Informatica Reports Record 2006 Revenues of $325 Million With 21 Percent Annual Growth

Informatica Corporation (Nasdaq: INFA), a leading provider of data integration software, today announced financial results for the fourth quarter and the year ended December 31, 2006.

Revenues for the fourth quarter of 2006 were $91.8 million, up 15 percent from the $79.8 million recorded in the fourth quarter of 2005. License revenues for the fourth quarter were $42.9 million, up 10 percent from the $39.0 million recorded in the fourth quarter of 2005. Net income for the fourth quarter, calculated in accordance with U.S. generally accepted accounting principles (GAAP), was $13.9 million or $0.15 per diluted share, versus net income of $13.6 million or $0.14 per diluted share in the fourth quarter of 2005. Results for the fourth quarter of 2006 reflect the impact of share-based compensation as required by Financial Accounting Standards (FAS) 123R, whereas 2005 results exclude these expenses. Non-GAAP net income for the fourth quarter of 2006 was $18.6 million or $0.20 per diluted share, up over 25 percent from $14.7 million or $0.16 per diluted share in the fourth quarter of 2005. Non-GAAP net income excludes charges related to purchased in-process research and development, share-based compensation, facilities restructurings, and the amortization of acquired technology and intangible assets. A reconciliation of GAAP results to non-GAAP results is included below.

For the year ended December 31, 2006, revenues were $324.6 million, up 21 percent from $267.4 million recorded in 2005. License revenues for the year 2006 were $146.1 million, up 22 percent from $120.2 million for the year 2005. GAAP net income for the year ended December 31, 2006 was $36.2 million or $0.39 per diluted share, versus $33.8 million or $0.37 per diluted share for the year ended December 31, 2005. Results for 2006 reflect the impact of share-based compensation as required by Financial Accounting Standards (FAS) 123R, whereas 2005 results exclude these expenses. Non-GAAP net income for the year 2006 was $57.7 million or $0.62 per diluted share, up over 44 percent from $39.3 million or $0.43 per diluted share for the year 2005.

"Guided by our singular mission, we achieved record financial results and gained market share in both the data integration and data quality categories," said Sohaib Abbasi, chairman and CEO of Informatica. "The combination of the highest ever customer demand and most competitive products, positions us strongly to realize the substantial growth opportunity in the data integration market."

Significant milestones achieved since October 2006 include:

-- Signed repeat business with 257 customers. Customers continue to

derive considerable value from their investments in Informatica

solutions. Repeat customers included AEGON Nederland NV, Bank of

America, Barclays Global Investors, California State Automobile

Association, CEMEX, Honeywell, IBM Corporation, Linkshare, Manulife

Financial, Philips International, Seagate Technology, and Shoppers Drug

Mart.

-- Added 91 new customers. Informatica increased its customer base this

quarter to 2,749 companies including 59 new Informatica customers and

32 customers added through the Itemfield acquisition. New customers

include Alliant Techsystems, BankUnited Financial, Chinatrust

Commercial Bank, Danske Bank A/S, Kellogg, Brown & Root, Ministero

della Giustizia Italiana, NetWork for Electronic Transfers, Pepco

Energy Services, Rollins Inc., and Wendy's International.

-- Acquired Itemfield, a leading data transformation vendor. Itemfield's

technology enables near-universal access to unstructured and semi-

structured data. The acquisition further extends Informatica's

leadership in enterprise data integration with additional cross-

enterprise data exchange technology. Industry-specific, data exchange

formats supported include SWIFT, NACHA, ACORD, RosettaNet, HIPAA and

HL7.

-- Announced latest releases of data quality products. Informatica Data

Quality 3.1 and Informatica Data Explorer 5.0. were made generally

available in November 2006, delivering enhanced value for customers

looking to implement best-in-class data quality processes. These

include simple yet powerful business-oriented user interfaces; new

capabilities that increase user and developer productivity; and end-to-

end integration with the Informatica PowerCenter data integration

platform, enabling data profiling and cleansing to become integral

components of the overall data integration lifecycle.

-- Informatica extends global education services reach. Informatica,

NIIT, Softtek and Visionary Integration Professionals entered into new

product training partnerships in India, Latin America and U.S. to

deliver hands-on training for Informatica data integration products.

In teaming with local companies in key geographies, Informatica is

making it easier and more cost-effective for customers and systems

integrators to leverage expert data integration instruction.

-- Recognized as a "Leader" in first DI tools Magic Quadrant. Informatica

is the only independent data integration software company positioned on

the completeness of vision and ability to execute axes in the "leaders"

quadrant. The positioning reflects the market response to Informatica's

singular focus on data integration, consistent track record of

innovation that genuinely benefits customers, and commitment to a

positive customer service and support experience.

Conference Call and Webcast

Informatica will be discussing its fourth quarter and annual 2006 results on a conference call today beginning at 2:00 p.m. PST. A live Webcast of the conference call will be available at http://www.informatica.com/investor . A replay of the call will also be available by dialing 617-801-6888, reservation number 54718905.

About Informatica

Informatica Corporation is a leading provider of enterprise data integration software and services. Using Informatica products, companies gain greater business value by integrating all their information assets. More than 2,700 companies worldwide rely on Informatica to reduce the cost and expedite the time to address data integration needs of any complexity and scale. For more information, call 650-385-5000 (1-800-653-3871 in the U.S.), or visit http://www.informatica.com.

INFORMATICA CORPORATION

GAAP TO NON-GAAP RESULTS

(in thousands, except per share data and percentages)

(unaudited)

Three Months Ended Years Ended

December 31, December 31,

2006 2005 2006 2005

GAAP Net income $13,925 $13,553 $36,206 $33,804

Plus:

Amortization of acquired technology 573 226 2,118 922

Amortization of intangible assets 199 47 653 188

Facilities restructuring charges (174) 781 3,212 3,683

Purchased in-process research and

development - - 1,340 -

Share-based payment compensation 4,123 49 14,138 723

Non-GAAP Net income $18,646 $14,656 $57,667 $39,320

Three Months Ended Years Ended

December 31, December 31,

2006 2005 2006 2005

Diluted net income per share:

Diluted GAAP Net income per share $0.15 $0.14 $0.39 $0.37

Plus:

Amortization of acquired technology 0.01 0.01 0.02 0.01

Amortization of intangible assets - - 0.01 -

Facilities restructuring charges - 0.01 0.04 0.04

Purchased in-process research and

development - - 0.01 -

Share-based payments 0.04 - 0.15 0.01

Diluted Non-GAAP Net income per share $0.20 $0.16 $0.62 $0.43

Shares used in computing diluted GAAP

Net income per share 103,176 94,163 92,942 92,083

Shares used in computing diluted Non-

GAAP Net income per share 103,692 94,163 93,679 92,083

Non-GAAP Financial Information

To supplement the company's condensed consolidated financial statements presented on a GAAP basis, Informatica uses non-GAAP financial measures of net income and net income per share. These measures are adjusted to exclude the charges and expenses discussed above. The company believes the disclosure of such non-GAAP financial measures is appropriate to enhance an overall understanding of its historical financial performance. These adjustments to the company's GAAP results are made with the intent of providing both management and investors a more complete understanding of the company's underlying operational results, trends, and marketplace performance. Informatica believes that the inclusion of these non-GAAP financial measures provides consistency and comparability with its historical financial results, as well as comparability to similar companies in the company's industry, many of which present similar non-GAAP financial measures to investors. In addition, these non-GAAP financial measures are among the primary indicators management uses as a basis for its planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income or net income per share prepared in accordance with GAAP in the U.S.

Safe Harbor

This press release contains forward-looking statements relating to our opportunity for growth in the data integration market, potential impact of our acquisition of Itemfield and efforts being conducted with strategic training partners. Such statements involve risks and uncertainties, and actual results may differ materially from the results described in this press release. The potential risks and uncertainties that could cause actual results to differ include, among others, risks related to (1) competition with larger companies that have longer operating histories and greater financial, technical, marketing, and other resources; (2) uncertainty in the state of IT spending and the continued growth in the market for data integration solutions in general; (3) successful integration of Itemfield's technology and its employees into Informatica; and (4) lack of control regarding our strategic partners' devotion of adequate resources to promote, sell, implement, and support our products, as well as those risks and uncertainties included under the caption "Risk Factors" in Informatica's report on Form 10-Q for the quarter ended September 30, 2006, which is on file with the SEC and is available on the company's investor relations website at http://www.informatica.com/ . All information provided in this release is as of January 25, 2007, and Informatica undertakes no duty to update this information.

NOTE: Informatica, Informatica Data Quality, Informatica Data Explorer and PowerCenter are registered trademarks of Informatica Corporation in the United States and in jurisdictions throughout the world. All other company and product names may be trade names or trademarks of their respective owners.

INFORMATICA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

Three Months Ended Years Ended

December 31, December 31,

2006 2005 2006 2005

Revenues:

License $42,859 $38,955 $146,092 $120,182

Service 48,942 40,883 178,506 147,249

Total revenues 91,801 79,838 324,598 267,431

Cost of revenues:

License 3,164 1,758 6,978 4,465

Service 16,056 13,385 58,402 46,801

Amortization of

acquired technology 573 226 2,118 922

Total cost of

revenues 19,793 15,369 67,498 52,188

Gross profit 72,008 64,469 257,100 215,243

Operating expenses:

Research and

development 13,928 11,101 54,997 42,585

Sales and marketing 38,061 36,072 138,851 118,770

General and

administrative 7,612 5,337 28,187 20,583

Amortization of

intangible assets 199 47 653 188

Facilities restructuring

charges (174) 781 3,212 3,683

Purchased in-process

research and development - - 1,340 -

Total operating

expenses 59,626 53,338 227,240 185,809

Income from

operations 12,382 11,131 29,860 29,434

Interest income

and other, net 3,183 2,029 11,823 6,544

Income before income

taxes 15,565 13,160 41,683 35,978

Income tax provision

(benefit) 1,640 (393) 5,477 2,174

Net income $13,925 $13,553 $36,206 $33,804

Basic net income

per common share $0.16 $0.15 $0.42 $0.39

Diluted net income

per common share (1) $0.15 $0.14 $0.39 $0.37

Shares used in

computing basic

net income per common

share 86,168 87,651 86,420 87,242

Shares used in

computing diluted

net income per

common share 103,176 94,163 92,942 92,083

(1) Diluted EPS is calculated under the "if converted" method for the

three months ended December 31, 2006. This includes an add-back of

$1,749 in interest and issuance cost amortization, net of income

taxes.

INFORMATICA CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

December 31,

2006 2005

Assets

Current assets:

Cash and cash equivalents $120,491 $76,545

Short-term investments 280,149 185,649

Accounts receivable, net of allowances of

$1,666 in 2006 and $1,094 in 2005 65,407 50,533

Prepaid expenses and other current assets 10,424 9,342

Total current assets 476,471 322,069

Restricted cash 12,016 12,166

Property and equipment, net 14,368 21,026

Goodwill and intangible assets, net 187,317 85,229

Other assets 6,593 532

Total assets $696,765 $441,022

Liabilities and stockholders' equity

Current liabilities:

Accounts payable and other current

liabilities $62,400 $45,844

Accrued facilities restructuring charges 18,758 18,718

Deferred revenues 85,364 69,748

Total current liabilities 166,522 134,310

Convertible senior notes 230,000 -

Accrued facilities restructuring

charges, less current portion 65,052 75,815

Deferred revenues, less current portion 7,035 8,167

Deferred tax liability, non-current 993 -

Stockholders' equity 227,163 222,730

Total liabilities and

stockholders' equity $696,765 $441,022

INFORMATICA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

Years Ended

December 31,

2006 2005

Operating activities:

Net income $36,206 $33,804

Adjustments to reconcile net income to net

cash provided by operating activities:

Depreciation and amortization 10,104 9,198

Share-based payment compensation

expense and amortization of

stock-based compensation 14,138 723

Amortization of intangible assets

and acquired technology 3,605 1,144

Impairment of property and equipment 2,668 -

Allowance (recovery) for doubtful accounts

and sales returns allowances (32) 350

Purchased in-process research and

development 1,340 -

Non-cash facilities restructuring charges 3,212 3,683

Changes in operating assets and liabilities:

Accounts receivable (11,434) (8,348)

Prepaid expenses and other assets (172) (3,596)

Accounts payable and accrued liabilities 997 (2,571)

Accrued compensation and related expenses 4,328 4,769

Income taxes payable 1,624 1,606

Deferred tax liability 993 -

Accrued facilities restructuring charges (13,772) (18,299)

Deferred revenues 13,098 15,472

Net cash provided by operating

activities 66,903 37,935

Investing activities:

Purchases of property and equipment (3,767) (9,913)

Purchases of investments (462,367) (227,132)

Maturities of investments 249,624 104,586

Sales of investments 118,802 89,000

Acquisitions, net of cash acquired (95,763) -

Net cash used in investing activities (193,471) (43,459)

Financing activities:

Proceeds from issuance of common stock 23,837 21,503

Repurchases and retirement of common stock (78,541) (26,500)

Issuance of convertible senior notes 230,000 -

Payment of issuance costs on

convertible senior notes (6,242) -

Net cash provided by (used in)

financing activities 169,054 (4,997)

Effect of foreign exchange rate changes on

cash and cash equivalents 1,460 (1,875)

Net increase (decrease) in cash and

cash equivalents 43,946 (12,396)

Cash and cash equivalents at

beginning of the year 76,545 88,941

Cash and cash equivalents at end of

the year $120,491 $76,545

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