Openwave Reports Second Quarter Fiscal 2010 Financial Results

Openwave Systems Inc. (Nasdaq: OPWV), one of the world's leading software innovators enabling revenue-generating personalized services which converge the mobile and broadband experience, today announced that revenues for the second fiscal quarter ended December 31, 2009 were $49.7 million, compared with $49.8 million in the prior quarter ended September 30, 2009 and $48.1 million in the December quarter in the preceding fiscal year. Bookings for the second quarter of fiscal 2010 were $46.5 million. The company ended the quarter with $128.5 million in cash and investments.

"The quarterly results demonstrate Openwave's progress over the past year and our commitment to financial discipline," said Ken Denman, CEO of Openwave. "Having anticipated the dramatic increase in mobile data traffic, we have focused on realigning our product portfolio to enable our customers to better capitalize on this unprecedented demand. We're bringing to market new context-aware software solutions that deliver intelligent bandwidth management and enable new revenue opportunities, and will begin unveiling these new solutions later this month at Mobile World Congress."

On a GAAP basis, net income for the second fiscal quarter ended December 31, 2009 was $213,000 or $0.00 per share, compared with a net income of $990,000, or $0.01 per share, in the prior quarter and a net loss of $64.2 million, or $0.77 per share, in the December quarter in the preceding year. GAAP net loss for the December quarter of the prior year included an impairment to goodwill of $59.5 million.

On a non-GAAP basis, net income for the second fiscal quarter ended December 31, 2009 was $3.5 million, or $0.04 per share, compared with a net loss of $380,000 or $0.00 per share, in the prior quarter and net income of $1.4 million, or $0.02 per share, during the December quarter of the prior year. Non-GAAP net income (loss) excludes discontinued operations, amortization of intangibles and other acquisition-related costs, stock-based compensation, professional fees associated with certain unusual events, impairments, restructuring, realized losses on auction rate securities and other-than-temporary impairments of investments and the tax impact of these items.

A reconciliation between net income (loss) on a GAAP basis and a non-GAAP basis is provided below in a table immediately following the Condensed Consolidated Statements of Operations.

Non-GAAP Measure
The Company's stated results include the non-GAAP measures: non-GAAP net loss and non-GAAP net loss per share. These non-GAAP measures exclude certain items that generally are non-recurring events, such as costs associated with Openwave's stock option lawsuit. Additionally, these non-GAAP measures exclude other items that are non-cash items that many other companies exclude, in order to compare Openwave with other companies, such as stock-based compensation and amortization of intangibles. These non-GAAP measures also exclude items which management does not consider when evaluating Openwave's on-going business, such as restructuring costs and discontinued operations. Openwave considers non-GAAP net income (loss) to be an important measure because it provides a useful measure of the operational performance of Openwave and is used by Openwave's management for that purpose. In addition, investors often use measures such as these to evaluate the financial performance of a company. These non-GAAP measures are presented for supplemental informational purposes only for understanding Openwave's operating results. These non-GAAP results should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from non-GAAP measures used by other companies.

Conference Call Information
Openwave has scheduled a conference call for 5:00 p.m. eastern time today to discuss its financial results for its second quarter ended December 31, 2009. Interested parties may access the conference call over the Internet through Openwave's website at www.openwave.com or by telephone at (877) 941-1427 or (480) 629-9664 (international). A replay of the conference call will be available for two weeks beginning at approximately 8:00 p.m. eastern time today by calling 800-406-7325. The replay can be accessed internationally by calling 303-590-3030. Reservation number: 4202622.

A live webcast of the call, together with supplemental financial information, will also be available on the Quarterly Earnings section of Openwave's website at http://investor.openwave.com for at least 12 months.