8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report

(Date of earliest event reported)

January 30, 2009

QUALITY SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

CALIFORNIA
(State or other jurisdiction
of incorporation) 0-13801
(Commission File Number) 95-2888568
(IRS Employer
Identification Number)

18111 Von Karman, Suite 600

Irvine, California 92612

(Address of Principal Executive Offices)

(949) 255-2600

(Registrant's Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

The information in this Form 8-K and the Exhibits attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On January 29, 2009, Quality Systems, Inc. issued a press release announcing its financial performance for the period ended December 31, 2008. On January 30, 2009, Quality Systems, Inc. conducted a conference call concerning its performance for the period ended December 31, 2008. A copy of the news release is attached to this Form 8-K as Exhibit 99.1, which is incorporated herein by this reference.

Item 8.01 Other Events.

Quarterly Dividend 

On January 28, 2009, the Company’s Board declared a quarterly cash dividend of $0.30 per share on the Company’s outstanding shares of common stock, payable to shareholders of record as of March 11, 2009 with an anticipated distribution date on or about April 3, 2009 pursuant to the Company’s current policy to pay a regular quarterly dividend on the Company’s outstanding shares of Common Stock each fiscal quarter subject to further Board review, approval and establishment of record and distribution dates by the Board prior to the declaration and payment of each such quarterly dividend. A copy of the Company’s press release announcing the dividend is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No. Description

99.1	Press Release dated January 29, 2009
99.2	Press Release dated January 30, 2009

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: January 30, 2009

QUALITY SYSTEMS, INC.

By: /s/ Paul Holt                                 

Paul Holt
Chief Financial Officer

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EXHIBITS ATTACHED TO THIS REPORT ON FORM 8-K

Exhibit

Number Description

99.1	Press Release dated January 29, 2009
99.2	Press Release dated January 30, 2009

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EX-99.1

For Further Information, Contact:

Quality Systems, Inc. Susan J. Lewis

18111 Von Karman Avenue, Suite 600 Phone: (303) 804-0494

Irvine, CA 92612 slewis@qsii.com

Phone: (949) 255-2600

Contact: Paul Holt, CFO, pholt@qsii.com

FOR IMMEDIATE RELEASE

JANUARY 29, 2009

QUALITY SYSTEMS, INC. REPORTS 2009 THIRD QUARTER RESULTS

IRVINE, Calif. ... January 29, 2009 ... Quality Systems, Inc. (NASDAQ:QSII) today announced the results of operations for its fiscal 2009 third quarter ended December 31, 2008. The Company posted record net revenues of $65.5 million in the third quarter, an increase of 36% from the $48.1 million generated during the same quarter of the prior year. The Company reported net income of $13.2 million, up 17% when compared with net income of $11.2 million reported in the comparable quarter last year. Fully diluted earnings per share reached $0.46 for the quarter, an increase of 15% versus $0.40 fully diluted earnings per share earnings for the same period a year ago.

For the quarter, the Company’s NextGen Healthcare Information Systems division posted record revenue of $61.5 million, up 40% when compared with the same quarter in the prior year and record operating income of $22.8 million, up 28% over third quarter last year. The Company’s Healthcare Strategic Initiatives acquisition contributed approximately $4.9 million to NextGen revenue during the quarter. The Company’s Practice Management Partners acquisition, which closed on October 28, 2008, contributed approximately $2.6 million to NextGen revenue during the quarter.

“We are pleased with the Company’s performance for the quarter. The strategic growth initiatives we put in place during the first nine months of this year are continuing to pay off. Our entry into the revenue cycle management business is reaping results as we remain focused on growing the business organically while reinvesting in new product and service development efforts,” noted Steven T. Plochocki, president and chief executive officer.

Quality Systems’ management will host a conference call to review results of the 2009 third quarter on Friday, January 30, 2009, at 9:00 AM ET (6:00 AM PT). All participants should dial 800-762-9441 at least ten minutes prior to the start of the call. International callers should dial 480-248-5081.

To hear a live web simulcast or to listen to the archived web cast following completion of the call, please visit the Company’s web site at www.qsii.com, click on the "Investor Relations" tab, then select “Conference Calls," to access the link to the call. To listen to a telephone replay of the conference call, please 800-406-7325 and enter reservation identification number 3968610. The replay will be available from approximately 12:00 PM ET on Friday, January 30, 2009, through 11:59 PM ET on Friday, February 6, 2009. A transcript of the conference call will be made available on the QSII website at www.qsii.com.

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Quality Systems, Inc.

2009 Third Quarter Results

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About Quality Systems, Inc.

Irvine, Calif.-based Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management, patient records and revenue cycle management applications as well as connectivity products and services for medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information.

SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS

This news release may contain forward-looking statements within the meaning of the federal securities laws. Statements regarding future events, developments, the Company's future performance, as well as management's expectations, beliefs, intentions, plans, estimates or projections relating to the future (including, without limitation, statements concerning revenue and net income), are forward-looking statements within the meaning of these laws and involve a number of risks and uncertainties. Management believes that these forward-looking statements are reasonable and are based on reasonable assumptions and forecasts, however, undue reliance should not be placed on such statements that speak only as of the date hereof. Moreover, these forward-looking statements are subject to a number of risks and uncertainties, some of which are outlined below. As a result, actual results may vary materially from those anticipated by the forward-looking statements. 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; 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; the timing, cost and success or failure of new product and service introductions, development and product upgrade releases; undetected errors or bugs in software; product liability; changing economic, political or regulatory influences in the health-care industry; changes in product-pricing policies; availability of third-party products and components; competitive pressures including product offerings, pricing and promotional activities; the Company's ability or inability to attract and retain qualified personnel; possible regulation of the Company's software by the U.S. Food and Drug Administration; uncertainties concerning threatened, pending and new litigation against the Company including related professional services fees; uncertainties concerning the amount and timing of professional fees incurred by the Company generally; changes of accounting estimates and assumptions used to prepare the prior periods' financial statements; 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. A significant portion of the Company's quarterly sales of software product licenses and computer hardware is concluded in the last month of the fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. Due to these and other factors, the Company's revenues and operating results are very difficult to forecast. A major portion of the Company's costs and expenses, such as personnel and facilities, are of a fixed nature and, accordingly, a shortfall or decline in quarterly and/or annual revenues typically results in lower profitability or losses. As a result, comparison of the Company's period-to-period financial performance is not necessarily meaningful and should not be relied upon as an indicator of future performance. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

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[Financial Tables Attached]

QUALITY SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

	Three Months Ended				Nine Months Ended
	December 31, 2008		December 31, 2007		December 31, 2008		December 31, 2007
Revenues:
Software, hardware and supplies	$	22,336	$	20,591	$	65,002	$	55,844
Implementation and training services		2,675		3,115		9,746		9,545
System sales		25,011		23,706		74,748		65,389
Maintenance		19,152		14,861		53,522		40,862
Electronic data interchange services		8,008		5,739		21,663		16,169
Revenue cycle management and related services		6,835		256		13,319		612
Other services		6,473		3,528		16,432		12,236
Maintenance, EDI, revenue cycle management  and other services		40,468		24,384		104,936		69,879
Total revenue		65,479		48,090		179,684		135,268
Cost of revenue:
Software, hardware and supplies		3,030		2,984		9,912		7,949
Implementation and training services		2,143		2,638		7,783		7,469
Total cost of system sales		5,173		5,622		17,695		15,418
Maintenance		2,826		3,131		8,856		9,292
Electronic data interchange services		5,541		4,162		15,688		11,413
Revenue cycle management and related services		4,475		166		8,912		402
Other services		5,085		3,067		12,398		8,940
Total cost of maintenance, EDI, revenue cycle  management and other services		17,927		10,526		45,854		30,047
Total cost of revenue		23,100		16,148		63,549		45,465
Gross profit		42,379		31,942		116,135		89,803
Operating expenses:
Selling, general and administrative		18,601		13,283		52,136		39,114
Research and development costs		3,624		2,874		10,085		8,362
Total operating expenses		22,225		16,157		62,221		47,476
Income from operations		20,154		15,785		53,914		42,327
Interest income		328		710		1,042		2,094
Other income		—		953		—		953
Income before provision for income taxes.		20,482		17,448		54,956		45,374
Provision for income taxes		7,332		6,234		20,193		16,548
Net income	$	13,150	$	11,214	$	34,763	$	28,826
Net income per share:
Basic	$	0.46	$	0.41	$	1.25	$	1.06
Diluted	$	0.46	$	0.40	$	1.23	$	1.04
Weighted average shares outstanding:
Basic		28,340		27,362		27,913		27,261
Diluted		28,473		27,696		28,275		27,739
Dividends declared per common share	$	0.30	$	0.25	$	0.85	$	0.75

QUALITY SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

	December 31, 2008			March 31, 2008
ASSETS
Current assets:
Cash and cash equivalents	$	55,428		$	59,046
Restricted cash		1,383			—
Marketable securities		2,450			2,500
Accounts receivable, net		100,267			76,585
Inventories, net		1,253			1,024
Income tax receivable		513			—
Net current deferred tax assets		6,059			6,397
Other current assets		4,172			4,596
Total current assets		171,525			150,148
Marketable securities		8,199			20,124
Equipment and improvements, net		6,369			4,773
Capitalized software costs, net		9,550			8,852
Net deferred tax assets		—			—
Intangibles, net		8,760			—
Goodwill		28,717			1,840
Other assets		2,074			2,171
Total assets	$	235,194		$	187,908
Current liabilities:
Accounts payable	$	4,472		$	4,685
Deferred revenue		47,190			44,389
Accrued compensation and related benefits		9,341			8,346
Income taxes payable		—			1,541
Dividends payable		8,511			6,861
Other current liabilities		9,895			4,394
Total current liabilities		79,409			70,216
Deferred revenue, net of current		355			506
Net deferred tax liabilities		2,977			1,575
Deferred compensation		1,724			1,906
Total liabilities		84,465			74,203
Commitments and contingencies
Shareholders’ equity:
Common stock
$0.01 par value; authorized 50,000 shares; issued and      outstanding 28,371 and 27,448 shares at December 31, 2008      and March 31, 2008, respectively		284			274
Additional paid-in capital		101,530			75,556
Retained earnings		48,932			38,071
Accumulated other comprehensive loss, net of tax		(17	)		(196	)
Total shareholders’ equity		150,729			113,705
Total liabilities and shareholders’ equity	$	235,194		$	187,908

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EX-99.2

For Further Information, Contact:

Quality Systems, Inc. Susan J. Lewis

18111 Von Karman Avenue, Suite 600 Phone: (303) 804-0494

Irvine, CA 92612 slewis@qsii.com

Phone: (949) 255-2600

Contact: Paul Holt, CFO, pholt@qsii.com

FOR IMMEDIATE RELEASE

JANUARY 30, 2009

Quality Systems, Inc. Announces Cash Dividend

IRVINE, Calif.-- (BUSINESS WIRE) — January 30, 2009–Quality Systems, Inc. (NASDAQ:QSII - News) announced today that the Company’s Board of Directors declared a cash dividend of Thirty Cents ($0.30) per share on the Company’s outstanding shares of Common Stock, payable to shareholders of record as of March 11, 2009 with an anticipated distribution date of April 3, 2009, pursuant to the Company’s current policy to pay a regular quarterly dividend of Thirty Cents ($0.30) per share on the Company’s outstanding shares of Common Stock, subject to further Board review and approval and establishment of record and distribution dates by the Board prior to the declaration and payment of each such quarterly dividend.

About Quality Systems, Inc.

Irvine, Calif.-based Quality Systems, Inc. and its NextGen Healthcare Information Systems subsidiary develop and market computer-based practice management, patient records and revenue cycle management applications as well as connectivity products and services for medical and dental group practices. Visit www.qsii.com and www.nextgen.com for additional information.

SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS

This news release may contain forward-looking statements within the meaning of the federal securities laws. Statements regarding future events, developments, the Company's future performance, as well as management's expectations, beliefs, intentions, plans, estimates or projections relating to the future (including, without limitation, statements concerning revenue and net income), are forward-looking statements within the meaning of these laws and involve a number of risks and uncertainties. Moreover, these forward-looking statements are subject to a number of risks and uncertainties, some of which are outlined below. As a result, actual results may vary materially from those anticipated by the forward-looking statements. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: the volume and timing of systems sales and installations; length of sales cycles and the installation process; the possibility that products will not achieve or sustain market acceptance; seasonal patterns of sales and customer buying behavior; the timing, cost and success or failure of new product and service introductions, development and product upgrade releases; undetected errors or bugs in software; changing economic, political or regulatory influences in the healthcare industry; changes in product-pricing policies; availability of third-party products and components; competitive pressures including product offerings, pricing and promotional activities; the Company's ability or inability to attract and retain qualified personnel; possible regulation of the Company's software by the U.S. Food and Drug Administration; uncertainties concerning threatened, pending and new litigation against the Company including related professional services fees; uncertainties concerning the amount and timing of professional fees incurred by the Company generally; changes of accounting estimates and assumptions used to prepare the prior periods' financial statements; 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. A significant portion of the Company's quarterly sales of software product licenses and computer hardware is concluded in the last

month of the fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. Due to these and other factors, the Company's revenues and operating results are very difficult to forecast. A major portion of the Company's costs and expenses, such as personnel and facilities, are of a fixed nature and, accordingly, a shortfall or decline in quarterly and/or annual revenues typically results in lower profitability or losses. As a result, comparison of the Company's period-to-period financial performance is not necessarily meaningful and should not be relied upon as an indicator of future performance. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

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