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PeopleSoft Announces Record Quarterly Revenue

PeopleSoft Asia Pacific License Revenue Grows 108 Percent

Auckland – July 25, 2001 -- PeopleSoft Inc. (Nasdaq: PSFT) today announced record financial results for the quarter ended June 30, 2001. Total revenue increased 27 percent over the second quarter of last year to $533 million. It was the highest revenue in company history and the fifth consecutive record quarter.

Continued market demand for PeopleSoft’s collaborative enterprise applications drove second quarter license revenue up 51 percent over the second quarter of last year to $166 million. Service revenues rose 20 percent over the same quarter of last year to $337 million as customer adoption of PeopleSoft 8 drove increased demand for the Company’s service offerings.

Net income from recurring operations increased sharply, rising 188 percent to $46 million, or $0.14 per share, up from $16 million, or $0.06 per share, in the same quarter of 2000.

Including non-recurring items, second quarter net income rose to $47 million, or $0.15 per share. The second quarter of 2001 includes two non-recurring items; a favourable after-tax adjustment to existing restructuring reserves of $2.6 million and an after-tax charge of $1.1 million related to the acquisition of SkillsVillage.

The company’s cash and investments were $1.4 billion at June 30, 2001, an increase of $247 million during the quarter. Day’s sales outstanding (DSO) improved to 68 days from 77 days over the same period.

Management Commentary
“PeopleSoft’s strong performance in this challenging economic environment is a direct result of continued market acceptance of PeopleSoft 8 enterprise applications and our diligent focus on precision management and execution,” said President and CEO Craig Conway.
“In this difficult market, customers are particularly concerned with increasing productivity and reducing costs,” Conway said. “Moving enterprise applications to the internet enables companies to immediately realize these business benefits. PeopleSoft 8, based on a pure internet architecture, is the technology that is driving this dramatic shift.

“In June, PeopleSoft delivered PeopleSoft 8 CRM, the first and only CRM solution to run entirely on the internet,” Conway said. “The on-time delivery of this next generation CRM solution further demonstrates PeopleSoft’s continued leadership in providing integrated, best-of-breed applications.

“In addition to delivering industry-leading products and services, PeopleSoft continues to be an extremely well-managed company,” Conway concluded. “Our cash position and DSO are the strongest in PeopleSoft’s history. At a time when our competitors are reporting slower growth, PeopleSoft continues to demonstrate market leadership and report strong financial results.”

Customer Wins
PeopleSoft won significant deals against its competitors in the second quarter in all product lines and across all geographies. Enterprises buying PeopleSoft enterprise applications included: 24 Hour Fitness, AT&T Wireless, Credit Suisse Group, Dana Farber Cancer Institute, U.S. Department of Defense, France Telecom, Hewlett Packard Co., Morgan Stanley Dean Witter & Co., Nextel Communications Inc., PricewaterhouseCoopers LLP, Ross Stores Inc., Siemens Business Services Inc., TD Waterhouse Group Inc., Tiffany & Co. and Waste Management Inc.

In Asia Pacific
Across Asia Pacific, PeopleSoft recorded strong growth over the second quarter of 2000, with total revenue increasing by 71 percent, with 108 percent growth in license revenue and 43 percent in services revenue in constant USD.

The Region continued to secure new customers for it’s industry-leading enterprise solutions including Aon Risk Services Australia, Kaz, Griffith University, GME, CNPC Engineering and Services Limited, Health Science Authority, Hong Leong, Mahindra BT, Novel Group, P&O Ports and Telecom New Zealand Australia. A number of customers also went live on PeopleSoft 8 including Jupiters Limited, Lang Corporation and StarHub.

In Australia, where PeopleSoft was competing against top CRM vendor Siebel, Aon Risk Services was signed as a PeopleSoft 8 CRM customer.

“PeopleSoft 8 CRM delivers not only the functionality we need, but because it’s pure internet, it’s easy to use and simple and quick to deploy – which means lowered infrastructure and training costs. Simply put, PeopleSoft are the only vendor who meet our every requirement – technology, functionality and cultural fit,” Aon Australia CEO Mr. Peter Harmer said.

“It’s been a milestone quarter for PeopleSoft, during which we delivered the industry’s first and only pure internet Customer Relationship Management (CRM) solution – PeopleSoft 8 CRM,” said David Webster, PeopleSoft Managing Director for Australia and New Zealand. “The market and our customers have greeted the solution extremely positively, and we are looking forward to seeing it deliver significant value and return to our customers. With the signing of Aon earlier this quarter and our strong sales pipeline, we are bullish about the uptake of this new technology.”

Following the worldwide launch and General Availability of PeopleSoft 8 CRM in June, PeopleSoft continues to drive aggressive growth in this market. Customer commitment to and interest in CRM across Asia Pacific was confirmed when almost 800 delegates attended events unveiling PeopleSoft 8 CRM in June. New appointments to CRM roles across the Region included Alan Hyde as PeopleSoft Sales Director for Australia and New Zealand, and Ray Kloss as Product Marketing Manager for PeopleSoft Customer and Supplier solutions.

In Asia Pacific PeopleSoft also continues it’s dominance of HRMS, with local language product being delivered in Chinese, and local payroll extensions being delivered in Hong Kong and Australia before the end of the year, with payroll for Malaysia, Singapore and New Zealand planned for 2002.

PeopleSoft’s employees grew 31% over the past year across the Region, with the company currently employing over 450 staff.

Ends

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