1. ArcSight Reports 39% Year-over-Year Growth for Fiscal Second Quarter Ended October 31, 2009
Company Posts Total Revenues of $45.5M for Fiscal Second Quarter and GAAP and Non-GAAP
Earnings per Diluted Share of $0.07 and $0.15, Respectively
For the Fiscal Second Quarter:
• Total Revenue: $45.5M, a 39% increase year-over-year
• GAAP Net Income: $2.5M or $0.07 per diluted share
• Non-GAAP Net Income: $5.2M or $0.15 per diluted share
• Deferred Revenue: $47.6M, a 21% increase year-over-year
• Positive Cash Flows from Operations: $1.6M
CUPERTINO, CA – December 3, 2009 – ArcSight, Inc. (NASDAQ: ARST), a leading global provider of security and compliance management solutions that protect enterprises and
government agencies, today announced financial results for its fiscal second quarter ended October 31, 2009.
For the second quarter of fiscal 2010, ArcSight reported total revenues of $45.5 million compared to total revenues of $32.8 million reported in the second quarter of fiscal 2009. Net
income on a GAAP basis for the second quarter of fiscal 2010 was $2.5 million, or $0.07 per diluted share, including $222,000 in amortization of intangible assets and $2.5 million in
stock-based compensation expense. This compares to a GAAP net income of $1.8 million, or $0.06 per diluted share, reported in the second quarter of fiscal 2009, including
$210,000 in amortization of intangible assets and $1.5 million in stock-based compensation expense.
Non-GAAP net income for the second quarter of fiscal 2010 was $5.2 million, or $0.15 per diluted share, which compares to a non-GAAP net income of $3.6 million, or $0.11 per
diluted share, reported in the second quarter of fiscal 2009, in each case excluding the above-mentioned amortization and stock-based compensation charges.
During the second quarter of fiscal 2010, the company generated $1.6 million in cash from operations and closed the second quarter with cash, cash equivalents and marketable
securities of $107.2 million.
“We’re extremely pleased with our exceptional second quarter results, driven in large part by a seasonally strong contribution from the federal sector that exceeded our
expectations. And while the federal sector is an important part of our business and our growth, our commercial business continues to contribute materially to our results as well,”
commented Tom Reilly, president and CEO of ArcSight. “For the second quarter, we saw improvements in most verticals in all geographic regions. This success reflects our
commitment to our three strategic imperatives, including focusing relentlessly on our customers’ success and leveraging our platform across a broader array of the IT infrastructure
for enterprise-wide threat and risk monitoring.”
Business Outlook
The following forward-looking statements reflect expectations as of December 3, 2009. Results may be materially different and could be affected by the factors detailed in this
release and in recent ArcSight SEC filings.
Third Quarter Expectations – Ending January 31, 2010
Based on current business trends and the visibility the company has from second quarter performance, ArcSight expects revenue for the third quarter of fiscal 2010 to be in the
range of $43 million to $46 million, representing growth in the range of 18-26% over the same quarter of fiscal 2009.
ArcSight expects non-GAAP net income for the third quarter of fiscal 2010 to be in the range of $4.9 million to $6.1 million, or $0.14 to $0.17 per diluted share, which excludes
stock-based compensation expense and amortization of intangibles.

2. ArcSight CFO Wins Public Company Category in Silicon Valley/San Jose Business Journal
CFO of the Year Awards
CUPERTINO, CA – November 23, 2009 – ArcSight, Inc. (NASDAQ: ARST), a leading global provider of security and compliance
management solutions that protect enterprises and government agencies, today announced that CFO Stewart Grierson has been
named CFO of the Year in the Public Company category by the Silicon Valley/San Jose Business Journal. The CFO of the Year Award
winners were announced at an awards dinner on November 19 at the Computer History Museum in Mountain View, California.
The awards honor CFOs in five categories, describing the winners as “the financial superheroes of business that are a force in Silicon
Valley.” Award recipients are selected annually by a panel of executive judges made up of leaders in Silicon Valley businesses.
According to the Silicon Valley/San Jose Business Journal, “This year’s CFO of the Year award winners and runners-up demonstrate
the diversity of industry backgrounds and experience levels that have helped Silicon Valley’s companies weather the worst economic
trough since the Great Depression.”
Stewart Grierson has been instrumental in the success of ArcSight, leading the company through its public offering last year in one of
the most challenging economic times in recent history. ArcSight was the only venture-backed, Silicon Valley-based IPO in 2008.
Grierson joined ArcSight in 2003 and has served as Chief Financial Officer since October 2004. Silicon Valley/San Jose Business
Journal profiles Grierson as Public Company CFO Winner in the November 20 issue article titled, “Grierson helped lead ArcSight,
valley's only IPO of 2008.”
“Stewart embodies what it takes to be an excellent CFO,” said Stan McKee, ArcSight board member and chairman of its audit
committee, and former CFO of Electronic Arts. “In addition to knowing the numbers and having good technical knowledge in finance,
he is a good communicator, has a detailed grasp of the business and is a valuable contributor to the strategic direction of the company.
As a CFO, it’s easy to get lost in the numbers and forget that what we’re doing affects the lives of every employee and stockholder.
Stewart always has that top of mind.”
“I have been very fortunate to have Stewart as one of our key executive team members helping to successfully grow our business
during one of the most difficult economic environments in decades,” said Tom Reilly, ArcSight President and CEO.” Our ability to grow
in the past year and to deliver solid operating margins is a testament to the strong operational decisions that Stewart makes on a day-
today basis. His contribution goes well beyond the CFO role as his opinion is valued across the business.”
ArcSight and its products continue to gain the respect of the industry. Already in 2009, ArcSight ESM / Logger received the gold in the
SIEM category in the Information Security™ Magazine and Searchsecurity.com™ 2009 Readers’ Choice Awards and ArcSight ESM
won the First Annual Homeland Security Awards from Government Security News (GSN) in the Best Security Incident and Event
Management category. ArcSight was also named one of the ‘Best Places to Work’ in the Bay Area by the Silicon Valley/San Jose
Business Journal and the San Francisco Business Times. In addition, ArcSight’s partner program was awarded a Five-Star Partner
Program certification in Everything Channel's 15th annual 2009 Partner Program Guide.

3. International Market Research Firm Confirms ArcSight is Market Share
Leader in SIEM for Fifth Consecutive Year
ArcSight Continues to Be the Leader in SIEM, with Nearly Double the Market Share of
Closest Competitor
CUPERTINO, Calif., Oct 27, 2009 (BUSINESS WIRE) -- ArcSight, Inc. (NASDAQ:ARST), a leading global provider of security and
compliance management solutions that protect enterprises and government agencies, today announced that analyst firm IDC classified
it as the market share leader in the security information and event management (SIEM) market for the fifth year in a row according to
the IDC market analysis titled "IDC, Worldwide Security and Vulnerability Management Market 2009-2013 Forecast and 2008 Vendor
Shares, September 2009."
According to IDC, ArcSight grew its market share from 18.6 percent in 2007 to 19 percent of the total market revenue in SIEM in 2008.
This is the fifth year running that ArcSight has been named the SIEM market share leader. As in 2007, the five top vendors in SIEM
have nearly 50 percent of the market. In addition, ArcSight's market share is nearly twice that of its closest competitor in SIEM.
IDC also reported that the company placed second in the security management category and that the company moved up from fifth to
fourth leading vendor in the overall security and vulnerability management (SVM) market.
According to the IDC report, an "area where SVM makes security smart is in the SIEM market, where an ever-growing set of security
data has to be processed to find the critical information among a huge set of data. The SIEM market is important for providing audit
information and ensuring proper utilization of security technologies."
"We are relentlessly focused on the success of our customers and that in turn is contributing to our successful growth," said Tom Reilly,
president and CEO, ArcSight. "As cybercrime continues, organizations need a sophisticated solution to detect and protect their key
enterprise information and infrastructure. We believe SIEM is an integral weapon in this war."
This IDC study provides a top-down sizing of the SVM market, which incorporates the security and vulnerability management
submarkets. The study covers the 2008 calendar year for the market sizing and forecasts the market for the period 2009-2013.
About ArcSight
ArcSight (NASDAQ:ARST) is a leading global provider of security and compliance management solutions that protect businesses and
government agencies. ArcSight identifies, assesses, and mitigates both internal and external cyber threats and risks across the
organization for activities associated with critical assets and processes. With the market-leading ArcSight SIEM platform, organizations
can proactively safeguard their assets, comply with corporate and regulatory policy and control the risks associated with cyber-theft,
cyber-fraud, cyber-warfare and cyber-espionage. For more information, visit www.arcsight.com.
Forward Looking Statements
This news release contains forward-looking statements, including without limitation the company's belief that its relentless focus on the
success of its customers will contribute to its successful growth; and its belief that SIEM is an integral weapon to detect and protect
organizations' key information and infrastructure. These forward-looking statements are subject to material risks and uncertainties that
may cause actual results to differ substantially from expectations. Investors should consider important risk factors, which include: the
risk that demand for SIEM solutions may not continue at anticipated levels and may decrease; the risk that cyber threats may not
continue to rise or that potential customers may not perceive the benefit of addressing those threats with products such as ArcSight's;
and other risks detailed under the caption "Risk Factors" in the ArcSight Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission, or the SEC, on September 9, 2009 and the company's other filings with the SEC. You can obtain copies of the
company's Quarterly Report on Form 10-Q and its other SEC filings on the SEC's website at www.sec.gov.
© 2009 ArcSight, Inc. All rights reserved. ArcSight and the ArcSight logo are trademarks of ArcSight, Inc.

4. ArcSight Ranked Number 236 Fastest Growing Company in North America on Deloitte’s 2009 Technology Fast 500™
Attributes Revenue Growth to Need for Cyber Security and Compliance Solutions
CUPERTINO, CA – October 21, 2009 – ArcSight, Inc. (NASDAQ: ARST), a leading global provider of security and compliance management solutions that protect enterprises and
government agencies, today announced that it ranked number 236 on Technology Fast 500™, Deloitte LLP’s ranking of 500 of the fastest growing technology, media, telecommunications,
life sciences and clean technology companies in North America. Rankings are based on percentage of fiscal year revenue growth during the five-year period from 2004 – 2008. ArcSight’s
revenue grew from $15.3 million in fiscal 2004 to $101.5 million in fiscal 2008.
ArcSightCEO Tom Reilly credits the company’s growth over the past five years to the need for cyber security and compliance solutions to enable businesses and government agencies to
reduce risk and increase visibility across their IT infrastructure. He said, "Cyber criminals continue to refine their tactics in order to take advantage of all the new opportunities afforded by
the vast amount of valuable data housed online, made even more accessible by increasing connectivity. Companies are saying that they need to move beyond monitoring just the network
infrastructure and look for threats and risks across the entire enterprise."
“Technology Fast 500™ recognizes innovative companies that have broken down barriers to success and defied the odds with their remarkable five-year revenue growth,” said Phil
Asmundson, Vice Chairman and U.S. Technology, Media and Telecommunications leader, Deloitte LLP. "We congratulate ArcSight on this accomplishment."
“With its impressive five-year growth, ArcSight has earned its position among the fastest growing technology, media, telecommunications, life sciences and clean technology companies in
North America,” said Mark Jensen, Managing Partner, Technology and Venture Capital Services, Deloitte & Touche LLP. ”Deloitte is proud to honor ArcSight for its achievement.”
Overall, Technology Fast 500™ award winners for 2009 had growth rates ranging from 212 to 146,050 percent over five years, with an average growth rate of 2,486 percent.
Technology Fast 500™ Selection and Qualifying Criteria
Technology Fast 500™ provides a ranking of the fastest growing technology, media, telecommunications, life sciences and clean technology companies in North America. This ranking is
compiled from nominations submitted directly to the Technology Fast 500™ website, and public company database research conducted by Deloitte. Technology Fast
500™ award winners for 2009 are selected based on percentage fiscal year revenue growth during the five year period from 2004 to 2008.
Deloitte’s 2009 Technology Fast 500TM Media Guidance 4
In order to be eligible for Technology Fast 500™ recognition, companies must own proprietary intellectual property or proprietary technology that contributes to a significant portion of the
company's operating revenues. Using other companies' technology or intellectual property in a unique way does not satisfy this requirement. Consulting companies, professional service
firms, etc. are not eligible unless they have proprietary technology that contributes to a significant portion of their operating revenues.
Technology Fast 500™ award eligibility requirements also include base-year operating revenues of at least $50,000 USD or CD, and current-year operating revenues of at least $5 million
USD or CD. These revenues must have more than doubled between 2004 and 2008. Additionally, companies must be in business for a minimum of five years, and be headquartered within
North America.
About ArcSight
ArcSight (NASDAQ: ARST) is a leading global provider of security and compliance management solutions that protect businesses and government agencies. ArcSight identifies, assesses,
and mitigates both internal and external cyber threats and risks across the organization for activities associated with critical assets and processes. With the market-leading ArcSight SIEM
platform, organizations can proactively safeguard their assets, comply with corporate and regulatory policy and control the risks associated with cyber-theft, cyber-fraud, cyber-warfare and
cyber-espionage. For more information, visit www.arcsight.com.
About Deloitte
As used in this document, “Deloitte” means Deloitte LLP. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.
Forward Looking Statement and Other Disclaimers
This news release contains forward-looking statements, including without limitation ArcSight’s belief that cyber criminals will continue to refine their tactics in order to take advantage of all
the new opportunities afforded by the vast amount of valuable data housed online, made even more accessible by increasing connectivity; and the company’s belief that companies will
move beyond monitoring just the network infrastructure and look for threats and risks across the entire enterprise. These forward-looking statements are subject to material risks and
uncertainties that may cause actual results to differ substantially from expectations. Investors should consider important risk factors, which include: the risk that cyber threats may not
continue to rise or that potential customers may not perceive the benefit of addressing those threats with products such as ArcSight’s; the risk that organizations will not appreciate the
value of monitoring beyond the network infrastructure; and other risks detailed under the caption “Risk Factors” in the ArcSight Quarterly Report on Form 10 Q filed with the Securities and
Exchange Commission, or the SEC, on September 9, 2009 and the company’s other filings with the SEC. You can obtain copies of the company’s Quarterly Report on Form 10 Q and its
other SEC filings on the SEC’s website at www.sec.gov.
ArcSight’s historical growth rates described in this release are not necessarily indicative of the results to be expected for any future period.

5. - How ArcSight Plans to Stay Ahead of the Curve – 10/13/09
http://www.thestreet.com/story/10610892/1/how-arcsight-plans-to-stay-ahead-of-the-curve.html
- ArcSight rings the NASDAQ bell – 10/13/09
http://www.facebook.com/video/video.php?v=101829273169366&ref=mf
- ArcSight’s CEO on Jim Cramer’s Mad Money – 10/12/09
http://www.cnbc.com/id/15840232?play=1&video=1293371632
- ArcSight’s YouTube Page:
http://www.youtube.com/ArcSightVideo
- ArcSight on TheStreet – 10/13/09
http://www.thestreet.com/video/index.html?bcpid=1459183594&bclid=0&bctid=44648841001

6.
ArcSight FraudView in the News:
ArcSight app cracks down on financial fraud
http://www.infoworld.com/d/security‐central/arcsight‐app‐cracks‐down‐financial‐fraud‐756?source=rss_security_central
By Jeremy Kirk, IDG News ‐‐ September 15, 2009
Syndicated in 8 publications: Computerworld, InfoWorld, ITWorld.com, The Industry Standard, Network World, PC World, CIO
Germany and IDG Norway
FraudView is designed to help banks and brokerage houses detect stock scams and other fraudulent financial transactions
ArcSight Leverages Security Correlation Engine with FraudView
http://www.channelinsider.com/c/a/Security/ArcSight‐Leverages‐Security‐Correlation‐Engine‐with‐FraudView‐356182/
By Ericka Chickowski, Channel Insider – September 15, 2009
[FraudView] could be a huge opportunity for systems integrators in the financial space who have been hit hard lately by customer’s
cost cutting and cancellation of projects that do not offer high ROI.
ArcSight launches financial fraud checking appliance <http://www.scmagazineuk.com/ArcSight‐launches‐financial‐fraud‐
checking‐appliance/article/148949/>
SC Magazine UK – September 15, 2009
Reed Henry, senior vice president of marketing, ArcSight, said: “We are seeing the rise and growth in sophistication of threats to
sensitive financial information, infrastructure and operations. Organisations need advanced technology available to head off
potential risk.
“ArcSight FraudView is already being used to detect wire fraud in wholesale banks and ‘pump and dump' stock schemes in retail
brokerages. In these cases, the combination of multiple bits of information into a single risk score provided by ArcSight FraudView
aids the institution in preventing a fraudulent transaction from occurring.”
Dark matter: Black gold for IT
http://www.infoworld.com/d/data‐management/dark‐matter‐black‐gold‐it‐729
By Eric Knorr, InfoWorld – September 15, 2009
To take a timely example, ArcSight ‐‐ one of the leading SEM vendors ‐‐ just announced FraudView, which mines security log data for
statistically significant patterns of nefarious activity. According to Reed Henry, senior vice president of marketing for ArcSight,
FraudView is already being used to detect wire fraud in wholesale banks and "pump and dump" stock schemes in retail brokerages.
Protect ’09 and Keynotes in the News:
CEO Tom Reilly describes ArcSight’s strategies for combating rampant cyber‐security threats
http://www.gsnmagazine.com/cms/features/news‐analysis/2649.html
Government Security News – September 15, 2009
Having listed this formidable array of cyber‐threats, Reilly hastened to point out that with the evolving nature and scope of the
threats, the ArcSight platform is evolving and changing as well. “Cloud awareness,” “Transaction Integrity” and “Log Management“
are all important considerations, he said, with a new “Fraud View” product being introduced at the Protect 09 event.
Melissa Hathaway proposes cyber threat reduction through public‐private partnership
http://www.gsnmagazine.com/cms/features/news‐analysis/2648.html
Government Security News – September 15, 2009
Cyber security is everyone’s responsibility...That was the central thesis of Melissa Hathaway’s keynote speech on Day One of this
week’s ArcSight Protect ’09 client symposium in Washington, DC. And as former Acting Senior Director for Cyberspace on the
National Security Council and the Homeland Security Council in the Obama administration, Hathaway clearly knows what she’s
talking about.
Melissa Hathaway urges more cooperation, government attention to cybersecurity
http://searchsecurity.techtarget.com/news/article/0,289142,sid14_gci1368168,00.html
By Michael Mimoso, SearchSecurity.com – September 14, 2009
Hathaway was the keynote speaker Monday at ArcSight's annual user conference, Protect '09. Much of Hathaway's address touched
upon points she made in the Cyberspace Policy Review, released May 29.

7. Pressure builds on Obama to appoint cybersecurity coordinator
http://fcw.com/articles/2009/09/14/web‐cyber‐coordinator‐urged.aspx
By Ben Bain, Federal Computer Week – September 14, 2009
Meanwhile, in addition to speculation over whom Obama will pick, observers have also questioned whether the official will have
enough power. James Lewis, who directs the CSIS Commission, said the new adviser will be taking a job “three months late, three
layers down and after the ship has been shot full of holes.” Lewis made the comments today during a panel discussion at the
ArcSight Protect ’09 conference near Washington. “It’s easier to herd cats on day one than it is to herd them on day 112,” said Lewis,
who directs CSIS’ technology and public policy program.
Hathaway: Feds Starting to Get Cybersecurity
http://www.internetnews.com/security/article.php/3839001/Hathaway+Feds+Turning+a+Corner+on+Cybersecurity.htm
By Kenneth Corbin, InternetNews.com – September 14, 2009
"The speed, scale and solutions need to outpace our opponents, and we're not doing a very good job right now," [Melissa Hathaway]
said this morning at the ArcSight Protect 09 security conference. "The threat is outpacing our defenses. It's growing at a volume and
velocity never imagined before."
Outlook dim for international cooperation to fight cyber attacks
http://www.nextgov.com/nextgov/ng_20090914_2629.php?oref=topnews
By Jill R. Aitoro, NextGov – September 14, 2009
"It's one grid, one global network, and we're all stuck in the same boat," said James Lewis, director of the technology and public
policy program at the Center for Strategic and International Studies. "We need to establish some rules."
Hathaway on cyber security for the first time after leaving the White House <http://www.net‐
security.org/secworld.php?id=8092>
By Zeljka Zorz, Help Net Security – September 15, 2009
internetnews reports that in her keynote at the ArcSight Protect 09 security conference she warned about the fast‐paced nature and
the severity of cyber threats to digital networks.

8. ArcSight Reports 25% Year-over-Year Growth for Fiscal First Quarter Ended July 31, 2009
Company Posts Total Revenues of $34.6M for Fiscal First Quarter and GAAP and Non-GAAP Earnings per Diluted Share of $0.03
and $0.09, Respectively
For the Fiscal First Quarter:
• Total Revenue: $34.6M, a 25% increase year-over-year
• GAAP Net Income: $1.0M or $0.03 per diluted share
• Non-GAAP Net Income: $3.2M or $0.09 per diluted share
• Positive Cash Flows from Operations: $9.0M
CUPERTINO, CA – September 3, 2009 – ArcSight, Inc. (NASDAQ: ARST), a leading global provider of security and compliance
management solutions that protect enterprises and government agencies, today announced financial results for its fiscal first quarter ended
July 31, 2009.
For the first quarter of fiscal 2010, ArcSight reported total revenues of $34.6 million compared to total revenues of $27.7 million reported in the
first quarter of fiscal 2009. Net income on a GAAP basis for the first quarter of fiscal 2010 was $1.0 million, or $0.03 per diluted share,
including $222,000 in amortization of intangible assets and $1.9 million in stock-based compensation expense. This compares to a GAAP net
loss of $1.3 million, or $(0.04) per diluted share, reported in the first quarter of fiscal 2009, including $211,000 in amortization of intangible
assets and $1.4 million in stock-based compensation expense.
Non-GAAP net income for the first quarter of fiscal 2010 was $3.2 million, or $0.09 per diluted share, excluding the above-mentioned
amortization and stock-based compensation charges. This compares to a non-GAAP net income of $0.3 million, or $0.01 per diluted share,
reported in the first quarter of fiscal 2009, excluding the above-mentioned charges.
During the first quarter of fiscal 2010, the company generated $9.0 million in cash from operations and closed the first quarter with cash and
cash equivalents of $101.5 million.
“ArcSight’s strong first quarter reflects our continued execution of our three business imperatives for fiscal 2010, namely focusing on our
customers’ success to drive follow-on product purchases, pursuing new high value opportunities by leveraging our platform for enterprise-wide
threat and risk monitoring and extending our reach into the mid-market by leveraging our channel partners,” commented Tom Reilly, president
and CEO of ArcSight. “We will continue to serve our customers effectively with a robust platform of product offerings that helps them mitigate
risk and protect their most valuable assets in a constantly evolving regulatory and threat landscape.”
Business Outlook
The following forward-looking statements reflect expectations as of September 3, 2009. Results may be materially different and could be
affected by the factors detailed in this release and in recent ArcSight SEC filings.
Second Quarter Expectations – Ending October 31, 2009
Based on current business trends and the visibility the company has from first quarter performance, including an anticipated seasonally higher
second quarter relative to the company’s first quarter, ArcSight expects revenue for the second quarter of fiscal 2010 to be in the range of
$38.5 million to $42.5 million, representing growth in the range of 17-30% over the same quarter of fiscal 2009.
ArcSight expects non-GAAP net income for the second quarter of fiscal 2010 to be in the range of $3.5 million to $4.9 million, or $0.10 to
$0.14 per diluted share, which excludes stock-based compensation expense and amortization of intangibles.
Conference Call and Webcast Information
ArcSight will host a conference call and live webcast to discuss these financial results for investors and analysts at 2:00 p.m. Pacific Time on
September 3, 2009. To access the conference call, dial 877-397-0284 for the U.S. or Canada and 719-325-4862 for international callers. The
webcast will be available live on the Investor Relations section of the company’s website at www.arcsight.com. An audio replay of the call will
also be available to investors by phone beginning at approximately 5:00 p.m. Pacific Time on September 3, 2009 until 9:00 p.m. Pacific Time

9. on September 10, 2009, by dialing 888-203-1112 for the U.S. or Canada or 719-457-0820 for international callers, and entering passcode
9868484. In addition, an archived webcast will be available on the Investor Relations section of the company’s website at www.arcsight.com.
Use of Non-GAAP Financial Measures
ArcSight reports all financial information required in accordance with generally accepted accounting principles (GAAP). To supplement the
ArcSight unaudited condensed consolidated financial statements presented in accordance with GAAP, ArcSight uses certain non-GAAP
measures of financial performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation
from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from
non-GAAP financial measures used by other companies. In addition, these non-GAAP measures have limitations in that they do not reflect all
of the amounts associated with the results of ArcSight operations as determined in accordance with GAAP. The non-GAAP financial
measures used by ArcSight include historical non-GAAP net income (loss) and non-GAAP basic and diluted earnings (loss) per share. These
non-GAAP financial measures exclude amortization of intangible assets and stock-based compensation from the ArcSight statement of
operations.
For a description of these items, including the reasons why management adjusts for them, and reconciliations of these non-GAAP financial
measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled "Use of Non-
GAAP Financial Information" as well as the related tables that precede it. ArcSight may consider whether other significant non-recurring items
that arise in the future should also be excluded in calculating the non-GAAP financial measures it uses.
ArcSight believes that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide
meaningful supplemental information regarding the performance of ArcSight by excluding certain items that may not be indicative of the
company’s core business, operating results or future outlook. ArcSight management uses, and believes that investors benefit from referring
to, these non-GAAP financial measures in assessing operating results of ArcSight, as well as when planning, forecasting and analyzing future
periods. These non-GAAP financial measures also facilitate comparisons of the performance of ArcSight to prior periods.
Cautionary Statement Regarding Forward Looking Statements
This news release contains forward-looking statements, including without limitation those regarding ArcSight’s “Business Outlook” (“Second
Quarter Expectations – Ending October 31, 2009”); ArcSight’s belief that continued execution against its three business imperatives for fiscal
2010 will result in continued financial performance; ArcSight’s belief that focusing on its customers’ success will drive follow-on product
purchases; ArcSight’s intent to pursue new high value opportunities by leveraging its platform for enterprise wide threat and risk monitoring
and extend its reach into the mid-market by leveraging its channel partners; ArcSight’s intent to continue to serve its customers effectively with
a robust platform of product offerings that helps them mitigate risk and protect their most valuable assets in a constantly evolving regulatory
and threat landscape. These forward-looking statements are subject to material risks and uncertainties that may cause actual results to differ
substantially from expectations. Investors should consider important risk factors, which include: the risk that demand for our security and
compliance management solutions may not increase and may decrease; the risk that competitors may be perceived by customers to be better
positioned to help handle compliance violations and security threats and protect their businesses from major risk; the risk that the growth of
ArcSight may be lower than anticipated; and other risks detailed under the caption “Risk Factors” in the ArcSight Annual Report on Form 10 K
filed with the Securities and Exchange Commission, or the SEC, on July 9, 2009 and the company’s other filings with the SEC. You can
obtain copies of the company’s Annual Report on Form 10 K and its other SEC filings on the SEC’s website at www.sec.gov.
The foregoing information represents the company’s outlook only as of the date of this press release, and ArcSight undertakes no obligation to
update or revise any forward-looking statements, whether as a result of new information, new developments or otherwise.
About ArcSight
ArcSight (NASDAQ: ARST) is a leading global provider of security and compliance management solutions that protect businesses and
government agencies. ArcSight identifies, assesses, and mitigates both internal and external cyber threats and risks across the organization
for activities associated with critical assets and processes. With the market-leading ArcSight SIEM platform, organizations can proactively
safeguard their assets, comply with corporate and regulatory policy and control the risks associated with cyber-theft, cyber-fraud, cyber-
warfare and cyber-espionage. For more information, visit www.arcsight.com. (ARST-IR)
© 2009 ArcSight, Inc. All rights reserved. ArcSight and the ArcSight logo are trademarks of ArcSight, Inc.

10. ARCSIGHT, INC.
Condensed Consolidated Balance Sheets
(In thousands)
As of As of
July 31, April 30,
2009 2009
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 101,460 $ 90,467
Accounts receivable, net 23,122 34,184
Capitalized software, current 2,303 -
Other prepaid expenses and current assets 3,953 3,861
Total current assets 130,838 128,512
Property and equipment, net 5,326 4,416
Goodwill 5,746 5,746
Acquired intangibles assets, net 1,097 1,319
Capitalized software licenses, non-current 1,913 -
Other long-term assets 1,166 1,168
Total assets $ 146,086 $ 141,161
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 3,613 $ 1,432
Accrued compensation and benefits 6,491 11,671
Obligations for software licenses 2,599 363
Other accrued liabilities 4,482 4,337
Deferred revenues, current 34,569 36,160
Total current liabilities 51,754 53,963
Deferred revenues, non-current 7,254 8,888
Obligations for software licenses, non-current 1,753 -
Other long-term liabilities 1,763 1,637
Total liabilities 62,524 64,488
Stockholders’ equity:
Additional paid-in capital 119,526 113,781
Accumulated other comprehensive loss (185) (314)
Accumulated deficit (35,779) (36,794)
Total stockholders’ equity 83,562 76,673
Total liabilities and stockholders’ equity $ 146,086 $ 141,161

11. ARCSIGHT, INC.
Consolidated Statement of Operations
(On a GAAP basis)
(In thousands, except per share amounts)
(Unaudited)
For the Three Months Ended
July 31, July 31,
2009 2008
Revenues:
Products $ 18,265 $ 15,802
Maintenance 11,919 8,568
Services 4,371 3,293
Total revenues 34,555 27,663
Cost of revenues:
Products 1,944 1,655
(1)
Maintenance 1,925 1,631
Services(1) 2,630 2,043
Total cost of revenues 6,499 5,329
Gross profit 28,056 22,334
Operating expenses(1):
Research and development 5,598 5,315
Sales and marketing 14,785 14,868
General and administrative 6,018 4,349
Total operating expenses 26,401 24,532
Income (loss) from operations 1,655 (2,198)
Interest income 28 404
Other income and expense, net (117) (99)
Income (loss) before provision for income taxes 1,566 (1,893)
Provision (benefit) for income taxes 551 (563)
Net income (loss) $ 1,015 $ (1,330)
Net income (loss) per common share, basic $ 0.03 $ (0.04)
Net income (loss) per common share, diluted $ 0.03 $ (0.04)
Shares used in computing basic net income (loss) per common share 32,685 30,992
Shares used in computing diluted net income (loss) per common share 35,249 30,992
(1) Stock-based compensation expense as included in above
Cost of maintenance revenues 80 46
Cost of services revenues 33 33
Research and development 429 339
Sales and marketing 612 751
General and administrative 776 234

12. ARCSIGHT, INC.
Consolidated Statement of Operations
(GAAP to Non-GAAP Reconciliation)
(In thousands, except per share amounts)
(Unaudited)
For the Three Months Ended
July 31, July 31,
2009 2008
GAAP net income (loss) $ 1,015 $ (1,330)
Plus:
a) Stock-based expenses 1,930 1,403
b) Amortization of intangibles 222 211
Non-GAAP net income $ 3,167 $ 284
GAAP net income (loss) per common share, basic $ 0.03 $ (0.04)
Plus:
a) Stock-based expenses 0.06 0.04
b) Amortization of intangibles 0.01 0.01
Non-GAAP net income, basic $ 0.10 $ 0.01
Non-GAAP net income, diluted $ 0.09 $ 0.01
Shares used in computing basic net income (loss) per common share 32,685 30,992
Shares used in computing diluted net income (loss) per common share 35,249 33,114

13. Use of Non-GAAP Financial Information
In addition to the reasons stated above, which are generally applicable to each of the items
ArcSight excludes from its non-GAAP financial measures, ArcSight believes it is appropriate to
exclude certain items for the following reasons:
Amortization of Intangibles. When analyzing the operating performance of an acquired entity,
ArcSight management focuses on the total return provided by the investment (i.e., operating
profit generated from the acquired entity as compared to the purchase price paid) without taking
into consideration any allocations made for accounting purposes. Because the purchase price for
an acquisition necessarily reflects the accounting value assigned to intangible assets (including
acquired in-process technology and goodwill), when analyzing the operating performance of an
acquisition in subsequent periods, ArcSight management excludes the GAAP impact of the
amortization of acquired intangible assets to its financial results. ArcSight believes that such an
approach is useful in understanding the long-term return provided by an acquisition and that
investors benefit from a supplemental non-GAAP financial measure that excludes the accounting
amortization expense associated with acquired intangible assets.
In addition, in accordance with GAAP, ArcSight generally recognizes expenses for internally-
developed intangible assets as they are incurred until technological feasibility is reached,
notwithstanding the potential future benefit such assets may provide. Unlike internally developed
intangible assets, however, and also in accordance with GAAP, ArcSight generally capitalizes the
cost of acquired intangible assets and recognizes that cost as an expense over the useful lives of
the assets acquired (other than goodwill, which is not amortized, and acquired in-process
technology, which is expensed immediately, as required under GAAP). As a result of their GAAP
treatment, there is an inherent lack of comparability between the financial performance of
internally developed intangible assets and acquired intangible assets. Accordingly, ArcSight
believes it is useful to provide, as a supplement to its GAAP operating results, a non-GAAP
financial measure that excludes the amortization of acquired intangibles.
Stock-Based Compensation. When evaluating the performance of its consolidated results,
ArcSight does not consider stock-based compensation charges. Likewise, the ArcSight
management team excludes stock-based compensation expense from its operating plans. In
contrast, the ArcSight management team is held accountable for cash-based compensation and
such amounts are included in its operating plans. Further, when considering the impact of equity
award grants, ArcSight places a greater emphasis on overall stockholder dilution rather than the
accounting charges associated with such grants.
ArcSight believes it is useful to provide a non-GAAP financial measure that excludes stock-based
compensation in order to better understand the long-term performance of its business.

14. ArcSight Ranked as Top "In Use" Vendor for Event Log Management System and Securit... Page 1 of 2
Print Back to story
ArcSight Ranked as Top "In Use" Vendor for Event Log Management
System and Security Information Event Management According To
TheInfoPro's Information Security Study
Press Release
Source: ArcSight, Inc.
On Tuesday July 28, 2009, 8:00 am EDT
CUPERTINO, Calif.--(BUSINESS WIRE)--ArcSight, Inc. (NASDAQ:ARST - News), a leading global provider of security and compliance management solutions
that intelligently identify and mitigate cyber threat and risk for businesses and government agencies, today announced it was named top “in use” vendor for both
event log management system and security information event management (SIEM) product categories among Fortune 1000 (F1000) security professionals in
TheInfoPro’s™ Information Security Study: Technology Roadmap (Wave 11, Q2 2009).
TheInfoPro’s Information Security Study: Technology Roadmap (Wave 11, Q2 2009) is based on interviews with 246 information security professionals at F1000
and MSE organizations in North America and Europe that were completed in May 2009. The study provides detailed plans about usage patterns for 43
information security technologies that fall under the following categories: network access, network malware protection, network communication content
protection, identity management, vulnerability management, access management, data protection and outsourced security services.
Log management solutions ranked among the top of both the study’s Fortune 1000 (F1000) and Midsize Enterprise (MSE) Security Management Solutions Heat
Indices, which gauges the immediacy of user need and planned spending.
Other findings of note from TheInfoPro’s Information Security Study: Vendor Performance Report (Wave 11, Q2 2009) include:
100 percent of the current ArcSight customers who took part in the study indicated that they have no plans to switch to a competitor.
50 percent of participants that rated ArcSight plan to spend more money on its products in 2010 than they did in 2009.
ArcSight received the highest possible ratings in the areas of “delivery as promised” and “brand / reputation,” and solid customer ratings in the areas of
“technical innovation,” “features / functions” and “product quality.”
“We’re happy that TheInfoPro’s Information Security Study recognizes again how important ArcSight’s compliance and security management solutions are to the
industry and more importantly, our customers,” said Tom Reilly, president and CEO of ArcSight. “In the current economic environment, we are seeing a barrage
of sophisticated cyber attacks. We’re working closely with our customers to give them real-time awareness of cyber threats and risks that occur within and
outside the organization.”
“Each year, respondents to our Information Security Study continue to give ArcSight high results in the “delivering as promised” and “brand reputation” categories
for their SIEM and event log management solutions,” said Bill Trussell, Managing Director of Information Security Research at TheInfoPro. “Our interviewees
indicate that organizations are choosing the ArcSight brand to give them the tools they need to protect their business from cyber threat and risk.”
About TheInfoPro
TheInfoPro is the only independent research network for the Information Technology (IT) industry. Through a peer network of over 1800 of the world’s largest
buyers and users of IT, including Citigroup, FedEx, McGraw-Hill, MasterCard, Pfizer, Vodafone, PepsiCo, JPMorgan Chase, and Harvard University, TheInfoPro
delivers detailed budget, vendor performance and technology roadmap data without spin or bias. Known as the “voice of the customer,” TheInfoPro helps IT
professionals, technology providers, and institutional investors make sound decisions on technologies, vendor relationships and investments. TheInfoPro was
founded in 2002 by alumni of Gartner, Giga, EMC, and Bell Labs. To learn more, visit www.theinfopro.net or call 1-212-672-0010.
About ArcSight
ArcSight (NASDAQ: ARST - News) is a leading global provider of security and compliance management solutions that protect businesses and government
agencies. ArcSight identifies, assesses, and mitigates both internal and external cyber threats and risks across the organization for activities associated with
critical assets and processes. With the market-leading ArcSight SIEM platform, organizations can proactively safeguard their assets, comply with corporate and
regulatory policy and control the risks associated with cyber-theft, cyber-fraud, cyber-warfare and cyber-espionage. For more information, visit
www.arcsight.com.
Forward Looking Statements
This news release contains forward-looking statements, including without limitation those regarding findings from TheInfoPro’s Information Security Study that
100 percent of the current ArcSight customers who took part in the study indicated that they have no plans to switch to a competitor and that 50 percent of
respondents who rated ArcSight plan to spend more money on its products in 2010 than they did in 2009. These forward-looking statements are subject to
material risks and uncertainties that may cause actual results to differ substantially from expectations. Investors should consider important risk factors, which
include: the risk that demand for our compliance and security management solutions may not increase and may decrease; the risk that competitors may be
perceived by customers to be better positioned to help handle compliance violations and security threats and protect their businesses from major risk; and other
risks detailed under the caption “Risk Factors” in the ArcSight Annual Report on Form 10-K filed with the Securities and Exchange Commission, or the SEC, on
July 9, 2009 and the company’s other filings with the SEC. You can obtain copies of the company’s Annual Report on Form 10-K and its other SEC filings on the
SEC’s website at www.sec.gov.
© 2009 ArcSight, Inc. All rights reserved. ArcSight and the ArcSight logo are trademarks of ArcSight, Inc.
http://finance.yahoo.com/news/ArcSight-Ranked-as-Top-In-Use-bw-2757755562.html/pri... 7/28/2009

15. June 19, 2009 Scott Zeller • szeller@needhamco.com • 617-457-0903
Infrastructure Software / Software
ArcSight, Inc. (ARST) – Buy
ARST: Reiterate BUY, raise target from $19 to $21 after positive investor meetings
We hosted ArcSight management on Thursday for investor meetings;
investor interest was quite strong. We found discussions to be positive,
Price Target Change
with the questions noticeably shifting away from a focus on earnings and
margins, and focusing more often on drivers for revenue growth. Our view Market D ata
is investors are weighing the fundamentals of demand for ARST products Price (06/18/09) $17.48
vs. ability to scale the company, and also the timing of such revenue
12-Month Price Target $21.00
growth (near-term vs. long-term). Our impression is investors view last
week’s quarterly guidance as conservative, yet appropriate – as evidence, 52-Week range $18.72-4.74
we point to the flattish recent performance of shares, despite conservative Shares Out. (MM) 34.4
guidance below consensus for F1Q. We believe near-term (FY10) revenue Market cap (MM) $601.6
growth is likely to be driven by continued growth in the public sector and Avg. daily volume (000) 562.7
enterprise appliances; longer-term growth (FY11, beyond) is likely to be
driven by utilities/power grid/infrastructure, as well as certain just-initiated Financial Data
government agency projects, called out by management as important Total Debt/Cap. 0.0%
contributors, yet still too early for FY10 contribution. On the earnings Price/LTM Rev. 4.4x
picture, we believe the company has moderated expectations for margins Tangible BVPS $2.02
with last week’s comments about FY10 being an investment year for the
Net Cash Per Share $2.63
company; investors may find this passable, so long as the revenue growth
remains robust. Reiterate BUY, upping target from $19 to $21, no change
to our above-consensus estimates, which are likely conservative.
• Focus on revenue growth – near-term vs. long term. A nuance we had ArcSight, Inc. participates in the security
not previously understood is that although government is the biggest revenue
software market, where it is a leader in the
vertical at ARST, several government projects were started in the most
recent two quarters, and have “seeded” large projects for the future; we were event management market. ArcSight products
encouraged by this because it suggests FY11 revenue strength, and at the help customers manage IT performance alerts
same time explains why currently 70% of revs come from existing customers. by collecting, correlating and prioritizing risk
• Customer “lifecycle” revenue growth grabs attention. We believe items.
management’s emphasis on how an initial $300k deal grows over a few
years to be 3x original investment (or greater) caught investor attention and
is a positive of the ARST long term growth story.
• Reiterate BUY, raise target from $19 to $21, no change to our above-
consensus estimates, which are likely conservative. Our $21 target is
3.0x EV/FY11 revenue, and 30x our FY11 $0.70 EPS estimate. We chose to
up our target from 2.7x up to 3.0x EV/FY11 revenue, based on similar
valuations for revenue growth comps, including RVBD (now 3.1x EV/revs)
and VMW (now 5.2x EV/revs).
ArcSight, Inc. Price 06/18/09
FY FY FY 20
04/30/09 A 04/30/10 E 04/30/11 E 18
Old New Old New 16
14
Rev. (MM) $136.2 $159.2 $159.2 $189.0 $189.0 12
Growth 34.1% 16.9% 16.9% 18.7% 18.7% 10
8
Op. Mar. 13.8% 18.2% 20.8% 6
EPS: 1Q 0.01 0.08 0.08 0.15 0.15 Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
4
EPS: 2Q 0.11 0.13 0.13 0.17 0.17 Volume (000)
EPS: 3Q 0.21 0.16 0.16 0.19 0.19 3,500
3,000
2,500
EPS: 4Q 0.18 0.17 0.17 0.20 0.20 2,000
1,500
EPS: Year 0.51 0.54 0.54 0.70 0.70 1,000
500
0
Growth nm 7.1% 7.1% 29.9% 29.9% Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
P/E Ratio 18.0x 32.3x 32.3x 24.9x 24.9x
Note: Pro forma earnings estimates displayed above do not include one-time items or any
stock compensation expenses.
Disclosures applicable to this security: B, G.
Disclosure explanation on the inside back cover of this report.

16. Summary
We hosted ArcSight management on Thursday for investor meetings; investor
interest was quite strong. We found discussions to be positive, with the questions
noticeably shifting away from a focus on earnings and margins, and focusing more
often on drivers for revenue growth. Our view is investors are weighing the
fundamentals of demand for ARST products vs. ability to scale the company, and
also the timing of such revenue growth (near-term vs. long-term). Our impression
is investors view last week’s quarterly guidance as conservative, yet appropriate –
as evidence, we point to the flattish recent performance of shares, despite
conservative guidance below consensus for F1Q. We believe near-term (FY10)
revenue growth is likely to be driven by continued growth in the public sector and
enterprise appliances; longer-term growth (FY11, beyond) is likely to be driven by
utilities/power grid/infrastructure, as well as certain just-initiated government
agency projects, called out by management as important contributors, yet still too
early for FY10 contribution. On the earnings picture, we believe the company has
moderated expectations for margins with last week’s comments about FY10 being
an investment year for the company; investors may find this passable, so long as
the revenue growth remains robust. Reiterate BUY, upping target from $19 to
$21, no change to our above-consensus estimates, which are likely conservative
Focus on revenue growth – near-term vs. long term. A nuance we had not
previously understood is that although government is the biggest revenue vertical
at ARST, several government projects were started in the most recent two
quarters, and have “seeded” large projects for the future; we were encouraged by
this point because it points to FY11 revenue strength, and also answers how
revenue from existing customers has climbed to 70% range in recent two quarters
(customer wins healthy, yet some newer gov’t wins generating moderate/early
revenue).
Margin story consistent with recent call – this year is an investment year. As
described on last week’s earnings call, FY10 is an infrastructure growth year for
ARST as it focuses on international revenue growth and domestic channel partner
programs; this is baked in shares, as FY10 EPS growth now sub 5%. Focus is on
revenue growth.
Customer “lifecycle” revenue growth caught attention. We believe
management’s emphasis on how an initial $300k deal grows over a few years to
be 3x original investment (or greater) caught investor attention and is a positive of
the ARST long term growth story. Follow on purchases include: additional
endpoint tracking, new geographies, and additional appliances.
Field info encouraging. Our view is fundamental demand for ARST’s
compliance security software remains solid; we base this view on field discussions
with several private company competitors to ARST. As CEO Tom Reilly has said,
(paraphrase) “audit occurs during a down economy as well as a good economy”,
and ARST software supports compliance and audit, making it less discretionary in
IT budgets.
Reiterate BUY, raise target from $19 to $21, no change to our above-
consensus estimates, which are likely conservative. Our $21 target is 3.0x
EV/FY11 revenue, and 30x our FY11 $0.70 EPS estimate. We chose to up our
target from 2.7x up to 3.0x EV/FY11 revenue, based on similar valuations for
revenue growth comps, including RVBD (now 3.1x EV/revs) and VMW (now 5.2x
EV/revs)
Risk statement: Buyers of ARST shares face risks including but not limited to: a
continued challenging IT spending environment, competition from larger better
2 An Investment Analysis by Needham & Company, LLC

17. capitalized participants in the network equipment and enterprise software markets;
the challenge of growing international revenues.
An Investment Analysis by Needham & Company, LLC 3

18. Income Statement: Arc Sight, Inc. (ARST)
FY 2009 FY 2010 FY 2011
F1Q F2Q F3Q F4Q F1Q F2Q F3Q F4Q F1Q F2Q F3Q F4Q
FY08 July 08 Oct 08 Jan 09 Apr 09 (A) FY09 July 09 (E) Oct 09 Jan 10 Apr 10 FY10 July 10 Oct 10 Jan 11 Apr 11 FY11
Products 63.765 15.802 19.169 21.775 23.870 80.616 19.000 22.000 23.000 25.000 89.000 20.000 24.000 26.000 28.000 98.000
Maintenance 27.607 8.568 9.530 10.004 10.419 38.521 11.000 12.000 13.000 14.000 50.000 15.000 16.000 17.000 18.000 66.000
Services 10.173 3.293 4.136 4.613 4.989 17.031 4.500 4.800 5.200 5.700 20.200 5.500 6.000 6.500 7.000 25.000
TOTAL REVENUE $101.545 $27.663 $32.835 $36.392 $39.278 $136.168 $34.500 $38.800 $41.200 $44.700 $159.200 $40.500 $46.000 $49.500 $53.000 $189.000
cost of product 4.767 1.655 1.844 2.637 2.459 8.595 2.100 2.300 2.400 2.500 9.300 2.200 2.500 2.500 2.700 9.900
gross mgn product 93% 90% 90% 88% 90% 89% 89% 90% 90% 90% 90% 89% 90% 90% 90% 90%
cost of maintenance 5.585 1.585 1.609 1.581 1.870 6.645 1.900 2.000 2.200 2.400 8.500 2.500 2.700 2.900 2.100 10.200
gross mgn maint 80% 82% 83% 84% 82% 83% 83% 83% 83% 83% 83% 83% 83% 83% 88% 85%
cost of services 5.685 2.010 2.348 2.553 2.822 9.733 2.500 2.700 2.900 3.200 11.300 3.000 3.300 3.600 3.900 13.800
gross mgn svcs 44% 39% 43% 45% 43% 43% 44% 44% 44% 44% 44% 45% 45% 45% 44% 45%
Total Cost of Revenue 16.037 5.250 5.801 6.771 7.151 24.973 6.500 7.000 7.500 8.100 29.100 7.700 8.500 9.000 8.700 33.900
Cost of Sales as % of Revenue 16% 19% 18% 19% 18% 18% 19% 18% 18% 18% 18% 19% 18% 18% 16% 18%
Gross Profit 85.508 22.413 27.034 29.621 32.127 111.195 28.000 31.800 33.700 36.600 130.100 32.800 37.500 40.500 44.300 155.100
GROSS MGN 84.2% 81.0% 82.3% 81.4% 81.8% 81.7% 81.2% 82.0% 81.8% 81.9% 81.7% 81.0% 81.5% 81.8% 83.6% 82.1%
OPEX
R&D 18.406 4.976 5.089 4.879 6.251 21.195 5.500 6.000 6.000 6.500 24.000 6.000 7.000 7.000 8.000 28.000
S&M 50.768 14.117 13.605 11.832 14.276 53.830 13.500 14.000 14.500 16.000 58.000 14.000 16.000 17.000 18.000 65.000
G&A 12.758 4.115 4.503 4.157 5.495 18.270 5.000 5.000 5.000 5.000 20.000 5.000 5.500 6.000 7.000 23.500
Other (e.g., amortization) (0.573) (0.211) (0.238) (0.210) (0.211) (0.870) (0.200) (0.200) (0.200) (0.200) (0.800) (0.200) (0.200) (0.200) (0.200) (0.800)
Total OPEX 81.359 22.997 22.959 20.658 25.811 92.425 23.800 24.800 25.300 27.300 101.200 24.800 28.300 29.800 32.800 115.700
Loss/Profit From Operations 4.149 (0.584) 4.075 8.963 6.316 18.770 4.200 7.000 8.400 9.300 28.900 8.000 9.200 10.700 11.500 39.400
OPERATING MGN 4.1% -2.1% 12.4% 24.6% 16.1% 13.8% 12.2% 18.0% 20.4% 20.8% 18.2% 19.8% 20.0% 21.6% 21.7% 20.8%
Other Income & Interest expense 0.472 0.305 0.300 0.157 (0.068) 0.694 0.000 0.000 0.200 0.200 0.400 0.200 0.200 0.200 0.200 0.800
Pretax Income 4.621 (0.279) 4.375 9.120 6.248 19.464 4.200 7.000 8.600 9.500 29.300 8.200 9.400 10.900 11.700 40.200
Taxes 1.131 (0.563) 0.795 2.183 0.149 2.564 1.428 2.380 2.924 3.230 9.962 2.788 3.196 3.706 3.978 13.668
Tax Rate 24% NM 18% 24% 2% 13% 34% 34% 34% 34% 34% 34% 34% 34% 34% 34%
Net Income 3.490 0.284 3.580 6.937 6.099 16.900 2.772 4.620 5.676 6.270 19.338 5.412 6.204 7.194 7.722 26.532
Diluted Shares Outstanding 25.936 33.114 32.780 33.494 34.416 33.451 35.000 35.500 36.000 36.500 35.750 37.000 37.500 38.000 38.500 37.750
EPS $0.12 $0.01 $0.11 $0.21 $0.18 $0.51 $0.08 $0.13 $0.16 $0.17 $0.54 $0.15 $0.17 $0.19 $0.20 $0.70
Total Revenue Y/Y 45% 39% 33% 32% 34% 34% 25% 18% 13% 14% 17% 17% 19% 20% 19% 19%
Total Revenue Q/Q NA -6% 19% 11% 8% NA -12% 12% 6% 8% NA -9% 14% 8% 7% NA
EPS Y/Y #VALUE! 321% 7% 30%
R&D as % of revenue 18% 18% 15% 13% 16% 16% 16% 15% 15% 15% 15% 15% 15% 14% 15% 15%
S&M as % of revenue 50% 51% 41% 33% 36% 40% 39% 36% 35% 36% 36% 35% 35% 34% 34% 34%
G&A as % of revenue 13% 15% 14% 11% 14% 13% 14% 13% 12% 11% 13% 12% 12% 12% 13% 12%
CY08 Revenue $126.266 CY09 Revenue $153.778 CY10 Revenue $180.700
EPS $0.34 EPS $0.54 EPS $0.67
4 An Investment Analysis by Needham & Company, LLC

19. Balance Sheet: Arc Sight, Inc. (ARST)
note: figures are cumulative FY 2008 FY 2009
F1Q F2Q F3Q F4Q F1Q F2Q F3Q F4Q
FY06 FY07 July 07 Oct 07 Jan 08 Apr 08 FY08 July 08 Oct 08 Jan 09 Apr 09 (A) FY09
Assets
Current Assets
Cash and cash equivalents 16.443 16.917 21.231 71.946 71.946 74.172 75.678 82.891 90.467 90.467
Accounts Receivable, net 12.247 15.554 9.399 26.658 26.658 17.323 23.192 22.223 34.184 34.184
Capitalized software licenses, current 0.000 0.249 1.998 1.900 1.900 0.000
Other prepaid expenses, current assets 1.277 2.207 2.786 3.665 3.665 5.886 4.152 3.176 3.861 3.861
Other 0.000 0.000 0.000 0.000
Total Current Assets 29.967 34.927 0 0 35.414 104.169 104.169 97.381 103.022 108.29 128.512 128.512
Restricted Cash 0.000 0.842 0.842 0.842 0.842 0.000
Income taxes receivable 1.020 0.761 0.738 0.391 0.391 0.000
Property and equipment, net 1.925 2.753 4.915 4.834 4.834 5.479 5.226 4.749 4.416 4.416
Goodwill 0.000 5.746 5.746 5.746 5.746 5.746 5.746 5.746 5.746 5.746
Acquired intangible assets, net 0.000 2.734 2.304 2.161 2.161 1.950 1.740 1.530 1.319 1.319
Capitalized software licenses, non-current 0.000 0.394 0.589 0.144 0.144 0.000
Other 0.014 0.833 3.863 0.292 0.292 1.422 1.411 1.391 1.168 1.168
TOTAL ASSETS 32.926 48.990 0.000 0.000 54.411 118.579 118.579 111.978 117.145 121.706 141.161 141.161
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable 0.647 2.846 0.834 3.115 3.115 2.548 3.349 1.230 1.432 1.432
Accrued compensation and benefits 3.384 6.678 6.154 11.864 11.864 5.591 6.529 7.757 11.671 11.671
Obligations for software licenses 0.000 0.551 2.427 2.222 2.222 0.000
Other accrued liabilities 2.845 3.869 3.590 3.745 3.745 6.435 6.110 6.485 4.700 4.700
Deferred revenues, current 17.714 24.794 28.678 36.512 36.512 35.613 34.777 33.524 36.160 36.160
Other 0.000 0.000 0.000 0.000
Total Current Liabilities 24.590 38.738 0.000 0.000 41.683 57.458 57.458 50.187 50.765 48.996 53.963 53.963
Deferred revenues, non-current 6.903 4.794 2.734 4.754 4.754 5.152 4.685 3.970 8.888 8.888
Other 0.000 0.328 1.709 1.598 1.598 1.643 1.626 1.687 1.637 1.637
TOTAL LIABILITIES 31.493 43.860 0.000 0.000 46.126 63.810 63.810 56.982 57.076 54.653 64.488 64.488
TOTAL STOCKHOLDERS EQUITY 1.433 5.130 0.000 0.000 8.285 54.769 54.769 54.996 60.069 67.053 76.673 76.673
Convertible preferred stock 26.758 26.758 26.758 0.000 0.000 0.000
Common stock 0.000 0.000 0.000 0.000 0.000 0.000
Additional paid-in capital 19.383 23.479 27.391 101.574 101.574 103.087 106.518 108.531 113.781 113.781
Deferred stock based compensation (0.396) (0.554) (0.169) (0.053) (0.053) (0.009) (0.002) 0.000
Accumulated other comprehensive income (0.003) 0.013 (0.048) (0.045) (0.045) (0.045) (0.255) (0.349) (0.314) (0.314)
Accumulated deficit (44.309) (44.566) (45.647) (46.707) (46.707) (48.037) (46.192) (41.129) (36.794) (36.794)
TOTAL LIABILITIES & STOCKHOLDERS' EQUIT 32.926 48.990 0.000 0.000 54.411 118.579 118.579 111.978 117.145 121.706 141.161 141.161
An Investment Analysis by Needham & Company, LLC 5

20. ArcSight, Inc.
($ in MM, except per share data) Annual Quarterly
Fiscal Year Ending April 30 FY FY Ending Ending Ending Ending
4/30/2008 4/30/2009 7/31/2008 10/31/2008 1/31/2009 4/30/2009
BALANCE SHEET
ASSETS
Cash & Short-term Investments 71.9 90.5 74.2 75.7 82.9 90.5
Receivables 26.7 34.2 17.3 23.2 22.2 34.2
Inventory 0.0 0.0 0.0 0.0 0.0 0.0
Other Current Assets 5.6 3.9 5.9 4.2 3.2 3.9
Current Assets 104.2 128.5 97.4 103.0 108.3 128.5
Property and Equipment 4.8 4.4 5.5 5.2 4.7 4.4
Goodwill and Intangibles 7.9 7.1 7.7 7.5 7.3 7.1
Long-term Marketable Securities 0.8 0.0 0.0 0.0 0.0 0.0
Other Assets 0.8 1.2 1.4 1.4 1.4 1.2
Total Assets 118.6 141.2 112.0 117.1 121.7 141.2
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities 57.5 54.0 50.2 50.8 49.0 54.0
Short-term Debt 0.0 0.0 0.0 0.0 0.0 0.0
Long-term Debt 0.0 0.0 0.0 0.0 0.0 0.0
Shareholders' Equity 54.8 76.7 55.0 60.1 67.1 76.7
Total Liabilities + Shareholders' Equity 118.6 141.2 112.0 117.1 121.7 141.2
INCOME STATEMENT
Revenue 101.5 136.2 27.7 32.8 36.4 39.3
Gross Profit 85.5 111.2 22.4 27.0 29.6 32.1
Operating Income 4.1 18.8 (0.6) 4.1 9.0 6.3
Pretax Income 4.6 19.5 (0.3) 4.4 9.1 6.2
Net Income 3.5 16.9 0.3 3.6 6.9 6.1
Shares Outstanding 25.9 33.5 33.1 32.8 33.5 34.4
CASH FLOW STATEMENT
Depreciation and Amortization 2.5 0.0 0.8 1.6 2.5 0.0
Cash Flow from Operations 13.5 0.0 3.8 4.5 12.3 0.0
Capital Expenditures (4.0) 0.0 (1.2) (1.6) (1.8) 0.0
CASH MANAGEMENT*
DSOs 75.9 81.5 71.5 55.5 56.2 64.6
Inventory Days 0.0 0.0 0.0 0.0 0.0 0.0
Days Payable 67.8 33.2 48.5 45.7 30.4 16.8
Cash Conversion Cycle 8.0 48.3 23.0 9.8 25.7 47.9
PROFITABILITY
Gross Margin 84.2% 81.7% 81.0% 82.3% 81.4% 81.8%
Operating Margin 4.1% 13.8% (2.1%) 12.4% 24.6% 16.1%
Net Margin 3.4% 12.4% 1.0% 10.9% 19.1% 15.5%
Return on Assets* 4.2% 13.0% 1.0% 12.5% 23.2% 18.6%
Return on Equity* 11.7% 25.7% 2.1% 24.9% 43.7% 33.9%
Total D ebt/Capital 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
PER SHARE DATA
Tangible Book Value 1.81 2.08 1.43 1.60 1.78 2.02
Cash 2.81 2.70 2.24 2.31 2.47 2.63
Net Cash 2.81 2.70 2.24 2.31 2.47 2.63
EPS (Pro Forma) 0.12 0.51 0.01 0.11 0.21 0.18
EPS (Pro Forma Including Option Expenses)
EPS (GAAP)
6 An Investment Analysis by Needham & Company, LLC

21. ANALYST CERTIFICATION
I, Scott Zeller, hereby certify that the views expressed in this research report accurately reflect my personal views about
the subject company (ies) and its (their) securities. I also certify that I have not been, am not, and will not be receiving
direct or indirect compensation in exchange for expressing the specific recommendation(s) in this report.
Price, Rating, and Price Target History: ArcSight, Inc. (ARST/NASDAQ) as of 6-18-09
9/29/08 12/10/08 1/13/09 3/6/09 3/26/09 6/12/09 6/18/09
B : $11.0 B : $8.0 B : $11.0 B : $13.0 B : $14.0 B : $19.0 B : $21.0
22
20
18
16
14
12
10
8
6
4
Dec 07 Mar 08 Jun 08 Sep 08 Dec 08 Mar 09 Jun 09
Source: Factset (Prices) / Needham (ratings and target price)
Disclosures applicable to this security: B, G.
An Investment Analysis by Needham & Company, LLC 7

22. 445 Park Avenue, New York, NY 10022 (212) 371-8300
% of companies under coverage % for which investment banking services
with this rating have been provided for in the past 12 months
Strong Buy 4 0
Buy 47 6
Hold 42 4
Under Perform <1 0
Rating Suspended 4 0
Restricted <1 33
Under Review <1 50
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8 An Investment Analysis by Needham & Company, LLC