BackWeb Reports Solid Third Quarter 2000 Results

Company Reports 89 Percent Revenue Growth Over Third Quarter Last Year; BackWeb's Push Communications Infrastructure for E-Business Gain Momentum

SAN JOSE, Calif. — October 25, 2000 — BackWeb® Technologies (Nasdaq: BWEB), a leading provider of push communications infrastructure for e-business, today announced results for its third quarter ending September 30, 2000.

Revenues for the period increased 89 percent to $11.7 million, from $6.2 million in the third quarter of 1999 and up 10 percent from $10.6 million for the second quarter of 2000. Excluding amortization charges related to a previous acquisition and deferred stock compensation, net loss for the third quarter was $0.5 million, or $0.01 per diluted share, compared to a net loss of $1.6 million or $0.05 per diluted share for the same period a year earlier. Including these charges, net loss for the quarter was $1.5 million, or $0.04 cents per share loss compared to a net loss of $2.4 million, or $0.07 per share in the third quarter of 1999.

The company's strong performance was driven by the increasing demand for BackWeb's e-business infrastructure. Moving rapidly toward a de facto infrastructure standard, the company achieved numerous significant milestones during the quarter including: the addition of more than 100 new customer relationships; strong repeat customer sales; continued infrastructure product expansion to support wireless and other delivery methods; and the ongoing cultivation of long-term partnerships with IBM and SAP.

"In today's new environment, Global 2000 technology spending requires a rapid return on investment, which in turn makes our products even more attractive," said Eli Barkat, chairman and CEO of BackWeb Technologies. "BackWeb's ability to provide an immediate and true competitive advantage proved to be a priority in technology spending decisions. This competitive marketplace helped drive our success during the quarter as we continued to add several new key accounts to our broad existing customer base."

Third Quarter 2000 Highlights
BackWeb experienced strength in virtually every single metric used to track its growth and success.

New Customer Wins:

• Siemens AG to provide its distribution staff with the latest product and pricing information;
• Fidelity Institutional Retirement Services to reliably deliver call center notifications;
• ABB for time-sensitive IT notifications; and
  Several other new customers, such as Nestle, Molex, Canada Post,
• Fujitsu Network Communications, FashionNet.com, PowerWeb Application Services, and Digital Square.

Upsells to Existing Customers:

• IBM Canada for reseller communications;
• Network Associates, Inc. for delivery of anti-virus updates to its IT administrators; and
• Increasing demand by other existing customers such as Compaq Computer Corp., Guidant Corporation and Information Services International (ISI).

Broadened Customer Base:

During the quarter, BackWeb's strategy to strengthen and broaden its customer base continued to gain momentum through its support of ASP and start-up organizations such as Amicada and CABC, Inc., enabling these smaller companies to increase time-to-market and functionality of service offerings by building unique business models and technology services on top of BackWeb's Internet infrastructure.
Strategic Alliances:

During the quarter, BackWeb strengthened its ubiquity presence through its recent alliance with Packard Bell, the Consumer Division of NEC Computers International. The division will be bundling BackWeb software onto approximately 1 million PCs a year to establish an e-commerce subscriber channel for its consumers throughout Europe. Packard Bell is a new member in a series of BackWeb consumer ubiquity partnerships such as Compaq, Hewlett- Packard and RealNetworks.

BackWeb also made substantial investments in its new CRM partnership with IBM, and continued to harvest revenues from its relationship with SAP.

New Products:

Following on the momentum created by the July launch of its integrated Internet and Wireless Universal Push Initiative, BackWeb updated its entire product line to provide customers with a single infrastructure to proactively reach any user, on any device, and at any time. To address this growing demand among global corporations, the company launched BackWeb Push Application Server 1.0, BackWeb Foundation Release 6.0, and BackWeb eAccelerator suite v2.1. As part of this new offering, which significantly expands the company's addressable market, BackWeb also announced plans to release French and German language versions of its popular BackWeb e-Accelerator suite, and will port its software to the AIX, Linux and DB2 platforms.
Strategic Investment in 3Path:

As part of an initiative to fuel growth throughout the push market, BackWeb today announced it has made a minority investment in 3Path, Inc. Based in New York, 3Path formerly known as DeliverEx, Inc., is an ASP service developed on the BackWeb communication infrastructure. 3Path enables priority, permission-based, fully hosted, peer-to-peer digital content delivery services targeted for the small and mid-size markets. "Our investment in 3Path expands BackWeb's market presence by leveraging the explosive growth of the ASP market," said Barkat. BackWeb participated in a financing round led by other investors, an approach it plans to take in any future investments it may make.

Conference Call
BackWeb has scheduled a conference call for 5:00 p.m. EDT today to discuss the third quarter results. Interested parties may access the conference call over the Internet at http://www.backweb.com. A recording of the call will be available for playback through close of business on October 31, 2000. The replay number is (719) 457-0820 and the pass code is 455149.

About BackWeb Technologies
BackWeb Technologies is a leading offline Web software company. BackWeb extends the value of technology investments by offering mobile and remote employees offline access to portals, intranets and other Web-based applications and content. The company's products reduce network costs and improve the productivity of an increasingly mobile workforce. At the core of BackWeb's products is its patented Polite® synchronization technology that can distribute large amounts of data even over narrow bandwidth connections. BackWeb® customers include market leaders such as Boehringer Ingelheim, Centocor, Eastman Kodak, GE Healthcare, Guidant, HP, KLA Tencor, Lam Research, Pfizer and more than one hundred other companies. BackWeb also has strategic reseller alliances with software industry leaders: Plumtree, SAP and IBM. The company is headquartered in San Jose, Calif. and Rosh Ha'ayin, Israel. For more information, visit www.backweb.com or call (800) 863-0100.

Statements in this news release, which are not purely historical, are forward-looking statements within the meaning of the U.S. Securities laws, including statements of beliefs, plans, expectations or intentions regarding the future. Examples of these statements include, but are not limited to, the ability of BackWeb software to allow customers to gain mobile, disconnected use of their portals and help increase field sales and field service productivity, the integration of BackWeb software with BEA products will help developers extend portal applications for offline use without changing the way they work, and the ability of the resulting applications to help field sales and service organizations realize maximum productivity, cost savings, and process acceleration gains while disconnected from the network. Actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include unforeseen technological issues related to use of the BackWeb software, deployment issues related to implementation, unforeseen software errors, competitive factors and business and expense factors that may affect the perceived efficiencies from use of BackWeb's products, and the risks and uncertainties detailed from time to time in BackWeb's periodic reports and registration statements filed with the U.S. Securities and Exchange Commission. BackWeb assumes no obligation to update any forward-looking statements contained in this press release.

© 2004 BackWeb Technologies Ltd. All rights reserved. BackWeb and Polite are registered trademarks of BackWeb Technologies. All other trademarks are property of their respective owners.

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