Pumatech, Inc. announces preliminary fourth quarter results

SAN JOSE, Calif. (08/08/02) - Pumatech, Inc. (NASDAQ: PUMA), a leading provider of enterprise level software products and services that deliver highly relevant information wherever and whenever it's needed, announced its preliminary results for its quarter ended July 31, 2002.

For its fourth quarter of fiscal 2002, the Company now expects to report revenues in the range of $4.3 million to $4.7 million, a decrease from revenues of $5.7 million reported for the third quarter of fiscal 2002. The company expects to report a pro-forma net loss in the range of $3.0 million to $3.5 million, or a pro-forma diluted loss per share ranging from $(.07) to $(.09), compared to a reported pro-forma loss of approximately $4.5 million or pro-forma diluted loss per share of $(.10) reported last fiscal quarter. Pro-forma losses exclude amortization of intangible assets, non-cash compensation charges and non-recurring charges associated with the restructuring activities in both fiscal Q3 and fiscal Q4.

Reported net loss is expected to range between $12.5 million to $13.0 million, or a diluted loss per share range between $(.28) to $(.30), as compared to a reported net loss of $8.2 million last fiscal quarter or a reported diluted loss per share of $(.21). The company expects to record a charge of approximately $8.0 million this quarter associated with the discontinuance of its on-line service offerings and related technologies as well as facilities consolidations associated with it's Santa Cruz and Nashua facilities, executive severance and severance associated with the restructuring of certain business functions previously announced.

Cash and short-term investments are expected to be approximately $34.4 million as of July 31, 2002, or approximately 75 cents per share, as compared to $37.3M at April 30, 2002. This quarter's decrease in cash and short-term investments of $2.9 million compares to a decrease of $5.2 million reported last fiscal quarter.

During the quarter, the company experienced lower than expected revenue from software licenses impacting both its enterprise and technology licensing revenue segments as well as a decline in professional services revenue associated with the deployment of its technology.

"While this quarter's expected revenue will be below original expectations, we continue to aggressively manage our expense structure to protect our cash position. As previously announced, we have discontinued our on-line service offerings, closed our Santa Cruz and Nashua facilities and have effectively consolidated all U.S. non-field operations in San Jose. Additionally, we have restructured certain business functions further reducing our overall headcount and have implemented a more efficient and cost effective development model relying substantially on lower cost off-shore resources. We expect that the net result of these actions will be a significant decrease in our overall expense structure and therefore our targeted breakeven level," stated Kelly Hicks, vice president of operations and CFO.

Woodson (Woody) Hobbs, president and CEO of Pumatech stated, " Our decline in revenues this quarter is largely due to weak general economic conditions, reduced IT spending and our delays in bringing new products and features to market. Additionally, our decision to exit our on-line service and carrier offerings also contributed to the decline in revenues this quarter. We believe that our recent restructuring will not only further reduce our expenses but it also enables us to focus our development efforts with the goal of re-establishing revenue growth and moving us along the path to sustained profitability."

Pumatech's management expects to offer detail on the quarterly and fiscal year 2002 results during its regular quarterly earnings conference call on August 29, 2002. Details of the conference call are provided below.

INVESTOR CONFERENCE CALL

Management will discuss fourth quarter and fiscal 2002 year-end results and hold a question-and- answer session for investors on August 29, 2002, at 5:00 p.m. Eastern /2:00 p.m. Pacific. To participate, call 706-643-0341 a few minutes ahead of time (no passcode required). If you are unable to participate, a replay will be available from 1:30 p.m. Eastern on Aug. 31, 2002 for 48 hours. To access, please dial 1-800-642-1687, or 1-706-645-9291 (international), reservation number 5245528. In addition, the replay will be available for 90 days via the Internet at www.pumatech.com.

ABOUT PUMATECH
Pumatech, Inc. (NASDAQ: PUMA) provides organizations with a comprehensive suite of enterprise-level software products and services that deliver highly relevant information - wherever and whenever it's needed. The company's portfolio makes Pumatech a single resource, providing the infrastructure necessary to expand the boundaries of information. Organizations can choose to use Pumatech's ready-made enterprise offerings, or they can leverage Pumatech's professional services team to create custom solutions built upon Pumatech's core enterprise platform. Pumatech's customer and strategic partner base includes Global 2000 companies such as Siebel, Oracle, Yahoo! NTT DoCoMo, Boeing, CNET and General Motors. The company has headquarters in Silicon Valley, Tokyo and London. Pumatech offers more information on its products and services at www.pumatech.com.

The forward looking statements above in this news release, including statements related to actual fourth quarter financial results, the impact of the discontinuance of the company's on-line service offerings, the closure of company facilities, the consolidation of company facilities, the restructuring of business functions, cost effective development model relying substantially on lower cost off-shore resources, and the timing and likelihood of anticipated profitability, are based on current expectations and beliefs and are subject to numerous risks and uncertainties that could cause actual results to differ materially. Factors that could cause actual results to differ materially include uncertainties related to the effect of general economic factors on the overall demand for our products and services, the timing of market adoption of wireless computing devices, the timely introduction, availability and acceptance of new products and upgrades, the impact of competitive products and pricing, consummation of binding agreements with prospective business partners and enforceability of the company's patents, as well as additional risk factors, as discussed in the "Risk Factors" section of Pumatech's Annual Report on Form 10-K for the year ended July 31, 2001 and Pumatech's quarterly reports filed from time to time with the U.S. Securities and Exchange Commission. Pumatech disclaims any obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.

Pumatech and the Pumatech logo are trademarks of Pumatech, Inc., that may be registered in certain jurisdictions. All other product and company names may be trademarks their respective owners.