<PAGE>   1

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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                            ------------------------

                                   FORM 10-Q

                            ------------------------

(MARK ONE)

     [X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934.

                     FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

        OR

     [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934.

                             FOR THE TRANSITION PERIOD FROM
                               ----------------------- TO
                               ----------------------- .
                           COMMISSION FILE NUMBER: 000-26247

                              VERITAS SOFTWARE CORPORATION
                 (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S>                                            <C>
                  DELAWARE                                      77-0507675
       (STATE OR OTHER JURISDICTION OF                       (I.R.S. EMPLOYER
       INCORPORATION OR ORGANIZATION)                       IDENTIFICATION NO.)
</TABLE>

                              1600 PLYMOUTH STREET
                        MOUNTAIN VIEW, CALIFORNIA 94043
                                 (650) 527-8000
   (ADDRESS, INCLUDING ZIP CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES
            AND REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

                            ------------------------

     Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]  No [ ]

     The number of shares of the registrant's common stock outstanding as of
April 30, 2001 was 397,413,462 shares.
--------------------------------------------------------------------------------
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<PAGE>   2

                          VERITAS SOFTWARE CORPORATION

                                     INDEX

<TABLE>
<CAPTION>
                                                                       PAGE
                                                                       ----
<S>      <C>                                                           <C>
                       PART I: FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements.................    1
         Condensed Consolidated Balance Sheets as of March 31, 2001
         and December 31, 2000.......................................    1
         Condensed Consolidated Statements of Operations for the
         Three Months Ended
         March 31, 2001 and 2000.....................................    2
         Condensed Consolidated Statements of Cash Flows for the
         Three Months Ended
         March 31, 2001 and 2000.....................................    3
         Notes to Condensed Consolidated Financial Statements........    4
         Management's Discussion and Analysis of Financial Condition
Item 2.  and Results of Operations...................................    9
         Quantitative and Qualitative Disclosures About Market
Item 3.  Risk........................................................   28

                        PART II: OTHER INFORMATION

Item 1.  Legal proceedings...........................................   31
Item 6.  Exhibits and Reports on Form 8-K............................   31
Signature............................................................   32
</TABLE>

                                        i
<PAGE>   3

                         PART I: FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                          VERITAS SOFTWARE CORPORATION

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

                                     ASSETS

<TABLE>
<CAPTION>
                                                               MARCH 31,     DECEMBER 31,
                                                                 2001            2000
                                                              -----------    ------------
                                                              (UNAUDITED)
<S>                                                           <C>            <C>
Current assets:
  Cash and cash equivalents.................................  $ 1,010,716    $   886,558
  Short-term investments....................................      234,103        232,891
  Accounts receivable, net of allowance for doubtful
     accounts of $8,990 at March 31, 2001 and $7,810 at
     December 31, 2000......................................      163,551        186,863
  Deferred income taxes.....................................       38,017         38,017
  Other current assets......................................       38,415         38,303
                                                              -----------    -----------
          Total current assets..............................    1,484,802      1,382,632
Long-term investments.......................................      119,816        136,111
Property and equipment, net.................................      186,052        168,389
Goodwill and other intangibles, net.........................    2,082,105      2,285,320
Other non-current assets....................................      114,962        110,382
                                                              -----------    -----------
          Total assets......................................  $ 3,987,737    $ 4,082,834
                                                              ===========    ===========

                          LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable..........................................  $    44,515    $    45,250
  Accrued compensation and benefits.........................       49,634         63,838
  Accrued acquisition and restructuring costs...............       18,353         44,123
  Other accrued liabilities.................................       69,818         69,289
  Income taxes payable......................................       33,926         34,454
  Deferred revenue..........................................      215,127        201,001
                                                              -----------    -----------
          Total current liabilities.........................      431,373        457,955
Convertible subordinated notes..............................      432,653        429,176
Deferred income taxes.......................................      198,252        213,132
Stockholders' equity:
  Common stock..............................................          415            412
  Additional paid-in capital................................    5,948,122      5,847,844
  Accumulated deficit.......................................   (1,308,264)    (1,152,166)
  Accumulated other comprehensive loss......................      (12,750)       (11,455)
  Treasury stock, cost; 18,675 shares at March 31, 2001.....   (1,702,064)    (1,702,064)
                                                              -----------    -----------
          Total stockholders' equity........................    2,925,459      2,982,571
                                                              -----------    -----------
          Total liabilities and stockholders' equity........  $ 3,987,737    $ 4,082,834
                                                              ===========    ===========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.
                                        1
<PAGE>   4

                          VERITAS SOFTWARE CORPORATION

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED
                                                                    MARCH 31,
                                                              ----------------------
                                                                2001         2000
                                                              ---------    ---------
<S>                                                           <C>          <C>
Net revenue:
  User license fees.........................................  $ 309,017    $ 204,316
  Services..................................................     78,424       40,324
                                                              ---------    ---------
          Total net revenue.................................    387,441      244,640
Cost of revenue:
  User license fees.........................................     10,668       11,778
  Services..................................................     31,670       18,299
  Amortization of developed technology......................     15,791       15,395
                                                              ---------    ---------
          Total cost of revenue.............................     58,129       45,472
                                                              ---------    ---------
Gross profit................................................    329,312      199,168
Operating expenses:
  Selling and marketing.....................................    142,805       87,583
  Research and development..................................     56,225       35,113
  General and administrative................................     25,904       14,911
  Amortization of goodwill and other intangibles............    221,226      219,759
                                                              ---------    ---------
          Total operating expenses..........................    446,160      357,366
                                                              ---------    ---------
Loss from operations........................................   (116,848)    (158,198)
Interest and other income, net..............................     18,628       11,263
Interest expense............................................     (6,969)      (7,523)
                                                              ---------    ---------
Loss before income taxes....................................   (105,189)    (154,458)
Provision for income taxes..................................     50,909       19,925
                                                              ---------    ---------
Net loss....................................................  $(156,098)   $(174,383)
                                                              =========    =========
Net loss per share -- basic and diluted.....................  $   (0.40)   $   (0.44)
                                                              =========    =========
Number of shares used in computing per share amounts --basic
  and diluted...............................................    394,829      394,471
                                                              =========    =========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.
                                        2
<PAGE>   5

                          VERITAS SOFTWARE CORPORATION

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED
                                                                     MARCH 31,
                                                              -----------------------
                                                                 2001         2000
                                                              ----------    ---------
<S>                                                           <C>           <C>
Cash flows from operating activities:
  Net loss..................................................  $ (156,098)   $(174,383)
  Adjustments to reconcile net loss to net cash provided by
     operating activities:
     Depreciation and amortization..........................      19,633        9,416
     Amortization of goodwill and other intangibles.........     221,226      219,759
     Amortization of developed technology...................      15,791       15,395
     Amortization of original issue discount on convertible
      notes.................................................       3,538        3,513
     Deferred income taxes..................................     (13,482)     (13,483)
  Changes in operating assets and liabilities, net of
     effects of business acquisitions:
  Accounts receivable.......................................      23,312        5,732
  Other assets..............................................         761      (11,184)
  Accounts payable..........................................        (735)       2,545
  Accrued compensation and benefits.........................     (14,204)       6,209
  Accrued acquisition and restructuring costs...............     (25,970)      (2,113)
  Other accrued liabilities.................................     (13,471)      (5,252)
  Income taxes payable......................................        (528)      (6,631)
  Tax benefits from stock plans.............................      63,341       38,000
  Deferred revenue..........................................      14,126       37,317
                                                              ----------    ---------
          Net cash provided by operating activities.........     137,240      124,840
Cash flows from investing activities:
  Purchases of investments..................................    (222,410)    (244,356)
  Investment maturities.....................................     237,493      293,544
  Purchases of property and equipment.......................     (35,898)     (20,172)
  Business acquisitions.....................................     (21,000)          --
  Strategic investments in businesses.......................      (8,100)          --
                                                              ----------    ---------
          Net cash provided by (used in) for investing
            activities......................................     (49,915)      29,016
Cash flows from financing activities:
  Proceeds from issuance of common stock....................      36,879       39,512
                                                              ----------    ---------
          Net cash provided by financing activities.........      36,879       39,512
Effect of exchange rate changes.............................         (46)      (1,143)
                                                              ----------    ---------
Net increase in cash and cash equivalents...................     124,158      192,225
Cash and cash equivalents at beginning of period............     886,558      148,244
                                                              ----------    ---------
Cash and cash equivalents at end of period..................  $1,010,716    $ 340,469
                                                              ==========    =========
Supplemental disclosures:
  Cash paid for interest....................................  $    4,312    $   4,322
  Cash paid for income taxes................................  $    1,379    $   1,865
Supplemental schedule of non-cash financing transactions:
  Issuance of common stock for conversion of notes..........  $       61    $      --
</TABLE>

     See accompanying notes to condensed consolidated financial statements.
                                        3
<PAGE>   6

                          VERITAS SOFTWARE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

 1. BASIS OF PRESENTATION

     The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for annual
financial statements. In the opinion of management, all adjustments, consisting
only of normal recurring adjustments, considered necessary for a fair
presentation have been included. The results for the interim periods presented
are not necessarily indicative of the results that may be expected for any
future period. The following information should be read in conjunction with the
consolidated financial statements and notes thereto included in VERITAS Software
Corporation's Annual Report on Form 10-K for the year ended December 31, 2000.

 2. USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the condensed consolidated
financial statements and accompanying notes. Actual results could differ from
those estimates.

 3. STOCK SPLIT

     On January 27, 2000, the Company announced a three-for-two split in the
form of a stock dividend paid on March 3, 2000 to stockholders of record on
February 18, 2000. All share and per share data have been restated to give
retroactive effect to this stock split.

 4. CHANGE IN ACCOUNTING PRINCIPLES

     On January 1, 2001, the Company adopted Statement of Financial Accounting
Standard No. 133, Accounting for Derivatives Instruments and Hedging Activities
("SFAS 133"). SFAS 133 requires the recognition of all derivatives on the
balance sheet at fair value. Derivatives that are not hedges of underlying
transactions are adjusted to fair value through current earnings. If the
derivative is a hedge, depending on the nature of the hedge, changes in fair
value of the derivative are offset against the change in fair value of the
hedges assets, liabilities or firm commitments through earnings or are
recognized in other comprehensive income until the hedged item is recognized in
earnings. The ineffective portion of a derivative's fair values is immediately
recognized in current earnings under other income (expense). The adoption of
SFAS 133 did not have a material impact on the Company's consolidated financial
position or operating results.

 5. NET LOSS PER SHARE

     Basic net loss per share is computed using the weighted-average number of
common shares outstanding during the period. Diluted net loss per share is
computed using the weighted-average number of common shares and dilutive
potential common shares outstanding during the period. However, dilutive
potential common shares outstanding are not included in the denominator for the
three months ended March 31, 2001, as their effect would be anti-dilutive.
Potential common shares consist of employee stock options using the treasury
stock method and common shares issuable upon conversion of the convertible
subordinated notes.

                                        4
<PAGE>   7
                          VERITAS SOFTWARE CORPORATION

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table sets forth the computation of basic and diluted net loss per
common share (in thousands, except per share amounts):

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED
                                                             MARCH 31,
                                                       ----------------------
                                                         2001         2000
                                                       ---------    ---------
<S>                                                    <C>          <C>
Numerator:
  Net loss...........................................  $(156,098)   $(174,383)
                                                       =========    =========
Denominator:
  Denominator for basic net loss per
     share -- weighted-average shares outstanding....    394,829      394,471
  Common stock equivalents...........................         --           --
                                                       ---------    ---------
  Denominator for diluted net loss per share.........    394,829      394,471
                                                       =========    =========
Basic and diluted net loss per share.................  $   (0.40)   $   (0.44)
                                                       =========    =========
</TABLE>

     Common stock equivalents included in the denominator for purposes of
computing diluted net loss per share do not include 6,747,804 shares issuable
upon conversion of the outstanding 5.25% convertible subordinated notes and
12,981,596 shares issuable upon conversion of the outstanding 1.856% convertible
subordinated notes, as their effect would be anti-dilutive for all periods
presented. For the three months ended March 31, 2001, potential common stock
equivalents included in the denominator for purposes of computing diluted net
loss per share do not include 45,725,284 potential common shares, all related to
employee stock options, as their effect would be anti-dilutive.

 6. COMPREHENSIVE LOSS

     The following are the components of comprehensive loss (in thousands):

<TABLE>
<CAPTION>
                                                         THREE MONTHS ENDED
                                                             MARCH 31,
                                                       ----------------------
                                                         2001         2000
                                                       ---------    ---------
<S>                                                    <C>          <C>
Net loss.............................................  $(156,098)   $(174,383)
Other comprehensive income (loss), net of tax:
  Foreign currency translation and derivative
     financial instrument adjustments................        801       (1,143)
  Unrealized gain (loss) on marketable securities....     (2,096)          --
                                                       ---------    ---------
Comprehensive loss...................................  $(157,393)   $(175,526)
                                                       =========    =========
</TABLE>

     The components of accumulated other comprehensive loss are (in thousands):

<TABLE>
<CAPTION>
                                                         MARCH 31,   DECEMBER 31,
                                                           2001          2000
                                                         ---------   ------------
<S>                                                      <C>         <C>
Foreign currency translation and derivative financial
  instrument adjustments...............................  $ (9,710)     $(10,511)
Unrealized gain (loss) on marketable securities........    (3,040)         (944)
                                                         --------      --------
Accumulated other comprehensive loss...................  $(12,750)     $(11,455)
                                                         ========      ========
</TABLE>

 7. DERIVATIVE FINANCIAL INSTRUMENTS

     In the normal course of business, the Company's financial position is
subjected to a variety of risks, including market risk associated interest rate
fluctuations and currency rate fluctuations on non-functional currency
denominated assets and liabilities. The Company regularly assesses risks and has
established policies and business practices to protect against effects of these
and other potential exposures. The Company uses

                                        5
<PAGE>   8
                          VERITAS SOFTWARE CORPORATION

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

derivatives to moderate the financial market risks of its business operations by
hedging the foreign currency market exposures underlying certain assets and
liabilities and commitments related to customer transactions. The Company does
not use derivatives for speculative or trading purposes.

     Cash flow hedges are hedges of forecasted transactions or of the
variability of cash flows to be received or paid related to a recognized asset
or liability. In September 2000, the Company entered into a three year cross
currency interest rate swap ("swap") transaction for the purpose of hedging
fixed interest rate, foreign currency denominated cash flows under an
intercompany loan receivable. This swap was entered into to protect against the
risk that the eventual cash flows resulting from the loan receivable will be
adversely affected by changes in exchange rates. During the three months ended
March 31, 2001, the portion of the hedging instrument excluded from the
assessment of the effectiveness and the ineffective portion of hedges had no
material impact on earnings for cash flow hedges.

     The effectiveness test for derivatives used to hedge the underlying
economic exposure is determined by using the forward-to-forward rate comparison
for currency forward contracts, which makes the same-currency hedges perfectly
effective.

     Additionally, the Company utilizes foreign currency forward exchange
contracts ("forward contracts") to hedge intercompany accounts of certain of its
international subsidiaries. Changes in the fair value of forward contracts are
recognized in other income (expense) as an offset to the changes in the fair
value of the assets or liabilities being hedged.

 8. SUMMARY FINANCIAL INFORMATION OF SUBSIDIARY

     VERITAS and its wholly owned subsidiary, VERITAS Operating Corporation, are
co-obligors on VERITAS' 5.25% convertible subordinated notes due 2004 and 1.856%
convertible subordinated notes due 2006. VERITAS and VERITAS Operating
Corporation are unconditionally, jointly and severally liable for all payments
under the notes. On June 30, 2000, VERITAS reorganized its corporate structure
that resulted in the elimination of differences in the consolidated financial
position and operating results of the parent company and VERITAS Operating
Corporation. Consequently, separate summarized financial information of VERITAS
and VERITAS Operating Corporation, previously presented pursuant to Staff
Accounting Bulletin No. 53, Financial Statement Requirements in Filings
Involving the Guarantee of Securities by the Parent, are no longer presented
since such information is now the same as the consolidated financial statements
presented elsewhere herein. No other subsidiaries of VERITAS are co-obligors or
guarantors of the convertible subordinated notes.

 9. SEGMENT INFORMATION

     The Company operates in one segment, data availability solutions. The
Company's products and services are sold throughout the world, through direct,
original equipment manufacturer, reseller and distributor channels. The
Company's chief operating decision maker, the chief executive officer, evaluates
the performance of the Company based upon stand-alone revenue by product
channels and revenues by geographic regions of the segment and does not receive
separate, discrete financial information about asset allocation, expense
allocation or profitability from the Company's data availability products or
services.

                                        6
<PAGE>   9
                          VERITAS SOFTWARE CORPORATION

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

     Geographic information (in thousands):

<TABLE>
<CAPTION>
                                                          THREE MONTHS ENDED
                                                              MARCH 31,
                                                         --------------------
                                                           2001        2000
                                                         --------    --------
<S>                                                      <C>         <C>
User license fees(1):
United States..........................................  $221,038    $152,801
Europe(2)..............................................    63,044      40,389
Other(3)...............................................    24,935      11,126
                                                         --------    --------
          Total........................................   309,017     204,316
                                                         --------    --------
Services(1):
United States..........................................    63,937      32,957
Europe(2)..............................................     9,559       6,086
Other(3)...............................................     4,928       1,281
                                                         --------    --------
          Total........................................    78,424      40,324
                                                         --------    --------
          Total net revenue............................  $387,441    $244,640
                                                         ========    ========
</TABLE>

<TABLE>
<CAPTION>
                                                     MARCH 31,     DECEMBER 31,
                                                        2001           2000
                                                     ----------    ------------
<S>                                                  <C>           <C>
Long-lived assets(4):
  United States....................................  $2,233,551     $2,423,292
  Europe(2)........................................      24,615         22,212
  Other(3).........................................       9,991          8,205
                                                     ----------     ----------
          Total....................................  $2,268,157     $2,453,709
                                                     ==========     ==========
</TABLE>

---------------
(1) License and services revenues are attributed to geographic regions based on
    location of customers.

(2) Europe includes the Middle East and Africa.

(3) Other includes Canada, Latin America, Japan and the Asia Pacific region.

(4) Long-lived assets include all long-term assets except those specifically
    excluded under SFAS No. 131, such as deferred income taxes and long-term
    investments. Reconciliation to total assets reported (in thousands):

<TABLE>
<CAPTION>
                                                     MARCH 31,     DECEMBER 31,
                                                        2001           2000
                                                     ----------    ------------
<S>                                                  <C>           <C>
Total long-lived assets............................  $2,268,157     $2,453,709
Other assets, including current....................   1,719,580      1,629,125
                                                     ----------     ----------
          Total consolidated assets................  $3,987,737     $4,082,834
                                                     ==========     ==========
</TABLE>

     No customer represented 10% or more of the Company's net revenue for the
three months ended March 31, 2001 or for the three months ended March 31, 2000.

10. COMMITMENTS AND CONTINGENCIES

  Facilities lease commitments

     During the first quarter of 2001, the Company amended its existing lease
agreement, originally signed in the second quarter of 1999, for new corporate
campus facilities in Mountain View, California. These facilities will replace
certain facilities that the Company currently leases in Mountain View. The new
corporate campus facilities will be developed in one phase for a total of
425,000 square feet and will provide space for sales, marketing, administration
and research and development functions. The lease term for these facilities is
five

                                        7
<PAGE>   10
                          VERITAS SOFTWARE CORPORATION

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

years beginning in March 2000, with an option to extend the lease term for two
successive periods of one year each. The Company has an option to purchase the
property (land and facilities) for $147.8 million or, at the end of the lease,
to arrange for the sale of the property to a third party with the Company
retaining an obligation to the owner for the difference between the sales price
and the guaranteed residual value up to $130.0 million if the sales price is
less than this amount, subject to certain provisions of the lease. The Company
anticipates occupying the new corporate campus facilities and beginning the
lease payments in the second quarter of 2001.

     During the first quarter of 2001, the Company amended its existing lease
agreement, originally signed in the first quarter of 2000 for its existing
facilities in Roseville, Minnesota. The Company will improve and expand its
existing facilities of 62,000 square feet and will develop adjacent property
adding 260,000 square feet to the campus, with the first phase of 142,000 square
feet being completed in the second quarter of 2001. The facilities will provide
space for research and development functions. The lease term for these
facilities is five years beginning in March 2000, with an option to extend the
lease term for two successive periods of one year each. The Company has an
option to purchase the property (land and facilities) for $41.5 million or, at
the end of the lease, to arrange for the sale of the property to a third party
with the Company retaining an obligation to the owner for the difference between
the sales price and the guaranteed residual value up to $35.5 million if the
sales price is less than this amount, subject to certain provisions of the
lease. The Company anticipates occupying the new campus facilities and beginning
the lease payments in the second quarter of 2001.

     During the third quarter of 2000, the Company signed a lease agreement for
the lease of 65 acres of land and subsequent improvements for new research and
development campus facilities in Milpitas, California. The Company plan to
develop the site in two phases, adding a total of 990,990 square feet, with the
first phase of 466,000 square feet being completed in the fourth quarter of
2002.

     The Company expects to complete the second phase of 524,990 square feet in
the third quarter of 2003. The facilities will provide space for research and
development functions. The lease term for the first phase is five years
beginning in July 2000, with an option to extend the lease term for two
successive periods of one year each. The Company has an option to purchase the
property (land and first phase facilities) for $243 million or, at the end of
the lease, to arrange for the sale of the property to a third party with the
Company retaining an obligation to the owner for the difference between the
sales price and the guaranteed residual value up to $220 million if the sales
price is less than this amount, subject to certain provisions of the lease. The
Company anticipates occupying the new campus facilities and beginning the lease
payments in the second quarter of 2002 for the first phase and third quarter of
2003 for the second phase. The Company expects to start negotiating the
financing terms of the second phase in the first quarter of 2002.

     The three lease agreements listed above require the Company to maintain
specified financial covenants such as earnings before interest, taxes,
depreciation and amortization ("EBITDA"), debt on EBITDA and quick ratio, all of
which the Company was in compliance with as of March 31, 2001.

                                        8
<PAGE>   11

ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

     The following discussion should be read in conjunction with our financial
statements and accompanying notes, which appear elsewhere in this Quarterly
Report on Form 10-Q. The following discussion contains forward-looking
statements within the meaning of Section 21E of the Securities Exchange Act of
1934 and Section 27A of the Securities Act of 1933, that involve risks and
uncertainties. These forward-looking statements include statements that reflect
our plans, estimates and beliefs, based on information available to us at the
time of this report. We assume no obligation to update any such forward-looking
statements. Actual results could differ materially from those anticipated in the
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those detailed from time to time in
our filings with the Securities and Exchange Commission and those discussed
below and elsewhere in this Form 10-Q, particularly in "Factors That May Affect
Future Results."

     Unless expressly stated or the content otherwise requires, the terms "we",
"our", "us" and "VERITAS" refer to VERITAS Software Corporation and its
subsidiaries.

OVERVIEW

     VERITAS is a leading independent supplier of data availability software
products. Data availability software includes storage management and data
protection software as well as clustering, replication and storage area
networking software.

     We develop products for most popular operating systems, including versions
of UNIX, Windows NT and Linux. We market our products and services to original
equipment manufacturers and end user customers through a combination of direct
sales and indirect sales channels such as resellers, value-added resellers,
hardware distributors, application software vendors and systems integrators.

     We derive user license fee revenue from shipments of our software products
to end-user customers through direct sales channels, indirect sales channels and
original equipment manufacturer customers. Our original equipment manufacturer
customers either bundle our products with the products licensed by the original
equipment manufacturers or offer them as options. Some original equipment
manufacturers also resell our products. We receive a royalty each time the
original equipment manufacturer licenses to a customer a copy of the original
equipment manufacturer's products that incorporates one or more of our products.
Our license agreements with our original equipment manufacturer customers
generally contain no minimum sales requirements. We cannot assure you that any
original equipment manufacturer will either commence or continue shipping
operating systems incorporating our products in the future. When we enter into
new agreements with original equipment manufacturer customers and resellers, a
significant period of time may elapse before we realize any associated revenue,
due to development work that we must generally undertake under these agreements
and the time needed for the sales and marketing organizations within these
customers and distributors to become familiar with and gain confidence in our
products.

     Our services revenue consists of fees derived mainly from annual
maintenance agreements, as well as fees from consulting and training services.
Original equipment manufacturer maintenance agreements covering our products
provide for technical and emergency support and minor unspecified product
upgrades for a fixed annual fee. Maintenance agreements covering products that
are licensed through channels other than original equipment manufacturers
provide for technical support and unspecified product upgrades for an annual fee
based on the number of user licenses purchased and the level of service
subscribed.

INTERNATIONAL SALES AND OPERATIONS

     Our international sales are generated primarily through our international
sales subsidiaries. International revenue, most of which is collectible in
foreign currencies, accounted for approximately 26% of our total revenue for the
three months ended March 31, 2001 and 24% of our total revenue for the three
months ended March 31, 2000. Our international revenue increased 74% from $58.9
million for the three months ended March 31, 2000 to $102.5 million for the
three months ended March 31, 2001.

                                        9
<PAGE>   12

     We believe that our success depends upon continued expansion of our
international operations. We currently have sales and service offices and
resellers located in North America, Europe, Asia-Pacific, South America and the
Middle East, and a development center in India. International expansion will
require us to establish additional foreign offices, hire more personnel and
recruit new international resellers, resulting in the diversion of significant
management attention and the expenditure of financial resources. To the extent
that we are unable to meet these additional requirements, growth in
international sales will be limited, and this would have an adverse effect on
our business, operating results and financial condition. International
operations are also subject us to a number of risks inherent in developing and
selling products outside the United States, including potential loss of
developed technology, limited protection of intellectual property rights,
imposition of government regulation, imposition of export duties and
restrictions, cultural differences in the conduct of business, and political and
economic instability.

SEAGATE TECHNOLOGY TRANSACTION

     On November 22, 2000, we completed a multi-party transaction with Seagate
Technology, Inc. ("Seagate") and Suez Acquisition Company (Cayman) Limited
("SAC"), a company formed by a group of private equity firms led by Silver Lake
Partners. The transaction was structured as a leveraged buyout of Seagate
pursuant to which Seagate sold all of its operating assets to SAC, and SAC
assumed and indemnified Seagate and us for substantially all liabilities arising
in connection with those operating assets. At the closing, and after the
operating assets and liabilities of Seagate had been transferred to SAC, a
wholly-owned subsidiary of ours merged with and into Seagate, following which
Seagate became our wholly-owned subsidiary and was renamed VERITAS Software
Technology Corporation. We issued approximately 109.4 million shares of our
common stock to the Seagate stockholders in exchange for approximately 128.1
million shares of our common stock and equity securities in Gadzoox Networks,
Inc. held by Seagate, which represents a decrease of approximately 18.7 million
shares of our outstanding common stock. We recorded the equity securities in
Gadzoox and other assets and liabilities assumed from Seagate at their fair
values and we accrued $40 million of acquisition related costs. As of March 31,
2001, our other assets included $70 million of indemnification receivable from
SAC and $4 million for our ownership in Gadzoox Networks, Inc, our accrued
acquisition and restructuring costs included $6 million of direct transaction
costs, and our deferred and other income taxes included an additional $132
million, which is net of a deferred tax asset of $3 million related to our
ownership in Gadzoox Networks, Inc. We did not acquire Seagate's disc drive
business or any other Seagate operating business.

     Acquisition-related costs are summarized below (in millions):

<TABLE>
<CAPTION>
                                                              DIRECT
                                                            TRANSACTION
                                                               COSTS
                                                            -----------
<S>                                                         <C>
Provision accrued at acquisition date.....................    $ 40.0
Cash payments.............................................      (8.6)
                                                              ------
Balance at December 31, 2000..............................      31.4
Cash payments.............................................     (25.4)
                                                              ------
Balance at March 31, 2001.................................    $  6.0
                                                              ======
</TABLE>

     It is anticipated that the remaining $6.0 million will be utilized in 2001.

BUSINESS COMBINATIONS

     On May 28, 1999, we acquired the Network & Storage Management Group
business of Seagate Software, Inc., which we refer to as NSMG. On June 1, 1999
we acquired TeleBackup Systems, Inc., which we refer to as TeleBackup. On August
10, 1999, we acquired certain assets of NuView, Inc., which we refer to as
NuView.

                                        10
<PAGE>   13

  NSMG acquisition

     The NSMG business developed and marketed software products and provided
related services enabling information technology professionals to manage
distributed network resources and to secure and protect enterprise data. In
connection with the NSMG acquisition, we issued 155,583,486 shares of our common
stock to Seagate Software and issued options to purchase 15,626,358 shares of
our common stock to our employees who were former NSMG employees. We accounted
for the NSMG acquisition using the purchase method of accounting, and we are
incurring charges of $221.5 million per quarter primarily related to the
amortization of developed technology, goodwill and other intangibles over their
estimated useful life of four years. The total NSMG purchase price was $3,464.5
million and included $3,151.4 million for the issuance of our common stock,
$269.7 million for the exchange of options to purchase our common stock and
$43.4 million of acquisition-related costs. The purchase price was allocated,
based on an independent valuation, to goodwill of $3,015.8 million, distribution
channels of $233.8 million, original equipment manufacturer agreements of $23.4
million, developed technology of $233.7 million, assembled workforce of $12.8
million, trademarks of $22.8 million, in-process research and development of
$101.2 million, net deferred tax liabilities of $179.5 million, other
intangibles of $1.5 million and tangible net liabilities assumed of $1.0
million. For the three months ended March 31, 2001 and 2000, we recorded $206.9
million for the amortization of goodwill and other intangibles, and $14.6
million for the amortization of developed technology related to this
acquisition.

     Acquisition-related costs consisted of direct transaction costs of $20.0
million, operating lease commitments on duplicative facilities of $8.2 million
and involuntary termination benefits of $15.2 million. Non-cash charges included
in the acquisition-related costs approximated $11.7 million.

     Acquisition-related costs are summarized below (in millions):

<TABLE>
<CAPTION>
                                                                OPERATING LEASE
                                              DIRECT             COMMITMENTS ON           INVOLUNTARY
                                         TRANSACTION COSTS   DUPLICATIVE FACILITIES   TERMINATION BENEFITS   TOTAL
                                         -----------------   ----------------------   --------------------   ------
<S>                                      <C>                 <C>                      <C>                    <C>
Provision accrued at acquisition
  date.................................       $ 20.0                 $ 8.2                   $ 15.2          $ 43.4
Cash payments..........................        (17.4)                 (0.3)                    (1.8)          (19.5)
Non-cash charges.......................           --                    --                    (11.7)          (11.7)
                                              ------                 -----                   ------          ------
Balance at December 31, 1999...........          2.6                   7.9                      1.7            12.2
Cash payments..........................         (1.9)                 (1.9)                    (0.9)           (4.7)
                                              ------                 -----                   ------          ------
Balance at December 31, 2000...........          0.7                   6.0                      0.8             7.5
Cash payments..........................         (0.3)                   --                       --            (0.3)
                                              ------                 -----                   ------          ------
Balance at March 31, 2001..............       $  0.4                 $ 6.0                   $  0.8          $  7.2
                                              ======                 =====                   ======          ======
</TABLE>

     It is anticipated that the remaining acquisition-related costs accrual of
$7.2 million will be utilized primarily for servicing operating lease payments
or negotiated buyout of operating lease commitments, the lease terms of which
will expire at various times through the year 2013.

     In addition, we recorded a restructuring charge of $11.0 million in 1999 as
a result of the NSMG acquisition. This restructuring charge related to exit
costs with respect to duplicative facilities that we planned to vacate, which
include $0.9 million of write-off of redundant equipment and leasehold
improvements, and involuntary termination benefits. Involuntary termination
benefits relate to the salary and fringe benefit expense for terminated
employees in research and development. The involuntarily terminated employees
represented 2% of the global workforce. In the fourth quarter of 2000, mainly as
a result of lower actual exit costs than originally estimated with respect to
duplicative facilities, we reversed $4.3 million of the restructuring charge.

                                        11
<PAGE>   14

     Restructuring costs are summarized below (in millions):

<TABLE>
<CAPTION>
                                                                                          WRITE OFF
                                          CANCELLATION                                   OF REDUNDANT
                                      OF FACILITIES LEASES       INVOLUNTARY            EQUIPMENT AND
                                      AND OTHER CONTRACTS    TERMINATION BENEFITS   LEASEHOLD IMPROVEMENTS   TOTAL
                                      --------------------   --------------------   ----------------------   -----
<S>                                   <C>                    <C>                    <C>                      <C>
Provision accrued at acquisition
  date..............................         $ 8.8                  $ 1.3                   $ 0.9            $11.0
Cash payments.......................            --                   (0.9)                     --             (0.9)
Non-cash charges....................            --                     --                    (0.9)            (0.9)
                                             -----                  -----                   -----            -----
Balance at December 31, 1999........           8.8                    0.4                      --              9.2
Cash payments.......................          (0.2)                    --                      --             (0.2)
Reversals...........................          (3.9)                  (0.4)                     --             (4.3)
                                             -----                  -----                   -----            -----
Balance at December 31, 2000........           4.7                     --                      --              4.7
Cash payments.......................            --                     --                      --               --
                                             -----                  -----                   -----            -----
Balance at March 31, 2001...........         $ 4.7                  $  --                   $  --            $ 4.7
                                             =====                  =====                   =====            =====
</TABLE>

     It is anticipated that the remaining restructuring charge accrual of $4.7
million will be utilized for servicing operating lease payments or negotiated
buyout of operating lease commitments, the lease terms of which will expire at
various times through 2012.

  TeleBackup acquisition

     TeleBackup designed, developed and marketed software products for local and
remote backup and recovery of electronic information stored on networked, remote
and mobile personal computers. TeleBackup became our wholly owned subsidiary in
exchange for the issuance of 6,842,795 shares of either our common stock or
exchangeable shares exchangeable into our common stock to the holders of
TeleBackup common shares, and the exchange of options to purchase 154,706 shares
of our common stock to our employees who were former employees of TeleBackup. We
accounted for the TeleBackup acquisition using the purchase method of
accounting, and we are incurring charges of $9.0 million per quarter, primarily
related to the amortization of developed technology, goodwill and other
intangibles over their estimated useful life of four years. The total purchase
price for TeleBackup was $143.1 million and included $134.1 million related to
the issuance of our common stock, $2.8 million for the issuance of options to
purchase our common stock and $6.2 million in acquisition-related costs. The
purchase price was allocated, based on an independent valuation, to goodwill of
$133.1 million, distribution channels of $1.0 million, original equipment
manufacturer agreements of $2.1 million, developed technology of $6.6 million,
assembled workforce of $0.3 million, trademarks of $1.3 million, in-process
research and development of $1.9 million, net deferred tax liabilities of $3.0
million and tangible net liabilities assumed of $0.2 million. For the three
months ended March 31, 2001 and 2000, we recorded $8.6 million for amortization
of goodwill and other intangibles, and $0.4 million for the amortization of
developed technology related to this acquisition.

     The acquisition costs of $6.2 million consist primarily of direct
transaction costs and involuntary termination benefits.

     Acquisition-related costs are summarized below (in millions):

<TABLE>
<CAPTION>
                                                       DIRECT             INVOLUNTARY
                                                  TRANSACTION COSTS   TERMINATION BENEFITS   TOTAL
                                                  -----------------   --------------------   -----
<S>                                               <C>                 <C>                    <C>
Provision accrued at acquisition date...........        $ 5.6                $ 0.6           $ 6.2
Cash payments...................................         (5.1)                (0.2)           (5.3)
                                                        -----                -----           -----
Balance at December 31, 1999....................          0.5                  0.4             0.9
Cash payments...................................         (0.2)                (0.4)           (0.6)
                                                        -----                -----           -----
Balance at December 31, 2000....................          0.3                   --             0.3
Cash payments...................................         (0.1)                  --            (0.1)
                                                        -----                -----           -----
Balance at March 31, 2001.......................        $ 0.2                $  --           $ 0.2
                                                        =====                =====           =====
</TABLE>

     It is anticipated that the remaining $0.2 million will be utilized in 2001.

                                        12
<PAGE>   15

  NuView acquisition

     Under an asset purchase agreement, we acquired certain assets of NuView for
a total cost of approximately $67.9 million. We accounted for the acquisition
using the purchase method of accounting, and we are incurring charges of $4.3
million per quarter primarily related to the amortization of developed
technology, goodwill and other intangibles over their estimated useful life of
four years. The purchase price included $47.7 million related to the issuance of
our common stock, $0.8 million for the issuance of options to purchase our
common stock to former NuView employees, $0.2 million in acquisition-related
costs and $19.2 million paid in cash. The purchase price was allocated, based on
an independent valuation, to goodwill of $62.6 million, developed technology of
$2.4 million, assembled workforce of $0.6 million, trademarks of $0.3 million,
covenant-not-to-compete of $0.9 million and in-process research and development
of $1.1 million. For the three months ended March 31, 2001 and 2000, we recorded
$4.1 million for amortization of goodwill and other intangibles, and $0.2
million for the amortization of developed technology related to this
acquisition.

     For the three months ended March 31, 2001 and 2000, we incurred net losses
due to the amortization of developed technology, goodwill and other intangibles
related to the acquisitions of the NSMG business, TeleBackup and NuView. Because
of these acquisitions, we will incur total charges of $234.8 million per quarter
until the second quarter of 2003 related to the amortization of developed
technology, goodwill and other intangibles. Because of these significant
quarterly charges it is likely that we will remain unprofitable at least through
the second quarter of 2003.

RESULTS OF OPERATIONS

     The following table sets forth the percentage of total net revenue
represented by certain line items from our condensed consolidated statement of
operations for the three months ended March 31, 2001 and 2000, respectively, and
the percentage changes between the comparable periods:

<TABLE>
<CAPTION>
                                                  PERCENTAGE OF
                                                TOTAL NET REVENUE         PERIOD-TO-PERIOD
                                               -------------------       PERCENTAGE CHANGE
                                               THREE MONTHS ENDED        ------------------
                                                    MARCH 31,            THREE MONTHS ENDED
                                               -------------------         MARCH 31, 2001
                                               2001          2000         COMPARED TO 2000
                                               -----         -----       ------------------
<S>                                            <C>           <C>         <C>
Net revenue:
  User license fees..........................    80%           84%               51%
  Services...................................    20            16                95%
                                                ---           ---               ---
          Total net revenue..................   100           100                58%
Cost of revenue:
  User license fees..........................     3             5                (9)%
  Services...................................     8             8                73%
  Amortization or developed technology.......     4             6                 3%
                                                ---           ---               ---
          Total cost of revenue..............    15            19                28%
                                                ---           ---               ---
Gross profit.................................    85            81                65%
Operating expenses:
  Selling and marketing......................    37            36                63%
  Research and development...................    15            14                60%
  General and administrative.................     6             6                74%
  Amortization of goodwill and other
     intangibles.............................    57            90                 1%
                                                ---           ---               ---
          Total operating expenses...........   115           146                25%
                                                ---           ---               ---
Income (loss) from operations................   (30)          (65)              (26)%
Interest and other income, net...............     5             5                65%
Interest expense.............................    (2)           (3)               (7)%
                                                ---           ---               ---
Income (loss) before income taxes............   (27)          (63)              (32)%
Provision for income taxes...................    13             8               156%
                                                ---           ---               ---
Net income (loss)............................   (40)%         (71)%             (11)%
                                                ===           ===               ===
</TABLE>

                                        13
<PAGE>   16

  Net Revenue

     Total net revenue increased 58% from $244.6 million for the three months
ended March 31, 2000 to $387.4 million for the three months ended March 31,
2001. We believe that the percentage increase in total revenue achieved in this
period is not necessarily indicative of future results, but we do expect net
revenue to continue to grow in 2001. Our revenue comprises user license fees and
service revenue.

     User License Fees. User license fees increased 51% from $204.3 million for
the three months ended March 31, 2000 to $309.0 million for the three months
ended March 31, 2001. The increase was primarily the result of the continued
growth in market acceptance of our software products, introduction of new
products, a greater volume of large end-user transactions, and increased revenue
from original equipment manufacturers. In particular, our user license fees from
our data protection, file and volume management and application solutions
products increased 45% from $181.9 million for the three months ended March 31,
2000 to $262.9 million for the three months ended March 31, 2001. The user
license fees from our data protection, file and volume management and
application solutions products accounted for 85% of user license fees for the
three months ended March 31, 2001, and 89% for the three months ended March 31,
2000. Our user license fees from our newer clustering and replication products
increased 106% from $22.4 million for the three months ended March 31, 2000 to
$46.1 million for the three months ended March 31, 2001. For the three months
ended March 31, 2001, we also recorded a greater volume of large end-user
transactions. For end-user transactions valued at $250,000 or more, our user
license fees increased 111% from $48.7 million for the three months ended March
31, 2000 to $102.7 million for the three months ended March 31, 2001. Our user
license fees from original equipment manufacturers increased 44% from $32.7
million for the three months ended March 31, 2000 to $47.4 million for the three
months ended March 31, 2001. The user license fees from original equipment
manufacturers accounted for 15% of user license fees for the three months ended
March 31, 2001 and 16% for the three months ended March 31, 2000.

     Service Revenue. We derive our service revenue primarily from contracts for
software maintenance and technical support and, to a lesser extent, consulting
and training services. Service revenue increased 95% from $40.3 million for the
three months ended March 31, 2000 to $78.4 million for the three months ended
March 31, 2001. The increase was primarily due to increased sales of service and
support contracts on new licenses, renewal of service and support contracts on
existing licenses and, to a lesser extent, an increase in demand for consulting
and training services. Service revenue represented 20% of total net revenue for
the three months ended March 31, 2001. We expect service revenue to increase in
absolute dollars and to increase slightly as a percentage of total net revenue.

  Cost of Revenue

     Cost of revenue increased 28% from $45.5 million for the three months ended
March 31, 2000 to $58.1 million for the three months ended March 31, 2001. Gross
margin on user license fees is substantially higher than gross margin on service
revenue, reflecting the low materials, packaging and other costs of software
products compared with the relatively high personnel costs associated with
providing maintenance, technical support, consulting, training services and
development efforts. Cost of service revenue varies depending upon the mix of
maintenance, technical support, consulting and training services. We expect
gross margin to fluctuate in the future, reflecting this mix and the timing
differences between increasing our organizational investments and the
recognition of revenue that we expect as a result of these investments.

     Cost of User License Fees (including amortization of developed
technology). Cost of user license fees consists primarily of royalties, media,
manuals and distribution costs. Also included in the cost of revenue is the
amortization of developed technology acquired in the NSMG, TeleBackup and NuView
acquisitions in 1999. Cost of user license fees decreased 2.6% from $27.2
million for the three months ended March 31, 2000 to $26.5 million for the three
months ended March 31, 2001. Gross margin on user license fees increased from
87% for the three months ended March 31, 2000 to 91% for the three months ended
March 31, 2001. The increase in gross margin on user license fees in 2001 was
due to a combination of an increase in user license fees revenue and the
stability of the amortization of developed technology. If we excluded the
amortization of developed technology from the cost of user license fees, the
gross margin on user license fees would have been

                                        14
<PAGE>   17

97% for the three months ended March 31, 2001 and 94% for the three months ended
March 31, 2000. The gross margin on user license fees may vary from period to
period based on the license revenue mix, because some products carry higher
royalty rates than others. We do not expect gross margin on user license fees to
increase in the future.

     Cost of Service Revenue. Cost of service revenue consists primarily of
personnel-related costs in providing maintenance, technical support, consulting
and training to customers. Cost of service revenue increased 73% from $18.3
million for the three months ended March 31, 2000 to $31.7 million for the three
months ended March 31, 2001. Gross margin on service revenue increased from 55%
for the three months ended March 31, 2000 to 60% for the three months ended
March 31, 2001. The gross margin improvement was the result of increased
productivity and higher service revenue growth due to support fees from a larger
installed customer base. We expect the costs of service revenue to continue to
increase in absolute dollars in future periods and we expect the gross margin on
service revenue to increase slightly as a percentage.

     Amortization of Developed Technology. Amortization of developed technology
increased 3% from $15.4 million for the three months ended March 31, 2000 to
$15.8 million for the three months ended March 31, 2001. These amounts mainly
represent the amortization of the developed technology recorded upon the
acquisition of NSMG, TeleBackup and NuView in 1999. The useful life of the
developed technology acquired is four years and we expect the amortization to be
approximately $15.8 million per quarter.

  Operating Expenses

     Total operating expenses increased 25% from $357.4 million for the three
months ended March 31, 2000 to $446.2 million for the three months ended March
31, 2001. We believe that the percentage increase in total operating expenses in
this period is not necessarily indicative of future results, but we do believe
that operating expenses will continue to increase as revenue increases and as we
continue to expand our operations globally. Our operating expenses are comprised
of selling and marketing expenses, research and development, general and
administrative expenses, and amortization of goodwill and other intangibles.

     Selling and Marketing. Selling and marketing expenses consist primarily of
salaries, related benefits, commissions, consultant fees and other costs
associated with our sales and marketing efforts. Selling and marketing expenses
increased 63% from $87.6 million for the three months ended March 31, 2000 to
$142.8 million for the three months ended March 31, 2001. The increase in
absolute dollars was primarily attributable to increased sales and marketing
staffing and, to a lesser extent, increased costs associated with new marketing
programs. As a percentage of net revenue, selling and marketing expenses
increased slightly from 36% for the three months ended March 31, 2000 to 37% for
the three months ended March 31, 2001. We intend to continue to expand our
global sales and marketing infrastructure, and accordingly, we expect our
selling and marketing expenses to increase in absolute dollars but not to change
significantly as a percentage of total net revenue in the future.

     Research and Development. Research and development expenses consist
primarily of salaries, related benefits, third-party consultant fees and other
engineering related costs. Research and development expenses increased 60% from
$35.1 million for the three months ended March 31, 2000 to $56.2 million for the
three months ended March 31, 2001. The increase was due primarily to increased
staffing levels associated with new hires and our acquisitions and expansion of
development efforts for new technology. As a percentage of net revenue, research
and development expenses increased from 14% for the three months ended March 31,
2000 to 15% for the three months ended March 31, 2001. We believe that a
significant level of research and development investment is required to remain
competitive, and expect these expenses will continue to increase in absolute
dollars in future periods and may increase slightly as a percentage of net
revenue. We expect research and development expenses to fluctuate from time to
time to the extent that we make periodic incremental investments in research and
development.

     General and Administrative. General and administrative expenses consist
primarily of salaries, related benefits and fees for professional services, such
as legal and accounting services. General and administrative expenses increased
74% from $14.9 million for the three months ended March 31, 2000 to $25.9
million for the three months ended March 31, 2001. The increase in absolute
dollars was primarily due to additional
                                        15
<PAGE>   18

personnel costs, and to a lesser extent, to an increase in other expenses
associated with enhancing our infrastructure to support expansion of our
operations. As a percentage of net revenue, general and administrative expenses
remained consistent at 6% for the three months ended March 31, 2001 and 2000. We
expect general and administrative expenses to increase in absolute dollars, but
not to change significantly as a percentage of net revenue.

     Amortization of Goodwill and Other Intangibles. Amortization of goodwill
and other intangibles increased 1% from $219.8 million for the three months
ended March 31, 2000 to $221.2 million for the three months ended March 31,
2001. This amount mainly represents amortization of goodwill, distribution
channels, trademarks and other intangibles assets recorded upon the acquisitions
of NSMG, TeleBackup and NuView in 1999. The estimated useful life of the
goodwill and the other intangibles is four years and we expect the amortization
to be approximately $221.7 million per quarter through 2003, and $1.9 million
per quarter thereafter through 2005.

     Interest and Other Income, Net. Interest and other income, net increased
65% from $11.3 million for the three months ended March 31, 2000 to $18.6
million for the three months ended March 31, 2001. The increase was primarily
due to increased amounts of interest income attributable to the higher level of
funds available for investment, which were primarily from the net cash provided
by operating activities.

     Interest Expense. Interest expense consisted primarily of interest recorded
under the 1.856% convertible subordinated notes due 2006 issued in August 1999
and the 5.25% convertible subordinated notes due 2004 issued in October 1997.
Interest expense decreased 7% from $7.5 million for the three months ended March
31, 2000 to $7.0 million for the three months ended March 31, 2001. The decrease
was primarily due to the interest expense savings that has been realized because
of the conversion of approximately $35.5 million of the 5.25% convertible
subordinated notes that occurred in 2000.

     Income Taxes. We had effective tax rates of negative 48% for the three
months ended March 31, 2001, compared to negative 13% for the three months ended
March 31, 2000. Our March 31, 2001 and 2000 effective tax rates were negative
and differed from the combined federal and state statutory rates primarily due
to differences attributable to acquisition related charges that were
non-deductible for tax purposes.

LIQUIDITY AND CAPITAL RESOURCES

  Cash Flows

     Our cash, cash equivalents and short-term investments totaled $1,244.8
million at March 31, 2001 and represented 65.3% of our net tangible assets. Cash
and cash equivalents are highly liquid with original maturities of ninety days
or less. Short-term investments consist mainly of investment grade commercial
paper, medium-term notes, corporate notes, government securities and market
auction preferreds. At March 31, 2001, we had $432.7 million of long-term
obligations and stockholders' equity was approximately $2,925.5 million.

     Net cash provided from operating activities was $141.5 million in the three
months ended March 31, 2001, and $86.8 million in the three months ended March
31, 2000. For the three months ended March 31, 2001, cash provided by operating
activities resulted primarily from income after adjustments to exclude non-cash
charges, including amortization of intangibles related to acquisition
activities, tax benefits from stock plans, and an increase in deferred revenue.
These increases were partially offset by a decrease in accrued compensation and
benefits, accrued restructuring and acquisition costs, and other accrued
liabilities. For the three months ended March 31, 2000, cash provided by
operating activities resulted primarily from income, after adjustments to
exclude non-cash charges including amortization of intangibles related to
acquisition activities, and an increase in deferred revenue, offset somewhat by
a decrease in deferred income taxes and an increase in other assets.

     Our investing activities used cash of $49.9 million in the three months
ended March 31, 2001, and provided cash of $29.0 million for the three months
ended March 31, 2000. For the three months ended March 31, 2001, the primary use
of cash was for the purchases of property and business acquisitions. For the
three months ended March 31, 2000, cash provided by investing activities
resulted primarily from the net

                                        16
<PAGE>   19

decrease in short-term and long-term investments of $49.2 million, offset by
capital expenditures of $20.2 million.

     Financing activities provided cash of $36.9 million for the three months
ended March 31, 2001, and $77.5 million for the three months ended March 31,
2000 from the issuance of common stock under our employee stock plans.

  Convertible Subordinated Notes

     In October 1997, we issued $100.0 million of 5.25% convertible subordinated
notes due 2004 (the "5.25% notes"), for which we received net proceeds of $97.5
million. We and our wholly owned subsidiary, VERITAS Operating Corporation, are
co-obligors on the 5.25% notes and are unconditionally, jointly and severally
liable for all payments under the notes. At March 31, 2001, a total principal
amount at maturity of $35.5 million was converted into approximately 3.7 million
shares of our common stock. Based on the aggregate principal amount at maturity
of $64.5 million outstanding as of March 31, 2001, the 5.25% notes provide for
semi-annual interest payments of $1.7 million each May 1 and November 1. The
5.25% notes are convertible into shares of our common stock at any time prior to
the close of business on the maturity date, unless previously redeemed or
repurchased, at a conversion price of $9.56 per share, subject to adjustment in
certain events, equivalent to a conversion rate of 104.65 shares of common stock
per $1,000 principal amount at maturity. On or after November 5, 2002, the 5.25%
notes will be redeemable over a period of time until maturity at our option at
declining premiums to par. The debt issuance costs are being amortized over the
term of the 5.25% notes using the interest method.

     In August 1999, we and our wholly-owned subsidiary, VERITAS Operating
Corporation, issued $465.8 million, aggregate principal amount at maturity, of
1.856% convertible subordinated notes due 2006 (the "1.856% notes") for which we
received net proceeds of approximately $334.1 million. The interest rate of
1.856%, together with the accrual of original issue discount, represents a yield
to maturity of 6.5%. We and VERITAS Operating Corporation are co-obligors on the
1.856% notes and are unconditionally, jointly and severally liable for all
payments under the notes. At March 31, 2001, a total principal amount at
maturity of $1.0 million was converted into approximately 28,000 shares of our
common stock. Based on the aggregate principal amount at maturity of $464.7
million outstanding as of March 31, 2001, the 1.856% notes provide for
semi-annual interest payments of $4.3 million each February 13 and August 13.
The 1.856% notes are convertible into shares of our common stock at any time
prior to the close of business on the maturity date, unless previously redeemed
or repurchased, at a conversion price of $35.80 per share, subject to adjustment
in certain events, equivalent to a conversion rate of 27.934 shares of common
stock per $1,000 principal amount at maturity. On or after August 16, 2002, the
1.856% notes will be redeemable over a period of time until maturity at our
option at the issuance price plus accrued original issue discount and any
accrued interest. The debt issuance costs are being amortized over the term of
the 1.856% notes using the interest method.

     At March 31, 2001, we have a ratio of long-term debt to total
capitalization of approximately 13%. The degree to which we will be leveraged
could materially and adversely affect our ability to obtain financing for
working capital, acquisitions or other purposes and could make us more
vulnerable to industry downturns and competitive pressures. We will require
substantial amounts of cash to fund scheduled payments of principal and interest
on our indebtedness, including the 5.25% notes and the 1.856% notes, future
capital expenditures and any increased working capital requirements. If we are
unable to meet our cash requirements out of cash flow from operations, we cannot
assure you that we will be able to obtain alternative financing.

  Commitments

     During the third quarter of 2000, we signed a $50.0 million unsecured
credit facility with a syndicate of financial institutions. At March 31, 2001,
no amount was outstanding. The credit facility is due to expire in September
2001. Borrowings under the credit facility bear interest at 1.0% to 1.5% over
LIBOR, and are subject to our compliance with financial and other covenants. The
credit agreement requires us to maintain specified financial covenants such as
earnings before interest, taxes, depreciation and amortization

                                        17
<PAGE>   20

("EBITDA"), debt on EBITDA and quick ratio, all of which we were in compliance
with as of March 31, 2001.

     During the first quarter of 2001, we amended our existing lease agreement,
originally signed in the second quarter of 1999, for new corporate campus
facilities in Mountain View, California. These facilities will replace certain
facilities we currently lease in Mountain View. The new corporate campus
facilities will be developed in one phase for a total of 425,000 square feet and
will provide space for sales, marketing, administration and research and
development functions. The lease term for these facilities is five years
beginning in March 2000, with an option to extend the lease term for two
successive periods of one year each. We have an option to purchase the property
(land and facilities) for $147.8 million or, at the end of the lease, to arrange
for the sale of the property to a third party with us retaining an obligation to
the owner for the difference between the sale price and the guaranteed residual
value up to $130.0 million if the sales price is less than this amount, subject
to certain provisions of the lease. We anticipate occupying the new corporate
campus facilities and beginning the lease payments in the second quarter of
2001.

     During the first quarter of 2001, we amended our existing lease agreement,
originally signed in the first quarter of 2000 for our existing facilities in
Roseville, Minnesota. We will improve and expand our existing facilities of
approximately 62,000 square feet and will develop adjacent property adding
approximately 260,000 square feet to the campus, with the first phase of
approximately 142,000 square feet being completed in the second quarter of 2001.
The facilities will provide space for research and development functions. The
lease term for these facilities is five years beginning in March 2000, with an
option to extend the lease term for two successive periods of one year each. We
have an option to purchase the property (land and facilities) for $41.5 million
or, at the end of the lease, to arrange for the sale of the property to a third
party with us retaining an obligation to the owner for the difference between
the sale price and the guaranteed residual value up to $35.5 million if the
sales price is less than this amount, subject to certain provisions of the
lease. We anticipate occupying the new campus facilities and beginning the lease
payments in the second quarter of 2001.

     During the third quarter of 2000, we signed a lease agreement for the lease
of 65 acres of land and subsequent improvements for new research and development
campus facilities in Milpitas, California. We plan to develop the site in two
phases, adding a total of 990,990 square feet, with the first phase of 466,000
square feet being completed in the fourth quarter of 2002. We expect to complete
the second phase of 524,990 square feet in the third quarter of 2003. The
facilities will provide space for research and development functions. The lease
term for the first phase is five years beginning in July 2000, with an option to
extend the lease term for two successive periods of one year each. We have an
option to purchase the property (land and first phase facilities) for $243
million or, at the end of the lease, to arrange for the sale of the property to
a third party with us retaining an obligation to the owner for the difference
between the sales price and the guaranteed residual value up to $220 million if
the sales price is less than this amount, subject to certain provisions of the
lease. We anticipate occupying the new campus facilities and beginning the lease
payments in the second quarter of 2002 for the first phase and third quarter of
2003 for the second phase. We expect to start negotiating the financing terms of
the second phase in the first quarter of 2002.

     The three lease agreements listed above require us to maintain specified
financial covenants such as EBITDA, debt on EBITDA and quick ratio, all of which
we were in compliance with as of March 31, 2001.

     We believe that our current cash, cash equivalents and short-term
investment balances and cash flow from operations will be sufficient to meet our
working capital and capital expenditure requirements for at least the next 12
months. After that time, we may require additional funds to support our working
capital requirements or for other purposes and may seek to raise such additional
funds through public or private equity financing or from other sources. We
cannot assure you that additional financing will be available at all or that if
available, we will be able to obtain it on terms favorable to us.

FACTORS THAT MAY AFFECT FUTURE RESULTS

     In addition to other information in this Quarterly Report on Form 10-Q, you
should carefully consider the following factors when evaluating VERITAS and our
business.

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<PAGE>   21

     OUR REVENUE MAY FLUCTUATE SIGNIFICANTLY, WHICH COULD CAUSE THE MARKET PRICE
OF OUR SECURITIES TO DECLINE

     We may experience a shortfall in revenue in any given quarter. Any such
shortfall in revenue could cause the market price of securities to fall
substantially. Our revenue in general, and our license revenue in particular,
are difficult to forecast and are likely to fluctuate significantly from quarter
to quarter due to a number of factors, many of which are outside of our control.
These factors include:

     - the timing and magnitude of sales through our original equipment
       manufacturer customers, including Hewlett-Packard, IBM, Microsoft, Oracle
       and Sun Microsystems;

     - the possibility that a slowdown in sales by our original equipment
       manufacturer customers could result in reduced demand for our products;

     - the unpredictability of the timing and magnitude of sales to the retail
       channel by our resellers and sales by our direct sales force, which tend
       to generate sales later in our quarters than original equipment
       manufacturer sales;

     - the timing and magnitude of direct sales to end-user customers;

     - the timing of revenue recognition for sales of software products and
       services;

     - the introduction, timing and market acceptance of new products;

     - changes in data storage and networking technology or introduction of new
       operating system upgrades by our original equipment manufacturer
       customers, which could require us to modify our products or to develop
       new products;

     - the relative growth rates of the Windows NT, UNIX and Linux markets;

     - the rate of adoption of storage area networks and the timing and
       magnitude of sales of our storage area networking products and services;

     - the rate of adoption of network attached storage appliance technology and
       the timing and magnitude of sales of our network attached storage
       appliance products and services;

     - the extent to which our customers renew their maintenance contracts with
       us;

     - changes in our pricing policies and distribution terms.

     - the timing and amount of revenue attributable to our end-user customers
       whose businesses are substantially dependent on the Internet or the
       telecommunications markets, whose ability to purchase our products may be
       adversely affected by their inability to raise additional capital or to
       meet their business objectives;

     - the possibility that our customers may cancel or defer purchases as a
       result of reduced information technology budgets;

     - the possibility that our customers may defer purchases in anticipation of
       new products or product updates by us our by our competitors;

     - the overall demand for data availability products and services, which is
       likely to be lower in weak or uncertain general economic and industry
       conditions; and

     - the possibility of an economic slowdown generally.

     You should not rely on the results of any prior periods as an indication of
our future performance. If we have a shortfall in revenue in any given quarter,
we probably will not be able to reduce our operating expenses quickly in
response. Therefore, any significant shortfall in revenue could have an
immediate adverse effect on our operating results for that quarter.

                                        19
<PAGE>   22

     OUR REVENUE MAY FLUCTUATE BECAUSE WE DEPEND ON LARGE ORDERS FROM END-USER
CUSTOMERS FOR A SIGNIFICANT PORTION OF OUR REVENUE

     We depend for a significant portion of our revenue on large orders, which
include lengthy sales cycles from end-user customers. Our revenue for a quarter
could fluctuate significantly based on whether a large sale near the end of a
quarter is closed or delayed. Our end-user customer sales generally range in
value from a few thousand to several million dollars. In recent quarters,
increases in revenue were partially attributable to a greater number of these
large end-user transactions. This trend may not continue. The effort to close
these large sales is typically complex and lengthy. Therefore, our revenue for a
given period is likely to be affected by the timing of these large orders, which
makes it difficult for us to predict that revenue. The factors that could delay
these large orders include:

     - time needed for end-user customers to evaluate our software;

     - customer budget restrictions, particularly in weak or uncertain general
       economic and industry conditions;

     - customer internal review and testing procedures; and

     - engineering work needed to integrate our software with customers'
       systems.

     OUR BUSINESS COULD BE ADVERSELY AFFECTED IF WE FAIL TO MANAGE OUR GROWTH
EFFECTIVELY

     If we fail to manage our growth effectively, our business and operating
results could be adversely affected, which could cause the market price of our
securities to fall. We expect to continue to grow our operations domestically
and internationally, and to increase our headcount. The growth in our operations
and headcount has placed, and will continue to place, a significant strain on
our management systems and resources. If we fail to manage this growth and our
future anticipated growth, we may experience higher operating expenses, and we
may be unable to meet the expectations of securities analysts or investors with
respect to future operating results. To manage this growth we must continue to:

     - improve our financial and management controls, reporting systems and
       procedures;

     - continue to add and integrate new senior management personnel;

     - improve our licensing models and procedures;

     - hire, train and retain qualified employees;

     - control expenses;

     - integrate geographically dispersed operations; and

     - invest in our internal networking infrastructure and facilities.

     We have committed a significant amount of money to obtaining additional
systems and facilities to accommodate our current and future anticipated growth.
To the extent that this anticipated growth does not occur or occurs more slowly
that we anticipate, we may not be able to reduce expenses to the same degree. If
we incur operating expenses out of proportion to revenue in any given quarter,
our operating results could be adversely impacted.

     WE MAY BE UNABLE TO HIRE AND RETAIN QUALIFIED EMPLOYEES

     Our future growth and success depends on our ability to hire and retain
qualified employees as needed, and to manage our employee base effectively. If
we are unable to hire and retain qualified employees, our business and operating
results could be adversely affected. Conversely, if we fail to reduce staffing
levels when necessary, our costs would be excessive and our business and
operating results could be adversely affected. Our personnel needs generally are
more acute than those facing most companies. We need to hire and retain sales,
technical and senior management personnel to support the planned expansion of
our business and to meet the anticipated increased customer demand for our
products and services. Competition for people with the skills

                                        20
<PAGE>   23

we require is intense, particularly in the San Francisco Bay area where our
headquarters are located, and the high cost of living in this area make our
recruiting and compensation costs higher. As a result, we expect to continue to
experience increases in compensation costs. In addition, the exercise of stock
options in the U.S. and certain foreign jurisdictions may result in substantial
increases in our employer payroll tax liabilities. We cannot assure you that we
will be successful in hiring or retaining new personnel. Even if we are
successful in hiring and retaining new personnel, the resulting growth is likely
to be disruptive to our business and could have an adverse effect on our ability
to maintain our anticipated growth.

     THE LOSS OF KEY PERSONNEL COULD ADVERSELY AFFECT OUR BUSINESS

     Our future anticipated growth and success depends on the continued service
of our key sales, technical and senior management personnel. Many of our senior
personnel have been with the company or its predecessors for a number of years,
and we cannot assure you that we will be able to retain them. The loss of senior
personnel can result in significant disruption to our ongoing operations, and
new senior personnel must spend a significant amount of time learning our
business and our systems in addition to performing their regular duties. Even
though we have entered into employment agreements with some key management
personnel, these agreements cannot prevent their departure. We do not have key
person life insurance covering any of our personnel, nor do we currently intend
to obtain any of this insurance.

     WE DISTRIBUTE OUR PRODUCTS THROUGH MULTIPLE DISTRIBUTION CHANNELS, EACH OF
WHICH IS SUBJECT TO RISKS

     Historically, we sold our products through original equipment manufacturers
and through direct sales. However, as a result of the NSMG and TeleBackup
acquisitions in 1999, we now have an established retail distribution channel as
well. If we fail to manage our distribution channels successfully, they may
conflict with one another or otherwise not function as we anticipate, and our
business and operating results could be adversely affected.

     Retail distribution. Some of our software products are sold primarily in
the retail channel, posing different challenges than we face in selling most of
our products. For example:

     - the VERITAS brand does not have high recognition in the retail channel;

     - retail distribution typically involves shorter product life cycles; and

     - the retail channel has higher risks of product returns, higher marketing
       expenses and less predictable market demand.

     Moreover, our retail distributors have no obligation to continue selling
our products and may terminate their relationships with us at any time.

     Direct sales. We also depend on our direct sales force to sell our
products. This involves a number of risks, including:

     - longer sales cycles for direct sales efforts;

     - our need to hire, train, retain and motivate our sales force; and

     - the length of time it takes our new sales representatives to become
       productive.

     Original equipment manufacturers. A portion of our revenue is expected to
come from our original equipment manufacturer customers that incorporate our
data availability software into systems they sell. Risks associated with our
original equipment manufacturer customers include:

     - we have no control over the shipping dates or volumes of systems they
       ship;

     - they have no obligation to recommend or offer our software products;

     - they have no minimum sales requirements and can terminate our
       relationship at any time;

     - they could choose to develop their own data availability products and
       incorporate those products into their systems instead of our products;
                                        21
<PAGE>   24

     - they could develop enhancements to and derivative products from our
       products; and

     - they could change their own base products, which could make it difficult
       for us to adapt our products to theirs.

     Finally, our original equipment manufacturer customers compete with one
another. If one of our original equipment manufacturer customers views the
products we have developed for another original equipment manufacturer as
competing with its products, it might decide to stop doing business with us,
which could adversely affect our business and our operating results.

     SOME OF OUR ORIGINAL EQUIPMENT MANUFACTURER AGREEMENTS MAY NOT RESULT IN
INCREASED PRODUCT SALES

     We have important original equipment manufacturer agreements with
Hewlett-Packard, IBM, Microsoft and Sun Microsystems. Unlike some of our other
original equipment manufacturer agreements under which we sell off-the-shelf
versions of our products, under these agreements we develop unique or "lite"
versions of our products to be included in these original equipment
manufacturers' systems software and products. If we are unable to leverage these
relationships to increase product sales, we will have expended significant
resources without generating corresponding revenue, which could adversely affect
our business and our operating results. We expect to leverage the inclusion of
our products in these systems software and products to generate sales of
additional products to the customers of the original equipment manufacturers.
These relationships require our personnel to develop expertise with respect to
the original equipment manufacturers' products and markets and to cooperate
closely with their personnel. We cannot assure you that we will be able to
attract and retain qualified employees to work with our original equipment
manufacturer customers or to develop and improve the products designed for these
customers.

     WE FACE UNCERTAINTIES PORTING PRODUCTS TO NEW OPERATING SYSTEMS AND
DEVELOPING NEW PRODUCTS

     Many of our products operate primarily on the UNIX computer operating
system. We are currently redesigning, or porting, these products to operate on
the Windows NT operating system. We are also developing new products for UNIX
and for Windows NT. In addition, we entered into an agreement with IBM under
which we will port our complete set of data availability products to
AIX/Monterey for IBM POWER and the Intel IA-64 processor-system. We may not be
able to accomplish any of this work quickly or cost-effectively. These
activities require substantial capital investment, the devotion of substantial
employee resources and the cooperation of the owners of the operating systems to
or for which the products are being ported or developed. For example, our
porting and development work for the Windows NT market has required us to hire
additional personnel with expertise on these platforms and to devote engineering
resources to these projects. For certain operating systems, we must obtain from
the operating system owners a source code license to portions of the operating
system software to port some of our products to or develop products for the
operating system. Operating system owners have no obligation to assist in these
porting or development efforts. If they do not grant us a license or if they do
not renew our license, we may not be able to expand our product line into other
areas.

     SALES OF A SMALL NUMBER OF PRODUCT LINES MAKE UP A SUBSTANTIAL PORTION OF
OUR REVENUE

     We derive and expect to derive a substantial majority of our revenue from a
limited number of software products. If many customers do not purchase these
products as a result of competition, technological change, budget constraints or
other factors, our revenue would decrease and our business and operating results
would be adversely affected. For the three months ended March 31, 2001, we
derived approximately $260.8 million, or 84%, of our license revenue from
storage management products, including VERITAS Volume Manager, VERITAS File
System, VERITAS NetBackup and VERITAS Backup Exec.

     WE DERIVE A SIGNIFICANT AMOUNT OF REVENUE FROM ONLY A FEW CUSTOMERS

     Although for the three months ended March 31, 2001 and 2000 no single
customer accounted for greater than 10% of our total net revenue, we still
derive significant revenue from a small number of customers. If any of them were
to reduce purchases from us, our business would be adversely affected unless we
were able to
                                        22
<PAGE>   25

increase sales to other customers substantially. Many of these customers have
recently announced that their own businesses are slowing, which could adversely
affect their demand for our products. We do not have a contract with any of
these customers that requires the customer to purchase any specified number of
software licenses from us. Therefore, we cannot be sure that these customers
will continue to purchase our products at current levels.

     OUR SUCCESS DEPENDS ON OUR ABILITY TO DEVELOP NEW AND ENHANCED PRODUCTS
THAT ACHIEVE WIDESPREAD MARKET ACCEPTANCE

     Our future success depends on our ability to address the rapidly changing
needs of our customers by developing and introducing new products, product
updates and services on a timely basis, by extending the operation of our
products on new platforms and by keeping pace with technological developments
and emerging industry standards. In order to grow our business, we are
committing substantial resources to developing software products and services
for the storage area networking market and the network attached storage
appliance market. Each of these markets is new and unproven, and industry
standards for these markets are evolving and changing. If these markets do not
develop as anticipated, or demand for our products in these markets does not
materialize or occurs more slowly that we expect, we will have expended
substantial resources and capital without realizing sufficient revenue, and our
business and operating results could be adversely affected.

     WE FACE INTENSE COMPETITION ON SEVERAL FRONTS

     We have a number of competitors in the markets for our products. If
existing or new competitors gain market share, our business and operating
results could be adversely affected. Our principal competitors are internal
development groups with original equipment manufacturers that provide data
availability functions to support their systems, as well as and hardware and
software vendors that offer backup and file and volume management, clustering
and replication, and storage area networking products.

     Many of our competitors have greater financial, technical sales, marketing
and other resources than we do. Our future and existing competitors could
introduce products with superior features, scalability and functionality at
lower prices than our products, and could also bundle existing or new products
with other more established products in order to compete with us. Our
competitors could also gain market share by acquiring or forming strategic
alliances with our other competitors. Finally, because new distribution methods
offered by the Internet and electronic commerce have removed many of the
barriers to entry historically faced by start-up companies in the software
industry, we expect to face additional competition from these companies in the
future.

     OUR FOREIGN OPERATIONS AND SALES CREATE SPECIAL PROBLEMS THAT COULD
ADVERSELY AFFECT OUR OPERATING RESULTS

     An investment in our securities is riskier than an investment in many
businesses because we have significant operations outside of the U.S., including
engineering, sales, customer support and production operations, and we plan to
expand our international operations. As of March 31, 2001, we had approximately
934 employees in Europe, 590 employees in the Asia-Pacific region, and 79
employees in Japan. Our foreign operations are subject to risks, including:

     - potential loss of proprietary information due to piracy, misappropriation
       or weaker laws regarding intellectual property protection;

     - imposition of foreign laws and other governmental controls, including
       trade restrictions;

     - fluctuations in currency exchange rates and economic instability such as
       higher interest rates and inflation, which could reduce our customers'
       ability to obtain financing for software products or which could make our
       products more expensive in those countries;

     - difficulties in hedging foreign currency transaction exposures;

     - longer payment cycles for sales in foreign countries and difficulties in
       collecting accounts receivable;

                                        23
<PAGE>   26

     - difficulties in staffing and managing our foreign operations, including
       difficulties related to administering our stock option plan in foreign
       countries and difficulties related to the new organizational structure in
       Europe that we implemented in 2001;

     - difficulties in coordinating the activities of our geographically
       dispersed and culturally diverse operations;

     - seasonal reductions in business activity in the summer months in Europe
       and other countries;

     - costs and delays associated with developing software in multiple
       languages; and

     - political unrest, particularly in areas in which we have facilities.

     In addition, our foreign sales are denominated in local currency, creating
risk of foreign currency translation gains and losses that could adversely
affect our business and operating results. We receive significant tax benefits
from sales to our non-U.S. customers. These benefits are contingent upon
existing tax regulations in both the U.S. and in the countries in which our
international customers are located. Future changes in domestic or international
tax regulations could affect our anticipated ability to continue to realize
these tax benefits.

     OUR GROWTH STRATEGY IS RISKIER THAN OTHERS BECAUSE IT IS BASED UPON
ACQUISITIONS OF OTHER BUSINESSES

     An investment in our securities is riskier than investments in many other
companies because our growth strategy includes acquisitions. We have grown
through acquisitions in the past and expect to pursue acquisitions in the
future.

     Acquisitions involve a number of special risks and challenges, including:

     - diversion of management attention from our core business;

     - integration of acquired company operations and employees with our
       existing business, including coordination of geographically dispersed
       operations;

     - incorporation of acquired company technology into our existing product
       lines, including consolidating technology with duplicative functionality
       or designed on different technological architecture;

     - loss or termination of employees, including costly litigation resulting
       from the termination of those employees;

     - dilution of our then-current stockholders' percentage ownership;

     - assumption of liabilities of the acquired company, including costly
       litigation related to alleged liabilities of the acquired company; and

     - presentation of a unified corporate image to our customers and our
       employees.

     In the past, our integration of the operations of acquired companies took
longer and was more difficult than we anticipated.

     OUR SUBSIDIARY FOLLOWING THE SEAGATE TECHNOLOGY LEVERAGED BUYOUT AND MERGER
TRANSACTION WILL REMAIN LIABLE TO THIRD PARTIES AFTER THE LEVERAGED BUYOUT AND
THE MERGER

     In November 2000, in the leveraged buyout and merger transaction involving
VERITAS and Seagate Technology, Seagate Technology sold all of its operating
assets to Suez Acquisition (Cayman) Company, and Seagate Technology became our
subsidiary. As part of the transaction, Suez Acquisition Company assumed and
agreed to indemnify our subsidiary and us for substantially all liabilities
arising in connection with Seagate's operations prior to the transaction.
However, governmental organizations or other third parties may seek recourse
against our subsidiary or us for these liabilities. Prior to the transaction,
Seagate was a large, multinational enterprise that owned or leased facilities
and offices in numerous states and foreign countries

                                        24
<PAGE>   27

and employed over 60,000 people worldwide. As a result, our subsidiary could
receive claims related to a wide range of possible liabilities. Some areas of
potential liability include:

     - environmental cleanup costs and liabilities for claims made under
       federal, state or foreign environmental laws;

     - tax liabilities;

     - obligations under federal, state and foreign pension and retirement
       benefit laws;

     - existing or future litigation relating to the leveraged buyout or the
       merger transaction;

     - existing and future litigation arising from the restructuring that
       Seagate commenced last year, including litigation initiated by terminated
       employees; and

     - existing and future patent litigation.

     Any such claim, with or without merit, could be time consuming to defend,
result in costly litigation and divert management attention from our core
business. Moreover, if Suez Acquisition Company is unable or unwilling to
indemnify our subsidiary or us under the indemnification agreement for any of
these liabilities, we could experience a material adverse effect on our business
and operating results.

     THE SEAGATE MERGER CONSIDERATION MAY BE SUBJECT TO RECOVERY UNDER
FRAUDULENT CONVEYANCE LAWS

     The leveraged buyout and merger transaction involving VERITAS and Seagate
Technology may be subject to review under state or federal fraudulent transfer
laws in the event that a bankruptcy case or lawsuit is commenced by or on behalf
of unpaid creditors of Suez Acquisition Company or any of its affiliates. Under
bankruptcy laws, a court could attempt to proceed against the consideration paid
to Seagate's stockholders in the merger, or direct that amounts deposited with
the trustee administering the distributions of Seagate's tax refunds and credits
be held for the benefit of creditors. A court might take one or more of these
actions if it determined that when the leveraged buyout was completed, Seagate's
operating assets were sold for less then fair value and at that time Seagate,
Suez Acquisitions Company and their affiliates:

     - were or became insolvent;

     - were engaged in a business or transaction for which their unencumbered
       assets constituted unreasonably small capital; or

     - intended to incur or reasonably should have believed that they would
       incur debts beyond their ability to repay as those debts matured.

     A court could also proceed against the consideration paid to Seagate's
stockholders in the merger, or against Seagate's tax refunds and credits
otherwise payable to Seagate's former stockholders following the merger, if the
court found that Seagate effected the leveraged buyout with an actual intent to
hinder, delay or defraud its creditors.

     OUR EFFECTIVE TAX RATE MAY INCREASE

     Our effective tax rate could be adversely affected by several factors, many
of which are outside of our control. Our effective tax rate is directly affected
by the relative proportions of domestic and international revenue and income
before taxes. We are also subject to changing tax laws in multiple jurisdictions
in which we operate. We do not have a history of audit activity from various
taxing authorities and while we believe we are in compliance with all federal,
state and international tax laws, there are various interpretations of their
application that could result in additional tax assessments. In addition, in
November 2000, we acquired Seagate Technology, which has significant tax audit
and tax litigation activity. We believe that we have meritorious defense against
asserted deficiencies and that the likely outcome of a re-determination of these
asserted deficiencies by the United States Tax Court and tax settlement
authorities will not result in an additional provision for income taxes. We have
an indemnification agreement with Suez Acquisition (Cayman) Company for these
deficiencies. If Suez Acquisition (Cayman) Company is unable to or is

                                        25
<PAGE>   28

unwilling to indemnify our subsidiary or us under the indemnification agreement
for any of these deficiencies, we could experience a material adverse effect on
our business and operating results.

     OUR STRATEGY OF INVESTING IN DEVELOPMENT-STAGE COMPANIES INVOLVES A NUMBER
OF RISKS AND UNCERTAINTIES

     An investment in our securities is riskier than investments in many other
companies because we plan to pursue our strategy of investing in
development-stage companies. Each of these investments involves risks and
uncertainties, including:

     - diversion of management attention from our core business;

     - failure to leverage our relationship with these companies to access new
       technologies and new markets;

     - inability to value investments appropriately or to predict changes to the
       future value of investments;

     - inability to manage investments effectively; and

     - loss of cash invested.

     WE ARE INCURRING SIGNIFICANT ACCOUNTING CHARGES IN CONNECTION WITH OUR
     ACQUISITIONS THAT ARE CREATING NET LOSSES IMMEDIATELY AND IN THE FUTURE

     The significant costs of integration associated with the NSMG, TeleBackup
and NuView acquisitions in 1999 increase the risk that we will not realize the
anticipated benefits of those acquisitions. Because we accounted for these
acquisitions using the purchase method of accounting, we recorded goodwill and
other intangible assets of approximately $3,754.9 million in 1999. This amount
is being amortized over four years, and is resulting in charges to operations of
approximately $234.8 million per quarter until the second quarter of 2003. As a
result of these charges, we expect to continue to have net losses for the
foreseeable future.

     WE HAVE A SIGNIFICANT AMOUNT OF DEBT THAT WE MAY BE UNABLE TO SERVICE OR
REPAY

     In October 1997, we issued $100.0 million in aggregate principal amount of
5.25% convertible subordinated notes due 2004, of which $64.5 million was
outstanding as of March 31, 2001. In August 1999, we issued $465.8 million
aggregate principal amount at maturity of 1.856% convertible subordinated notes
due 2006, of which $464.7 million was outstanding as of March 31, 2001. As of
March 31, 2001, the annual interest payments on our outstanding 5.25% notes were
$3.4 million and the annual interest payments on our outstanding 1.856% notes
were $8.6 million, all of which we plan to fund from cash flows from operations.
We will need to generate substantial amounts of cash from our operations to fund
interest payments and to repay the principal amount of debt when it matures,
while at the same time funding capital expenditures and our other working
capital needs. If we do not have sufficient cash to pay our debts as they come
due, we could be in default of those debts. For example, the notes could be
declared immediately due and payable if we do not make timely payments. Our
substantial leverage could also increase our vulnerability to general adverse
economic and industry conditions because it makes it more difficult for us to
raise capital if needed.

     WE MAY NOT BE ABLE TO PROTECT OUR PROPRIETARY INFORMATION

     We rely on a combination of copyright, patent, trademark and trade secret
laws, confidentiality procedures, contractual provisions and other measures to
protect our proprietary information. All of these measures afford only limited
protection. These measures may be invalidated, circumvented or challenged, and
others may develop technologies or processes that are similar or superior to our
technology. Because we license the source code for some of our products, there
is a higher likelihood of misappropriation or other misuse of our intellectual
property. We also license some of our products under shrink wrap license
agreements that are not signed by licensees and therefore may be unenforceable
under the laws of some jurisdictions. Despite our efforts to protect our
proprietary rights, unauthorized parties may attempt to copy our products or to
obtain or use information that we regard a proprietary.

                                        26
<PAGE>   29

     THIRD PARTIES MAY CLAIM THAT WE INFRINGE THEIR PROPRIETARY RIGHTS

     We may from time to time receive claims that we have infringed the
intellectual property rights of others. As the number of products in the
software industry increases and the functionality of these products further
overlap, we believe that we may become increasingly subject to infringement
claims, including patent and copyright infringement claims. We have received
several trademark claims in the past and may receive more claims in the future
based on the name VERITAS, which is a word commonly used in trade names
throughout Europe and the western hemisphere. In addition, former employers of
our former, current or future employees may assert claims that such employees
have improperly disclosed to us the confidential or proprietary information of
these former employers. Any such claim, with or without merit, could:

     - be time consuming to defend;

     - result in costly litigation;

     - divert management's attention from our core business;

     - require us to stop selling, to delay shipping or to redesign our product;
       and

     - require us to pay monetary amounts as damages, for royalty or licensing
       arrangements, or to satisfy indemnification obligations that we have with
       some of our customers.

     In addition, we license and use software from third parties in our
business. These third party software licenses may not continue to be available
to us on acceptable terms. Also, these third parties may from time to time
receive claims that they have infringed the intellectual property rights of
others, including patent and copyright infringement claims, which may affect our
ability to continue licensing this software. Our inability to use any of this
third party software could result in shipment delays or other disruptions in our
business, which could materially and adversely affect our operating results.

     WE MIGHT EXPERIENCE SIGNIFICANT DEFECTS IN OUR PRODUCTS

     Software products frequently contain errors or failures, especially when
first introduced or when new versions are released. We might experience
significant errors or failures in our products, or they might not work with
other hardware or software as expected, which could delay the development or
release of new products or new versions of products, or which could adversely
affect market acceptance of our products. Our end-user customers use our
products for applications that are critical to their businesses, and they have a
greater sensitivity to product defects than the market for software products
generally. If we were to experience significant delays in the release of new
products or new versions of products, or if customers were dissatisfied with
product functionality or performance, we could lose revenue or be subject to
liability for service or warranty costs, and our business and operating results
could be adversely affected.

     NATURAL DISASTERS OR POWER OUTAGES COULD DISRUPT OUR BUSINESS

     We must protect our business and our network infrastructure against damage
from earthquake, flood, hurricane and similar events, as well as from power
outages. A substantial portion of our operations are subject to these risks,
particularly our operations located in California. We have already experienced
temporary power losses in our California facilities due to power shortages that
have disrupted our operations, and we expect in the future to experience
additional power losses that could disrupt our operations. While the impact to
our business and operating results has not been material, we cannot assure you
that power losses will not adversely affect our business in the future, or that
the cost of acquiring sufficient power to run our business will not increase
significantly. Since we do not have sufficient redundancy in our networking
infrastructure, a natural disaster or other unanticipated problem at our primary
data center could have an adverse effect on our business, including both our
internal operations and our ability to communicate with our customers or sell
our products over the Internet.

                                        27
<PAGE>   30

     SOME PROVISIONS IN OUR CHARTER DOCUMENTS MAY PREVENT OR DETER CERTAIN
CORPORATE ACTIONS

     Some of the provisions in our charter documents may deter or prevent
certain corporate actions, such as a merger, tender offer or proxy contest,
which could affect the market value of our securities. These provisions include:

     - our board of directors is authorized to issue preferred stock with any
       rights it may determine;

     - our board of directors is classified into three groups, with each group
       of directors to hold office for three years;

     - our stockholders are not entitled to cumulate votes for directors and may
       not take any action by written consent without a meeting; and

     - special meetings of our stockholders may be called only by our board of
       directors, by the chairman of the board or by our chief executive
       officer, and may not be called by our stockholders.

     We also have in place a stockholder rights plan that is designed to
discourage coercive takeover offers.

     OUR STOCK PRICE MAY BE VOLATILE IN THE FUTURE, AND YOU COULD LOSE THE VALUE
OF YOUR INVESTMENT

     The market price of our common stock has experienced significant
fluctuations and may continue to fluctuate significantly, and you could lose the
value of your investment. The market price of our common stock may be adversely
affected by a number of factors, including:

     - announcements of our quarterly operating results or those of our
       competitors or our original equipment manufacturer customers;

     - changes in earnings estimates by securities analysts;

     - announcements of planned acquisitions by us or by our competitors;

     - the gain or loss of a significant customer;

     - announcements of new products by us, our competitors or our original
       equipment manufacturer customers; and

     - slowdowns in the economy generally.

     The stock market in general, and the market prices of stocks of other
technology companies in particular, have experienced extreme price volatility,
which has adversely affected and may continue to adversely affect the market
price of our common stock for reasons unrelated to our business or operating
results.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

FOREIGN CURRENCY RISK

     We transact business in various foreign currencies and we have established
a foreign currency hedging program, utilizing foreign currency forward exchange
contracts ("forward contracts") to hedge certain foreign currency transaction
exposures. Under this program, increases or decreases in our foreign currency
transactions are offset by gains and losses on the forward contracts, so as to
mitigate the possibility of foreign currency transaction gains and losses. We do
not use forward contracts for speculative or trading purposes. All foreign
currency transactions and all outstanding forward contracts are marked-to-market
at the end of the period with unrealized gains and losses included in other
income (expense). The unrealized gain (loss) on the outstanding forward
contracts at March 31, 2001 was immaterial to our consolidated financial
statements.

     Our outstanding forward contracts as of March 31, 2001 are presented in the
table below. This table presents the notional amounts using March 31, 2001
exchange rates and the weighted average contractual foreign currency exchange
rates. Notional weighted average exchange rates are quoted using market
conventions where the currency is expressed in currency units per U.S. dollar,
except for the Australian dollar,

                                        28
<PAGE>   31

the Euro and the British pound. All of these forward contracts mature in 34 days
or less as of March 31, 2001 (dollars in thousands):

<TABLE>
<CAPTION>
                                                                          NOTIONAL WEIGHTED
                                                                          AVERAGE EXCHANGE
                                                       NOTIONAL AMOUNT          RATE
                                                       ---------------    -----------------
<S>                                                    <C>                <C>
FUNCTIONAL CURRENCY -- U.S. DOLLAR
Australian dollar....................................      $ 5,676               0.494
British pound........................................      $15,672               1.438
Euro.................................................      $48,247               0.889
Japanese yen.........................................      $ 9,053             122.250
Norwegian kroner.....................................      $   165               9.108
Swiss franc..........................................      $   580               1.721
                                                           -------
          Total......................................      $79,393
FUNCTIONAL CURRENCY -- EURO
Australian dollar....................................      $   553               1.806
British pound........................................      $ 5,597               0.618
Swedish krona........................................      $ 1,847               9.176
Swiss franc..........................................      $ 1,160               1.531
                                                           -------
          Total......................................      $ 9,157
                                                           -------
          Grand total................................      $88,550
                                                           =======
</TABLE>

INTEREST RATE RISK

     Our exposure to market risk for changes in interest rates relates primarily
to our investment portfolio and long-term debt obligations. Our primary
investment objective is to preserve principal while at the same time maximizing
yields without significantly increasing risk. Our portfolio includes money
markets funds, commercial paper, medium-term notes, corporate notes, government
securities and market auction preferreds. The diversity of our portfolio helps
us to achieve our investment objective. As of March 31, 2001, approximately 80%
of our investment portfolio is composed of investments with original maturities
of one year or less and approximately 55% of our investment portfolio matures
less than 90 days from the date of purchase.

     Long-term debt of $432.7 million consists of 5.25% convertible subordinated
notes due 2004 of $64.5 million (the "5.25% notes") and 1.856% convertible
subordinated notes due 2006 of $368.2 million (the "1.856% notes"). The interest
rate of 1.856% on the 1.856% notes, together with the accrual of original issue
discount, represents a yield to maturity of 6.5%. The nominal interest rate on
these notes is fixed and the notes provide for semi-annual interest payments of
approximately $1.7 million each May 1 and November 1 for the 5.25% notes and
approximately $4.3 million each February 13 and August 13 for the 1.856% notes.
The notes are convertible into our common stock at any time prior to the close
of business on the maturity date, unless previously redeemed or repurchased,
subject to adjustment in certain events.

     The following table presents the amounts of our cash equivalents,
investments and long-term debt that may be subject to interest rate risk and the
average interest rates as of March 31, 2001 by year of maturity. At

                                        29
<PAGE>   32

March 31, 2001, amortized cost approximated fair value for all cash equivalents
and investments (dollars in thousands):

<TABLE>
<CAPTION>
                                                  2002 AND                   FAIR VALUE
                                       2001      THEREAFTER    2001 TOTAL    TOTAL 2001    TOTAL 2000
                                     --------    ----------    ----------    ----------    ----------
<S>                                  <C>         <C>           <C>           <C>           <C>
Cash equivalents and short-term
  investments:
  Fixed rate.......................  $401,785     $ 76,048      $477,833     $  480,607     $763,839
  Average fixed rate...............      5.49%        6.91%         5.72%          5.68%        6.05%
  Variable rate....................  $ 10,700     $  1,500      $ 12,200     $   12,200     $ 10,000
  Average variable rate............      5.07%        6.88%         5.11%          5.11%        5.91%
Total cash equivalents and
  short-term investments:
  Investments......................  $412,485     $ 77,548      $490,033     $  492,807     $773,839
  Average rate.....................      5.48%        6.88%         5.70%          5.67%        6.05%
Long-term investments:
  Fixed rate.......................        --     $119,816      $119,816     $  121,945     $ 49,004
  Average fixed rate...............        --         6.36%         6.36%          6.25%        5.75%
Long-term debt:
  Fixed rate.......................        --     $432,653      $432,653     $2,102,403     $454,557
  Average fixed rate...............        --         6.31%         6.31%          6.31%        6.22%
</TABLE>

     In September 2000, we entered into a three year cross currency interest
rate swap transaction for the purpose of hedging fixed interest rate, foreign
currency denominated cash flows under an inter-company loan receivable. Under
the terms of this derivative financial instrument, EURO denominated fixed
principal and interest payments to be received under the inter-company loan will
be swapped for U.S. dollar fixed principal and interest payments. As a result of
entering into the cross currency interest rate swap, we have mitigated our
exposure to foreign currency exchange rate fluctuations. The gains or losses on
the foreign currency loan receivable will be offset by the gains or losses on
the cross currency interest rate swap. Because we are receiving fixed interest
payments under the cross currency interest rate swap transaction, we are still
subject to fluctuations in U.S. dollar interest rates. As of March 31, 2001 the
impact of these fluctuations was not significant.

EQUITY PRICE RISK

     We are exposed to equity price risk on the marketable portion of our
portfolio of equity securities investments. We typically do not attempt to
reduce or eliminate our market exposure on these equity securities. These
investments are in companies in the high-technology industry. As of March 31,
2001, we had marketable equity securities in two companies, representing a total
market value of $6.3 million. Assuming a 10% adverse change, our marketable
equity securities investments would decrease in value by approximately $0.6
million. Subsequent to March 31, 2000, many high-technology stocks have
experienced a significant decrease in value. If our marketable equity security
investments as of March 31, 2001 had been valued using prices as of April 30,
2001, the value of these securities would have increased by approximately $0.8
million, or 12.1%. This estimate is not necessarily indicative of future
performance and actual results may differ materially. We also have begun to make
investments in development-stage companies that we believe provide strategic
opportunities for us. We intend that these investments will complement our own
research and development efforts, provide access to new technologies and
emerging markets, and create opportunities for additional sales of our products
and services. We cannot assure you that this initiative will have the above
mentioned desired results, or even that we will not lose all or any part of
these investments.

                                        30
<PAGE>   33

                           PART II: OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     On April 12, 2001, the Delaware Chancery Court approved the settlement of
and dismissed the Delaware lawsuit captioned In Re Seagate Technology, Inc.
Shareholders Litigation.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a) EXHIBITS

<TABLE>
<CAPTION>
                                                                 INCORPORATED BY REFERENCE
    EXHIBIT                                                      --------------------------    FILED
    NUMBER                   EXHIBIT DESCRIPTION                 FORM      DATE     NUMBER    HEREWITH
    -------                  -------------------                 -----   ---------  -------   --------
    <S>       <C>                                                <C>     <C>        <C>       <C>
    10.01 *   VERITAS 1993 Equity Incentive Plan, as amended      S-8    03/29/01    4.01
    10.02 *   VERITAS 1993 Employee Stock Purchase Plan, as       S-8    03/29/01    4.02
              amended
    10.03     Third Amendment and Restatement of Certain                                         X
              Operative Agreements and Other Agreements dated
              April 5, 2001 among VERITAS Software Global
              Corporation, the various parties to the
              participation agreement and other operative
              agreements from time to time, First Security
              Bank, National Association, as "Owner Trustee",
              the various banks and other lending institutions
              which are parties to the participation agreement
              and other operative agreements from time to time
              as "Holders", the various banks and other lending
              institutions which are parties to the
              participation agreement and other operative
              agreements from time to time as "Lenders", and
              Bank of America, N.A., as the "Agent" for the
              secured parties (Mountain View, CA)
    10.04     Second Amendment and Restatement of Certain                                        X
              Operative Agreements and Other Agreements dated
              April 5, 2001 among VERITAS Software Global
              Corporation, the various parties to the
              participation agreement and other operative
              agreements from time to time, First Security
              Bank, National Association, as "Owner Trustee",
              the various banks and other lending institutions
              which are parties to the participation agreement
              and other operative agreements from time to time
              as "Holders", the various banks and other lending
              institutions which are parties to the
              participation agreement and other operative
              agreements from time to time as "Lenders", and
              Bank of America, N.A., as the "Agent" for the
              secured parties (Roseville, MN)
</TABLE>

---------------
* Management contract, compensatory plan or arrangement

     (b) REPORTS ON FORM 8-K

<TABLE>
<CAPTION>
    DATE OF REPORT   ITEM(S)                           DESCRIPTION
    --------------   -------                           -----------
    <C>              <S>       <C>
       01/24/01       5, 7     VERITAS announced financial results for its fourth quarter
                               ended December 31, 2000 and included the press release.
</TABLE>

                                        31
<PAGE>   34

                                   SIGNATURE

     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, thereunto duly authorized, on May 11, 2001.

                                          VERITAS SOFTWARE CORPORATION

                                                /s/ KENNETH E. LONCHAR
                                          --------------------------------------
                                                    Kenneth E. Lonchar
                                               Executive Vice President and
                                                 Chief Financial Officer
                                           (Principal Financial and Accounting
                                                         Officer)

                                        32
<PAGE>   35

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                 INCORPORATED BY REFERENCE
  EXHIBIT                                                        --------------------------    FILED
  NUMBER                    EXHIBIT DESCRIPTION                  FORM      DATE     NUMBER    HEREWITH
  -------                   -------------------                  -----   ---------  -------   --------
  <S>       <C>                                                  <C>     <C>        <C>       <C>
  10.01*    VERITAS 1993 Equity Incentive Plan, as amended        S-8    03/29/01    4.01
  10.02*    VERITAS 1993 Employee Stock Purchase Plan, as         S-8    03/29/01    4.02
            amended
  10.03     Third Amendment and Restatement of Certain                                           X
            Operative Agreements and Other Agreements dated
            April 5, 2001 among VERITAS Software Global
            Corporation, the various parties to the
            participation agreement and other operative
            agreements from time to time, First Security Bank,
            National Association, as "Owner Trustee", the
            various banks and other lending institutions which
            are parties to the participation agreement and
            other operative agreements from time to time as
            "Holders", the various banks and other lending
            institutions which are parties to the participation
            agreement and other operative agreements from time
            to time as "Lenders", and Bank of America, N.A., as
            the "Agent" for the secured parties (Mountain View,
            CA)
  10.04     Second Amendment and Restatement of Certain                                          X
            Operative Agreements and Other Agreements dated
            April 5, 2001 among VERITAS Software Global
            Corporation, the various parties to the
            participation agreement and other operative
            agreements from time to time, First Security Bank,
            National Association, as "Owner Trustee", the
            various banks and other lending institutions which
            are parties to the participation agreement and
            other operative agreements from time to time as
            "Holders", the various banks and other lending
            institutions which are parties to the participation
            agreement and other operative agreements from time
            to time as "Lenders", and Bank of America, N.A., as
            the "Agent" for the secured parties (Roseville, MN)
</TABLE>

---------------
* Management contract, compensatory plan or arrangement