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.
   

July 28, 2003

Quality Systems Reports First- Quarter Results

IRVINE, Calif.--(BUSINESS WIRE)--July 28, 2003--Quality Systems, Inc. (Nasdaq:QSII - News) today announced the results of operations for its fiscal 2004 first quarter ended June 30, 2003.

The Company posted net revenues of $16.3 million in the first quarter, an increase of 33% from $12.3 million for the same quarter last year. The Company reported net income of $2,277,000, an increase of 40% over net income of $1,626,000 for the comparable quarter of the prior year. Fully diluted earnings per share totaled $0.35 in the quarter, an increase of 35% over the fully diluted $0.26 per share earnings recorded in the same quarter last year.

The revenue, net income, and earnings per share results achieved in the quarter were records for the Company. Results in the quarter were driven by record revenue and profits in the Company's NextGen Healthcare Information Systems division. For the quarter, the Company's NextGen Healthcare division posted record revenues of $12.2 million, up 51% from the same quarter of the prior year, and record operating income of $3.4 million, up 62% over the same quarter of the prior year.

Quality Systems, Inc. will hold a conference call to discuss first-quarter financial results today, Monday, July 28, 2003 at 1:00 p.m. EDT (10:00 a.m. PDT). To participate in the call, please call 877-586-7724 five to ten minutes prior to the scheduled conference call time. There is no pass code required for this call. If you are unable to participate in the call at this time, a replay will be available on Monday, July 28 at 1:00 p.m. PDT, through Monday, August 4 at midnight PDT; call 800-642-1687 and enter the conference ID number 1836697.

A transcript of the conference call will be made available on the QSII Web site (www.qsii.com). Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary are developers and providers of computer-based practice management, medical records, and connectivity applications for medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information.

This news release may contain 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 impact actual results are volume and timing of systems sales and installations, length of sales cycles and installation process; the possibility that the products will not achieve market acceptance; 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.

Quality Systems, Inc.
    Consolidated Statements of Operations and Comprehensive Income
                              (Unaudited)
                                                  Three Months Ended
                                                      June 30,
                                                  2003        2002
Net Revenues:
   Sales of computer systems,
      upgrades and supplies                     9,474,000   6,425,000
   Maintenance and other services               6,832,000   5,882,000
                                               16,306,000  12,307,000
Cost of Products and Services                   6,610,000   4,920,000
Gross Profit                                    9,696,000   7,387,000
Selling, General and
   Administrative Expenses                      4,740,000   3,673,000
Research and Development Costs                  1,366,000   1,135,000
Income from Operations                          3,590,000   2,579,000
Investment Income, net                            100,000     104,000
Income before Provision for
   Income Taxes                                 3,690,000   2,683,000
Provision for Income
   Taxes                                        1,413,000   1,057,000
Net Income                                     $2,277,000  $1,626,000
Income  per Share - Basic                           $0.37       $0.27
Income  per Share - Diluted                         $0.35       $0.26
Weighted average number
   of shares outstanding - Basic                6,157,000   6,106,000
Weighted average number
   of shares outstanding - Diluted              6,466,000   6,332,000
                         Quality Systems, Inc.
                      Consolidated Balance Sheets
                            (in thousands)
                                                June 30,    March 31,
                                                 2003         2003
                                               (unaudited)
ASSETS
Current Assets:
   Cash and cash equivalents                      $38,976     $36,443
   Accounts receivable, net                        19,039      17,561
   Inventories                                      1,152         667
   Deferred tax assets                              2,029       2,029
   Other current assets                             1,432       2,086
    Total current assets                           62,628      58,786
Equipment and Improvements, net                     1,734       1,777
Capitalized Software Costs, net                     2,760       2,511
Deferred Tax Asset                                  1,819       1,819
Excess of Cost Over Net Assets
   of Acquired Business, net                        1,840       1,840
Other Assets                                          861         869
 Total assets                                     $71,642     $67,602
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
   Accounts payable                                $1,483      $2,477
   Deferred revenue                                13,979      11,699
   Other current liabilities                        6,298       5,893
    Total liabilities                              21,760      20,069
Commitments and Contingencies
Shareholders' Equity:
   Common stock, $0.01 par value, 20,000
    shares authorized, 6,161 and 6,152 shares
    issued and outstanding, respectively               62          62
   Additional paid-in capital                      35,193      35,121
   Retained Earnings                               14,627      12,350
 Total shareholders' equity                        49,882      47,533
 Total liabilities and shareholders' equity       $71,642     $67,602
                          
Contact:
Quality Systems Inc., Irvine
Lou Silverman, 949/255-2600
www.qsii.com
or
Coffin Communications Group, Sherman Oaks, Calif.
William F. Coffin/Sean Collins, 818/789-0100
www.coffincg.com.