ADD to BW0541, VA-WEBMETHODS.

Business/Technology Editors

ADD to BW0541 after the last table, webMethods, Inc. Balance Sheets (in thousands) (unaudited).

webMethods, Inc.  Pro Forma Income Statements
Impact of Pro Forma Adjustments on Reported Net Loss
(in thousands, except shares and per share data)
(Unaudited)
                                           Three Months
                                              Ended
                                           March 31, 2001

                                As Reported Adjustments(1) As Adjusted


Revenues
 License                      $     43,679    $    --      $ 43,679
 Professional services               9,981         --         9,981
 Maintenance                         8,114         --         8,114
Total revenues                      61,774         --        61,774

Cost of revenue
 License                             1,225         --         1,225
 Professional services
  and maintenance                   13,083         (172)     12,911

Total cost of revenue               14,308         (172)     14,136

Gross profit                        47,466          172      47,638

Operating expenses

 Sales and marketing                31,981         (720)     31,261
 Research and development           16,902       (3,051)     13,851
 General and administration          5,967          (66)      5,901
 Acquisition related expenses          490         (490)       --
 Amortization of goodwill
  and intangibles                   10,507      (10,507)       --
 In-process research and
  development                       32,109      (32,109)       --

Total operating expenses            97,956      (46,943)     51,013

Operating loss                     (50,490)      47,115      (3,375)

Interest income, net and other       3,653         --         3,653

Net (loss) income             $    (46,837)   $  47,115    $    278


Fully diluted net
 income per share                                          $   0.01

Shares used in computing
 fully diluted net
 income per share                                        52,286,603


(1) The adjustments represent stock based compensation charges,
    in-process research and development, acquisition related expenses,
    and amortization of acquired goodwill and intangibles

    The pro forma information is not in accodance with GAAP and is
    presented to enhance the understanding of the results of
    operations