RICHMOND, Calif.– February 14, 2002 – QRS Corporation (Nasdaq: QRSI), a market leader in supply chain technology for the retail industry, announced today the results of its fourth quarter and year ended December 31, 2001. The Company reported revenues of $34.3 million for the quarter ended December 31, 2001, compared to revenues of $34.0 million for the quarter ended December 31, 2000. Revenues for the fourth quarter of 2001 exclude $1.6 million in unrecognized revenues that the Company did not recognize due to Kmart's January 22, 2002, Chapter 11 Bankruptcy filing. For the year ended December 31, 2001, the Company reported revenues of $142.6 million compared to revenues of $143.5 million for the year ended December 31, 2000.

"The plan for my first 100 days was to close the year positioned for improved performance," said Liz Fetter, president and CEO of QRS. "During the fourth quarter we executed on our key initiatives, including realigning QRS' products and services, reducing operating costs, developing a new world-class executive leadership team and achieving key wins in the marketplace. We are very pleased with these successes and our ability to maintain steady revenues despite the challenging economic environment and the specific impact of the Kmart Bankruptcy filing," said Fetter.

Net loss for the quarter ended December 31, 2001 was ($141.2 million), or ($9.08) per share, diluted, compared to net loss of ($9.7 million), or ($0.67) per share, diluted, for the quarter ended December 31, 2000. Net loss for the year ended December 31, 2001 was ($173.3 million), or ($11.26) per share, diluted, compared to net loss of ($42.4 million) or ($2.92) per share, diluted, for the year ended December 31, 2000.

Net loss for the fourth quarter and for the year ended December 31, 2001 include restructuring expenses of $14.1 million and $19.4 million, respectively, associated with severance, stock-based compensation, and facilities closure, and impairment losses of $114.7 million and $125.7 million, respectively, relating to the write-down of acquired goodwill and other intangible and tangible assets and the write-off of capitalized service and product development costs (of which $110.4 million and $121.4 million, respectively, have been included in operating expenses, and $4.3 million has been included in cost of revenues for each period).

Without these restructuring expenses, impairment losses and the write-off of capitalized service and product development costs, the pro forma net loss and gross margin for the quarter ended December 31, 2001, would have been ($12.4 million) or ($0.79) per share, diluted, and 38%, respectively; pro forma net loss and gross margin for the year ended December 31, 2001, would have been ($28.2 million) or ($1.84) per share, diluted, and 41%, respectively.

The Company's restructuring initiatives in 2001 are expected to result in operating expense reductions of approximately $6 million to $8 million in real estate and salary expense, plus an additional $26 million in reduced amortization expense related to intangible assets in 2002.

The Company also reported it had no long-term debt as of December 31, 2001, and that it ended the year with cash and marketable securities totaling $38.6 million, an increase of approximately 40% from $27.6 million as of December 31, 2000.

During the fourth quarter of 2001, under Fetter's leadership, the Company initiated a comprehensive strategic review of its businesses and market opportunities. In consideration of the current tightening in information technology spending and uncertainties in the marketplace, the Company concluded that future cash flows from the assets acquired in connection with the acquisitions of RockPort, Image Info, Retail Data Services and Tradeweave Inc. would not be sufficient to recover the carrying value of the acquired goodwill and other intangible assets. Therefore, in compliance with Generally Accepted Accounting Principles, the Company recorded the impairment loss during the quarter ended December 31, 2001.

In addition, the Company restructured its operations in the fourth quarter of 2001, which included the realignment of QRS' products and services, the elimination of full-time positions and the consolidation of real estate. In December 2001, the Company announced that restructuring expenses for the fourth quarter 2001 were estimated to be in the range of $7 million to $10 million. Actual restructuring expenses for the quarter were $14.1 million, based substantially on an updated assessment of the declining San Francisco and New York Metro area real estate markets.

"By taking significant restructuring and impairment charges and improving our cost structure, we believe our operating margins going forward will better reflect the performance of the Company," said Jack Parsons, chief financial officer of QRS. "We expect to maintain revenues in the first half of 2002 and our goal is to begin to show growth in the second half of the year. We also intend to manage costs aggressively with the goal of returning to operating profitability by mid-year and increasing gross margins by 10 percentage points by year-end."

Highlights from Q4 2001 and 2002 year-to-date:

• Closing and implementing key deals. Jones Apparel Group Inc. (NYSE: JNY) implemented QRS' Tradeweave™ Collaborative Merchandising to enhance its merchandising process and work more effectively with its retail customers; Federated Department Stores Inc. (NYSE: FD) entered into a new multi-year agreement for the use of Tradeweave Product Catalog and Tradeweave Data Exchange Messaging in the synchronization and exchange of procurement documents and related information with its vendors.
• Broadening the product offering to meet customers' evolving needs. A strategic partnership with Cyclone Commerce for joint development and distribution of products was announced at the National Retail Federation show in January 2002. The partnership positions QRS as the only provider of a complete trading community management offering for the retail industry.
• Expanding into new geographic markets. Selfridges, a leading European department store, became the first retailer in Europe to sign a contract for QRS' Tradeweave Product Catalog.
• Building the management team. Executive leadership has been augmented with the following key additions:
  -- Senior vice president and chief financial officer
  -- Vice president, finance
  -- Senior vice president, general counsel and corporate secretary
  -- Senior vice president, human resources
  -- Vice president, product management and marketing
  -- Vice president, consumer packaged goods/grocery sales and marketing

"We have made significant progress in a short period of time. We are on pace with our plan and have been successful in achieving a comprehensive set of goals related to the balance sheet, operations, recruitment and business strategy development," said Fetter. "And, we are focused on delivering on our promise of profitability and long-term growth."

Conference Call Information

An earnings announcement conference call is scheduled for 11:00 a.m. PST (2:00 p.m. EST) on Thursday, February 14, 2002. The toll-free number for those who would like to participate is 1-877-580-9103 with pass code QRS.

Replay will be available from Thursday, February 14, 3:00 p.m. (6:00 p.m. EST) until Monday, February 18, 5:00 p.m. (8:00 p.m. EST) at 1-800-945-1849.

The call also will be Web-cast and can be accessed at www.qrs.com.

About QRS
QRS is a market leader in supply chain technology for the retail industry. QRS software applications and services help the world's top retailers and manufacturers achieve superior profit, maximum efficiency and competitive advantage. Since 1988 QRS has led the way in supply chain technology with tools that now include Tradeweave brand messaging, catalog, sourcing, merchandising and showroom. QRS has the world's largest retail product catalog and the world's largest online retail trading community. Learn more about QRS Corporation at www.qrs.com.