes being treated as though it was issued at a discount, with the debt discount being accreted as additional non-cash interest expense over the term of the notes using the effective interest method. TIBCO believes that excluding this expense from its non-GAAP measures is useful to investors because this incremental interest expense does not represent a cash outflow for the company and is not meaningful in evaluating current versus past business results. Finally, TIBCO believes that non-GAAP measures of profitability that exclude non-cash interest accretion expense are widely used by analysts and investors.

TIBCO Software Inc.
Reconciliation of GAAP to Non-GAAP Measures
(unaudited)
(in thousands, except net income per share)
		Three Months Ended														Nine Months Ended
		September 2, 2012							August 28, 2011							September 2, 2012								August 28, 2011
		Operating Income			Net income attributable to TIBCO Software Inc.				Operating Income			Net income attributable to TIBCO Software Inc.				Operating Income				Net income attributable to TIBCO Software Inc.				Operating Income			Net income attributable to TIBCO Software Inc.
GAAP		$	43,152		$	26,086			$	36,588		$	23,529			$	104,664			$	73,219			$	84,182		$	60,528
	Amortization of intangible assets - cost of revenue		4,714			4,714				2,492			2,492				11,878				11,878				12,235			12,235
	Amortization of intangible assets - operating expense		4,640			4,640				4,632			4,632				14,841				14,841				14,553			14,553
	Stock-based compensation - cost of revenue		1,313			1,313				1,717			1,717				3,711				3,711				3,548			3,548
	Stock-based compensation - R&D expense		3,885			3,885				2,933			2,933				11,244				11,244				8,585			8,585
	Stock-based compensation - S&M expense		5,380			5,380				4,566			4,566				15,367				15,367				12,856			12,856
	Stock-based compensation - G&A expense		4,832			4,832				3,702			3,702				14,808				14,808				11,197			11,197
	Acquisition related and other		845			845				863			863				2,170				2,170				1,686			1,686
	Non-cash interest expense related to convertible debt		-			3,717				-			-				-				5,281				-			-
	Restructuring adjustment		72			72				143			143				(447	)			(447	)			110			110
	Income tax adjustment for non-GAAP		-			(9,582	)			-			(5,132	)			-				(28,008	)			-			(22,215	)
Non-GAAP		$	68,833		$	45,902			$	57,636		$	39,445			$	178,236			$	124,064			$	148,952		$	103,083
Diluted net income per share attributable to TIBCO Software Inc.:
	GAAP				$	0.15						$	0.14							$	0.43						$	0.35
	Non-GAAP				$	0.27						$	0.23							$	0.73						$	0.59
Shares used to compute diluted net income per share attributable to TIBCO Software Inc.:						169,165							172,957								169,836							173,703