Exhibit 99.1

Pegasystems Announces Record Revenue for Fourth Quarter and Fiscal Year 2011

Dramatic increase in customer demand fuels record bookings and revenue;

Value of 2011 license signings up more than 75 percent over previous year

CAMBRIDGE, Mass. – February 29, 2012 – Pegasystems Inc. (NASDAQ: PEGA) today announced financial results for the fourth quarter and year ended December 31, 2011. GAAP revenue for 2011 increased 24% to $416.7 million compared to 2010. GAAP net income for 2011 was $10.1 million, or $0.26 per diluted share, compared to GAAP net loss of $5.9 million, or ($0.16) per diluted share, for 2010. Non-GAAP net income for 2011 was $28.4 million, or $0.72 per diluted share, compared to Non-GAAP net income of $22.5 million, or $0.57 per diluted share, for 2010.

SELECTED GAAP & NON-GAAP RESULTS (1)

(1) See a reconciliation of our GAAP to Non-GAAP measures contained in the financial schedules at the end of this release.

Business Perspective

“We had terrific results in Q4 highlighted by growth across geographies and within key industries, including financial services, insurance, communications, energy, warranty management, travel & hospitality, and healthcare,” said Alan Trefler, Founder and CEO of Pegasystems. “Significant customer wins during the quarter included one of the largest global wireless carriers, one of the largest insurers in Western Europe, and a leading U.S. cable television provider. We also saw increased adoption of our solutions at a leading U.K bank, two of the largest global banks, and a leading online travel services provider. Our work with partners continues to bear fruit with most of these customer successes driven with partners who continue building significant Pega practices.”

“We enter 2012 excited about recent and imminent additions to our product portfolio. We are broadening our product leadership focus in the areas of multi-channel customer service and next-best-action marketing. We

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are also extending our mobile, social media, and decisioning capabilities across our core platform and industry solutions. We are thrilled that our existing customers are seeing the value from their initial purchases, and are expanding their adoption of Pega technology,” concluded Mr. Trefler.

Craig Dynes, Pegasystems’ CFO, added, “Despite the challenging economy, we set new records for the value of license signings for both the year and Q4. We start 2012 with a great backlog and a strong pipeline. We estimate our 2012 revenue to exceed $500 million, with no material differences between GAAP and Non-GAAP revenue. Similar to last year, we expect 2012 will be back-end loaded, and therefore, revenue for the first half of 2012 is estimated to be about 45% of annual guidance.”

“We believe that our record license signings are related to our investments in sales and R&D. These will be areas of continued investment to drive future growth. Accordingly, net income for 2012 is estimated to be $15 million, or $0.37 per diluted share, on a GAAP basis, or $36.5 million or $0.91 per diluted share on a Non-GAAP basis. Because of the back-ended nature of our revenue, as well as important planned expenditures in the first half of 2012 which include our annual sales kickoff in Q1 and our PegaWORLD user conference in Q2, we estimate the first half of 2012 to be break-even on a GAAP basis or earnings of $0.25 per diluted share on a Non GAAP basis.”

Messrs. Trefler and Dynes will host a conference call and live Webcast associated with this announcement at 6:00 p.m. EST on February 29, 2012. Dial-in information is as follows: (877) 348-9349 (domestic) or (678) 809-1046 (international). To listen to the Webcast log onto www.pega.com at least 5 minutes prior to the event’s broadcast and click on the Webcast icon in the Investor Relations section. A replay of the call will also be available on www.pega.com in the Investor Relations section Audio Archives link.

Discussion of Non-GAAP Measures

To supplement financial results presented on a GAAP basis, the Company provides Non-GAAP measures, including in this release. Pegasystems’ management utilizes a number of different financial measures, both GAAP and Non-GAAP, in analyzing and assessing the overall performance of the business, for making operating decisions, and for forecasting and planning for future periods. The Company’s annual financial plan is prepared both on a GAAP and Non-GAAP basis, and the Non-GAAP annual financial plan is approved by our board of directors. In addition and as a consequence of the importance of these measures in managing the business, the Company uses Non-GAAP measures and results in the evaluation process to establish management’s compensation.

The Non-GAAP measures exclude certain business combination accounting entries and expenses related to our acquisition of Chordiant, as well as other significant expenses including stock-based compensation. The Company believes that these Non-GAAP measures are helpful in understanding our past financial performance and our anticipated future results. These Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. A reconciliation of the Company’s GAAP to Non-GAAP measures is included in the financial schedules at the end of the release.

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Forward-Looking Statements

Certain statements contained in this press release may be construed as "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995, including those relating to our revenue, net income, and earnings per share. The words “anticipate,” “project,” “expect,” “plan,” “intend,” “believe,” “estimate,” “should”, “target,” “forecast,” “could,” “preliminary,” “guidance” and similar expressions, among others, identify forward-looking statements, which speak only as of the date the statement was made. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause the Company’s actual results to differ from those expressed in such forward-looking statements. These risks and uncertainties include, among others, variation in demand for our products and services and the difficulty in predicting the completion of product acceptance and other factors affecting the timing of our license revenue recognition, our ability to develop new products and evolve existing ones, the ongoing consolidation in the financial services and healthcare markets, our ability to attract and retain key personnel, reliance on key third party relationships, the potential loss of vendor specific objective evidence for our professional services, and management of the Company’s growth. Further information regarding these and other factors which could cause the Company’s actual results to differ materially from any forward-looking statements contained in this press release is contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and other recent filings with the Securities and Exchange Commission. The forward-looking statements contained in this press release represent the Company’s views as of February 29, 2012. Investors are cautioned not to place undue reliance on such forward-looking statements and there are no assurances that the matters contained in such statements will be achieved. Although subsequent events may cause the Company’s view to change, the Company does not undertake and specifically disclaims any obligation to publicly update or revise these forward-looking statements whether as the result of new information, future events or otherwise. The statements should therefore not be relied upon as representing the Company’s view as of any date subsequent to February 29, 2012.

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About Pegasystems

Pegasystems, the leader in business process management and software for customer centricity, helps organizations enhance customer loyalty, generate new business, and improve productivity. Our patented Build for Change^® technology speeds the delivery of critical business solutions by directly capturing business objectives and eliminating manual programming. Pegasystems flexible on-premise and cloud-based solutions enable clients to quickly adapt to changing business conditions in order to outperform the competition. For more information, please visit us at www.pega.com.

For Information, contact:

Craig Dynes, Chief Financial Officer

617-866-6020

CDynes@pega.com

All trademarks are the property of their respective owners.

The information contained in this press release is not a commitment, promise, or legal obligation to deliver any material, code or functionality. The development, release and timing of any features or functionality described remains at the sole discretion of Pegasystems. Pegasystems specifically disclaims any liability with respect to this information.

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Pegasystems Inc.

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)

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PEGASYSTEMS INC.

RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES (1)

($ in thousands, except per share data)

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PEGASYSTEMS INC.

RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES (1)

($ in thousands, except per share data)

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PEGASYSTEMS INC.

FOOTNOTES FOR RECONCILIATON OF

SELECTED GAAP MEASURES TO NON-GAAP MEASURES

Revenue: Business combination accounting rules require that we determine the fair value of the deferred revenue liability for contractual obligations assumed from Chordiant. In post-acquisition reporting periods, we recognize revenue for the fair value of these contracts, when all the revenue recognition criteria are satisfied, instead of the revenue that would have been recognized by Chordiant as an independent company. We add back the effect of the deferred revenue fair value adjustment in Non-GAAP revenue to reflect the full amount of these revenues to provide a more complete comparison with the revenue of peer companies.

Amortization of intangible assets: We have excluded the effect of amortization of intangible assets acquired from Chordiant from our Non-GAAP operating expenses and net earnings measures. Amortization of intangible assets is inconsistent in amount and frequency and is significantly affected by the timing and size of our acquisitions. Investors should note that the use of intangible assets contributed to our revenues earned during the periods presented and will contribute to our future period revenues as well. Amortization of intangible assets will recur in future periods.

Stock-based compensation expenses: We have excluded the effect of stock-based compensation expenses from our Non-GAAP operating expenses and net earnings measures. Although stock-based compensation is a key incentive offered to our employees, and we believe such compensation contributed to the revenues earned during the periods presented and also believe it will contribute to the generation of future period revenues, we continue to evaluate our business performance excluding stock-based compensation expense.

Acquisition-related costs and restructuring costs: We have excluded the effect of acquisition-related costs and restructuring costs from our Non-GAAP operating expenses and net earnings measures. We incurred direct and incremental costs associated with the Chordiant acquisition. These acquisition-related costs were primarily due diligence costs, advisory and legal transaction fees, and valuation and tax consulting fees. We have also incurred restructuring costs related to the integration of the acquisition, which we generally would not have otherwise incurred in the periods presented as a part of our continuing operations. Restructuring costs consist of employee severance and other exit costs. We believe it is useful for investors to understand the effects of these items on our total operating expenses.

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Condensed Consolidated Balance Sheets

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Condensed Consolidated Statements of Cash Flows

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FY 2012 Reconciliation of Forward-Looking Guidance

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