Quality Systems, Inc. ("QSI") and its wholly-owned subsidiary, MicroMed Healthcare Information Systems, Inc. ("MicroMed"), develop and provide computer-based practice management, medical records, and e-business applications for medical and dental group practices.
   

January 27 , 2000

Quality Systems Inc. Reports Fiscal 2000 Third-Quarter Results
TUSTIN, Calif. — Quality Systems Inc. (Nasdaq:QSII - news) today announced results for the fiscal 2000 third quarter ended Dec. 31, 1999.

Third-quarter revenues for fiscal 2000 were unchanged at $8.8 million as compared with the third quarter of the previous year. Net income for the company rose 28.7% to $475,000, or $0.08 per basic and diluted share, for the quarter ended Dec. 31, 1999, compared with net income of $369,000, or $0.06 per basic and diluted share, for the comparable quarter of the previous year.

For the nine-month period ended Dec. 31, 1999, the company posted net revenues of $27.6 million, up 15.2% from $24.0 million for the nine months ended Dec. 31, 1998. In the current nine-month period, the company achieved net income of $2.0 million, or $0.31 per basic and diluted share, compared with a net loss of $171,000, or $0.03 loss per basic and diluted share, for the same period a year ago.

The improved net income for the nine months reflects an increase in sales coupled with a decrease in selling, general and administrative expenses. For the latest nine-month period, sales of computer systems, upgrades and supplies grew 13.8% and maintenance and other services increased 16.8% compared with the same period a year ago, while SG&A decreased 7.2%.

Quality Systems Chairman and CEO Sheldon Razin commented, ``During the third quarter, we progressed in the development of our Web-enabled applications and e-healthcare products and services. We are moving forward with our Internet initiatives and will continue to implement these strategies in upcoming quarters.''

Quality Systems is one of the leading developers and providers of computer-based practice management and electronic medical records systems for medical and dental group practices, with a customer base of approximately 600 clients in 45 states, Canada and Saudi Arabia.

This news release contains forward-looking statements, including those related to revenue and net income, that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are volume and timing of systems sales and installations, length of sales cycles and installation process, seasonal patterns of sales and customer buying behavior, the development by competitors of new or superior technologies, delays in product development, undetected errors or bugs in software, product liability, changing economic, political or regulatory influences on the healthcare industry, changes in product pricing policies, competitive pressures, possible regulation of the company's software by the U.S. Food and Drug Administration, general economic conditions, and the risk factors detailed from time to time in Quality Systems' periodic reports and registration statements filed with the Securities and Exchange Commission as applied to the company as of the date hereof. 


                         Quality Systems Inc.
Consolidated Statements of Operations and Comprehensive Income (Loss)
                              (Unaudited)
               (in thousands, except per-share amounts)
                            Three Months Ended    Nine Months Ended
                                  Dec. 31,             Dec. 31,
                               1999      1998       1999     1998
Net Revenues:
 Sales of computer systems,
   upgrades & supplies       $ 4,435   $ 5,000   $ 15,184   $ 13,338
 Maintenance and other
  services                     4,373     3,827     12,435     10,645
                               8,808     8,827     27,619     23,983
Cost of Products and Services  4,023     4,037     12,547     11,510
Gross Profit                   4,785     4,790     15,072     12,473
Selling, General &
 Administrative Expenses       3,166     3,390      9,344     10,072
Research and Development Costs   962       842      2,819      2,630
Income (Loss) from Operations    657       558      2,909       (229)
Investment Income                183       109        531        260
Income before Provision for
 Income Taxes                    840       667      3,440         31
Provision for Income Taxes       365       298      1,485        202
Net Income (Loss) and
 Comprehensive Income (Loss)    $475      $369     $1,955      $(171)
Net Income (Loss) per Share,
 basic and diluted            $ 0.08    $ 0.06     $ 0.31    $ (0.03)
Weighted average number
 of shares outstanding:
 Basic                         6,208     6,242      6,213      6,162
 Diluted                       6,218     6,243      6,223      6,162