Ottawa, ON and Burlington MA, December 19, 2002—Cognos Incorporated (Nasdaq: COGN; TSX: CSN - all figures in U.S. dollars), the world leader in business intelligence solutions, today announced results for its third quarter of fiscal year 2003, which ended November 30, 2002.

Revenue for the quarter was $138.1 million, an increase of 11 percent compared with revenue of $124.2 million for the same period last year. Net income was $19.9 million or $0.22 per share. This is an increase of 50 percent compared with net income of $13.3 million or $0.15 per share in the third quarter of last year.

Revenue for the nine-month period ended November 30, 2002 was $387.3 million, compared with $348.5 million for the same period last year. Net income for the first nine months of this year was $43.6 million or $0.48 per share, compared with $9.3 million or $0.10 per share, including restructuring charges of $12.8 million, for the corresponding period last year. Excluding restructuring charges, net income for the first nine months of last year was $18.3 million or $0.20 per share.¹

Total business intelligence (BI) revenue achieved strong growth in the quarter, continuing its momentum. BI revenue reached $130.3 million, an increase of 14 percent from the third quarter of last year. BI license revenue increased 7 percent to $60.3 million, compared with $56.5 million for the same period last year. BI support revenue increased 26 percent to reach $47.1 million, compared with $37.5 million last year. The strong growth in this important, recurring revenue stream underscores the high value our customers place on the Cognos enterprise BI solution.

Highlights of the Quarter

• Double-digit percentage growth for BI revenue in all of our three major geographies - US, Europe and Asia/Pacific

• Analytic Applications revenue growth of 68 percent year over year to $10.4 million

• Contracts greater than $200,000 increased 17 percent year over year to 74; contracts greater than $50,000 increased 14 percent to 458

• Continued operating margin expansion to 20.3 percent

• Outstanding customer response to Cognos Series 7 and Corporate Performance Management: 10,000 customers attended Cognos Enterprise 2002 User Days in 29 cities

• Cognos Series 7 named best overall BI solution by META Group SPEX

• Independent study by Nucleus Research revealed high customer satisfaction and return on investment for the Cognos BI solution

Cognos continued to strengthen its balance sheet during the quarter. Cash flow was $6.8 million, net of $6.9 million expended to repurchase stock in the quarter. The Company had $338.1 million in cash, cash equivalents, and short-term investments at the end of the third quarter. Days sales outstanding for accounts receivable were 67 days, based on ending balances, compared with 73 days for the same period last year.

"The third quarter was rock solid for Cognos," said Cognos CEO Ron Zambonini. "We delivered excellent results across the board in a tough market. The Cognos team is performing and our customers are responding to the superior value proposition of the Cognos solution. We continue to demonstrate our leadership in the BI market by driving excellent momentum.

"Leading organizations throughout the world made significant commitments to our enterprise business intelligence solution again this quarter. The Company was awarded four contracts greater than $1 million. More indicative of the strong market acceptance of the Cognos solution was the 17 percent increase in contracts greater than $200,000. Many of our largest customers were again represented in these enterprise-scale contracts. These customers know through first-hand experience the proven and predictable ROI of the Cognos solution, and include leading corporations like American Express, AT&T, BMW, Federal Express, Ford Motor Company, General Electric, GlaxoSmithKline, Manulife Financial, Merrill Lynch, Penn Mutual Life, Pfizer, Shell Oil, Toyota, and the U.S. Air Force.

"Our new product pipeline is driving a clear competitive advantage for Cognos," continued Mr. Zambonini. "Cognos Series 7 and analytic applications continue to build momentum. Series 7 is spurring our competitive success in new accounts, and the robust uptake within our existing customer base provides additional up-sell and cross-sell opportunities. Cognos Metrics Manager was released on schedule on November 27th. I've never seen a more positive customer response to a Cognos solution than for Metrics Manager. And I have never been more positive about the position and prospects for Cognos."

Business Outlook
Management offers the following outlook for the fourth quarter of fiscal 2003, ending February 28, 2003, excluding the impact of the planned acquisition of Adaytum, Inc.:

• Revenue is expected to be in the range of $155 million to $157 million;

• Diluted earnings per share are expected to be in the range of $0.28 to $0.29.

Management offers the following outlook for the full fiscal year 2003, excluding the impact of the planned acquisition of Adaytum, Inc.:

• Revenue is expected to be in the range of $542 million to $544 million;

• Diluted earnings per share are expected to be in the range of $0.76 to $0.77.

Certain statements made in this press release that are not based on historical information are forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

This press release contains forward-looking statements relating to, among other things, the Company's expectations concerning future revenues and earnings, business outlook and business momentum; the demand for the Company's current and future products; the Company's ability to deliver business intelligence solutions that respond to changing market requirements; the Company's ability to compete in an intensely competitive marketplace; and the soundness of the Company's business model and technology strategies.

These forward-looking statements are neither promises nor guarantees, but involve risks and uncertainties that may cause actual results to differ materially from those in the forward-looking statements. Factors that may cause such differences include, but are not limited to: the Company's ability to maintain revenue growth or to anticipate a decline in revenue from any of its products or services; the Company's ability to develop and introduce new products and enhancements in the BI software market; rapid technological change in the business intelligence software market; new product introductions and enhancements by competitors; the Company's ability to compete in an intensely competitive market; the Company's ability to select and implement appropriate business models and strategies; the Company's reliance on partners and other third party distribution channels to market and distribute its products; fluctuations in its quarterly and annual operating results based on historical patterns, which may cause its stock price to fluctuate or decline; the impact of global economic conditions on the Company's business and the Company's ability to implement timely and appropriate remedial measures; unauthorized use of the Company's intellectual property; claims by third parties that the Company's software infringes their intellectual property; the risks inherent in international operations, such as currency exchange rate fluctuations; the Company's ability to identify, hire, train, motivate, and retain highly qualified management and other key personnel; and the Company's ability to identify, pursue, and complete acquisitions which could divert management attention and financial resources and not produce desired business results; as well as the risk factors discussed in the Company's most recent Annual Report on Form 10-K filed with the United States Securities and Exchange Commission. Readers should not place undue reliance on any such forward-looking statements, which speak only as of the date they are made. The Company disclaims any obligation to publicly update or revise any such statement to reflect any change in its expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those contained in the forward-looking statements.

Cognos will present the Company's financial results for the third quarter fiscal year 2003 and discuss expectations for the future at 5:15 p.m. Eastern Time, today, December 19, 2002. The conference call may be accessed at 416-640-1907. The Webcast may be accessed at http://www.cognos.com/company/investor/events/fy03q3/index.html.