Ansoft Corporation Second Quarter Results - 30% Increase in Revenue.

PITTSBURGH -- Ansoft Corporation (NASDAQ:ANST) today announced financial results for its second quarter of fiscal 2005 ended October 31, 2004.

Revenue for the second quarter totaled $15.9 million, an increase of 30% compared to $12.3 million reported in the previous fiscal year's second quarter. Net income for the second quarter was $1.9 million or $0.14 per diluted share, as compared to a net loss of $(22,000), or $0.00 per diluted share in the previous fiscal year's second quarter.

"We are pleased with the continued revenue growth in both product lines and in our domestic and international markets this quarter," said Nicholas Csendes, Ansoft's President and CEO. "For the fiscal year, we anticipate revenue growth to exceed 20% with increasing profitability."

Ansoft is a leading developer of high-performance electronic design automation (EDA) software. Engineers use Ansoft software to design state-of-the-art electronic products, such as cellular phones, Internet-access devices, broadband networking components and systems, integrated circuits (ICs), printed circuit boards (PCBs), automotive electronic systems and power electronics. Ansoft markets its products worldwide through its own direct sales force and has comprehensive customer-support and training offices throughout North America, Asia and Europe.

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. These forward-looking statements involve risks and uncertainties about the Company's business that are detailed from time to time in the Company's SEC reports, including the reports on Form 10-K for the year ended April 30, 2004.

ANSOFT CORPORATION
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
               (In thousands, except per share amounts)
                              (unaudited)

                                  Three months ended Six months ended
                                      October 31,      October 31,
                                     2004    2003     2004     2003
                                    ------- ------- -------- --------
Revenue
   License                          $8,661  $6,893  $14,830  $12,234
   Service and other                 7,285   5,365   13,794   10,675
                                    ------- ------- -------- --------
Total revenue                       15,946  12,258   28,624   22,909
Costs of revenue
   License                             125     164      222      306
   Service and other                   356     272      660      520
                                    ------- ------- -------- --------
Total cost of revenue                  481     436      882      826
                                    ------- ------- -------- --------
Gross profit                        15,465  11,822   27,742   22,083
                                    ------- ------- -------- --------
Operating Expenses
   Sales and marketing               7,601   6,339   15,098   12,659
   Research and development          4,048   3,773    8,026    7,596
   General and administrative        1,329   1,186    2,393    2,297
   Amortization                        384     761      793    1,618
                                    ------- ------- -------- --------
Total operating expenses            13,362  12,059   26,310   24,170
                                    ------- ------- -------- --------
Income (loss) from operations        2,103    (237)   1,432   (2,087)
Net realized gain (loss) on sale of
 securities                            (27)     --      732       --
Other income, net                      647     207      601      468
                                    ------- ------- -------- --------
Income (loss) before income taxes    2,723     (30)   2,765   (1,619)
Income tax expense (benefit)           834      (8)     844     (405)
                                    ------- ------- -------- --------
Net income (loss)                   $1,889    $(22)  $1,921  $(1,214)
                                    ======= ======= ======== ========
Net income (loss) per share
    Basic                            $0.16  $(0.00)   $0.17   $(0.10)
                                    ======= ======= ======== ========
    Diluted                          $0.14  $(0.00)   $0.14   $(0.10)
                                    ======= ======= ======== ========
Weighted average shares
 used in calculation
   Basic                            11,567  11,637   11,616   11,655
                                    ======= ======= ======== ========
   Diluted                          13,238  11,637   13,275   11,655
                                    ======= ======= ======== ========



                          ANSOFT CORPORATION
                      CONSOLIDATED BALANCE SHEETS
                            (In thousands)

                                                 October 31, April 30,
                                                    2004       2004
                                                  --------- ---------
                                                 (unaudited)
Assets
Current assets
Cash and cash equivalents                           $8,947   $15,218
Accounts receivable, net                             8,602    10,179
Deferred income taxes                                  576       343
Prepaid expenses and other assets                    1,452       675
                                                  --------- ---------
Total current assets                                19,577    26,415

Equipment and furniture                              3,402     3,598
Marketable securities                               24,871    25,502
Other assets                                           381       383
Deferred income taxes                                4,973     5,158
Goodwill                                             1,239     1,239
Intangible assets                                    4,548     5,341
                                                  --------- ---------
Total assets                                       $58,991   $67,636
                                                  ========= =========


Liabilities and stockholders' equity
Current liabilities
Accounts payable and accrued expenses               $3,818    $4,015
Deferred revenue                                    12,802    11,935
                                                  --------- ---------
Total current liabilities                           16,620    15,950

Line of credit                                       5,000    10,000
                                                  --------- ---------

Total liabilities                                   21,620    25,950

Stockholders' equity
Preferred stock                                          -         -
Common stock                                           131       129
Additional paid-in capital                          60,462    58,562
Treasury stock                                     (16,856)   (9,090)
Accumulated other comprehensive income                 319       691
Accumulated deficit                                 (6,685)   (8,606)
                                                  --------- ---------
Total stockholders' equity                          37,371    41,686

 Total liabilities and stockholders' equity        $58,991   $67,636
                                                  ========= =========