Blue Coat Systems Inc (BCSI) SEC Filing 10-Q Quarterly report for the period ending Sunday, October 31, 2010

Exhibit 99.1

BLUE COAT REPORTS RESULTS FOR

SECOND QUARTER FISCAL 2011

Company Reports Strong Operating Cash Flow, Non-GAAP Gross Margin

and Non-GAAP Operating Profit

Board of Directors Approves Share Repurchase Program

SUNNYVALE, Calif., November 18, 2010

“Blue Coat achieved a quarter that met top and bottom line expectations,” said Michael Borman, president and chief executive officer Blue Coat Systems. “While our non-GAAP earnings-per-share, operating margin and cash flow from operations results were good, our revenue growth was lower than what we are capable of delivering. Importantly, I believe we have now stabilized our EMEA sales operations. Moving ahead, we have a number of exciting opportunities with new and revitalized products in growing markets, which should help maximize the company’s growth potential.”

On a GAAP basis, the Company reported net income of $12.0 million, or $0.25 per diluted share, for the second quarter of fiscal 2011, compared with net income of $8.4 million, or $0.19 per diluted share, in the second quarter of fiscal 2010, a year-over-year improvement of 44% in GAAP net income.

The Company reported non-GAAP net income of $18.1 million, or $0.38 per diluted share, for the second quarter of fiscal 2011, compared with non-GAAP net income of $13.1 million, or $0.29 per diluted share, in the second quarter of fiscal 2010, a year-over-year improvement of 38% in non-GAAP net income. For the second quarter of fiscal 2011, the Company utilized a non-GAAP annual effective tax rate of 27% compared with a 30% rate for fiscal 2010.

Cash flow provided by operations in the second quarter of fiscal 2011 was $22.9 million. The Company ended the quarter on October 31, 2010, with cash, cash equivalents, and restricted cash of $289.8 million, an increase of $52.4 million in the first six months of this fiscal year.

“I am particularly pleased with the company’s ability to generate strong cash flow from operations, which increased 26% year-over-year,” said Gordon C. Brooks, senior vice president and chief financial officer Blue Coat Systems.

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