Sybase Reports Strong 2006 Third Quarter Operating Results

Mobile and Wireless Business Increases 19% Year over Year
Pro Forma EPS of $0.40 Exceeds First Call Consensus Estimates

DUBLIN, Calif. — October 19, 2006 — Sybase, Inc. (NYSE: SY), a leading provider of enterprise infrastructure and mobile software, today reported financial results for the third quarter ended September 30, 2006.

For the 2006 third quarter, total license revenue increased 9% to $76.3 million from $69.7 million in the third quarter of 2005. Total revenue for the 2006 third quarter increased 5% to $209.1 million from $199.3 million in the third quarter of 2005.

Pro forma operating income for the 2006 third quarter increased 13% to $40.9 million, compared with pro forma operating income of $36.2 million in the 2005 third quarter. Pro forma net income for the 2006 third quarter increased 20% to $36.3 million, or earnings per diluted share of $0.40. Included in the third quarter pro forma EPS is a tax benefit of approximately $0.04. This compares with pro forma net income of $30.1 million, or earnings per diluted share (EPS) of $0.33 for the third quarter of 2005.

Operating income calculated in accordance with generally accepted accounting principles (GAAP) for the third quarter of 2006 increased 7% to $32.2 million, compared with GAAP operating income of $30.2 million for the year-ago quarter. The GAAP results for the 2006 third quarter include the impact of $3.1 million associated with implementation of FAS 123R.

The company reported GAAP net income of $25.1 million, or GAAP EPS of $0.27, for the 2006 third quarter. This compares with GAAP net income of $28.0 million, or GAAP EPS of $0.30, for the 2005 third quarter. Included in third quarter 2006 GAAP EPS is an increase in the company’s tax provision of $9.0 million compared with the third quarter of 2005 and the previously stated impact associated with the implementation of FAS 123R.

Pro forma amounts exclude the amortization of certain purchased intangibles, stock-based compensation, and restructuring costs. Accompanying this release is a reconciliation of pro forma and GAAP amounts for the 2006 third quarter.

“We’re pleased with our operating results this quarter,” said John Chen, chairman, CEO, and president of Sybase. “We generated strong cash flow from operations, exceeded EPS consensus estimates, and delivered our ninth consecutive quarter of revenue growth.

“Our strongest vertical segments in the quarter were financial services, technology and computer services,” added Mr. Chen. “We experienced steady demand for our core database platforms, combined with robust growth from our mobile device management solutions and IQ analytics server.

“During the quarter, we entered into a definitive agreement to acquire Mobile 365, the largest provider of mobile messaging and content delivery services. With this acquisition, which is expected to close in the fourth quarter, we will extend our reach to approximately 700 mobile operators, plus global brands and mobile content developers throughout the world. This strategic acquisition will position Sybase as the world’s largest mobile enterprise software and services provider,” concluded Mr. Chen.

Balance Sheet and Other Data
At September 30, 2006, Sybase reported $979.5 million in cash and cash investments, including restricted cash of $5.6 million. The company generated $38.9 million in cash flow from operations in the third quarter.

Days sales outstanding for the 2006 third quarter was 57.

Forward Guidance
For the fourth quarter ending December 31, 2006, management anticipates revenues in the range of $245 million to $250 million, assuming the acquisition of Mobile 365 closes in mid-November and contributes $10 million to $12 million in revenue in the fourth quarter. Pro forma fully diluted EPS for the fourth quarter is expected to be approximately $0.46. The impact of the acquisition is expected to be immaterial to pro forma EPS in the fourth quarter. GAAP EPS for the fourth quarter is estimated to be approximately $0.34, which includes the impact of expensing options under FAS 123R and a preliminary estimate of $4.0 million for amortization of intangibles related to the acquisition of Mobile 365.

Management is raising its most recent full-year 2006 estimate for fully diluted pro forma EPS to approximately $1.46 from $1.38. Management is also revising full-year 2006 GAAP EPS guidance to approximately $1.09 from $1.12, which includes the impact of expensing options under FAS 123R and a preliminary estimate of $4.0 million for amortization of intangibles related to the acquisition of Mobile 365.

Management is raising its full-year 2006 cash flow target from $170 million to a range of $185 million to $190 million. The impact of the Mobile 365 acquisition is expected to be immaterial to full-year 2006 pro forma EPS and cash flow.

Accompanying this release is a reconciliation of projected pro forma and GAAP amounts for the 2006 fourth quarter and full year.

2006 Third Quarter Company Highlights

* Launched Sybase® Data Integration Suite, a flexible and scalable solution that combines key data integration techniques including replication, data federation, ETL (extract, transform, and load), real-time events, and data search with integrated development and administration.
* Delivered Sybase® Unwired Accelerator 8.0, an innovative mobile solution that enables users to access their enterprise applications, data, and business processes from mobile devices.
* Delivered the next generation of the AvantGo® mobile Internet service, featuring a fully enhanced wireless experience that enables users to have always-available access to Web content, automatically synchronized to their mobile device for Research in Motion (RIM) BlackBerry™ handsets.
* Delivered Sybase IQ® version 12.7, a highly optimized analytics server that adds enhanced query performance, improved data privacy, and features that support compliance with regulations such as Sarbanes-Oxley.
* Delivered SQL Anywhere® 10, a market-leading database and data exchange solution for frontline environments.
* For the fifth consecutive year, Sybase iAnywhere was recognized by IDC as the leader in the mobile device management enterprise software market in its annual Worldwide Mobile Device Management Enterprise 2006-2010 Forecast and 2005 Vendor Shares report.
* Announced Gartner Inc. positioned Sybase® IQ as a challenger in its 2006 Data Warehouse DBMS Magic Quadrant report.

Conference Call and Webcast Information
The Sybase 2006 third quarter conference call and simultaneous Webcast is scheduled to begin at 7:30 a.m., Pacific Time/10:30 a.m. Eastern Time on Thursday, October 19, 2006. To access the live Webcast, please visit www.fulldisclosure.com or Sybase’s Website at www.sybase.com at least 20 minutes prior to the call to download any necessary audio or plug-in software. A telephone replay will be available approximately two hours after the conference call ends and will be available until 10:00 p.m. Pacific Time on October 26, 2006. To access the replay, please dial (888) 203-1112 for domestic access and (719) 457-0820 for international callers the access code for the telephone replay is #3437992. Additionally, the archived Webcast will be available through October 26, 2006 at http://www.sybase.com/about_sybase/investorrelations.

About Sybase, Inc.
Sybase is the largest global enterprise software company exclusively focused on managing and mobilizing information from the data center to the point of action. Sybase provides open, cross-platform solutions that securely deliver information anytime, anywhere, enabling customers to create an information edge. The world’s most critical data in commerce, finance, government, healthcare, and defense runs on Sybase. For more information, visit the Sybase Website at http://www.sybase.com.

Forward-Looking Statements
Certain statements in this release concerning Sybase, Inc. and its prospects and future growth are forward-looking and involve a number of uncertainties and risks. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to, the performance of the global economy and growth in software industry sales market acceptance of the company’s products and services customer and industry analyst perception of the company and its technology vision and future prospects the success of certain business combinations engaged in by the company or by competitors political unrest or acts of war possible disruptive effects of organizational or personnel changes and other factors described in Sybase, Inc’s reports filed with the U.S. Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2005 and Form 10-Q for the quarters ended March 31, 2006 and June 30, 2006.

Sybase, Adaptive Server Enterprise (ASE), Information Anywhere Suite, Sybase IQ, Sybase Data Integration Suite, Sybase Unwired Accelerator, AvantGo, and SQL Anywhere are trademarks of Sybase, Inc. or its subsidiaries. All other names may be trademarks of the companies with which they are associated.

Contact Information

Lorna Fernandes

Sybase Public Relations

Sybase, Inc.

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