Check Point Software Technologies Ltd. Reports Financial Results For The Second Quarter 2002.

Business Editors

REDWOOD CITY, Calif.--(BUSINESS WIRE)--July 22, 2002

Check Point Software Technologies Ltd. (Nasdaq:CHKP), the worldwide leader in securing the Internet, today announced financial results for the second quarter ended June 30, 2002.

Net income for the

quarter was $64.7 million or $0.26 per share (diluted) compared to $63.6 million and $0.25 in the first quarter of 2002. Revenues for the quarter were $108.6 million, a $4M sequential increase. During the second quarter, the company generated cash flow of $75.6 million, bringing the total cash and interest bearing investments to $1.18 billion as of June 30, 2002. Days Sales Outstanding (DSO) improved to 49 days.

"We are pleased to report that Check Point continued to deliver solid operational and financial performance during the second quarter. Despite continued weakness in the IT macroeconomic condition, we saw increased demand and business volume, especially in the US market," said Gil Shwed, chairman and chief executive officer of Check Point Software Technologies. "During the quarter, we continued to win significant deals, grow our partnerships and deliver technological advancements."

Second Quarter highlights include:

-- Next Generation Security - Introduced SmartDefense, the first product in a new category of Active Defense security solutions. SmartDefense intelligently detects and protects against known and unknown network attacks. Also, announced technology enhancements to secure VoIP communications and Wireless LAN infrastructures.

-- Next Generation Management - Introduced SmartCenter and SmartCenter Pro, delivering feature rich management tools in an easy-to-use, highly scalable single console with the industry's lowest total cost of ownership for network security deployments.

-- Groundbreaking Price/Performance - Raised the bar on security price/performance with the introduction of Next Generation Performance Pack. Real-world benchmarks delivered 710 Mbps VPN and 3.1 Gbps firewall performance on a single $4K system.

-- Global Partnerships - Unveiled worldwide agreement with HP to deliver end-to-end VPN/security solutions on multiple HP platforms; agreement included HP sales, consulting, integration services and technical support. Also, signed Softbank as the first distributor in Japan for our Safe@ product line, primarily targeted at small offices/home offices.

-- Wireless Security - Expanded OPSEC integration category to enable comprehensive, interoperable security for mobile devices and wireless networking solutions - with support from industry-leading partners HP, Intel, IBM, Microsoft, Nokia and Proxim.

-- Security Certifications - Check Point VPN-1(R)/FireWall-1(R) Next Generation has passed rigorous tests to achieve three important U.S. and international certifications and conform to the highest security standards mandated by government and commercial organizations worldwide. The following three certifications were obtained during the quarter: Common Criteria (EAL4), Federal Information Processing Standard 140-1 (FIPS 140) and IT Security Evaluation Criteria (ITSEC E3).

-- Check Point Experience - Achieved record attendance with over 2,500 customers and partners at Check Point Experience conferences held in Anaheim, California and Dublin, Ireland. This demonstrates the continued and growing importance of Internet security and best-of-breed technology in today's marketplace.

"We continued to expand our leadership in all segments of our business -- the most secure enterprise solutions, securing wireless infrastructures and the small office/home office broadband segment. In addition, we raised the security bar with the new SmartDefense solution. Based on our results and our platform partners' reports, we continue to gain market share in the open solutions and the hardware-based VPN/firewall segments. Overall, we are pleased with the demand and level of activity in our marketplace and believe that we will see the results of our leadership with the improvement in the IT macroeconomic conditions."

Conference Call Information

The Company will host a conference call with the investment community on July 22 at 5:30 AM PT/8:30 AM ET. To listen to the live webcast, please visit Check Point's web site at http://www.checkpoint.com/ir. A replay of the conference call will be available through Monday, August 5, 2002, at the Company's website or by telephone at (719) 457-0820, confirmation code 565746.

Safe Harbor Statement

Certain statements in this press release are forward-looking statements. Because such statements deal with future events, they are subject to various risks and uncertainties and actual results could differ materially from Check Point's current expectations. Factors that could cause or contribute to such differences include, but are not limited to: the impact on revenues of economic and political uncertainties and weaknesses in various regions of the world, including the commencement or escalation of hostilities or acts of terrorism; the inclusion of network security functionality in third-party hardware or system software; any unforeseen developmental or technological difficulties with regard to Check Point's products; changes in the competitive landscape, including new competitors or the impact of competitive pricing and products; a shift in demand for products such as Check Point's; unknown factors affecting third parties with which Check Point has formed business alliances; timely availability and customer acceptance of Check Point's new and existing products, and other factors and risks discussed in Check Point's Annual Report on Form 20-F for the year ended December 31, 2001, which is on file with the Securities and Exchange Commission. Check Point assumes no obligation to update information concerning its expectations.

About Check Point Software Technologies

Check Point Software Technologies is the worldwide leader in securing the Internet. It is the confirmed market leader of both the worldwide VPN and firewall markets. The company's Secure Virtual Network (SVN) architecture provides the VPN and security infrastructure that uniquely enables secure and reliable Internet communications. SVN solutions, as delivered in the company's Next Generation product family, secure business communications and resources for corporate networks, remote employees, branch offices and partner extranets. Extending the power of SVN is Check Point's Open Platform for Security (OPSEC), the industry's framework and alliance for integration and interoperability with "best-of-breed" solutions from over 300 leading companies. Check Point solutions are sold, integrated and serviced by a network of 2,500 certified partners in 203 countries. For more information, please call us at (800) 429-4391 or (650) 628-2000 or visit us on the Web at http://www.checkpoint.com or at http://www.opsec.com.

Note to Editors: (c)2002 Check Point Software Technologies Ltd. All rights reserved. Check Point, the Check Point logo, ClusterXL, ConnectControl, FireWall-1, FireWall-1 SecureServer, FireWall-1 SmallOffice, FireWall-1 XL, FloodGate-1, INSPECT, INSPECT XL, IQ Engine, Meta IP, Open Security Extension, OPSEC, Provider-1, SecureKnowledge, SecureUpdate, SiteManager-1, SmartDefense, SVN, UAM, User-to-Address Mapping, UserAuthority, Visual Policy Editor, VPN-1, VPN-1 Accelerator Card, VPN-1 Net, VPN-1 Pro, VPN-1 SecureClient, VPN-1 SecuRemote, VPN-1 SecureServer, VPN-1 SmallOffice, and are trademarks or registered trademarks of Check Point Software Technologies Ltd. or its affiliates. All other product names mentioned herein are trademarks or registered trademarks of their respective owners. The products described in this document are protected by U.S. Patent No. 5,606,668 and 5,835,726 and may be protected by other U.S. Patents, foreign patents, or pending applications.

                CHECK POINT SOFTWARE TECHNOLOGIES LTD.
            CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
               (In thousands, except per share amount)

                       Three Months Ended       Six Months Ended
                            June 30,                June 30,
                       ------------------       -----------------
                        2002        2001         2002       2001
                       ------------------       -----------------
                           (Unaudited)             (Unaudited)

Revenues              $108,587    $142,071     $213,170   $287,081
Cost of revenues         4,889       6,464        9,504     16,542
                      --------------------     -------------------
Gross profit           103,698     135,607      203,666    270,539
                      --------------------     -------------------

Operating expenses:
Research and
 development             7,383       9,049       14,782     18,369
Sales and marketing     27,865      28,714       52,898     59,096
General and
 administrative          4,364       6,145        9,201     12,683
                      --------------------     -------------------
Total operating
 expenses               39,612      43,908       76,881     90,148
                      --------------------     -------------------

Operating income        64,086      91,699      126,785    180,391
Financial &
 other income, net      12,332      11,574       24,559     21,675
                      --------------------     -------------------
Income before
 income taxes           76,418     103,273      151,344    202,066
Income taxes            11,684      16,472       23,074     31,587
                      --------------------     -------------------

Net income             $64,734     $86,801     $128,270   $170,479
                      ====================     ===================
Earnings per
 share (Basic)           $0.27       $0.36         0.53      $0.72
                      ====================     ===================
Number of shares
 used in computing
 earnings per share
 (Basic)               243,740     239,202      243,673    238,044
                      ====================     ===================
Earnings per
 share (Fully
 diluted)                $0.26       $0.33        $0.50      $0.66
                      ====================     ===================
Number of shares
 used in computing
 earnings per share
 (Fully diluted)       253,559     260,440      256,279    259,879
                      ====================     ===================



                CHECK POINT SOFTWARE TECHNOLOGIES LTD.
               SELECTED CONSOLIDATED BALANCE SHEET DATA

                            (In thousands)

                                ASSETS

                                      June 30,          December 31,
                                        2002                2001
                                    -----------         ------------
                                    (Unaudited)          (Audited)

Assets:
Cash and cash equivalents,
 deposits and marketable
 securities                         $1,182,361           $1,028,317
Trade receivables, net                  59,315               74,294
Other receivables and
 prepaid expenses                       21,029               21,290
Net property and equipment              12,163               13,248
Deferred income taxes                    5,874                5,759
                                    ----------           ----------
Total assets                        $1,280,742           $1,142,908
                                    ==========           ==========


                            LIABILITIES AND
                          SHAREHOLDERS' EQUITY

Liabilities:
Deferred revenues                      $94,624              $95,703
Trade payables and other
 accrued liabilities                   134,556              131,477
                                    ----------           ----------

Total current liabilities              229,180              227,180
                                    ----------           ----------

Shareholders' Equity:
Share capital                              737                  735
Additional paid-in capital             154,378              146,816
Retained earnings                      896,447              768,177
                                    ----------           ----------

Total shareholders' equity           1,051,562              915,728
                                    ----------           ----------

Total liabilities and
 shareholders equity                $1,280,742           $1,142,908
                                    ==========           ==========