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Peoplesoft License Revenues Increase 37 Percent


PEOPLESOFT LICENSE REVENUES INCREASE 37 PERCENT

Strong Growth in CRM and Core Business Applications

Auckland - July 21, 2000 - PeopleSoft Inc. (Nasdaq: PSFT) announced today its financial results for the quarter ended June 30, 2000. Revenues, net income and net income per share from recurring operations for the second quarter of 2000 were $420.2 million, $15.9 million and $0.06, respectively. This compares with revenues, net income and net income per share from recurring operations of $360.7 million, $1.6 million and $0.01, respectively, for the second quarter of 1999.

Revenues from software license fees for the second quarter of 2000 increased to $109.8 million, a 37% increase from the same quarter last year, reflecting continued strong demand for the company’s eBusiness applications. PeopleSoft experienced significant growth compared with the same quarter last year in Human Resource Management and Financial applications – up 38%, and Supply Chain Management applications – up 44%. Customer Relationship Management (CRM) applications emerged as PeopleSoft’s largest license revenue product line in the quarter. License revenues increased in all major geographic regions, with the United States growing 49% and International growing 31% assuming constant currency exchange rates.

Expenses were $404.0 million for the second quarter of 2000, compared with $365.7 million in the same quarter last year. The increases were primarily in product development, cost of development services and sales and marketing. Development costs increased due to the continuing costs associated with completing the development of PeopleSoft 8, the company’s pure-Internet suite of eBusiness applications which was publicly launched in July 2000. Sales and marketing expenses increased as the company invested in additional sales personnel and marketing campaigns to drive PeopleSoft 8.

Management Commentary

“Demand for PeopleSoft was strong across every product line and geography,” said PeopleSoft President and Chief Executive Officer Craig Conway. “It is a major milestone that license revenue exceeded the $100 million mark for the first time since 1998. This is especially significant coming in the quarter prior to the launch of PeopleSoft 8.”

“In the last quarter we have dramatically increased our market position and visibility,” said Executive Vice President of Worldwide Marketing and Strategy Baer Tierkel. “We are excited with the overwhelmingly positive initial reviews of PeopleSoft 8, our new pure Internet suite of eBusiness applications. In order to maximize the revenue opportunity presented by PeopleSoft 8, we are rapidly adding field sales resources and have launched the largest marketing campaign in PeopleSoft’s history.”

“This quarter marks the transformation of PeopleSoft to an eBusiness company” added Conway. “With the launch of PeopleSoft 8 in the third quarter, PeopleSoft expects to be a dominant competitor in the eBusiness applications market.”

In Asia Pacific

In Asia Pacific, licence revenue increased by 40%, service revenue increased by 19% and total revenue increased by 26%, when compared with the second quarter of 1999.

“PeopleSoft Asia Pacific has enjoyed a very successful second quarter,” said Andrew Barkla, Regional Vice President, PeopleSoft Asia Pacific. “We have won some of the most prestigious customers in the region, and seen particularly strong growth in our newer product lines, Customer Relationship Management and Enterprise Performance Management. We have also expanded our team to include a number of the industry’s leading executives and are undergoing rapid expansion in North Asia.

“With the momentum we have gathered in the past two quarters, and the launch of PeopleSoft 8 this month, I believe we are well on track to achieve our forecast of 30% annual growth,” Mr Barkla added.

Quarterly Highlights

PeopleSoft continued an aggressive introduction of eBusiness applications in Q2 2000. The following highlights were announced or occurred since PeopleSoft’s last earnings release.

eBusiness
 Delivered PeopleSoft CRM for Communications, a complete Internet solution for service providers.
 Unveiled first CRM Internet platform for integrated Front- and Back-Office eBusiness solutions.
 Delivered Vantive Asset and Configuration Management to enable the management of technology investments.
 Shipped Wireless CRM for eBusiness in North America - Vantive Mobile FieldService for RIM Inter@ctive Pagers.
 Bolstered Internet-based, eBusiness Analytic product line by acquiring Advance Planning Solutions.
 Delivered pure Internet global eProcurement Solution - PeopleSoft eProcurement 2.0.
 Announced first pure Internet, integrated, global staffing solution – PeopleSoft Staffing Front Office.
 Launched PeopleSoft MarketPlace in North America and implemented first customer.

Accolades
 PeopleSoft eBusiness Applications #1 in ASP Industry with more than 125 customers.
 PeopleSoft 8 Enterprise Performance Management was rated "Outstanding" by luminary Bill Inmon.
 PeopleSoft University won Excellence Award from Corporate University Xchange.
 Marketing programs won prestigious awards, including the Silver ICON and two Addy awards.

Leadership
 CRM luminary Sam L. Gallucci joined PeopleSoft to head CRM Division.
 Former Oracle executive Kerry P. Lamson joined PeopleSoft to head MarketPlace Solutions Division.
 Former EDS executive Michael P. Gregoire joined PeopleSoft Consulting as SVP of North America.
 Expanded global partnership to provide eBusiness Applications with IBM's DB2 universal database.
 Forged an ASP initiative with PricewaterhouseCoopers to host PeopleSoft’s industry leading solutions.

About PeopleSoft
PeopleSoft is the world’s leading provider of eBusiness applications that enable people - customers, employees, and suppliers - to power the Internet. PeopleSoft’s pure Internet Customer Relationship Management, Supply Chain Management, and Enterprise Management solutions provide the industry’s most open and flexible e-commerce platform. PeopleSoft employs more than 7,000 people worldwide, including 2,400 eBusiness consultants. More than 4,500 organisations in 107 countries run on PeopleSoft eBusiness applications.

PeopleSoft began operations in Asia Pacific in 1993 and now has offices in Sydney, Melbourne, Canberra, Perth, Brisbane, Adelaide, Auckland, Wellington, Singapore, Hong Kong and Malaysia. Its customers include AAP, AMP, Alcoa, Australian National University, Australian Stock Exchange, Coles Myer, Department of Defence, Eastern Energy, Ford, Foxtel, John Fairfax Holdings, Loy Yang Power, National Mutual Health Insurance, NZ Police, NZ Post, UNITEC, Reserve Bank of Australia, Reding Paper Products, Transfield Pty Ltd, University of NSW, WA Department of Education and WA Petroleum, Hewlett-Packard, Citibank, AMD, DBS Bank, PSA Corporation, Singapore Ministry of Finance, Morrison Express, Singtel, Starhub, Tenaga Nasional, Telekom Malaysia and Swire Properties. For further information, please visit www.peoplesoft.com

Media information:
Imogen Riley Peter Hennessey
PeopleSoft Botica Conroy & Associates
Phone: +61 2 9413 0120 Phone: +64 9 303 3862
Fax: +61 2 9413 0001 Fax: +64 9 303 3610
Mobile: 0412 774 144 Mobile: 021 403 504
Imogen_Riley@peoplesoft.com peterh@bca.co.nz


This release contains projections or other forward-looking statements regarding future events or the future financial performance of the Company that involve risks and uncertainties. Readers are cautioned that these statements are only predictions and may differ materially from actual future events or results. The specific forward-looking statements relate to such matters as expectations regarding future competitive position; new product development status, including the timing of availability of PeopleSoft 8 (please refer to the risk factor entitled “PeopleSoft could experience fluctuations in quarterly operating results which could adversely impact its stock price”); position in the Internet sector; and future growth. Please refer to the Company's annual report to shareholders (Form 10-K) and subsequent filings on Form 10-Q for more information on the risk factors that could cause actual results to differ.

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