<PAGE>


                   UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                                 Washington DC  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 September 30, 1996

                                          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: 0-26592

                               THE VANTIVE CORPORATION
                (Exact name of registrant as specified in its charter)

              DELAWARE                                77-0266662

    (State or other jurisdiction of                 (I.R.S. Employer
    incorporation or organization)                  Identification No.)


                                 2455 AUGUSTINE DRIVE
                            SANTA CLARA, CALIFORNIA 95054
                                    (408) 982-5700

            (Address and telephone number of principal executive offices)


Indicate by check mark whether 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 $0.001 par value Common Stock
outstanding on November 4, 1996, was 24,122,851.


                          This report consists of 18 pages.

<PAGE>

                               THE VANTIVE CORPORATION

                                      FORM 10-Q

                                  TABLE OF CONTENTS

                                                                        PAGE NO.
                                                                        --------

PART I:  FINANCIAL INFORMATION

        Item 1:  Financial Statements (Unaudited)

                 Condensed Consolidated Balance Sheets as of               3
                 September 30, 1996 and December 31, 1995

                 Condensed Consolidated Statements of Operations           4
                 for the Quarters Ended September 30, 1996 and 1995
                 and the Nine Months Ended September 30, 1996 and 1995

                 Condensed Consolidated Statements of Cash Flows           5
                 for the Nine Months Ended September 30, 1996 and 1995

                 Notes to Condensed Consolidated Financial Statements      6

        Item 2:  Management's Discussion and Analysis of Financial         8
                 Condition and Results of Operations

PART II: OTHER INFORMATION

        Item 1:  Legal Proceedings                                        15

        Item 2:  Changes in Securities                                    15

        Item 3:  Defaults upon Senior Securities                          15

        Item 4:  Submissions of Matters to a Vote of Security Holders     15

        Item 5:  Other Information                                        15

        Item 6:  Exhibits and Reports on Form 8-K                         16

        Signatures                                                        17


                                          2

<PAGE>

Part I:  Financial Information
Item 1: Financial Statements

                               THE VANTIVE CORPORATION
                        CONDENSED CONSOLIDATED BALANCE SHEETS
                                    (In Thousands)


                                                   September 30,   December 31,
                                                       1996           1995
                                                   -------------   ------------
                                                    (unaudited)
                                        ASSETS
CURRENT ASSETS:
 Cash and cash equivalents . . . . . . . . .           $  19,424     $  17,614
 Short-term investment . . . . . . . . . . .              12,694         8,815
 Accounts receivable, net. . . . . . . . . .              11,439         4,049
 Prepaid expenses and other current assets..               1,770         1,265
                                                       ---------     ---------
   Total current assets. . . . . . . . . . .              45,327        31,743
 Property and equipment, net . . . . . . . .               5,243         2,628
 Other assets. . . . . . . . . . . . . . . .                 281           216
                                                       ---------     ---------
TOTAL ASSETS . . . . . . . . . . . . . . . .           $  50,851     $  34,587
                                                       ---------     ---------
                                                       ---------     ---------

                         LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
 Accounts payable and accrued liabilities. .           $   8,278     $   4,328
 Deferred revenues . . . . . . . . . . . . .               6,997         2,952
                                                       ---------     ---------
   Total current liabilities . . . . . . . .              15,275         7,280
                                                       ---------     ---------
 Long-term liabilities . . . . . . . . . . .                 527           650
                                                       ---------     ---------
STOCKHOLDERS' EQUITY
 Common stock. . . . . . . . . . . . . . . .                  24            24
 Additional paid-in-capital. . . . . . . . .              32,065        31,538
 Retained earnings/(accumulated deficit) . .               2,960        (4,905)
                                                       ---------     ---------
   Total stockholders' equity. . . . . . . .              35,049        26,657
                                                       ---------     ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .           $  50,851     $  34,587
                                                       ---------     ---------
                                                       ---------     ---------


See accompanying notes

                                          3

<PAGE>

                               THE VANTIVE CORPORATION
                    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                        (In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
 
                                                          Three Months Ended             Nine Months Ended
                                                             September 30,                 September 30,
                                                       ---------------------------------------------------------
                                                          1996           1995           1996            1995
                                                       ---------------------------------------------------------
                                                       (unaudited)    (unaudited)    (unaudited)     (unaudited)
<S>                                                    <C>            <C>            <C>             <C>
REVENUES:
 License fees  . . . . . . . . . . . . . . .           $  11,102       $  4,289      $  28,104      $  10,976
 Services. . . . . . . . . . . . . . . . . .               6,147          2,320         15,159          5,337
                                                       ---------      ---------      ---------      ---------
   Total revenues. . . . . . . . . . . . . .              17,249          6,609         43,263         16,313
COST OF REVENUES:
 Licenses. . . . . . . . . . . . . . . . . .                 113             51            266            133
 Services. . . . . . . . . . . . . . . . . .               3,316          1,510          8,407          4,040
                                                       ---------      ---------      ---------      ---------
   Total cost of revenues. . . . . . . . . .               3,429          1,561          8,673          4,173
                                                       ---------      ---------      ---------      ---------
GROSS MARGIN . . . . . . . . . . . . . . . .              13,820          5,048         34,590         12,140
OPERATING EXPENSES:
 Sales and marketing . . . . . . . . . . . .               6,462          2,946         16,389          7,212
 Research and development. . . . . . . . . .               1,694            890          4,199          2,358
 General and administrative. . . . . . . . .               1,511            641          3,726          1,514
                                                       ---------      ---------      ---------      ---------
   Total operating expenses. . . . . . . . .               9,667          4,477         24,314         11,084
                                                       ---------      ---------      ---------      ---------
OPERATING INCOME . . . . . . . . . . . . . .               4,153            571         10,276          1,056
OTHER INCOME . . . . . . . . . . . . . . . .                 370            131            930            136
                                                       ---------      ---------      ---------      ---------
INCOME BEFORE PROVISION FOR INCOME TAXES . .               4,523            702         11,206          1,192
PROVISION FOR INCOME TAXES . . . . . . . . .               1,357             70          3,362            119
                                                       ---------      ---------      ---------      ---------
NET INCOME . . . . . . . . . . . . . . . . .           $   3,166       $    632      $   7,844      $   1,073
                                                       ---------      ---------      ---------      ---------
                                                       ---------      ---------      ---------      ---------

NET INCOME PER SHARE . . . . . . . . . . . .           $    0.12       $   0.03      $    0.31      $    0.05
                                                       ---------      ---------      ---------      ---------
                                                       ---------      ---------      ---------      ---------
SHARES USED IN PER SHARE COMPUTATION . . . .              26,046         23,324         25,713         22,200
                                                       ---------      ---------      ---------      ---------
                                                       ---------      ---------      ---------      ---------

</TABLE>
 
NOTE: NET INCOME PER SHARE AND SHARES USED IN PER SHARE COMPUTATION REFLECT A 
2-FOR-1 STOCK SPLIT IN THE FORM OF A 100 PERCENT STOCK DIVIDEND TO 
STOCKHOLDERS OF RECORD ON SEPTEMBER 30, 1996.

See accompanying notes


                                          4

<PAGE>

                               THE VANTIVE CORPORATION
                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    (In Thousands)


                                                         Nine Months Ended
                                                           September 30,
                                                     -------------------------
                                                        1996          1995
                                                     -----------   -----------
                                                     (unaudited)   (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income. . . . . . . . . . . . . . . . . .        $   7,844      $   1,073
 Adjustments to reconcile net income to net cash
  provided by operating activities:
  Depreciation and amortization. . . . . . . .              874            426
  Provision for sales allowances . . . . . . .              365            225
  Changes in net assets and liabilities -
   Increase in accounts receivable . . . . . .           (7,755)        (2,623)
   Increase in prepaid expenses and other
    current assets . . . . . . . . . . . . . .             (506)          (140)
   Increase in other assets. . . . . . . . . .              (64)           (66)
   Increase in accounts payable/accrued
    liabilities. . . . . . . . . . . . . . . .            4,010            984
   Increase in deferred revenues . . . . . . .            4,044          1,754
   Increase in deferred rent . . . . . . . . .               73             45
                                                      ---------      ---------
    Net cash provided by operating activities.            8,885          1,678
                                                      ---------      ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of short-term investments. . . . . .           (3,878)        (8,847)
 Purchase of property and equipment. . . . . .           (3,489)        (1,038)
                                                      ---------      ---------
    Net cash used in investing activities. . .           (7,367)        (9,885)
                                                      ---------      ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from issuance of common stock. . . .              565         20,668
 Repurchase of common stock. . . . . . . . . .              (15)            --
 Payments on capital lease obligations . . . .             (256)            --
                                                      ---------      ---------
    Net cash provided by financing activities.              294         20,668
                                                      ---------      ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS. . .            1,812         12,461
EFFECT OF EXCHANGE RATE CHANGES ON CASH. . . .               (2)             6
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD           17,614          3,154
                                                      ---------      ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD . . .        $  19,424      $  15,621
                                                      ---------      ---------
                                                      ---------      ---------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW ACTIVITY
 Cash paid for interest. . . . . . . . . . . .        $     122      $      70
                                                      ---------      ---------
                                                      ---------      ---------
 Cash paid for income taxes. . . . . . . . . .        $   2,624      $     120
                                                      ---------      ---------
                                                      ---------      ---------


See accompanying notes


                                          5

<PAGE>

                               THE VANTIVE CORPORATION
                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                      UNAUDITED


1.  BASIS OF PRESENTATION

    The condensed consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission.  Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations.  However, the Company believes that the
disclosures are adequate to make the information presented not misleading.
These condensed consolidated financial statements should be read in conjunction
with the financial statements and the notes thereto included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1995.

    The unaudited information has been prepared on the same basis as the annual
financial statements, and in the opinion of the Company's management, reflects
all normal recurring adjustments necessary for a fair presentation of the
information for the periods presented.  Operating results for any quarter are
not necessarily indicative of the results for any future periods.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    PRINCIPLES OF CONSOLIDATION

    The condensed consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries.  Intercompany accounts and
transactions have been eliminated.

    REVENUES

    The Company generates revenues from licensing the rights to use its
software products directly to end-users and indirectly through sublicense fees
from resellers.  The Company also generates revenues from sales of post-contract
support, consulting and training services performed for customers who license
its products.

    Revenues from perpetual software license agreements are recognized upon
shipment of the software if there are no significant post-delivery obligations,
if collection is probable and if payment is due within one year.  If an
acceptance period is required, revenues are recognized upon the earlier of
customer acceptance or the expiration of the acceptance period.  The Company
enters into reseller arrangements that typically provide for sublicense fees
payable to the Company based on a percent of the Company's list price.
Sublicense fees are generally recognized as reported by the reseller in
relicensing the Company's products to end-users.

    Revenues from post-contract support services are recognized ratably over
the term of the support period.  If post-contract support services are included
free or at a discount in a license agreement, such amounts are allocated out of
the license fee at their fair market value based on the value established by
independent sale of such post-contract support services to customers.
Consulting revenues are primarily related to implementation services performed
on a time and materials basis under separate service arrangements related to the
installation of the Company's software products. Revenues from consulting and
training services are recognized as services are performed.  If a transaction
includes both license and service elements, license fee revenue is recognized
upon shipment of the software, provided services do not include significant
customization or modification of the base product and the payment term for
licenses are not subject to acceptance criteria.  In cases where license fee
payments are contingent upon the acceptance of services, revenues from both the
license and the service elements are deferred until the acceptance criteria are
met.


                                          6

<PAGE>

    NET INCOME PER SHARE

    On September 23, 1996, the Company announced a two-for-one stock split in
the form of a 100 percent stock dividend to be distributed on October 14, 1996
to stockholders of record on September 30, 1996.  All share and per share data
have been retroactively adjusted to reflect the stock split.

    Except as noted below, net income per share is computed using the weighted
average number of outstanding shares of common and common equivalents from
outstanding stock options (when dilutive using the treasury stock method).
Common equivalent shares were excluded from the computation if their effect was
antidilutive except that, pursuant to the Securities and Exchange Commission
Staff Accounting Bulletins and staff policy, the computations for net income per
share in 1995 include all common and common stock equivalent shares issued
within 12 months preceding the filing date of the Company's initial public
offering as if they were outstanding for all periods presented (using the
treasury stock method assuming the public offering price).  Mandatorily
redeemable convertible preferred stock and warrants outstanding during that
period were included (using the if converted method) in the 1995 computations as
common equivalent shares even though the effect was antidilutive.  Primary and
fully diluted earnings per common share were substantially the same in all
periods presented.

    SOFTWARE DEVELOPMENT COSTS

    The Company capitalizes eligible computer software development costs upon
the establishment of technological feasibility, which the Company has defined as
completion of a working model.  For the periods presented, costs eligible for
capitalization were insignificant and, thus, the Company charged all software
development costs to research and development expense.

    INVESTMENTS

    Investments have been accounted for in accordance with Statement of
Financial Accounting Standards (SFAS) No. 115.  The Company classifies its
investments as held to maturity investments as defined under the provisions of
SFAS 115 and carries such investments at amortized cost in its balance sheet.


                                          7

<PAGE>

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

                               THE VANTIVE CORPORATION

    The Company was founded in October 1990 to develop software to enable
businesses to improve their customer service.  The Company was engaged
principally in research and development from inception through December 31,
1992.  The Company introduced its first product, VANTIVE SUPPORT, in July 1992,
and introduced VANTIVE QUALITY and the Oracle version of VANTIVE SUPPORT in the
fall of 1993.  The Company introduced VANTIVE HELPDESK in August 1994, VANTIVE
SALES in early 1995, and VANTIVE FIELDSERVICE in early 1996.  License fees for
the Company's software products consist of (i) a per server fee based on the
specific VANTIVE ENTERPRISE application(s) licensed and (ii) a fee based on the
maximum number of concurrent or named users allowed to access those
applications.  Most of the Company's revenues to date have resulted from
non-recurring license fees based on sales of concurrent user licenses.  The
remaining revenues are primarily attributable to service revenues, which include
post-contract support, consulting and training revenue.  Of these service
revenues, only post-contract support revenues are expected to be recurring.
Post-contract support revenues accounted for approximately 12% of total
revenues, in the quarter and nine months ended September 30, 1996.  Because
concurrent user fees are not application specific, the breakdown of revenues
attributable to specific applications for customers that have purchased more
than one application cannot be precisely determined by the Company.  However,
the Company believes that most of its revenues have been derived from fees
associated with VANTIVE SUPPORT and, to a lesser degree, VANTIVE HELPDESK.  In
any period, a significant portion of the Company's revenues may be derived from
significant sales to a limited number of customers.  During the quarter ended
September 30, 1995 and September 30, 1996 and  the first nine months of 1995 and
1996, no customer accounted for over 10% of total revenues.  As significant
sales to a particular customer are typically non-recurring, the Company does not
believe its future results are dependent on recurring revenues from any
particular customer.

    The Company's revenues are derived from software license fees and fees for
its services.  License revenues consist of license fees for the Company's
products as well as fees from sublicensing third party software products.  The
Company generally recognizes license fees upon shipment of software products if
there are no significant post-delivery obligations, if collection is probable
and if the license agreement requires payment within one year.  If significant
post-delivery obligations exist or if a product is subject to customer
acceptance, revenues are deferred until no significant obligations remain or
acceptance has occurred.  Revenues from services have to date consisted
primarily of consulting revenues, post-contract support revenues and, to a
lesser extent, training revenues.  Consulting and training revenues generally
are recognized as services are performed.  Post-contract support revenues are
recognized ratably over the term of the support period, which is typically one
year.  See Note 2 of Notes to Condensed Consolidated Financial Statements.

    THIS MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS INCLUDES A NUMBER OF FORWARD-LOOKING STATEMENTS WHICH
REFLECT THE COMPANY'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL
PERFORMANCE.  THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND
UNCERTAINTIES, INCLUDING THOSE DISCUSSED BELOW THAT COULD CAUSE ACTUAL RESULTS
TO DIFFER MATERIALLY FROM HISTORICAL RESULTS OR THOSE ANTICIPATED.  IN THIS
REPORT, THE WORDS "ANTICIPATES," "BELIEVES," "EXPECTS," "FUTURE," "INTENDS,"
AND SIMILAR EXPRESSIONS IDENTIFY FORWARD-LOOKING STATEMENTS.  READERS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH
SPEAK ONLY AS OF THE DATE HEREOF.


                                          8

<PAGE>

RESULTS OF OPERATIONS

    The following table sets forth the percentages that income statement items
are to total revenues for the quarter and nine months ended September 30, 1995
and 1996.

                               THE VANTIVE CORPORATION
                    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
 
                                                   Three Months Ended       Nine Months Ended
                                                      September 30,            September 30,
                                                 -----------------------  -----------------------
                                                    1996        1995         1996        1995
                                                 ----------- -----------  ----------- -----------
                                                 (unaudited) (unaudited)  (unaudited) (unaudited)
<S>                                               <C>         <C>          <C>         <C>
REVENUES:
  License fees . . . . . . . . . . . . . . .         64.4%       64.9%       65.0%       67.3%
  Services . . . . . . . . . . . . . . . . .         35.6        35.1        35.0        32.7
                                                   --------    --------    --------    --------
   Total revenues. . . . . . . . . . . . . .        100.0       100.0       100.0       100.0
COST OF REVENUES:
  Licenses . . . . . . . . . . . . . . . . .          0.7         0.8         0.6         0.8
  Services . . . . . . . . . . . . . . . . .         19.2        22.8        19.4        24.8
                                                   --------    --------    --------    --------
   Total cost of revenues. . . . . . . . . .         19.9        23.6        20.0        25.6
                                                   --------    --------    --------    --------
GROSS MARGIN . . . . . . . . . . . . . . . .         80.1        76.4        80.0        74.4
OPERATING EXPENSES:
  Sales and marketing. . . . . . . . . . . .         37.4        44.6        37.9        44.2
  Research and development . . . . . . . . .          9.8        13.5         9.7        14.4
  General and administrative . . . . . . . .          8.8         9.7         8.6         9.3
                                                   --------    --------    --------    --------
   Total operating expenses. . . . . . . . .         56.0        67.8        56.2        67.9
OPERATING INCOME . . . . . . . . . . . . . .         24.1         8.6        23.8         6.5
OTHER INCOME . . . . . . . . . . . . . . . .          2.1         2.0         2.1         0.8
                                                   --------    --------    --------    --------
INCOME BEFORE PROVISION FOR INCOME TAXES . .         26.2        10.6        25.9         7.3
PROVISION FOR INCOME TAXES . . . . . . . . .          7.8         1.0         7.8         0.7
                                                   --------    --------    --------    --------
NET INCOME . . . . . . . . . . . . . . . . .         18.4%        9.6%       18.1%        6.6%
                                                   --------    --------    --------    --------
                                                   --------    --------    --------    --------

</TABLE>
 
REVENUES

    LICENSE.  License revenues increased by 159% from $4.3 million to $11.1
million, in the quarters ended September 30, 1995 and 1996, respectively, and by
156% from $11.0 million in the first nine months of 1995 to $28.1 million in the
first nine months of 1996.  The increase in license revenues was primarily due
to the market's growing acceptance of the Company's products, the introduction
of the Company's products using the Microsoft SQL server relational database
management system and the Microsoft NT operating system, and increased sales as
a result of the expansion of the Company's direct sales force.  The Company does
not believe that the historical growth rates of license revenues will be
sustainable or are indicative of future results.


                                          9

<PAGE>

    SERVICE.  Service revenues are primarily comprised of fees from consulting,
post-contract support and, to a lesser extent, training services.  Service
revenues increased by 165% from $2.3 million to $6.1 million, in the quarters
ended September 30, 1995 and 1996, respectively, and by 184% from $5.3 million
in the first nine months of 1995 to $15.2 million in the first nine months of
1996.  The increase in service revenues was primarily due to the increase in
consulting, post-contract support and, to a lesser extent, training services
associated with increased sales of the Company's applications.  As the Company
implements its strategy of encouraging third party organizations such as systems
integrators to become proficient in implementing the Company's products,
consulting revenues as a percentage of total revenues may decrease.

COST OF REVENUE

    LICENSE.  Cost of license revenues includes the cost of product media, 
sublicensing fees for third-party software when bundled with the Company's 
products, product duplication and manuals.  Cost of license revenues was 
approximately $51,000, or 1.2% of the related license revenues, and $113,000, 
or 1.0% of the related license revenues, in the quarters ended September 30, 
1995 and 1996, respectively, and was approximately $133,000 in the first nine 
months of 1995 and approximately $266,000 in the first nine months of 1996, 
or 1.2% and 0.9% of the related license revenues, respectively.  The increase 
in cost of license revenues was primarily due to the increases in volume 
shipments of the Company's software applications and the cost of sublicensing 
third-party software. The decrease in cost of license revenues as a 
percentage of the related license revenues from September 30, 1995 to the 
comparable 1996 period was primarily due to economies of scale realized as a 
result of shipping greater quantities of product during the quarter ended 
September 30, 1996.

    SERVICE.  Cost of service revenues is primarily comprised of
employee-related costs and fees for third-party consultants incurred in
providing consulting, post-contract support and training services.  Cost of
service revenues was $1.5 million, or 65.1% of the related service revenues, and
$3.3 million, or 53.9% of the related service revenues,  in the quarters ended
September 30, 1995 and 1996, respectively, and was $4.0 million, in the first
nine months of 1995 and $8.4 million, in the first nine months of 1996, or 75.7%
and 55.5% of the related services revenues for these periods, respectively.  The
increase in absolute dollars was due primarily to increases in consulting,
support, training personnel, and third-party service providers during these
periods.  The cost of service revenues may vary between periods due to the mix
of services provided by the Company and the resources used to provide these
services.

OPERATING EXPENSES

    SALES AND MARKETING.  Sales and marketing expenses increased from $2.9
million, or 44.6% of revenues to $6.5 million, or 37.5% of revenues, in the
quarters ended September 30, 1995 and 1996, respectively.  Sales and marketing
expenses increased by 127% from $7.2 million, or 44.2% of revenues, in the first
nine months of 1995 to $16.4 million, or 37.9% of revenues, in the first nine
months of 1996.  The increase in absolute dollars was primarily related to the
expansion of the Company's sales and marketing resources, increased commissions
expense as a result of higher sales levels and increased marketing activities,
including direct mail, trade shows and promotional expenses.   The Company plans
to continue to invest heavily in expanding its sales and marketing activities.
Accordingly, sales and marketing expenses are anticipated to increase both in
absolute dollars and as a percent of revenues over the coming quarters.

    RESEARCH AND DEVELOPMENT.  Research and development expenses increased from
$0.9 million, or 13.5% of revenues to $1.7 million, or 9.8% of revenues, in the
quarters ended September 30, 1995 and 1996, respectively.  Research and
development expenses increased by 78% from $2.4 million, or 14.4% of revenues,
in the first nine months of 1995 to $4.2 million, or 9.7% of revenues, in the
first nine months of 1996.  Research and development expenses increased in
absolute dollars primarily as a result of an increase in personnel and outside
contractors to support the Company's product development activities.   Over the
coming quarters, the Company plans to continue to invest heavily in research and
development.   As a result, research and development expenses are anticipated to
increase both in absolute dollars and as a percent of revenues.


                                          10

<PAGE>

    Research and development expenses are generally charged to operations as
incurred.  In accordance with Statement of Financial Accounting Standards
No. 86, costs which were eligible for capitalization for these periods were
insignificant, and the Company charged all software development costs to
research and development expense.

    GENERAL AND ADMINISTRATIVE.  General and administrative expenses increased
from $0.6 million, or 9.7% of revenues to $1.5 million, or 8.8% of revenues, in
the quarters ended September 30, 1995 and 1996, respectively.  General and
administrative expenses increased 146% from $1.5 million, or 9.3% of revenues,
in the first nine months of 1995 to $3.7 million, or 8.6% of revenues, in the
first nine months of 1996.  General and administrative expenses increased in
absolute dollars during these periods primarily due to the addition of staff and
information system investments to support the growth of the Company's business
during these periods.

    PROVISION FOR INCOME TAXES.  The Company's provision for state, federal and
foreign income taxes for the three months ended September 30, 1996, was $1.4
million, based upon an estimated effective tax rate of approximately 30%.  As of
December 31, 1995, the Company had net operating loss carryforwards for Federal
tax reporting purposes of approximately $2.5 million. The Company had other tax
credit carryforwards of approximately $0.5 million.  The net operating loss and
research and development tax credit carryforwards expire in 2005 through 2009 if
not utilized.

BUSINESS RISKS

    THIS REPORT INCLUDES A NUMBER OF FORWARD-LOOKING STATEMENTS WHICH REFLECT
THE COMPANY'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL
PERFORMANCE.  THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND
UNCERTAINTIES, INCLUDING THOSE DISCUSSED BELOW THAT COULD CAUSE ACTUAL RESULTS
TO DIFFER MATERIALLY FROM HISTORICAL RESULTS OR THOSE ANTICIPATED.  IN THIS
REPORT, THE WORDS "ANTICIPATES," "BELIEVES," "INTENDS," "FUTURE," AND SIMILAR
EXPRESSIONS IDENTIFY FORWARD-LOOKING STATEMENTS.  READERS ARE CAUTIONED NOT TO
PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF
THE DATE HEREOF.

    FUTURE OPERATING RESULTS UNCERTAIN.  The Company has experienced
significant growth in revenues in recent periods.  The Company does not believe
that the historical growth rates of revenues, or the corresponding declines of
operating expenses as a percentage of revenues, will be sustainable or are
indicative of future results.  In addition, the Company's limited operating
history makes the prediction of future operating results difficult or
impossible.  The Company's future operating results will depend on many factors,
including demand for the Company's products, the level of product and price
competition, the ability of the Company to rapidly develop and market new and
existing products and to control the associated costs, the ability of the
Company to expand its direct sales force and indirect distribution channels and
the ability to attract and retain key personnel.  In particular, the ability of
the Company to achieve significant revenue growth in the future will depend on
its success in adding a substantial number of direct sales personnel in future
periods.  Competition for such personnel is intense, and there can be no
assurance that the Company can retain its existing sales personnel or that it
can attract, assimilate or retain additional highly qualified sales personnel in
the future.  Further, the Company believes, based on interactions with its
customers and potential customers, that the purchase of its products is
relatively discretionary and generally involves a significant commitment of
capital.  As a result, in the event of any downturn in any potential customer's
business or the economy in general, purchases of the Company's products may be
deferred or canceled, which could have a material adverse effect on the
Company's business, results of operations and financial condition.

    FLUCTUATIONS IN QUARTERLY OPERATING RESULTS.  The Company's quarterly
operating results have in the past varied and may in the future vary
significantly depending on factors such as the size, timing and recognition of
revenue from significant orders, increased competition, the timing of new
product releases by the Company and its competitors, market acceptance of the
Company's products, changes in the Company's and its competitors' pricing
policies, the mix of license and service revenue, budgeting cycles of its
customers, seasonality, the mix of direct and indirect sales, changes in
operating expenses, changes in Company strategy, personnel changes, foreign
currency exchange rates and general economic factors.  Further, the Company
believes, based on interactions with its customers and potential customers, that
the purchase of its products is relatively discretionary and generally involves
a significant commitment of capital.  As a result, in the event of any downturn
in any potential customer's business or the economy in general, purchases of the
Company's products may be deferred or canceled.


                                          11

<PAGE>

    A significant portion of the Company's revenues in any quarter are
typically derived from non-recurring sales to a limited number of customers.
Accordingly, revenues in any one quarter are not indicative of revenues in any
future period.  In addition, like many software applications companies, the
Company has generally recognized a substantial portion of its revenues in the
last month of each quarter, with these revenues concentrated in the last weeks
of the quarter.  Any significant deferral of purchases of the Company's products
could have a material adverse effect on the Company's business, results of
operations and financial condition in any particular quarter, and to the extent
that significant sales occur earlier than expected, operating results for
subsequent quarters may be adversely affected.  Product revenues are also
difficult to forecast because the market for customer asset management software
products is rapidly evolving.  The Company's sales cycle is typically six to
nine months and varies substantially from customer to customer.  In addition,
the Company expects that sales derived through indirect channels, which are
harder to predict and may have lower margins than direct sales, will increase as
a percentage of total revenues.  As a result of these factors, quarterly
revenues for any future quarter are not predictable with any significant degree
of certainty.  The Company's expense levels are based, in part, on its
expectations as to future revenues.  If revenues are below expectations,
operating results are likely to be adversely affected.  Net income may be
disproportionately affected by a reduction in revenues, because a significant
portion of the Company's expenses do not vary with revenues.  The Company may
also choose to reduce prices or increase spending in response to competition or
to pursue new market opportunities.  In particular, if new competitors,
technological advances by existing competitors, or other competitive factors
require the Company to invest significantly greater resources in research and
development efforts, the Company's operating margins in the future may be
adversely affected.  THE FOREGOING STATEMENTS REGARDING THE COMPANY'S FUTURE
REVENUES, OPERATING MARGINS AND NET INCOME ARE FORWARD-LOOKING STATEMENTS, AND
ACTUAL RESULTS MAY VARY SUBSTANTIALLY DEPENDING UPON A VARIETY OF FACTORS
DESCRIBED IN THIS PARAGRAPH AND ELSEWHERE IN THIS REPORT.

    Because of these factors, the Company believes that period-to-period
comparisons of its results of operations are not necessarily meaningful and that
such comparisons should not be relied upon as indications of future performance.
Due to all of the foregoing factors, it is likely that in some future quarter
the Company's operating results will be below the expectations of public market
analysts and investors.  In such event, the price of the Company's Common Stock
would likely be materially adversely affected.

    RAPID TECHNOLOGICAL CHANGE AND PRODUCT DEVELOPMENT RISKS.  The
client/server applications software market is subject to rapid technological
change, changing customer needs, frequent new product introductions and evolving
industry standards that may render existing products and services obsolete.  As
a result, the Company's position in its existing markets or other markets that
it may enter could be eroded rapidly by product advances.  The life cycles of
the Company's products are difficult to estimate.  The Company's growth and
future financial performance will depend in part upon its ability to attract and
retain highly qualified technical personal to enhance existing applications,
develop and introduce new applications that keep pace with technological
advances, meet changing customer requirements, respond to competitive products
and achieve market acceptance.

    The Company's product development efforts are expected to require, from
time to time, substantial investments by the Company in product development and
testing.  There can be no assurance that the Company will have sufficient
resources to make the necessary investments.  The Company has in the past
experienced development delays, and there can be no assurance that the Company
will not experience such delays in the future.  There can be no assurance that
the Company will not experience difficulties that could delay or prevent the
successful development, introduction or marketing of new or enhanced products.
In addition, there can be no assurance that such products will meet the
requirements of the marketplace and achieve market acceptance, or that the
Company's current or future products will conform to industry requirements.  If
the Company is unable, for technological reasons, to develop and introduce new
and enhanced products in a timely manner, the Company's business, results of
operations and financial condition could be materially adversely affected.


                                          12

<PAGE>

    Software products as complex as those offered by the Company may contain
errors that may be detected at any point in the products' life cycles.  The
Company has in the past discovered software errors in certain of its products
and has experienced delays in shipment of products during the period required to
correct these errors.  There can be no assurance that, despite testing by the
Company and by current and potential customers, errors will not be found,
resulting in loss of, or delay in, market acceptance and sales, diversion of
development resources, injury to the Company's reputation, or increased service
and warranty costs, any of which could have a material adverse effect on the
Company's business, results of operations and financial condition.

    INTERNATIONAL OPERATIONS.  The Company believes that its continued growth
and profitability will require expansion of its international operations.  To
successfully expand international sales, the Company must establish additional
foreign operations, hire additional personnel and recruit additional
international resellers.  To the extent that the Company is unable to do so in a
timely manner, the Company's growth in international sales, if any, will be
limited, and the Company's business, results of operations and financial
condition could be materially adversely affected.  As the Company continues to
expand its international operations, significant costs may be incurred ahead of
any anticipated international revenues, which could have a material adverse
effect on the Company's business, results of operations and financial condition.

    COMPETITION.  The client/server applications software market, including the
market for customer asset management software, is intensely competitive, highly
fragmented and subject to rapid change.  Because the Company offers multiple
applications which can be purchased separately or integrated as part of VANTIVE
ENTERPRISE, the Company competes with a variety of other companies depending on
the market for their applications software products.  These competitors include
companies targeting the customer support market, the help desk market, the sales
and marketing automation market, and the field service market.  In addition, the
Company believes that existing competitors and new market entrants will attempt
to develop fully integrated customer information systems.  The Company also
competes with third party professional service organizations that develop custom
software and with internal information technology departments of customers which
develop customer information systems.  Among the Company's current and potential
competitors are also a number of large hardware and software companies that may
develop or acquire products that compete with the Company's products.  The
Company also expects that competition will increase as a result of software
industry consolidations.  Current and potential competitors have established or
may establish cooperative relationships among themselves or with third parties
to increase the ability of their products to address the needs of the Company's
prospective customers.  Accordingly, it is possible that new competitors or
alliances among competitors may emerge and rapidly acquire significant market
share.  Increased competition is likely to result in price reductions, reduced
operating margins and loss of market share, any of which could materially
adversely affect the Company's business, results of operations and financial
condition.  Many of the Company's current and potential competitors have
significantly greater financial, technical, marketing and other resources than
the Company.  As a result, they may be able to respond more quickly to new or
emerging technologies and changes in customer requirements, or to devote greater
resources to the development, promotion and sale of products than can the
Company.  There can be no assurance that the Company will be able to compete
successfully against current and future competitors or that competitive
pressures faced by the Company will not materially adversely affect its
business, results of operations and financial condition.

    INCREASED USE OF THIRD PARTY DEVELOPMENT TOOLS.  The Company currently
markets a proprietary application development environment for its customers to
tailor its applications.  This application development environment is also used
by the Company to build and modify its applications products.  While the Company
believes based on interactions with its customers and potential customers, that
it currently derives significant competitive advantage from this proprietary
application development environment, it believes that competitive pressures,
technological changes demanded by customers, and significant advances in the
sophistication of third party application development tools such as VISUAL BASIC
FOR APPLICATIONS will require the Company to make greater use of third party
tools in the future.


                                          13

<PAGE>

    This could require the Company to invest significant resources in rewriting
some or all of its applications products utilizing these third party tools
and/or to enter into license arrangements with third parties which could result
in higher royalty payments and a loss of product differentiation.  There can be
no assurance that the Company would be able to successfully rewrite its
applications or enter into commercially reasonable licenses, and the costs of,
or inability or delays in, doing so could have a material adverse effect on the
Company's business, results of operations and financial condition.

    In addition to the "BUSINESS RISKS" mentioned above, the Company's business
entails a variety of additional risks, which are set forth in the "BUSINESS
RISKS" section of the Company's 1995 Report on Form 10-K filed with the
Securities and Exchange Commission.

FINANCIAL CONDITION

    Total assets as of September 30, 1996, increased $16.3 million from
December 31, 1995.  The increase was primarily due to increases in cash from
operations, short-term investments, accounts receivable and property and
equipment.  The combined balance of cash and short-term investments increased by
$5.7 million, primarily due to increased net income.  Net accounts receivable
increased $7.4 million primarily due to increased sales activity.  Net property
and equipment increased $2.6 million, primarily due to equipment purchases
associated with supporting the growth of the Company's business during this
period.

    Total liabilities as of September 30, 1996, increased $7.9 million from
December 31, 1995.  The increase was primarily due to increases in accounts
payable and accrued liabilities and deferred revenues of $3.9 million and $4.0
million, respectively.  These increases were primarily due to increased expense
levels and accruals associated with a higher transaction volume and associated
deferrals of revenues related to post-contract support.

LIQUIDITY AND CAPITAL RESOURCES

    Operating activities provided cash of $8.9 million, in the nine months
ended September 30, 1996.  The primary source of these funds was net income and
increases in deferred revenues and accounts payable and accrued liabilities,
partially offset by an increase in accounts receivable.  Operating activities
provided cash of $1.7 million in the nine months ended September 30, 1995.  The
primarily source of these funds was net income and increases in deferred
revenues and in accounts payable and accrued liabilities, partially offset by an
increase in accounts receivable.

    Investing activities used cash of  $7.4 million, in the nine months ended
September 30, 1996, primarily for the purchase of short-term, interest-bearing,
investment-grade securities and, to a lesser extent, purchase of capital
equipment.  Investing activities used cash of $9.9 million, in the nine months
ended September 30, 1995, primarily for the purchase of short-term,
interest-bearing, investment-grade securities.  The Company does not currently
have any material commitments for capital equipment acquisitions.

    Financing activities provided cash of $294,000 in the nine months ended
September 30, 1996.  The primary source of these funds was proceeds from the
issuance of common stock pursuant to the exercise of outstanding stock options,
partially offset by payments on capital lease obligations.  Financing activities
provided cash of $20.7 million in the nine months ended September 30, 1995,
primarily due to proceeds from the Company's initial public offering completed
in August 1995.

    At September 30, 1996, the Company's principal sources of liquidity was its
cash, cash equivalents and short-term investments of $32.1 million.  The Company
believes that existing cash and short-term investment balances and potential
cash flow from operations will be sufficient to meet its cash requirements for
the next twelve months.  While operating activities may provide cash in certain
periods to the extent the Company experiences growth in the future, operating
and investing activities may use cash, and consequently, such growth may require
the Company to obtain additional sources of financing.


                                          14

<PAGE>

PART II: OTHER INFORMATION

Item 1:  Legal Proceedings:

         Not Applicable.

Item 2:  Changes in Securities:

         Not Applicable.

Item 3:  Defaults upon Senior Securities:

         Not Applicable.

Item 4:  Submission of Matters to a Vote of Security Holders:

         Not Applicable.

Item 5:  Other Information:

         Not Applicable.


                                          15

<PAGE>

Item 6:  Exhibits and Reports on Form 8-K:

         A.        Exhibits

    *    3.1       Form of Agreement and Plan of Merger between The Vantive
                   Corporation, a California corporation, and The Vantive
                   Corporation, a Delaware corporation.
    *    3.2       Bylaws.
    *    10.1      Form of Indemnity Agreement for officers and directors.
    *    10.2      1991 Stock Option Plan, as amended.
    *    10.3      1995 Outside Directors Stock Option Plan.
    *    10.4      1995 Employee Stock Purchase Plan.
    *    10.5      Offer Letter dated May 21, 1993 between the Company and John
                   R. Luongo.
    *    10.6      Offer Letter dated April 6, 1995 between the Company and
                   John M. Jack.
    *+   10.7      Value Added Reseller License Agreement dated October 5, 1993
                   by and between Inference Corporation and the Company.
    *+   10.8      Basicscript License Agreement dated October 4, 1994 by and
                   between Henneberry Hill Technologies Corporation doing
                   business as Summit Software Company and the Company.
    *+   10.9      International VAR Agreement dated March 26, 1992 between
                   Oracle Corporation and the Company, as amended.
         10.9.1    International VAR Agreement dated June 28, 1996 between
                   Oracle Corporation and the Company, as amended.
    *+   10.10     Value Added Remarketer Agreement dated December 20, 1991
                   between Sybase, Inc. and the Company, as amended.
    *    10.11     Security and Loan Agreement dated May 12, 1995 between the
                   Company and Imperial Bank.
    *+   10.12     Application Bridge API VAR License Agreement dated
                   January 22, 1993 between the Company and Prospect Software,
                   Inc.
    *+   10.13     Compensation Letter dated May 10, 1995 between the Company
                   and John R. Luongo.
    *+   10.14     Compensation Letter dated May 10, 1995 between the Company
                   and Steven M. Goldsworthy.
    *    10.15     Lease Agreement dated January 13, 1995 between John
                   Arrillaga, Trustee, or his Successor Trustee, UTA dated
                   July 20, 1977 (John Arrillaga Separate Property Trust) as
                   amended, and Richard T. Peery, Trustee, or his Successor
                   Trustee, UTA dated July 20, 1977 (Richard T. Peery Separate
                   Property Trust) as amended, and the Company.
         27.1      Financial Summary Table

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

*   Incorporated by reference from the Company's Registration Statement
    (No. 33-94244), declared effective on August 14, 1995.

+   Confidential Treatment has been granted for portions of this exhibit.


         B.   Reports of Form 8-K

              No report of Form 8-K was filed by the Company during the three
              month period ended September 30, 1996.


                                          16

<PAGE>

                                      SIGNATURES

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


                                            THE VANTIVE CORPORATION


Dated:  November 11, 1996                   By: /s/ Kathleen Murphy
                                                ------------------------------
                                                Kathleen Murphy
                                                Chief Financial Officer
                                                (Principal Financial Officer)


Dated:  November 11, 1996                   By: /s/ Michael M. Loo
                                                ------------------------------
                                                Michael M. Loo
                                                Vice President, Finance
                                                (Principal Accounting Officer)


                                          17