EXHIBIT 99.1

NEWS

Editorial Contact: Erin Jones

949-754-8032

erin.jones@quest.com

Investor Contact: Scott Davidson

949-754-8659

scott.davidson@quest.com

QUEST SOFTWARE REPORTS RESULTS FOR FOURTH QUARTER AND 2003

Record Revenue of $89.0 Million for the Quarter;

$304 Million In Revenue for the Year Ended December 31, 2003

IRVINE, Calif., January 28, 2004 – Quest Software, Inc. (Nasdaq: QSFT), a leading provider of application management solutions, today reported record financial results for the quarter ended December 31, 2003. Total revenues increased 25% year over year to $89.0 million compared to last year’s fourth quarter revenue of $71.2 million. Total revenues increased 19% to $304.3 million in fiscal 2003 compared to total revenues of $255.6 million in fiscal 2002.

GAAP Results

Quest Software’s net income for the fourth quarter was $11.5 million, or $0.12 per diluted share. Net income for year ended December 31, 2003 was $21.5 million, or $0.23 per diluted share. GAAP operating margins increased sequentially from 8.1% to 19.0% in the fourth quarter, resulting in record GAAP operating income of $17.0 million.

Non-GAAP Results

On a pro forma basis, operating margins increased to 21.5% for the quarter, resulting in pro forma net income of $15.3 million, or $0.16 per share on a diluted basis. This compares to pro forma net income of $7.5 million, or $0.08 per share on a diluted basis, for the fourth quarter ended December 31, 2002. Pro forma operating income increased 71% to $38.5 million for the year ended December 31, 2003, and pro forma net income for the year was $31.7 million, or $0.34 per diluted share. Quest Software generated net cash of $27.2 million in the December 2003 quarter.

A reconciliation of pro forma and as reported financial results is included with this press release.

“We concluded the year with record license and services revenues and solid growth, with significant contributions coming from all regions and product lines,” said Vinny Smith, chairman and chief executive officer, Quest Software. “The fourth quarter marked solid execution on all fronts including product release milestones in our application performance management, database management and Microsoft infrastructure management areas with the introduction of Quest Foglight^®

Quest Reports Fourth Quarter 2003 Results – page 2 of 8

version 4.0, Quest Central for Databases version 4.0 and Quest Exchange Management Suite. Customers are eagerly adopting these new products because of their technical quality, depth of capability and ability to quickly deliver a return on investment. We also believe our ongoing efforts to increase internal productivity are paying off as reflected in Q4’s extraordinary margin expansion and operating income growth.”

During the fourth quarter, Quest Software received strong interest from customers in various vertical markets including communications, internet services, financial institutions, pharmaceuticals and technology for its application performance management, database management and Microsoft infrastructure management products. In the fourth quarter, Quest Software earned new customers and expanded its business with existing customers including Cingular Wireless, Earthlink, Inc., The Economical Insurance Group, E*TRADE FINANCIAL, McGraw Hill Companies, Ricoh Corporation, Royal Auto Club (RAC) Motoring Services, and Ticketmaster.

Quest Software management utilizes non-GAAP financial measures in the presentation of the Company’s results to provide a consistent understanding of its historical operating performance and comparisons with peer companies. Management believes that pro forma reporting provides a more accurate representation of the Company’s on-going economic performance and therefore uses pro forma reporting internally to evaluate and manage the Company’s operations. Management believes that these measures provide useful information because they exclude certain items including amortization of intangibles, other compensation expenses, gains or losses on investment securities and facility closure charges that are not necessarily relevant to understanding the operating activities within the Company’s business.

Financial Outlook

Quest Software management offers the following guidance for the quarter ending March 31, 2004:

• Revenue is expected to be in the range of $77.0 million to $79.0 million;

• GAAP diluted earnings per share is expected to be in the range of $0.06 to $0.08 per share;

• Pro forma diluted earnings per share is expected to be in the range of $0.07 to $0.09 per share. The pro forma guidance excludes approximately $1.3 million of amortization of purchased intangible assets, $563,000 of amortization of acquired intangible assets including customer lists, a non-compete agreement and trademarks, and $86,000 of other compensation charges related to stock options.

For the full year ending December 31, 2004, Quest Software management offers the following guidance:

• Annual revenue is expected to be in the range of $330 million to $340 million;

• GAAP diluted earnings per share is expected to be in the range of $0.32 to $0.35 per share;

Quest Reports Fourth Quarter 2003 Results – page 3 of 8

• Pro forma diluted earnings per share is expected to be in the range of $0.37 to $0.40. The pro-forma guidance excludes approximately $4.9 million of amortization of purchased intangible assets, $1.8 million of amortization of acquired intangible assets including customer lists, a non-compete agreement and trademarks, and $342,000 of other compensation charges related to stock options.

Fourth Quarter 2003 Conference Call Information

Quest Software will host a conference call today, Wednesday, January 28, 2004 at 2:00 p.m. Pacific Time, to discuss its results. A simultaneous Web cast of the conference call will be available on Quest Software’s Web site in the Investors – IR Events section at www.quest.com. A Web cast replay will be available on the same Web site through January 28, 2005. An audio replay of the call will also be available through February 11, 2004 by dialing (888) 203-1112 (from the United States or Canada) or (719) 457-0820 (outside the United States and Canada), using confirmation code: 215203.

About Quest Software, Inc.

Quest Software, Inc., a leader in application management, provides software for Application Confidence to 18,000 customers worldwide, including 75 percent of the Fortune 500. Quest products for database management, application performance management and Microsoft infrastructure management help customers develop, deploy, manage and maintain enterprise applications without expensive downtime or business interruption. Headquartered in Irvine, Calif., Quest Software can be found in offices around the globe and at www.quest.com.

Quest and Quest Software are registered trademarks of Quest Software, Inc. All other trademarks and registered trademarks are property of their respective owners.

# # #

Forward Looking Statements

This release and the matters to be discussed on the conference call may include predictions, estimates and other information that might be considered forward-looking statements. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ from those anticipated as a result of various factors, including:the impact of further adverse changes in general economic conditions on our customers; further reductions or delays in information technology spending; variations in the size and timing of customer orders; competitive products and pricing; rapid technological change; risks associated with the development and market acceptance of new products; disruptions caused by acquisitions of companies and/or technologies; fluctuating currency exchange rates and other risks associated with international operations; and the need to attract and retain qualified employees. For a discussion of these and other related risks, please refer to our recent SEC filings, including our Annual Report on Form 10-K for the year ended December 31, 2002, as amended, and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2003. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. We undertake no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.

Quest Reports Fourth Quarter 2003 Results – page 4 of 8

QUEST SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)
	Three Months Ended December 31,					Twelve Months Ended December 31,
	2003			2002		2003			2002
Revenues:
Licenses	$	54,250		$	44,143	$	179,560		$	160,636
Services		34,740			27,056		124,728			94,946
Total revenues		88,990			71,199		304,288			255,582
Cost of revenues:
Licenses		1,214			713		4,312			3,539
Services		5,560			4,628		21,365			17,913
Amortization of purchased intangible assets		1,284			1,765		7,675			5,744
Total cost of revenues		8,058			7,106		33,352			27,196
Gross profit		80,932			64,093		270,936			228,386
Operating expenses:
Sales and marketing		38,003			35,846		144,460			128,570
Research and development		16,859			15,107		67,448			60,051
General and administrative		8,371			6,553		29,656			24,971
In-process research and development		—			2,900		—			2,900
Intangible asset amortization		747			693		3,390			2,037
Total operating expenses		63,980			61,099		244,954			218,529
Income from operations		16,952			2,994		25,982			9,857
Other income, net		3,976			2,398		11,132			9,131
Loss on impairment/sale of aircraft		(3,495	)		—		(3,495	)		(790	)
Write-down of investments		—			1,405		—			310
Income before income tax provision		17,433			6,797		33,619			18,508
Income tax provision		5,955			2,987		12,103			8,124
Net income	$	11,478		$	3,810	$	21,516		$	10,384
Net income per share:
Basic	$	0.12		$	0.04	$	0.23		$	0.12
Diluted	$	0.12		$	0.04	$	0.23		$	0.11
Weighted average shares:
Basic		93,096			90,597		92,081			90,065
Diluted		96,480			92,724		94,231			92,820

Quest Reports Fourth Quarter 2003 Results – page 5 of 8

QUEST SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

	Three Months Ended December 31, 2003							Twelve Months Ended December 31, 2003
	GAAP			Adjustments		Adjusted		GAAP			Adjustments		Adjusted
Revenues:
Licenses	$	54,250				$	54,250	$	179,560				$	179,560
Services		34,740					34,740		124,728					124,728
Total revenues		88,990					88,990		304,288					304,288
Cost of revenues:
Licenses		1,214					1,214		4,312		(2	)(4)		4,310
Services		5,560		(13	)(1)		5,547		21,365		(71	)(4)		21,294
Amortization of purchased intangible assets		1,284		(1,284	)		—		7,675		(7,675	)		—
Total cost of revenues		8,058					6,761		33,352					25,604
Gross profit		80,932					82,229		270,936					278,684
Operating expenses:
Sales and marketing		38,003		(81	)(1)		37,922		144,460		(744	)(4)		143,716
Research and development		16,859		(68	)(1)		16,791		67,448		(509	)(4)		66,939
General and administrative		8,371		(16	)(1)		8,355		29,656		(100	)(4)		29,556
Intangible asset amortization		747		(747	)		—		3,390		(3,390	)		—
Total operating expenses		63,980					63,068		244,954					240,211
Income from operations		16,952					19,161		25,982					38,473
Other income, net		3,976					3,976		11,132		(98	)(5)		11,034
Loss on impairment of aircraft		(3,495	)	3,495	(2)		—		(3,495	)	3,495	(6)		—
Income before income tax provision		17,433					23,137		33,619					49,507
Income tax provision		5,955		1,847	(3)		7,802		12,103		5,720	(7)		17,823
Net income	$	11,478				$	15,335	$	21,516				$	31,684
Net income per share:
Basic	$	0.12				$	0.16	$	0.23				$	0.34
Diluted	$	0.12				$	0.16	$	0.23				$	0.34
Weighted average shares:
Basic		93,096					93,096		92,081					92,081
Diluted		96,480					96,480		94,231					94,231
For the Three Months Ended December 31, 2003
(1)    Represents compensation and other costs related primarily to stock option grants with a below fair market value exercise price.
(2)    Represents a one-time impairment charge to the carrying value of our aircraft.
(3)    Represents the tax effect of adjustments.
For the Twelve Months Ended December 31, 2003
(4)    Represents (1) $281,000 in severance and idle facility charges incurred from closing one of our Canadian offices, which are included in sales and marketing and research and development, and (2) compensation and other costs related primarily to stock option grants with a below fair market value exercise price.
(5)    Represents gain on securities held for trading purposes.
(6)    Represents a one-time impairment charge to the carrying value of our aircraft.
(7)    Represents the tax effect of adjustments.

Quest Reports Fourth Quarter 2003 Results – page 6 of 8

QUEST SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

	Three Months Ended December 31, 2002						Twelve Months Ended December 31, 2002
	GAAP		Adjustments		Adjusted		GAAP			Adjustments		Adjusted
Revenues:
Licenses	$	44,143			$	44,143	$	160,636				$	160,636
Services		27,056				27,056		94,946					94,946
Total revenues		71,199				71,199		255,582					255,582
Cost of revenues:
Licenses		713				713		3,539					3,539
Services		4,628	(21	)(1)		4,607		17,913		(110	)(1)		17,803
Amortization of purchased intangible assets		1,765	(1,765	)		—		5,744		(5,744	)		—
Total cost of revenues		7,106				5,320		27,196					21,342
Gross profit		64,093				65,879		228,386					234,240
Operating expenses:
Sales and marketing		35,846	(437	)(1)		35,409		128,570		(1,083	)(1)		127,487
Research and development		15,107	(150	)(1)		14,957		60,051		(621	)(1)		59,430
General and administrative		6,553	(51	)(1)		6,502		24,971		(175	)(1)		24,796
In-process research and development		2,900	(2,900	)		—		2,900		(2,900	)		—
Intangible asset amortization		693	(693	)		—		2,037		(2,037	)		—
Total operating expenses		61,099				56,868		218,529					211,713
Income from operations		2,994				9,011		9,857					22,527
Other income, net		2,398				2,398		9,131					9,131
Loss on sale of aircraft		—				—		(790	)	790			—
Write-down of investments		1,405	(1,405	)		—		310		(310	)		—
Income before income tax provision		6,797				11,409		18,508					31,658
Income tax provision		2,987	943	(2)		3,930		8,124		3,906	(2)		12,030
Net income	$	3,810			$	7,479	$	10,384				$	19,628
Net income per share:
Basic	$	0.04			$	0.08	$	0.12				$	0.22
Diluted	$	0.04			$	0.08	$	0.11				$	0.21
Weighted average shares:
Basic		90,597				90,597		90,065					90,065
Diluted		92,724				92,724		92,820					92,820
(1)    Represents compensation and other costs related primarily to stock option grants with a below fair market value exercise price. (2)    Represents the tax effect of adjustments.

Quest Reports Fourth Quarter 2003 Results – page 7 of 8

QUEST SOFTWARE, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

ASSETS
	December 31, 2003		December 31, 2002
Current assets:
Cash and cash equivalents	$	67,470	$	64,283
Short-term marketable securities available for sale		26,736		27,841
Accounts receivable, net		58,535		39,898
Prepaid expenses and other current assets		6,846		9,653
Deferred income taxes		15,074		9,491
Total current assets		174,661		151,166
Property and equipment, net		31,950		44,505
Long-term marketable securities		184,160		115,422
Goodwill, net		239,840		231,717
Amortizing intangible assets, net		25,159		31,116
Deferred income taxes		10,126		15,014
Other assets		1,915		2,341
Total assets	$	667,811	$	591,281
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	4,180	$	5,308
Accrued compensation		17,384		13,900
Other accrued expenses		27,939		23,678
Income taxes payable		9,082		1,262
Short-term portion of deferred revenue		73,957		59,209
Total current liabilities		132,542		103,357
Long-term liabilities:
Long-term portion of deferred revenue		9,416		4,001
Other long-term liabilities		1,677		5,941
Total long-term liabilities		11,093		9,942
Shareholders’ equity		524,176		477,982
Total liabilities and shareholders’ equity	$	667,811	$	591,281

Quest Reports Fourth Quarter 2003 – page 8 of 8

QUEST SOFTWARE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2003			2002			2003			2002
Cash flows from operating activities:
Net income	$	11,478		$	3,810		$	21,516		$	10,384
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		5,614			6,283			26,584			23,358
Compensation expense associated with stock option grants		94			494			890			1,415
Accrued interest receivable from shareholders		—			73			—			(26	)
Deferred income taxes		(2,780	)		(12,313	)		(3,234	)		(12,334	)
Provision for bad debts		268			272			291			903
Write-down of investments		—			(1,405	)		—			(310	)
Loss on impairment/sale of aircraft		3,495			—			3,495			790
In-process research and development		—			2,900			—			2,900
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable		(18,515	)		(8,442	)		(14,622	)		698
Prepaid expenses and other current assets		1,399			3,207			4,074			1,651
Other assets		2			1,302			(92	)		1,478
Accounts payable		(1,348	)		13			(1,329	)		(677	)
Accrued compensation		1,304			792			2,276			151
Other accrued expenses		4,380			2,156			869			(2,970	)
Income taxes payable		8,088			16,880			16,705			20,961
Deferred revenue		15,364			5,420			19,557			9,394
Other liabilities		(53	)		(3,282	)		(329	)		(4,536	)
Net cash provided by operating activities		28,790			18,160			76,651			53,230
Cash flows from investing activities:
Purchases of property and equipment		(960	)		324			(6,664	)		(3,006	)
Proceeds from sale of aircraft		—			—			—			1,932
Sale of equity investments		—			875			—			875
Cash paid for acquisitions, net of cash acquired		(50	)		(52,778	)		(4,796	)		(56,841	)
Purchases of marketable securities		(67,588	)		(13,767	)		(175,079	)		(57,640	)
Sales and maturities of marketable securities		12,888			62,927			106,348			92,795
Net cash (used in) provided by investing activities		(55,710	)		(2,419	)		(80,191	)		(21,885	)
Cash flows from financing activities:
Repayment of notes payable		(2,914	)		(49	)		(4,249	)		(1,884	)
Proceeds from repayment of note receivable from shareholder		—			(611	)		—			74
Repayment of capital lease obligations		(96	)		(221	)		(315	)		(414	)
Proceeds from the exercise of stock options		4,113			379			9,505			1,758
Proceeds from employee stock purchase plan		—			—			4,631			4,480
Net cash provided by financing activities		1,103			(502	)		9,572			4,014
Effect of exchange rate changes on cash and cash equivalents		(1,104	)		(646	)		(2,845	)		(1,355	)
Net (decrease) increase in cash and cash equivalents		(26,921	)		14,593			3,187			34,004
Cash and cash equivalents, beginning of period		94,391			49,690			64,283			30,279
Cash and cash equivalents, end of period	$	67,470		$	64,283		$	67,470		$	64,283