Check Point Software Technologies Ltd. Reports Second Quarter Earnings

Redwood City, CA —

Check Point Software Technologies Ltd. (NASDAQ: CHKPF) today announced second quarter revenues of $7,377,000 compared to $1,561,000 for the same period in 1995, an increase of 373%. Net income for the quarter was $3,228,000 or $0.10 per share, compared to $839,000 or $0.02 per share in the second quarter of 1995.

Revenues for the six months ended June 30, 1996 were $12,216,000, as compared to $3,200,000 for the same period in 1995. Net income for the six months ended June 30, 1996 was $5,991,000 or $0.18 per share, as compared with $1,681,000 or $0.05 per share, for the same period in 1995.

"In our first quarter as a public company, we are very pleased with our financial performance," stated Gil Shwed, chief executive officer and president of Check Point Software Technologies Ltd. "We experienced strong worldwide sales growth, continued to develop solid customer relationships, and forged strategic partnerships with key industry leaders. These are all important milestones as we work towards expanding our market presence."

During the second quarter, Check Point formed several key strategic relationships and formed numerous technology agreements. The Company expanded its relationship with Sun Microsystems by bundling FireWall-First!^TM , Check Point's entry-level firewall with every Netra Internet server. The company also announced an agreement with Bay Networks to integrate Check Point FireWall-1^TM into the Bay family of router platforms, creating the industry's first commercial firewall product on a router platform and entered into an agreement with Xylan to integrate FireWall-1 into Xylan's OmniSwitch and PizzaSwitch product, creating the first firewall security in a LAN switch.

"This was a very exciting quarter for the company, as we saw strong acceptance of our FireWall-1 technology, and its extensible architecture, which enabled us to provide support for many important new applications this quarter," stated Dr. Deborah Triant, chief executive officer and president of Check Point Software Technologies Inc. "We also expanded our base of technology partnerships through compatibility and interoperability agreements with major anti-virus software manufacturers such as McAfee Associates and Trend Micro. Additionally, we announced an agreement with Cheyenne Software, to integrate Cheyenne's InocuLAN virus detection software into a future release of Check Point FireWall-1, creating the first firewall with integrated virus protection."

During the second quarter Check Point announced FireWall-1 version 2.1--extending its platform support to include Windows NT and integrated support for FireWall-1 SecuRemote client encryption software on Windows 95 laptops and desktops. The product recently began shipping on July 15.

During July, Check Point also expanded its relationship with Hewlett Packard Company through its OEM agreement to include FireWall-1 in its Broadband Internet Delivery Services (BIDS) program.

Check Point Software Technologies Ltd. is a leader in global network security software applications. The Company's flagship product, Check Point FireWall-1 protects internal and external network communication for thousands of organizations of all sizes. The Company commanded a 40% share of the worldwide firewall market in 1995 according to an IDC study from February 1996. Its products are sold worldwide through numerous OEM partners, distributors, VARs, systems and network integrators and Internet Service Providers. Listed under the symbol "CHKPF," the company has U.S. headquarters in Redwood City, California and international headquarters in Ramat-Gan, Israel. For product information, please call (650) 482-4900, e-mail info@checkpoint.com or visit Check Point at http://www.checkpoint.com.

CHECK POINT SOFTWARE TECHNOLOGIES LTD.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(In thousands, except per share amount)

(Unaudited)

	Six Months Ended June 30		Three Months Ended June 30
	1995	1996	1995	1996

Revenues	$3,200	$12,216	$1,561	$7,377
Cost of revenues	253	648	87	416

Gross profit	2,947	11,568	1,474	6,961

Operating expenses:
Research and development net	347	1,205	188	827
Sales and marketing	439	3,596	206	2,373
General and administrative	454	879	232	610

Total operating expenses	1,240	5,680	626	3,810


Operating income	1,707	5,888	848	3,151
Financial income (loss)	(32)	101	(11)	76

Income (loss) before income tax	1,675	5,989	837	3,227
Income taxes (benefit)	(6)	(2)	(2)	(1)

Net income	$1,681	$5,991	$839	$3,228

Earning per share	$0.05	$0.18	$0.02	$0.10

Number of shares used in computing earnings per share	33,812	33,860	33,812	33,900

CHECK POINT SOFTWARE TECHNOLOGIES LTD. SELECTED CONSOLIDATED BALANCE SHEET DATA

(In thousands)

ASSETS

	December 31, 1995	June 30, 1996

Current Assets:		unaudited
Cash & cash equivalents	$3,634	$8,341
Trade receivable, net	2,900	5,442
Other receivable and prepaid expenses	158	448

Total current assets	6,692	14,231

Net property and equipment	388	876

Deferred Income Taxes	9	10

	$7,089	$15,117

LIABILITIES AND SHAREHOLDERS' EQUITY

Total current liabilities	$1,954	$3,969


Accrued Severance Pay, net	95	74


Total shareholders' equity	5,040	11,074

	$7,089	$15,117

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