Riverbed Technology 8-K Results of Operations and Financial Condition

Exhibit 99.1

Riverbed Technology Reports Record Fourth Quarter and Full Year 2011 Revenue and

Profits

Q4’11 revenue increases 23% year-over-year and 7% sequentially

Riverbed Technology (NASDAQ:RVBD), the IT performance company, today reported financial results for its fourth quarter (Q4’11) and fiscal year ended December 31, 2011.

Total GAAP revenue for Q4’11 was $203 million, an increase of 7% from $190 million reported in the third quarter of fiscal year 2011 (Q3’11) and an increase of 23% from $165 million reported in the fourth quarter of fiscal year 2010 (Q4’10). For fiscal year 2011, GAAP revenue was $726 million, up 32% from $552 million in fiscal year 2010. GAAP net income for Q4’11 was $20 million, or $0.12 per diluted share. This compares to GAAP net income of $19 million, or $0.12 per share, in Q3’11 and $13 million, or $0.08 per share, in Q4’10. GAAP net income for 2011 was $64 million, or $0.38 per diluted share, compared to GAAP net income of $34 million, or $0.22 per diluted share, in 2010.

Non-GAAP revenue for Q4’11 was $204 million, an increase of 7% from $191 million reported in Q3’11, and an increase of 23% from $165 million reported in Q4’10. For fiscal year 2011, non-GAAP revenue was $728 million, up 32% from $552 million in fiscal year 2010. Non-GAAP net income for Q4’11 was $41 million, or $0.25 per diluted share. This compares to non-GAAP net income for Q3’11 of $40 million, or $0.24 per diluted share, and non-GAAP net income for Q4’10 of $32 million, or $0.19 per diluted share. Non-GAAP net income for 2011 was $150 million, or $0.90 per diluted share, which compares to non-GAAP net income of $92 million, or $0.59 per diluted share in 2010.

“2011 was a year of tremendous achievement for Riverbed^® and a year in which we expanded our addressable market through new innovations, strategic acquisitions and partnerships. For the full year, revenue increased 32% while our non-GAAP net income grew 62% over 2010,” said Jerry M. Kennelly, Riverbed president and CEO. “We believe we are in the strongest strategic and competitive position in our history. Adding to that, early in 2012 we will be entering what we believe will be Riverbed’s most exciting and important product cycle yet.”

“The business has been executing well and fourth quarter revenue growth was fueled by strong enterprise sales in both the U.S. and EMEA,” added Randy S. Gottfried, Riverbed Chief Financial Officer. “Despite higher disk drive costs resulting from recent Thai floods, we reported strong gross and operating margins in the fourth quarter. We believe our past investments in our core and new products will continue to yield solid revenue and profit growth in 2012.”

2011 Business Highlights

• Awarded IDG’s InfoWorld 2011 Technology of the Year Award in the Best WAN Accelerator category for the sixth consecutive time.

• Received certification under the J.D. Power and Associates Certified Technology Service & Support (CTSS) program and the Technology Service Industry Association’s (TSIA) Excellence in Service Operations. Riverbed is one of a select few companies to receive this distinction for global certification under both the J.D. Power and Associates CTSS and the TSIA Excellence in Service Operations program in the same year.

• Announced with Akamai the intention to develop a joint application acceleration solution for hybrid cloud networks and SAAS applications.

• Introduced Riverbed Stingray(TM), a new portfolio of asymmetric software- and virtual-based offerings, including application delivery controllers, web content optimization and Web application firewalls based on technologies acquired from Zeus Technology and Aptimize Limited.

• Launched Riverbed Optimization System (RiOS^®) 7.0, expanding optimizations to include native support for HTTP video, UDP, and IPv6. Also included enhanced optimizations for virtual desktop infrastructure, Quality of Service, and integrated Cascade^® Shark functionality into the Steelhead^® appliance to deliver on-demand packet capture and analysis.

• Introduced Cascade 9.0, providing customers with fine-grained classification of traffic, including advanced Layer-7 awareness and a single business-level performance view of applications and services.

• Integrated the application-aware functionality of Cascade Profiler(TM) with the Cascade Shark(TM) network traffic recording appliance and Cascade Pilot(TM) network analysis software.

• Expanded the ecosystem for Riverbed Whitewater^® to include more than 15 cloud storage, backup software, and critical database protection solutions.

• Extended the Riverbed solutions available through the EMC Select Program to include all Steelhead Appliance models, Steelhead Mobile, Riverbed Services Platform, Central Management Controller, Interceptor^®, and all Cascade products.

Conference Call

Riverbed will host a conference call today, January 26, 2012, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to discuss its fourth quarter and full year 2011 results and outlook for 2012. The call will be broadcast live over the Internet atwww.riverbed.com/investors. A replay of the conference call will also be available via webcast atwww.riverbed.com/investors for 12 months.

Use of Non-GAAP Financial Information

To supplement our financial results presented in accordance with Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables and the related earnings conference call contain certain non-GAAP financial measures, including non-GAAP support and service revenue, non-GAAP revenue, non-GAAP gross profit, non-GAAP operating profit, non-GAAP operating margin, non-GAAP net income and net income per share, non-GAAP gross margin and non-GAAP operating margin, that we believe are helpful in understanding our past financial performance and future results. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “GAAP to Non-GAAP Reconciliations.” Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand and manage our business and forecast future periods. Our non-GAAP financial measures include adjustments based on the following items, as well as the related income tax effects, adjustments related to our tax valuation allowance and the interim tax cost of the one-time transfer of intellectual property rights between Riverbed legal entities:

Support deferred revenue: Business combination accounting rules require us to account for the fair value of support contracts assumed in connection with our acquisitions. The book value of the acquisition deferred support revenue was reduced by $4 million in the adjustment to fair value. Because these are typically one-year contracts, our GAAP revenues for an one year period subsequent to the acquisition of a business do not reflect the full amount of service revenues on assumed support contracts that would have otherwise been recorded by the acquired entity. The non-GAAP adjustment is intended to reflect the full amount of such revenues. We believe this adjustment is useful to investors as a measure of the ongoing performance of our business because we have historically experienced high renewal rates on support contracts, although we cannot be certain that customers will renew these contracts.

Stock-based compensation expenses: We have excluded the effect of stock-based compensation and related payroll tax expenses from our non-GAAP operating expenses and net income measures. Although stock-based compensation is a key incentive offered to our employees, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods.

Amortization of intangible assets: We have excluded the effect of amortization of intangible assets from our non-GAAP net income. Amortization of intangible assets is a non-cash expense, and it is not part of our core operations. Investors should note that the use of intangible assets contributed to revenues earned during the periods presented and will contribute to future period revenues as well.

Acquisition related and other expenses: We incur significant expenses in connection with our acquisitions and also incurred certain other operating expenses, which we would not have otherwise incurred in the periods presented as a part of our continuing operations. Acquisition related and other expenses consist of transaction costs, costs for transitional employees, other acquired employee related retention costs, integration related professional services, adjustments to the fair value of the acquisition related contingent consideration, adjustments to the fair value of inventory, and foreign exchange losses on the acquisition related contingent consideration. We believe it is useful for investors to understand the effects of these items on our total operating expenses.

Forward-Looking Statements

This press release contains forward-looking statements, including statements relating to our strategic and competitive position, our upcoming product cycle, and our expectations regarding revenue and profit growth in 2012. These forward-looking statements involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include our ability to react to trends and challenges in our business and the markets in which we operate; our ability to anticipate market needs or develop new or enhanced products to meet those needs; the adoption rate of our products; our ability to establish and maintain successful relationships with our distribution partners; our ability to compete in our industry; fluctuations in demand, sales cycles and prices for our products and services; shortages or price fluctuations in our supply chain; our ability to protect our intellectual property rights; general political, economic and market conditions and events; difficulties encountered in integrating new or acquired businesses and technologies; the inability to identify and realize the anticipated benefits of acquisitions; the expense and impact of legal proceedings; and other risks and uncertainties described more fully in our documents filed with or furnished to the Securities and Exchange Commission. More information about these and other risks that may impact Riverbed’s business are set forth in our Form 10-K filed with the SEC for the period ended December 31, 2010, and our subsequent Forms 10-Q filed with the SEC. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements. Any future product, feature or related specification that may be referenced in this release are for information purposes only and are not commitments to deliver any technology or enhancement. Riverbed reserves the right to modify future product plans at any time.

About Riverbed

Riverbed delivers performance for the globally connected enterprise. With Riverbed, enterprises can successfully and intelligently implement strategic initiatives such as virtualization, consolidation, cloud computing, and disaster recovery without fear of compromising performance. By giving enterprises the platform they need to understand, optimize and consolidate their IT, Riverbed helps enterprises to build a fast, fluid and

dynamic IT architecture that aligns with the business needs of the organization. Additional information about Riverbed (NASDAQ: RVBD) is available atwww.riverbed.com.

Riverbed and any Riverbed product or service name or logo used herein are trademarks of Riverbed Technology, Inc. All other trademarks used herein belong to their respective owners.

INVESTOR RELATIONS CONTACT

Renee Lyall

Riverbed Technology

415-247-6353

renee.lyall@riverbed.com

###

Riverbed Technology, Inc.

GAAP Condensed Consolidated Statements of Operations

In thousands, except per share amounts

Unaudited

	Three months ended December 31,					Twelve months ended December 31,
	2011			2010		2011		2010
Revenue:
Product	$	140,303		$	118,194	$	501,376	$	380,277
Support and services		62,532			47,239		225,100		171,612
Total revenue		202,835			165,433		726,476		551,889
Cost of revenue:
Cost of product		30,764			24,865		105,150		81,998
Cost of support and services		19,292			14,274		68,925		50,750
Total cost of revenue		50,056			39,139		174,075		132,748
Gross profit		152,779			126,294		552,401		419,141
Operating expenses:
Sales and marketing		77,606			66,477		272,635		225,052
Research and development		33,714			25,617		122,964		87,117
General and administrative		15,750			12,989		59,699		47,382
Acquisition-related costs		1,087			618		5,211		3,343
Total operating expenses		128,157			105,701		460,509		362,894
Operating profit		24,622			20,593		91,892		56,247
Other income (expense), net		(534	)		41		154		724
Income before provision for income taxes		24,088			20,634		92,046		56,971
Provision for income taxes		3,934			8,023		28,239		22,813
Net income	$	20,154		$	12,611	$	63,807	$	34,158
Net income per share, basic	$	0.13		$	0.08	$	0.41	$	0.24
Net income per share, diluted	$	0.12		$	0.08	$	0.38	$	0.22
Shares used in computing basic net income per share		155,699			149,058		154,411		145,012
Shares used in computing diluted net income per share		166,838			163,359		166,900		155,999

Riverbed Technology, Inc.

Condensed Consolidated Balance Sheets

In thousands

	December 31,			December 31,
	2011			2010
ASSETS
Current assets:
Cash and cash equivalents	$	215,476		$	165,726
Short-term investments		254,753			259,245
Trade receivables, net		78,016			50,726
Inventory		11,437			15,180
Deferred tax assets		16,783			20,832
Prepaid expenses and other current assets		35,078			30,958
Total current assets		611,543			542,667
Long-term investments		123,134			76,169
Fixed assets, net		29,277			21,522
Goodwill		117,474			25,653
Intangible assets, net		68,274			30,789
Deferred tax assets, non-current		56,708			35,775
Other assets		24,789			3,506
Total assets	$	1,031,199		$	736,081
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	35,341		$	27,015
Accrued compensation and related benefits		61,256			32,915
Other accrued liabilities		42,959			18,813
Deferred revenue		121,131			89,026
Total current liabilities		260,687			167,769
Deferred revenue, non-current		36,248			26,511
Other long-term liabilities		23,200			4,381
Total long-term liabilities		59,448			30,892
Stockholders’ equity:
Common stock		631,921			518,052
Retained earnings		83,116			19,309
Accumulated other comprehensive income (loss)		(3,973	)		59
Total stockholders’ equity		711,064			537,420
Total liabilities and stockholders’ equity	$	1,031,199		$	736,081

Riverbed Technology, Inc.

Condensed Consolidated Statements of Cash Flows

In thousands

Unaudited

	Twelve months ended December 31,
	2011			2010
Operating activities:
Net income	$	63,807		$	34,158
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		24,474			15,855
Stock-based compensation		89,734			70,801
Deferred taxes		(24,693	)		(11,851	)
Excess tax benefit from employee stock plans		(50,673	)		(27,538	)
Changes in operating assets and liabilities:
Trade receivables		(23,294	)		(1,026	)
Inventory		3,742			(4,414	)
Prepaid expenses and other assets		(21,900	)		(13,515	)
Accounts payable		7,259			8,392
Accruals and other liabilities		46,293			23,379
Acquisition-related contingent consideration		1,323			(5,249	)
Income taxes payable		50,993			27,436
Deferred revenue		41,843			29,087
Net cash provided by operating activities		208,908			145,515
Investing activities:
Capital expenditures		(18,059	)		(10,690	)
Purchase of available for sale securities		(616,592	)		(526,051	)
Proceeds from maturities of available for sale securities		401,795			404,767
Proceeds from sales of available for sale securities		169,123			43,862
Acquisitions, net of cash acquired		(120,537	)		(26,885	)
Net cash used in investing activities		(184,270	)		(114,997	)
Financing activities:
Acquisition-related contingent consideration		—			(9,909	)
Proceeds from issuance of common stock under employee stock plans, net of repurchases		55,830			64,295
Cash used to net share settle equity awards		(47,648	)		(12,331	)
Payments for repurchases of common stock		(35,040	)		—
Payment of debt assumed in acquisition		—			(2,244	)
Excess tax benefit from employee stock plans		50,673			27,538
Net cash provided by financing activities		23,815			67,349
Effect of exchange rate changes on cash and cash equivalents		1,297			110
Net increase in cash and cash equivalents		49,750			97,977
Cash and cash equivalents at beginning of period		165,726			67,749
Cash and cash equivalents at end of period	$	215,476		$	165,726

Riverbed Technology, Inc.

Supplemental Financial Information

In thousands

Unaudited

	Three months ended						Twelve months ended
	December 31,		September 30,		December 31,		December 31,
	2011		2011		2010		2011		2010
Revenue by Geography
United States		$108,976		$106,326		$91,661		$402,157		$294,631
Europe, Middle East and Africa		58,501		49,847		42,987		187,425		149,647
Rest of the world		35,358		33,610		30,785		136,894		107,611
Total revenue		$202,835		$189,783		$165,433		$726,476		$551,889
As a percentage of total revenues:
United States		54%		56%		55%		55%		53%
Europe, Middle East and Africa		29%		26%		26%		26%		27%
Rest of the world		17%		18%		19%		19%		20%
Total revenue		100%		100%		100%		100%		100%
Revenue by Sales Channel
Direct		$7,599		$7,068		$7,526		$32,627		$31,525
Indirect		195,236		182,715		157,907		693,849		520,364
Total revenue		$202,835		$189,783		$165,433		$726,476		$551,889
As a percentage of total revenues:
Direct		4%		4%		5%		4%		6%
Indirect		96%		96%		95%		96%		94%
Total revenue		100%		100%		100%		100%		100%

Riverbed Technology, Inc.

GAAP to Non-GAAP Reconciliation

In thousands, except per share amounts

Unaudited

	Three months ended									Twelve months ended
GAAP to Non-GAAP Reconciliations:	December 31,			September 30,			December 31,			December 31,
	2011			2011			2010			2011			2010
Reconciliation of Total revenue:
U.S. GAAP as reported	$	202,835		$	189,783		$	165,433		$	726,476		$	551,889
Adjustments:
Deferred revenue adjustment (6)		1,189			813			—			2,002			—
As adjusted	$	204,024		$	190,596		$	165,433		$	728,478		$	551,889
Reconciliation of Net income:
U.S. GAAP as reported	$	20,154		$	19,325		$	12,611		$	63,807		$	34,158
Adjustments:
Stock-based compensation (1)		21,734			22,504			20,305			89,734			70,801
Payroll tax on stock-based compensation (2)		3,565			234			1,634			7,465			3,147
Amortization on intangibles (3)		4,858			3,968			1,815			13,120			5,400
Acquisition-related costs (5)		3,400			4,681			1,104			10,853			5,260
Inventory fair value adjustment (4)		—			120			376			359			376
Deferred revenue adjustment (6)		1,189			813			—			2,002			—
Income tax adjustments (7)		(13,787	)		(11,565	)		(6,114	)		(37,375	)		(26,758	)
As adjusted	$	41,113		$	40,080		$	31,731		$	149,965		$	92,384
Reconciliation of Net income per share, diluted:
U.S. GAAP as reported	$	0.12		$	0.12		$	0.08		$	0.38		$	0.22
Adjustments:
Stock-based compensation (1)		0.13			0.14			0.12			0.54			0.46
Payroll tax on stock-based compensation (2)		0.02			—			0.01			0.04			0.02
Amortization on intangibles (3)		0.03			0.02			0.01			0.08			0.03
Acquisition-related costs (5)		0.02			0.03			0.01			0.07			0.03
Deferred revenue adjustment (6)		0.01			—			—			0.01			—
Income tax adjustments (7)		(0.08	)		(0.07	)		(0.04	)		(0.22	)		(0.17	)
As adjusted	$	0.25		$	0.24		$	0.19		$	0.90		$	0.59
Non-GAAP Net income per share, basic	$	0.26		$	0.26		$	0.21		$	0.97		$	0.64
Non-GAAP Net income per share, diluted	$	0.25		$	0.24		$	0.19		$	0.90		$	0.59
Shares used in computing basic net income per share (8)		155,699			155,367			149,058			154,411			145,012
Shares used in computing diluted net income per share (8)		166,838			167,031			163,359			166,900			155,999
Non-GAAP adjustments:
Support and services revenue	$	1,189		$	813		$	—		$	2,002		$	—
Cost of product		3,781			3,250			1,838			10,991			4,461
Cost of support and services		1,793			1,604			1,719			7,001			5,805
Sales and marketing		12,063			10,593			9,287			43,478			33,010
Research and development		8,688			7,699			6,846			32,457			21,621
General and administrative		5,534			5,148			4,926			21,301			16,744
Other acquisition costs		1,087			2,732			618			5,211			3,343
Other expense (9)		611			481			—			1,092			—
Provision for income taxes		(13,787	)		(11,565	)		(6,114	)		(37,375	)		(26,758	)
Total Non-GAAP adjustments	$	20,959		$	20,755		$	19,120		$	86,158		$	58,226

(1) Stock-based compensation expense is calculated in accordance with the fair value recognition provisions of Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 718,Compensation - Stock Compensationeffective January 1, 2006.

(2) Payroll tax on stock-based compensation represents the incremental cost for employer payroll taxes on stock option exercises and restricted stock units vested and released.

(3) The intangible assets recorded at fair value as a result of our acquisition are amortized over the estimated useful life of the respective asset.

(4) The inventory fair value adjustment recorded pursuant to our acquisition is excluded from our non-GAAP operating expenses as this cost would not have otherwise occurred in the period presented.

(5) We incurred expenses in connection with our acquisitions, which would not have otherwise occurred in the period presented as part of our operating expenses; therefore, these costs or credits are excluded from our non-GAAP operating expenses.

(6) Business combination accounting rules require us to account for the fair value of deferred revenue assumed in connection with an acquisition. The non-GAAP adjustment is intended to reflect the full amount of support and service revenue that would have otherwise been recorded by the acquired entity.

(7) The non-GAAP tax rate excludes the income tax effects of non-GAAP adjustments. Additionally, the non-GAAP tax rate includes adjustments to our tax valuation allowance on deferred tax assets and excludes the interim tax cost of the one-time transfer of intellectual property rights between our legal entities.

(8) Shares used in computing basic and diluted net income per share is reflective of the stock split for all periods presented.

(9) We incurred expenses, including revaluation of the contingent consideration, in connection with our acquisitions, which would not have otherwise occurred in the period presented as part of our other income (expense); therefore, these costs are excluded from our non-GAAP other income (expense).