CARPINTERIA, Calif.--(BUSINESS WIRE)--July 26, 2005--QAD Inc. (NASDAQ:QADI), a leading provider of enterprise applications for global manufacturers, has been named by Start magazine as one of the "Hottest Companies of 2005." For the third year in a row, Start editors have awarded QAD this distinction in recognition of the company's reputation for -- and commitment to -- helping manufacturers compete in the global marketplace.

The "Hottest Companies of 2005" recognizes technology suppliers that have developed innovative applications and products for the manufacturing industry. As manufacturers' challenges have evolved with the advent of globalization, QAD has continued to develop the capabilities of its flagship QAD MFG/PRO software to help streamline operations, enhance supply chain collaboration, optimize production and support industry and government compliance. Today, QAD's latest version of MFG/PRO -- the QAD Global Enterprise Edition -- now addresses multinationals' distributed computing requirements and supports service-oriented architecture that is rapidly gaining popularity.

Factors that played a part in QAD's selection from among 100 nominations included QAD's expansion to support the global and local needs of its customers. Already the largest provider of ERP solutions to the Chinese automotive sector, the company extended its worldwide operations to South Korea, Shanghai, and Detroit. QAD also continued to support definition of global technology standards and best practices for advanced manufacturing techniques, successfully demonstrating the Automotive Industry Action Group (AIAG) Inventory Visibility & Interoperability (IV&I) protocol for exchanging inventory data regardless of the application of origin. And in a year when manufacturers worldwide were focused on compliance with government and industry regulations, QAD enhanced its solutions' security and data control capabilities.

"This is a great honor, as QAD celebrates 25 years of exclusive focus on manufacturers' enterprise operations," said Pamela Lopker, QAD president and chairman of the board. "The Start award marks QAD's innovation and growth that come from deep insight into global manufacturing -- and that insight comes from working closely with the real experts, our customers."

About QAD

QAD is a leading provider of enterprise applications for global manufacturing companies. QAD applications provide critical functionality for managing manufacturing resources and operations within and beyond the enterprise, enabling global manufacturers to collaborate with their customers, suppliers and partners to make and deliver the right product, at the right cost and at the right time. Manufacturers of automotive, consumer products, electronics, food and beverage, industrial and medical products use QAD applications at approximately 5,300 licensed sites in more than 90 countries and in as many as 27 languages. For more information about QAD, telephone +1-805-684-6614, or visit the QAD Web site at: www.qad.com.

"QAD" is a registered trademark of QAD Inc. All other products or Company names herein may be trademarks of their respective owners.

Note to Investors: This press release contains certain forward-looking statements made under the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. A number of risks and uncertainties could cause actual results to differ materially from those in the forward-looking statements. These risks include, but are not limited to, evolving demand for the company's software products and products that operate with the company's products; the company's ability to sustain license and service demand; the company's ability to leverage improvements in the IT and economic environment; the company's ability to sustain customer renewal rates at current levels; the publication of opinions by industry analysts about the company, its products and technology; the reliability of estimates of transaction and integration costs and benefits; the entry of new competitors and their technological advances; delays in localizing the company's products for new markets; delays in sales as a result of lengthy sales cycles; changes in operating expenses, pricing, timing of new product releases, the method of product distribution or product mix; general economic conditions; exchange rate fluctuations; and the global political environment. In addition, revenue and earnings in the enterprise resource planning (ERP), e-business and distributed order management software industries are subject to fluctuations. Software license revenue, in particular, is subject to variability with a significant proportion of revenue earned in the last month of each quarter. Given the high margins associated with license revenue, modest fluctuations can have a substantial impact on net income. Investors should not use any one quarter's results as a benchmark for future growth. For a more detailed description of the risk factors associated with the company and the industries in which it operates, please refer to the company's Annual Report on Form 10-K for fiscal 2005 ended January 31, 2005.