i2 Announces First Quarter 2002 Results

Guide to E-Commerce Technology

Management of costs produces bottom-line improvement in a difficult market environment

Dallas, TX
16 April 2002

i2 Technologies, Inc. (Nasdaq: ITWO), the leading provider of dynamic value chain management solutions, today announced final results for the first quarter of 2002. On a pro forma basis, the loss per share was $0.07 in the first quarter of 2002, compared to a loss of $0.08 per share in the previous quarter and earnings of $0.02 per share in the first quarter of 2001. Pro forma reporting excludes the accounting impact of amortization of intangibles and acquired technology, write-offs of acquired in-process research and development, certain non-recurring items, employer taxes on stock option exercises, and net gains and losses realized on equity investments. Under generally accepted accounting principals (GAAP), i2 reported a loss per share of $0.08 in the first quarter of 2002, compared to losses of $1.40 per share in the previous quarter and $1.90 per share in the first quarter of 2001.

“The last 12 months have been extremely challenging for i2. Based on changing economic conditions, we saw a shift in customer IT buying patterns from large enterprise-wide projects to smaller, tactical solutions. In addition, our restructuring caused the company to become very internally focused. This had a negative impact on our sales execution,” said Sanjiv Sidhu, i2’s chairman and CEO. “But our vision and strategy remain sound, and there is a tremendous market opportunity in front of us. We are taking steps to improve our execution and strengthen the company for the long term. However, it may take more than a couple of quarters for these changes to drive improved top- and bottom-line results.”

Total revenues for the first quarter of 2002 were $168 million, compared to $198 million in the previous quarter and $364 million in the first quarter of 2001. License revenues for the first quarter 2002, were $59 million, down from $73 million in the previous quarter and $211 million in the first quarter of 2001.

“Due to continued economic and execution issues, our revenues for the first quarter fell short of plan,” said Bill Beecher, i2’s chief financial officer. “However, we effectively managed costs and were able to exceed our expectations for total expense reduction. Pro forma operating expenses decreased by nearly $37 million from last quarter, and by 40 percent from the first quarter of 2001. With new management, we believe that for now we must stabilize the organization, improve execution and focus on reestablishing top-line growth.”

During the quarter, i2 won various deals against its competitors in several industries and geographies. The company achieved wins with customers such as LG, Mitsubishi Electric, NEC and Nokia in high-tech; Dillard’s, PepsiCo and Shaw’s Supermarkets in consumer goods and retail; and Methanex Corp., Occidental Petroleum and Potash Corp. in process and chemicals. The company also announced a collaborative project with Shell Global Solutions to assess the development of a fully integrated supply chain software package for the downstream oil industry.

“While the economy as a whole, particularly technology spending, has yet to show marked signs of improvement, our high-value, bottom-line enhancing solutions continue to make the short-list of customer priorities,” added Sidhu. “i2 is the recognized leader in the industry and a trusted partner to our customers who rely on us to help them solve some of their most challenging problems. Our goal is to help our customers achieve the highest returns at the lowest risk, in the shortest amount of time possible.”

i2’s commitment to customer success remains the company’s top priority. With 77 go-lives in the first quarter of 2002, the company continues to demonstrate its focus on meeting customer project commitments. Companies going live on i2 solutions in the quarter included Bell Helicopter, Bethlehem Steel, Con-Way Logistics, Motorola, Samsung and Texas Instruments.

First Quarter Highlights
Executive Appointments
The executive staff has added three key executives to the team including Sam Nakane, Ray Greer and Dr. Berhnard Schwister. Sam Nakane, most recently president of i2 Japan, was promoted to the position of chief operating officer earlier this month. Ray Greer joined i2 as executive vice president and president of Global Network Solutions and Services. As previously announced, i2 will bolster its management strength in Europe with the appointment of Dr. Berhnard Schwister as i2’s vice president of Central Europe, effective July 1, 2002.

Partnerships
i2 announced its alliance with Telcordia Technologies, the leading provider of operations support systems and consulting and engineering services to the telecommunications industry. Together, the companies plan to deliver an integrated supply chain solution designed to allow communications service providers and suppliers to benefit from reduced inventories, accelerated cost savings, improved customer service and tighter links with business partners. i2 also recently recognized the one-year anniversary of its successful partnership with webMethods. i2 partners with webMethods to provide integration capabilities to assist companies in cross-enterprise collaboration enabled by i2`s market-leading dynamic value chain management solutions.

Solution Enhancements and Technology Standards
i2 announced the availability of inventory visibility and exception management capabilities within its i2 Five.Two collaboration solution. The i2 solution is designed to enable companies to quickly act on accurate and up-to-date order, inventory and shipment information, leading to improved responsiveness. The company also recently affirmed its commitment to open standards by adopting J2EE standards for inter-application integration and Java™ Authentication and Authorization Service.

i2 PLANET Las Vegas
The company will host i2 PLANET May 13-16 at the Venetian Hotel in Las Vegas. Executives from world-class companies such as DaimlerChrysler, IBM, Shell, Sprint, Sun Microsystems, TaylorMade-adidas Golf and VF Corporation will address General Session attendees. More than 125 breakout sessions will feature customer presentations in vertical markets such as aerospace and defense, automotive and industrial, high-tech, process and utilities, retail and consumer goods, and transportation and distribution. For more information visit http://planet.i2.com.

Earnings Call Information
Company management will host a conference call today, April 16, with analysts and investors. The call is scheduled for 4:00 p.m. CST and will be open to the public via the company`s Web site at http://www.i2.com/investor.

A conference call replay will be available following the conference call for approximately 24 hours. To access the replay, dial 800-475-6701, and enter passcode 631225. The replay will also be available via the company`s Web site at http://www.i2.com/investor.

About i2
For more than a decade, i2 has been a leader in supply chain management. i2 has extended its technology and expertise to Dynamic Value Chain Management—solutions to help companies collaborate on decision-making processes not only across functions within a single company, but across multiple companies. i2 solutions span the value chain interactions, including customer relationship management, supply chain management and supplier relationship management. Established in 1988, i2 is the only software solutions provider that measures, audits, and reports total value provided to its customers, with a mission to deliver $75 billion in value by 2005. Learn more at www.i2.com.

i2 Cautionary Language
This press release may contain forward-looking statements that are indicative of i2 management’s belief and opinion at the time of issuance. These statements are typically indicated by such terms as “plans to”, “will”, “believe”, “being”, “are”, and other similar expressions as they relate to i2, including statements regarding expectations of future financial and operating results and our ability to return to profitability, continued demand for our solutions, improved execution, and our customers’ ability to achieve expected benefits of our software. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from these expectations. Factors that could cause actual results to differ include but are not limited to: continued reduction in the pace of IT spending, general economic conditions, competition, the failure of our customers to successfully implement our solutions or to achieve benefits attributable to our products, increased length of sales cycles, revenue stream volatility as a result of our reliance on large transactions, decreased visibility into future revenues growth or weakness, unforeseen expenses we may incur in future quarters, or the inability to identify expenses that can be eliminated. In addition, please refer to i2’s filings with the Securities and Exchange Commission (SEC), including the sections captioned “Forward-Looking Statements” and “Factors That May Affect Future Results” in Management’s Discussion and Analysis of Financial Condition and Results of Operations, Item 7 of our Form 10-K filed with the SEC on April 1, 2002 for a more complete discussion of these risks and uncertainties. i2 assumes no obligation to update the forward-looking information contained in this news release.

i2 is a registered trademark of i2 Technologies, Inc. and its subsidiaries.

For further press information, please contact:
Sue LaDow
Media Relations
469-357-3027
susan_ladow@i2.com

Brent Anderson
Investor Relations
469-357-6012
brent_anderson@i2.com