Total revenue was $89.5 million for the third quarter of fiscal 2011, up 19% compared to the year-ago quarter, and up 6% sequentially.

Net income was $2.3 million, or $0.04 per share, for the third quarter of fiscal 2011, compared to net income of $3.6 million, or $0.07 per share, for a year-ago quarter. The year-over-year decrease was primarily driven by the accounting impacts of the TripIt acquisition.

Non-GAAP pre-tax income was $16.0 million, or $0.29 per share, for the third quarter of fiscal 2011, compared to $16.1 million, or $0.31 per share, for the year-ago quarter. Sequentially, non-GAAP pre-tax income was up 17% compared to the second quarter of fiscal 2011. Please refer to “About Concur’s Non-GAAP Financial Measures” below for an explanation of our non-GAAP financial measures used in this press release.

Non-GAAP operating margin was 19.8% for the third quarter of fiscal 2011, compared to 23.9% for the year-ago quarter. Sequentially, non-GAAP operating margin was up 190 basis points compared to the second quarter of fiscal 2011.

Cash flow from operations was at $16.3 million for the third quarter of fiscal 2011.

Concur completed the acquisition of GlobalExpense, a leading UK expense claim management provider, in early July. This acquisition had no financial impact on fiscal 2011 third quarter results.

Concur delivered TripIt Pro integration into both its core travel and expense management services, enabling Concur to consume business travel itineraries from any source or booking tool and deliver them directly into Concur expense reports, providing greater visibility for both managed and unmanaged travel programs.

Concur introduced new travel functionality including comprehensive travel request functionality for pre-trip and expenses approval, and additional rail partnerships for integrated rail content, giving business travelers the right information at the right time to help them make informed travel decisions.

Concur continues to see rapid adoption of the Concur® Connect Platform, which enables customers, partners, and third party developers to connect to and extend Concur’s technology solutions with a diverse set of applications and services. New developments include:

A new partnership and API with thetrainline.com, the UK’s leading online rail retailer, that enables users to view prices, availability, reserve and purchase any UK journey – and compare air and rail service options – all on one screen. Through the Concur Connect Platform, thetrainline.com joins a growing list of travel suppliers that not only feed complete electronic folio data in the form of e-receipts directly into Concur, but also provide Concur clients with broad access to travel inventory.

Concur announced that it has joined the NetSuite SuiteCloud Developer Network to create an integration of Concur with NetSuite. The joint solution will help NetSuite and Concur customers to create end-to-end processes that combine expense reporting and management with NetSuite’s Accounts Payable and General Ledger services.

Concur further enhanced its broad array of imaging options with the introduction of the Receipt Store, which enables users, as well as third-party developers using the Concur Connect Platform, to send receipt images from any source to a central receipt repository and easily assign them to specific expense line items.

Concur announced a $5 million strategic investment in Yapta, a leading provider of airfare tracking and hotel rate tracking services. Yapta’s airfare tracking engine will power TripIt Pro’s airfare price tracking and price assurance capabilities.

Concur launched the Concur Advisor Program, designed to provide accountants in public practice and small-to-medium-sized business (SMB) consultants with solutions, training and support to better serve their clients.

Sponsored by Concur, the Global Business Travel Association Foundation released a traveler segmentation study which identifies five segments of travelers in the market today based on their travel goals, characteristics, technology usages and demographics.

Concur expects revenue for the fourth quarter of fiscal 2011 to grow approximately 22% year-over-year from the fourth quarter of fiscal 2010, resulting in fiscal 2011 growth of approximately 19% year-over-year from fiscal 2010. GlobalExpense is expected to contribute $0.5 million in revenue for the fourth quarter of fiscal 2011 and $5.0 million for fiscal year 2012.

For the fourth quarter of fiscal 2011, Concur expects non-GAAP pre-tax income per share to be $0.37 which includes approximately $0.03 of dilution in Q4 of fiscal 2011 from acquisition-related activities.

Concur expects fiscal 2011 non-GAAP operating margin to be 21.0% or more for the year as a whole which includes approximately 50 basis points of dilution in Q4 of fiscal 2011 from acquisition-related activities. The Company expects GlobalExpense to be accretive to non-GAAP pre-tax net income for the fiscal year ending September 30, 2012.

Concur expects cash flows from operations in fiscal 2011 to be between $78 and $82 million, excluding acquisition and other related costs. The Company expects capital expenditures to be between $31 and $33 million.

Revenue

Expenses:

Cost of operations

Sales and marketing

Systems development and programming

General and administrative

Revaluation of contingent consideration

Amortization of intangible assets

Total expenses

Operating income

Other income (expense):

Interest income

Interest expense

Loss from equity investments

Other, net

Total other expense, net

Income (loss) before income tax

Income tax expense (benefit)

Consolidated net income

Less: Net loss attributable to noncontrolling interest

Net income attributable to Concur

Net income per share attributable to Concur Common shareholders:

Basic

Diluted

Weighted average shares used in computing net income per share:

Basic

Diluted

Assets

Current assets:

Cash and cash equivalents

Short-term investments

Restricted cash

Accounts receivable, net of allowance of $1,802 and $2,374

Deferred tax assets

Deferred costs and other assets

Total current assets

Non-current assets:

Property and equipment, net

Investments

Deferred costs and other assets

Intangible assets, net

Deferred tax assets

Goodwill

Total assets

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

Customer funding liabilities

Accrued compensation

Acquisition-related liabilities

Other accrued expenses and liabilities

Deferred revenues

Total current liabilities

Non-current liabilities:

Senior convertible notes, net

Deferred rent and other long-term liabilities

Deferred revenues

Acquisition-related contingent consideration

Tax liabilities

Total liabilities

Equity:

Concur stockholders’ equity:

Convertible preferred stock, par value $0.001 per share

Authorized shares: 5,000; No shares issued or outstanding

Common stock, $0.001 par value per share

Authorized shares: 195,000

Shares issued and outstanding: 53,960 and 52,379

Additional paid-in capital

Accumulated deficit

Accumulated other comprehensive loss

Total Concur stockholders’ equity

Noncontrolling interest

Total equity

Total liabilities and equity

Operating activities:

Net income

Adjustments to reconcile net income to net cash provided by operating activities:

Amortization of intangible assets

Depreciation

Accretion of discount and issuance costs on notes, net

Net recovery of sales allowances

Share-based compensation

Loss on revaluation of contingent liability

Deferred income taxes

Excess tax benefits from share-based compensation

Loss from equity method investments

Changes in operating assets and liabilities:

Accounts receivable

Deferred costs and other assets

Accounts payable

Accrued liabilities

Deferred revenues

Net cash provided by operating activities

Investing activities:

Purchases of investments

Maturities of investments

Increase (decrease) in customer funding liabilities, net of changes in restricted cash

Investment in unconsolidated affiliate

Investments in consolidated joint venture by noncontrolling interest

Purchases of property and equipment

Acquisition funds held at trust

Payments for acquisition, net of cash acquired

Net cash provided by (used in) investing activities

Financing activities:

Equity issuance costs

Proceeds from borrowings on convertible debt

Net proceeds from share-based award activity

Proceeds from employee stock purchase plan activity

Tax withholding on stock awards

Excess tax benefits from share-based compensation

Repayments on capital leases

Net cash provided by (used in) financing activities

Effect of foreign currency exchange rate changes on cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Operating income:

Operating income

Income from operations as a % of total revenue (Operating Margin)

Add back:

Share-based compensation

Amortization of intangible assets

Acquisition and other related costs

Revaluation of contingent consideration

Contingent consideration (included in compensation expense)

Non-controlling interest joint venture

Non-GAAP operating income

Non-GAAP operating income as a % of total revenue (Non-GAAP Operating Margin)

Net income:

Net income

Add back:

Share-based compensation

Amortization of intangible assets

Acquisition and other related costs

Revaluation of contingent consideration

Contingent consideration (included in compensation expense)

Loss from equity method investments

Accretion of discount on senior convertible notes

Income tax expense (benefit)

Non-GAAP pretax income

Diluted income per share:

Diluted income per share

Add back:

Share-based compensation

Amortization of intangible assets

Acquisition and other related costs

Revaluation of contingent consideration

Contingent consideration (included in compensation expense)

Loss from equity method investments

Accretion of discount on senior convertible notes

Income tax expense (benefit)

Non-GAAP pretax diluted income per share

Shares used in calculation of basic and diluted non-GAAP income per share:

Non-GAAP operating expense:

Cost of operations

Sales and marketing

Systems development and programming

General and administrative

Total

Non-GAAP operating income*

Non-GAAP pretax diluted income per share*

Cost of operations

Less:

Share-based compensation

Non-GAAP cost of operations

Sales and marketing expenses

Less:

Share-based compensation

Contingent consideration (included in compensation expense)

Non-GAAP sales and marketing expenses

Systems development and programming expenses

Less:

Share-based compensation

Contingent consideration (included in compensation expense)

Non-GAAP systems development and programming expenses

General and administrative expenses

Less:

Share-based compensation

Acquisition and other related costs

Non-GAAP general and administrative expenses

Share-based compensation. Concur’s non-GAAP financial measures exclude share-based compensation, which consist of expenses for stock options and restricted stock units (“RSU”). Concur excludes these expenses from its non-GAAP financial measures primarily because they are non-cash expenses that it does not consider part of ongoing operating results when assessing the performance of our business, and the exclusion of these expenses facilitates the comparison of results and business outlook for future periods with results for prior periods.

Acquisition and other related costs. New authoritative guidance on business combinations requires us to record in the income statement, certain items that at the time of an acquisition would have been recorded to goodwill under the old authoritative guidance. We have excluded the effect of acquisition and other related costs from certain non-GAAP financial measures in order to facilitate the comparison of our business outlook for future periods with results from prior periods when such expenses were recorded to goodwill. We also believe it is useful for investors to understand the effects of these items on our operations. Acquisition and other related costs include transaction fees, due diligence costs, travel expenses, and other one-time direct costs associated with strategic activity in which we may deploy capital.

Revaluation of contingent consideration. New authoritative guidance on business combinations requires contingent consideration to be recorded at fair value on the acquisition date. The new authoritative guidance also requires that changes in the fair value of the contingent consideration subsequent to the acquisition date be recorded in our statements of income. Under the old authoritative guidance contingent consideration would have been included as a component of deal consideration based on the actual amount paid, if any, when the contingency was resolved. Concur’s non-GAAP financial measures exclude the revaluation of contingent consideration, which is the change in fair value of the liability-classified acquisition-related contingent consideration. Concur excludes the unrealized gains or losses from the re-measurement of the contingent consideration from its non-GAAP financial measures in order to facilitate the comparison of our business outlook for future periods with results from prior periods when contingent consideration was recorded to goodwill. We also believe it is useful for investors to understand the effects of these items on our operations

Contingent consideration (included in compensation expense). Concur’s non-GAAP financial measures exclude contingent consideration included in compensation expense which relates to the potential cash payment to certain TripIt employees whose right to receive such payment is forfeited if they terminate their employment. The contingent cash payment that these employees are entitled to receive is part of the consideration that all TripIt shareholders received from Concur in exchange for their TripIt shares. As receipt of the contingent payment is subject to continued employment, GAAP requires that it be accounted for as compensation expense. Concur excludes this item from its non-GAAP financial measures primarily because it is a component of the deal consideration that it does not consider part of ongoing operating results when assessing the performance of our business, and the exclusion of these expenses facilitates the comparison of results and business outlook for future periods with results for prior periods.

Noncontrolling interest joint venture. Noncontrolling interest joint venture includes income or loss from operations due to our joint venture partner and is excluded from the calculation of non-GAAP operating income because it is unrelated to our ownership in the venture.

Loss from equity method investments. For investments under the equity method, Concur recognizes its share of the earnings or losses of an investee and adjusts the carrying amount of an investment for its share of the earnings or losses of the investee after the date of investments. Concur’s non-GAAP financial measures excluded the earnings or losses from GAAP income because it is unrelated to our ongoing operations and is significantly impacted by factors outside our direct control.

Amortization of intangible assets. In accordance with GAAP, operating expenses include amortization of software and other technology assets, other purchased intangible assets such as customer lists and covenants not to compete. Concur excludes these items from its non-GAAP financial measures because they are non-cash expenses that Concur does not consider part of ongoing operating results when

Accretion of discount on senior convertible notes. In accordance with GAAP, interest expense on the senior convertible notes includes the accretion of the discount, which is a non-cash expense that Concur does not consider part of ongoing operating results when assessing the performance of our business.

Income tax expense (benefit). Concur excludes this expense from certain non-GAAP financial measures primarily because it is largely a non-cash expense that Concur does not consider a meaningful component of our operating results when assessing the performance of our business, and the exclusion of this expense (benefit) facilitates the comparison of our business outlook for future periods with results for prior periods, which did not include income tax expense (benefit).

Concur’s management uses non-GAAP operating income (including the derived non-GAAP operating margin), non-GAAP operating expense, non-GAAP pre-tax income and non-GAAP diluted pre-tax income per share in internal reports used by management in monitoring and making decisions regarding Concur’s business. For example, these measures are used in monthly financial reports prepared for management, and in quarterly reports to Concur’s Board of Directors. Concur also uses non-GAAP pre-tax diluted income per share as a measure to determine executive cash incentive compensation.

Because share-based compensation, amortization of intangible assets, accretion of discount on senior convertible notes and income tax expense (benefit) are largely non-cash in nature, Concur believes that non-GAAP operating income, non-GAAP operating expense, non-GAAP pre-tax income and non-GAAP diluted pre-tax income per share provide a more focused view of the operations of its business. In particular, share-based compensation amounts are difficult to forecast, because the magnitude of the charges depends upon the volume and timing of RSU grants – which are unpredictable and can vary dramatically from period to period – and external factors such as interest rates and the trading price and volatility of Concur’s common stock. Excluding these amounts improves comparability of the performance of the business across periods.

The principal limitation of Concur’s non-GAAP financial measures is that they exclude significant expenses that are required by GAAP to be recorded. In addition, non-GAAP financial measures are subject to inherent limitations because they reflect the exercise of judgments by management about which charges are excluded from the non-GAAP financial measures.

To mitigate this limitation, Concur presents its non-GAAP financial measures in connection with its GAAP results, and recommends that investors do not give undue weight to its non-GAAP financial measures. Concur notes that the dilutive effect of outstanding stock options is reflected in fully-diluted shares outstanding used in calculating GAAP net income per share and non-GAAP diluted pre-tax income per share.