Great Elm Capital 8-K Openwave Achieves 30% Revenue Growth In Second Quarter

EXHIBIT 99.1

OPENWAVE ACHIEVES 30% REVENUE GROWTH IN SECOND QUARTER

REDWOOD CITY, Calif. —January 27, 2005 — Openwave Systems Inc. (Nasdaq: OPWV), the leading provider of open software products and services for the communications industry, today announced that revenues for its second fiscal quarter ended December 31, 2004 were $93.5 million, an increase of $9.9 million, or 12%, from $83.6 million during the preceding quarter ended September 30, 2004 and an increase of $21.8 million, or 30%, from $71.8 million during the December quarter in the preceding year.

“With all areas of our business performing well, this is the best revenue quarter we have had in three years,” said David Peterschmidt, president and CEO of Openwave. “We believe such outstanding results signal our customers’ and the industry’s optimism for mobile data services and affirm our goal of maintaining profitable growth.”

Net income on a GAAP basis for the second fiscal quarter ended December 31, 2004 was $1.9 million or $0.03 per diluted share, compared to net income of $957,000 or $0.01 per diluted share for the preceding quarter and a net loss of $9.4 million or $0.15 per diluted share for the December quarter in the preceding year. Net income on a non-GAAP basis, excluding all amortization of acquisition related intangibles and restructuring costs, for the second fiscal quarter ended December 31, 2004 was $4.6 million, or $0.07 per diluted share, compared with $3.5 million, or $0.05 per diluted share in the prior quarter. A reconciliation between net income on a GAAP basis and a non-GAAP basis is provided below in a table immediately following the Condensed Consolidated Statements of Operations.

At December 31, 2004, the Company had cash, cash equivalents, short-term and long-term investments totaling $280.0 million, of which $27.7 million is set aside as restricted cash. Net cash used in operating activities during the three months ended December 31, 2004 was $1.9 million, which included $2.8 million of cash used for restructuring costs.

-more-

Page 2 of 7 — Openwave Reports Second Quarter Fiscal 2005

Conference Call Information

Openwave has scheduled a conference call for 5:00 p.m. Eastern today to discuss its financial results for its second quarter ended December 31, 2004. Interested parties may access the conference call over the Internet through the Company’s web site atwww.openwave.com or by telephone at (888) 428-4480 or (612) 288-0329 (international).A replay of the conference call will be available for one week beginning at 8:30 p.m. Eastern on January 27 by calling 800-475-6701. The replay can be accessed internationally by calling 320-365-3844. Reservation number: 765796.

A live webcast of the call, together with supplemental financial information, will also be available on the Quarterly Earnings section of Openwave’s website athttp://investor.Openwave.com/medialist.cfm for at least 12 months.

Non-GAAP Measure

The company’s stated results and outlook include a non-GAAP measure, non-GAAP net income, which excludes all acquisition related amortization of intangibles and restructuring costs. The company considers this to be an important measure because it provides a useful measure of the operational performance of the company and is used by the company’s management for that purpose. In addition, investors often use a measure such as this to evaluate the financial performance of a company. Non-GAAP net income results are presented for supplemental informational purposes only for understanding Openwave’s operating results. These non-GAAP results should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from non-GAAP measures used by other companies.

About Openwave

Openwave Systems Inc. (Nasdaq: OPWV) is the leading independent provider of open software products and services for the communications industry. Openwave’s breadth of products, including mobile phone software, multimedia messaging software (MMS), email, location and mobile gateways, along with its worldwide expertise enable its customers to deliver innovative and differentiated data services. Openwave is a global company headquartered in Redwood City, California. For more information please visit www.openwave.com.

Cautionary Note Regarding Forward Looking Statements

This release contains forward-looking statements (including without limitation those contained in the Business Outlook section and the quotation from management) relating to expectations, plans or prospects for Openwave Systems Inc. that are based upon the current expectations and beliefs of Openwave’s management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Notwithstanding changes that may occur with respect to matters relating to the Business Outlook and other forward looking statements, Openwave does not expect to, and disclaims any obligation to, update such statements until the release of its next quarterly earnings announcement. Openwave, however, reserves the right to update such statements or any portion thereof at any time for any reason.

Page 3 of 7 — Openwave Reports Second Quarter Fiscal 2005

In particular, the following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: (a) the ability to realize our strategic objectives by taking advantage of market opportunities in the Americas, Europe, the Middle East, and Asia; (b) the ability to make changes in business strategy, development plans and product offerings to respond to the needs of our current, new and potential customers, suppliers and strategic partners; (c) risks associated with the development and licensing of software generally, including potential delays in software development, technical difficulties that may be encountered in the development or use of our software, and potential infringement claims by third parties; (d) the effects of our restructurings and the ability to successfully support our operations; (e) the ability to recruit and retain qualified, experienced employees; (f) the willingness of communication service providers to invest and improve their data networks; (g) the ability to successfully partner with other companies; (h) the ability to acquire additional companies and technologies and integrate such acquisitions; (i) increased global competition and pricing pressure on our products; (j) technological changes and developments; (k) general risks of the Internet and wireless and wireline telecommunications sectors; and (l) the uncertain economic and political climate in the United States and throughout the rest of the world and the potential that such climate may deteriorate.

For a detailed discussion of these and other cautionary statements, please refer to the risk factors discussed in filings with the U.S. Securities and Exchange Commission (“SEC”), including but not limited to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2004, and any subsequently filed reports. All documents also are available through the SEC’s Electronic Data Gathering Analysis and Retrieval system (EDGAR) atwww.sec.gov or from Openwave’s Web site at www.openwave.com.

Openwave and the Openwave logo are trademarks and or registered trademarks of Openwave Systems Inc. All other trademarks are the properties of their respective owners.

INVESTOR CONTACTS:

Mike Bishop

Senior Manager, Investor Relations

Openwave Systems Inc

650-480-4461

Joshua Pace

Chief Financial Officer

Openwave Systems Inc.

650-480-4999

MEDIA CONTACT:

Candace Locklear

Openwave Systems Inc.

650-480-4316

Page 4 of 7 - Openwave Reports Second Quarter Fiscal 2005

OPENWAVE SYSTEMS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS-UNAUDITED

(In thousands)

	December 31, 2004		June 30, 2004
Assets
Current Assets:
Cash, cash equivalents and short-term investments	$	229,486	$	269,771
Accounts receivable, net		125,675		78,421
Other current assets		27,025		15,694
Total current assets		382,186		363,886
Property and equipment, net		29,640		30,552
Long-term investments		22,735		44,663
Restricted cash		27,732		27,384
Intangibles, net and other assets		32,034		9,300
Goodwill		42,865		723
	$	537,192	$	476,508
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	6,866	$	4,697
Note payable		3,805		—
Accrued liabilities		45,747		36,679
Accrued restructuring costs		9,466		10,429
Deferred revenue		73,774		60,662
Total current liabilities		139,658		112,467
Accrued restructuring costs, less current portion		34,870		38,838
Deferred revenue, less current portion		5,616		1,321
Deferred rent obligations		4,636		4,308
Deferred tax liability		7,683		—
Convertible subordinated notes, net		146,955		146,542
Total liabilities		339,418		303,476
Total stockholders’ equity		197,774		173,032
	$	537,192	$	476,508

Page 5 of 7 — Openwave Reports Second Quarter Fiscal 2005

OPENWAVE SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS-UNAUDITED

(In thousands, except per share data)

	Three Months Ended								Six Months Ended
	December 31, 2004		September 30, 2004			December 31, 2003			December 31, 2004		December 31, 2003
Revenues:
License	$	45,791	$	38,185		$	38,175		$	83,976	$	70,383
Maintenance and support services		22,847		21,498			22,102			44,345		42,468
Professional services		14,950		16,818			9,335			31,768		19,138
Project/Systems		9,947		7,067			2,141			17,014		7,753
Total revenues		93,535		83,568			71,753			177,103		139,742
Cost of revenues:
License		1,090		81			1,079			1,171		3,024
Maintenance and support services		6,948		6,637			5,790			13,585		12,042
Professional services		13,220		12,295			8,685			25,515		15,981
Project/Systems		6,181		3,051			1,962			9,232		4,111
Amortization of intangible assets		1,409		1,141			1,177			2,550		1,799
Total cost of revenues		28,848		23,205			18,693			52,053		36,957
Gross profit		64,687		60,363			53,060			125,050		102,785
Operating Expenses:
Research and development		22,282		22,005			23,765			44,287		49,351
Sales and marketing		25,376		22,921			25,067			48,297		48,690
General and administrative		11,493		10,198			8,394			21,691		18,450
Restructuring and other related costs		585		907			(382	)		1,492		2,270
Stock-based compensation		1,232		594			754			1,826		1,489
Amortization and impairment of goodwill and other intangible assets		755		525			67			1,280		135
Total operating expenses		61,723		57,150			57,665			118,873		120,385
Operating income (loss)		2,964		3,213			(4,605	)		6,177		(17,600	)
Interest and other income, net		1,600		(243	)		84			1,357		662
Income (loss) before provision for income taxes		4,564		2,970			(4,521	)		7,534		(16,938	)
Income taxes		2,698		2,013			4,866			4,711		6,438
Net income (loss)	$	1,866	$	957		$	(9,387	)	$	2,823	$	(23,376	)
Basic net income (loss) per share	$	0.03	$	0.01		$	(0.15	)	$	0.04	$	(0.38	)
Diluted net income (loss) per share	$	0.03	$	0.01		$	(0.15	)	$	0.04	$	(0.38	)
Shares used in computing basic net income (loss) per share		66,073		65,151			61,925			65,614		61,015
Shares used in computing diluted net income (loss) per share		70,340		68,000			61,925			68,985		61,015

Page 6 of 7 — Openwave Reports Second Quarter Fiscal 2005

OPENWAVE SYSTEMS INC.

RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS)

(In thousands, except per share data)

	Three Months Ended							Six Months Ended
	December 31, 2004		September 30, 2004		December 31, 2003			December 31, 2004		December 31, 2003
Reconciliation between GAAP net income (loss) and Non-GAAP:
GAAP net income (loss)	$	1,866	$	957	$	(9,387	)	$	2,823	$	(23,376	)
Add back:
Restructuring costs and other related costs		585		907		(382	)		1,492		2,270
Amortization of acquisition related intangibles		2,164		1,666		1,244			3,830		1,934
Non-GAAP net income (loss)	$	4,615	$	3,530	$	(8,525	)	$	8,145	$	(19,172	)
Basic earnings (net loss) per share	$	0.03	$	0.01	$	(0.15	)	$	0.04	$	(0.38	)
Add back:
Restructuring costs and other related costs		0.01		0.01		(0.01	)		0.02		0.04
Amortization of acquisition related intangibles		0.03		0.03		0.02			0.06		0.03
Non-GAAP net income (loss)	$	0.07	$	0.05	$	(0.14	)	$	0.12	$	(0.31	)
Shares used in computing basic earnings (net loss) per share		66,073		65,151		61,925			65,614		61,015
Diluted earnings (net loss) per share	$	0.03	$	0.01	$	(0.15	)	$	0.04	$	(0.38	)
Add back:
Restructuring costs and other related costs		0.01		0.01		(0.01	)		0.02		0.04
Amortization of acquisition related intangibles		0.03		0.03		0.02			0.06		0.03
Non-GAAP net income (loss) per share	$	0.07	$	0.05	$	(0.14	)	$	0.12	$	(0.31	)
Shares used in computing diluted earnings (net loss) per share		70,340		68,000		61,925			68,985		61,015

Page 7 of 7 — Openwave Reports Second Quarter Fiscal 2005

OPENWAVE SYSTEMS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS-UNAUDITED

(in thousands)

	Three Months Ended									Six Months Ended
	December 31, 2004			September 30, 2004			December 31, 2003			December 31, 2004			December 31, 2003
Cash flows from operating activities:
Net income (loss)	$	1,866		$	957		$	(9,387	)	$	2,823		$	(23,376	)
Adjustments to reconcile net loss to net cash used for operating activities:
Depreciation, amortization and impairment of intangible assets		4,908			4,947			7,498			9,855			15,035
Provision for (recovery of) doubtful accounts		1,069			1,101			(38	)		2,170			97
Impairment of property and equipment - restructuring related		585			—			—			585			738
Other non-cash activities		1,655			271			301			1,926			569
Changes in operating assets and liabilities		(11,987	)		(21,739	)		(17,028	)		(33,726	)		(25,131	)
Net cash used for operating activities		(1,904	)		(14,463	)		(18,654	)		(16,367	)		(32,068	)
Cash flows from investing activities:
Purchases of property and equipment, net		(3,395	)		(1,626	)		(1,604	)		(5,021	)		(2,226	)
Purchases of intangible assets		(450	)		—			—			(450	)		—
Acquisitions, net of cash acquired		(408	)		(46,433	)		—			(46,841	)		—
Proceeds of short-term investments, net		3,368			3,412			23,869			6,780			26,063
Proceeds (purchases) of long-term investments, net		(209	)		(68	)		2,485			(277	)		6,897
Restricted cash and investments, and non-markateble securities		(952	)		(205	)		179			(1,157	)		(7,417	)
Net cash provided by (used for) investing activities		(2,046	)		(44,920	)		24,929			(46,966	)		23,317
Cash flows from financing activities:
Proceeds from issuance of common stock, net		6,159			767			6,762			6,926			8,389
Proceeds from issuance of convertible debt, net		—			—			—			—			145,672
Other, net		—			(4	)		52			(4	)		56
Cash provided by financing activities		6,159			763			6,814			6,922			154,117
Effect of exchange rates on cash and cash equivalents		842			(227	)		—			615			—
Net increase (decrease) in cash and cash equivalents		3,051			(58,847	)		13,089			(55,796	)		145,366
Cash and cash equivalents at beginning of period		172,662			231,509			271,616			231,509			139,339
Cash and cash equivalents at end of period	$	175,713		$	172,662		$	284,705		$	175,713		$	284,705