Onyx Software Corporation Reports Record Revenues in Q3 1999

Revenues Up 74% Over Same Quarter Last Year Exceeding Analysts' Expectations

Bellevue, Wash. - October 21, 1999 -- Onyx Software Corporation (Nasdaq: ONXS) today announced record revenues and positive earnings for the third quarter ending September 30, 1999. Revenues reached $15.7 million, up 74 percent from $9.0 million in revenues reported in the third quarter of 1998. Software license revenues totaled $9.9 million in the third quarter of 1999, up 66% over software license revenues of $6.0 million in the third quarter of 1998. Service revenues totaled $5.8 million in the third quarter of 1999, up 89% over service revenues of $3.1 million in the third quarter of 1998. Net income after tax for the third quarter was $336,000 or $0.02 per share, net income after tax for the third quarter excluding acquisition-related charges was $888,000 or $0.04 per share. This compares with a net loss of $2.1 million or $0.18 per share for the third quarter of 1998.

Revenues for the first nine months of 1999 reached $40.3 million, up 68 percent from $24.0 million in revenues reported in the first nine months of 1998. Software license revenues for the first nine months of 1999 grew 67% over the same period of 1998, while service revenues grew 70%. Net loss after tax for the nine months ended September 30, 1999 was $1.2 million or $0.08 per share; excluding acquisition-related charges, net loss after tax for the nine months ended September 30, 1999 was $430,000 or $0.03 per share. This compares with a net loss of $5.7 million or $0.49 per share for the same period of 1998.

"We had an excellent quarter, beating analysts' expectations on both the top and bottom lines," said Onyx Software President & CEO Brent Frei. "Onyx is one of only a few vendors who can deliver enterprise-wide Customer Relationship Management (CRM) solutions to companies of any size, in any industry. We continue to expand our market share in the heart of the burgeoning CRM market based on superior web technology, faster and more cost effective deployments, and stronger customer references. Onyx Software is committed to being the world's premier provider of Web-based CRM systems and we will continue to aggressively buy, build and partner to meet this goal."

Key Q3 Highlights

• Onyx Software's average deal size grew significantly in Q3, as companies across a variety of industries chose Onyx above the competition. New customers in Q3 included BuildNet, the building industry's leading business-to-business e-commerce solution, CVS.com, part of CVS, America's #1 pharmacy, Development Bank of Singapore, Diagnostic Ultrasound Corporation, Imaginus.Net, InfoSpace.com, a leader in enabling technologies and Internet services for Web sites and Internet appliances, and Sybase South Africa. Onyx also continued to see growth and investment from its current customer base including add-on orders from American Express, Portal Software, Prudential, Weider Publications and Techies.com.
• Onyx continued to expand its market and distribution presence by establishing strategic services and reseller relationships with several domestic and international partners, including BDO Siedman and Whittman-Hart in North America, Deloitte & Touche in the UK, Sonda in Brazil and Argentina, Norstan Canada, and Ericsson in Australia. The company also signed an agreement with IBM Global Financing to provide software and services financing to Onyx customers. After comprehensive reviews of CRM offerings, partners Ericsson, Sonda, BDO Siedman, and Whittman-Hart also chose Onyx for their internal CRM solutions and will deploy it extensively across their organizations.
• Onyx significantly expanded its European team with the post-quarter acquisition of Market Solutions, Ltd. (MSL) which expands Onyx Software's presence in Europe four-fold and gives Onyx additional knowledge base and experience to serve companies with large, complex CRM implementations. Some of MSL's flagship accounts are Lloyd's Bank and Bass Brewers, both with more than 1,000 users across many locations.
• Onyx began shipping Onyx Enterprise Portal, the industry's first front office portal. Customers using the portal are able to manage their critical business relationships and navigate other applications and Internet sites all from a single tightly integrated interface. Industry analysts recognize Onyx Enterprise Portal as unique in the CRM market and it is being rapidly adopted by customers and prospects.
• Onyx acquired Versametrix, adding key portal personalization technology and business intelligence enhancements to its product portfolio. Versametrix technology has been immediately absorbed into Onyx Software's portal strategy, Onyx eMetrix and Onyx DataMart.
• Onyx continued to invest in its ASP partner channel with several new customers going live on hosted versions of Onyx Enterprise Portal and Onyx Customer Center.
• Onyx continued to win prestigious awards that underscore its commitment to its customers, employees and shareholders. Recognition this quarter included a Best Business Practices award for exceeding customer expectations from Arthur Andersen; Deloitte & Touche's "Fast 50" award for fastest growing company in Washington; best software company to work for published in Washington CEO Magazine; and a finalist in three categories, more than any other CRM vendor, in Microsoft's Industry Solution Awards for outstanding customer management solutions.

Onyx Software Corporation (NASDAQ: ONXS) is a leading provider of Web-based Customer Relationship Management (CRM) systems. The company's innovative e-Business software combines comprehensive CRM functionality, third party applications and Internet content into personalized digital workplaces for marketing, sales and service employees, business partners and customers. The company's systems are scalable, flexible, reliable and deploy quickly resulting in a rapid return on investment and industry leading customer satisfaction. Onyx Software operates worldwide, supporting large, medium and small companies such as American Express, Cognos, Credit Suisse, FirstWorld Communications, Giga Information Group, InfoSpace, Interactive Intelligence, NTL Internet, Plumtree, Portland Trailblazers, Prudential, Sharp Electronics, Sierra Health Services, Singapore Press Holdings and US Bancorp Piper Jaffray. For more information call 1-888-275-6699, visit the Onyx Website at www.onyx.com or email info@onyx.com.

Contact:	Sar Ramadan	Ann Vasquez	Heather Knox
	Onyx Software Corporation	Onyx Software Corporation	Onyx Software Corporation
	Chief Financial Officer	Investor Relations	PR Director
	(425) 451-8060	(425) 451-8060	(425) 451-9225
	sarr@onyx.com	annv@onyx.com	hknox@onyx.com

Certain statements in this press release, including statements concerning Onyx Software's plans, intentions and expectations, are "forward-looking statements" within the meaning of the Securities Act of 1933, as amended. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. The words "believe," "expect," "intend," "anticipate," variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guaranties of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect Onyx's actual results include, but are not limited to, the "Risk Factors" described in our Securities and Exchange Commission filings, including the Prospectus related to our initial public offering dated February 11, 1999. Readers are cautioned not to place undue reliance upon these forward-looking statements that speak only as to the date of this release. Onyx undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

Onyx Software Corporation
Condensed Consolidated Statements of Earnings
(In Thousands, Except Per Share Data)

	Three Months Ended				Six Months Ended
	September 30, 1999		September 30, 1998		September 30, 1999		September 30, 1998
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
Revenues
License	$ 9,922		$ 5,961		$ 25,238		$ 15,153
Service	5,821		3,083		15,016		8,851
	-----------		-----------		-----------		-----------
Total revenues	15,743		9,044		40,254		24,004
Costs of Revenues
Cost of license	494		274		1,488		607
Cost of service	2,946		2,035		7,558		5,925
	-----------		-----------		-----------		-----------
Total cost of revenues	3,440		2,309		9,046		6,532
	-----------		-----------		-----------		-----------
Gross margin	12,303		6,735		31,208		17,472
Operating Expenses
Sales and marketing	7,484		5,491		20,322		13,693
Research and development	2,643		2,274		7,760		6,731
General and administrative	1,567		1,013		4,184		2,663
Acquisition-related charges and amortization	552				770
	-----------		-----------		-----------		-----------
Total operating expenses	12,246		8,778		33,036		23,087
Operating income (loss)	57		(2,043)		(1,828)		(5,615)
Interest income,net	407		33		943		95
	-----------		-----------		-----------		-----------
Income (ioss) before income taxes	464		(2,010)		(885)		(5,520)
Income tax provision	128		69		315		193
	-----------		-----------		-----------		-----------
Net income (loss)	$ 336		$ (2,079)		$ (1,200)		$ (5,713)
	===========		===========		===========		===========
Diluted earnings (loss) per share (1)	$ 0.02		$ (0.18)		$(0.08)		$(0.49)
	===========		===========		===========		===========
Basic and diluted- Shares used in per share computation (1)	19,760		11,847		15,376		11,739

(1) All amounts, with the exception of the quarter ended September 30, 1999, are calculated on a pro-forma basis, which assumes the conversion of preferred stock into common stock at the time of issuance.

Onyx Software Corporation
Condensed Consolidated Balance Sheet
(In Thousands)

	September 30, 1999		December 31, 1998
	(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$ 8,275		$ 1,853
Short-term marketable securities	23,879
Accounts receivable, net	18,005		13,149
Prepaid expenses and other current assets	1,713		1,327
	-----------		-----------
Total current assets	51,872		16,329
Property and equipment, net	7,690		1,664
Purchased technology, net	3,385		3,216
Other intangibles, net	565		642
Long-term marketable securities	1,006
Other assets	899		639
	-----------		-----------
TOTAL ASSETS	$ 65,417		$ 22,490
	===========		===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$ 1,957		$ 1,654
Salary and benefits payable	2,366		905
Accrued liabilities	1,473		1,685
Current portion long-term liabilities	172		1,191
Income taxes payable	446		288
Deferred revenues	9,634		6,745
	-----------		-----------
Total current liabilities	16,048		12,468
Long-term liabilities	160		4,486
Redeemable convertible preferred stock			13,285
SHAREHOLDERS' EQUITY
Common stock	59,441		1,912
Notes receivable from officers	(212)		(212)
Deferred stock-based compensation	(1,059)		(1,785)
Accumulated deficit	(8,821)		(7,621)
Accumulated other comprehensive loss	(140)		(43)
	-----------		-----------
Total shareholders' equity	49,209		(7,749)
	-----------		-----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 65,417		$ 22,490
	===========		===========

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MEDIA CONTACTS

Americas / Corporate Headquarters Mitch Briggs Public Relations Coordinator Consona Corporation Telephone: 317.249.1620 Mobile: 317.829.4210 Europe, Middle East, Africa Richard Furby Managing Director, Onyx UK Telephone: +44 (0) 1344 322 199 Fax: +44 (0) 1344 489 035 Japan Daisuke Sawamura Director, Professional Services Telephone: +81 03 5215 7311