EXHIBIT 99.1

Interwoven Announces Third Quarter Financial Results

Revenues of $50.9 Million; Non-GAAP Profit of $0.12 per Share; 68 New Customers

SUNNYVALE, Calif. – October 26, 2006 – Interwoven, Inc. (Nasdaq: IWOV), provider of Enterprise Content Management (ECM) solutions for business, today announced financial results for the three and nine months ended September 30, 2006.

Interwoven reported total revenues of $50.9 million for the third quarter of 2006, an increase of 16% from total revenues of $43.9 million for the third quarter last year. Net income for the third quarter of 2006, calculated in accordance with generally accepted accounting principles, was $1.8 million, or $0.04 per share, compared to net loss of $184,000, or roughly break even on a per share basis, for the same period last year. On a non-GAAP basis, Interwoven reported a net income of $5.2 million for the third quarter of 2006, or $0.12 per share, compared to non-GAAP net income of $2.9 million, or $0.07 per share, for the third quarter last year. Non-GAAP results exclude restructuring and excess facilities charges, stock-based compensation charges, amortization of intangible assets, and the related tax impact of these adjustments and, in the case of non-GAAP per share results, include the dilutive impact of common stock options.

For the nine months ended September 30, 2006, Interwoven reported total revenues of $146.4 million, an increase of 15% from total revenues of $127.5 million for same period last year. Net income for the nine months ended September 30, 2006, calculated in accordance with generally accepted accounting principles, was $2.1 million, or $0.05 per share, compared to a net loss of $499,000, or $0.01 per share, for same period last year. On a non-GAAP basis, Interwoven reported net income of $13.1 million for the nine months ended September 30, 2006, or $0.30 per share, compared to non-GAAP net income of $7.9 million, or $0.19 per share, for the same period last year. Non-GAAP results exclude restructuring and excess facilities charges, expenses associated with the retirement of the company’s former chief executive officer recorded in the first quarter of 2006, stock-based compensation charges, amortization of intangible assets, and the related tax impact of these adjustments and, in the case of non-GAAP per share results, include the dilutive impact of common stock options.

Reconciliations of net income (loss) and net income (loss) per share calculated in accordance with generally accepted accounting principles and non-GAAP net income and non-GAAP net income per share are provided in the tables immediately following the consolidated statements of operations. Additional information about the company’s non-GAAP financial measures can be found under the caption “Non-GAAP Financial Information” below.

“We are extremely pleased with our excellent financial results in Q3,” said Interwoven’s president Max Carnecchia. “Our revenues for the third quarter increased 16% over last year and, so far for the first nine months of 2006, our revenues have increased 15% over last year. Our strategy is working, our team is executing and we are clearly focused on increasing market share.”

Customer Acquisition

Interwoven continued its strong global customer momentum in the third quarter by adding 68 new customers. As a result, Interwoven now has nearly 3,700 customers worldwide.

New customers that selected Interwoven in the third quarter include Advanta Bank, Analog Devices, ATK Thiokol, Fortis Investments, Hermes Precisa (HPA), Hunton & Williams, M|C Communications,

Merchant & Gould, Mitsui & Co. USA, Prudential Insurance Co., Shin Kong Bank, TD Securities, Welch Allyn, and many others.

In the third quarter, Interwoven also received orders from existing customers, including: adidas, Amazon.com, Applied Biosystems, Avon, Astellas Pharma, Barclays, Bird & Bird, Blue Cross Blue Shield, Brodies, Campbell Soup, Canon, Cartoon Network, Ceridian, Chunghwa Telecom, Citibank, Deloitte Consulting, Elsevier Limited, Fujitsu, General Motors, Harrah’s, Howard Hughes Medical Institute, Kohler Company, Library of Congress, MasterCard, Mazda, Mitsubishi Securities, NASD, NEC, Novo Nordisk, OCBC, The Principal Life Insurance Co., Samsonite, Smithsonian Institution, Visa International, White & Case, and many others.

In the quarter, Interwoven continued its record of delivering software products and services that enable enterprises to provide richer customer experiences across multiple touchpoints. As an example, Analog Devices, a leader in high performance signal processing solutions, replaced its existing Web content management software with Interwoven’s solution. Analog Devices tested Interwoven against its existing software and selected Interwoven because its test results indicated that Interwoven’s solution is more scalable, more flexible, more open, reduces the cost of ownership, and provides unique functionality that will enable Analog Devices to provide superior support to its customers worldwide.

M|C Communications, a premier medical education and event management company, selected Interwoven as a foundation for its future business growth. For a major expansion of its online and offline business, M|C Communications needed to enable teams of physicians, educators, and medical reviewers from several institutions to collaborate to create complex educational materials for its customers, to be delivered with marketing information through print and online channels. Comparative tests and evaluations of software from several vendors indicated to M|C Communications that only Interwoven offered a comprehensive solution that met its needs for both collaborative document management and web content management.

Interwoven secured key wins in the professional services market, with sales to law firms, accounting firms, and corporate legal departments, including our first law firm in India, J. Sagar Associates, and a major firm in Singapore, Allen & Gledhill. Of several new competitive conversions this quarter, one of note was Hunton & Williams, one of the largest law firms in North America, with over 800 attorneys. In addition to the dozens of new law firms added in the quarter, Interwoven also added several accounting firms as new customers, bringing the total to over 60 accounting firm customers worldwide. The company also completed sales to major corporate departments, including Prudential Insurance. Prudential’s corporate legal and compliance departments purchased Interwoven’s collaborative document management and record management offerings to enable the secure creation, management, retention and ultimate disposal of its corporate documents.

In the financial services market, Interwoven continued to add some of the largest global financial institutions as customers in the third quarter. One example was Grupo Santander, the world’s tenth-largest financial group by market value, headquartered in Madrid, Spain. Santander purchased Interwoven’s OTC Derivatives Solution to replace its internally-developed systems to automate over-the-counter derivatives confirmation. This win is a classic example of the value Interwoven’s solutions provide to its financial services customers, enabling increased internal efficiencies while mitigating compliance risks.

Solution and Product Leadership

During the third quarter, Interwoven delivered enhancements to several of its products:

• Interwoven TeamSite, the industry’s top product for Web content management, was upgraded to make it easier to execute, manage, and control complex projects that span multiple Websites and

	multiple delivery channels. Enhancements included improved support for Linux, a next-generation drag-and-drop builder to create and manage workflows to automate the business processes that drive Web publishing, single sign-on enhancements, and FormsPublisher improvements that make it even faster for business users to quickly add and change Web content. These enhancements reduce the total cost of ownership and accelerate time to market.
•	A new Adobe InDesign plug-in enables both Mac and PC users to use Interwoven MediaBin’s power from inside the Adobe product, so InDesign users can place, manipulate, extract, and share images, publications, and media, strengthening brand consistency, accelerating campaigns, and reducing marketing costs.
•	Interwoven also delivered enhancements to the Interwoven Composite Application Provisioning Solution, Interwoven WorkSite, and Interwoven MetaTagger.

Company Developments

• Max Carnecchia Appointed President – The Interwoven board of directors appointed Max Carnecchia as Interwoven’s president. Mr. Carnecchia had been serving as Interwoven’s interim president since early this year. Prior to his appointment as interim president, Mr. Carnecchia served as Interwoven’s senior vice president of worldwide sales. Prior to joining Interwoven in 2001, Mr. Carnecchia held positions with several companies, among them IBM, Intel, and Group 1 Software.

• Ben Kiker Appointed SVP and CMO – Ben Kiker joined Interwoven as its senior vice president and chief marketing officer. Previously, Mr. Kiker was vice president of Americas marketing for Siebel Systems. Prior to Seibel, Mr. Kiker was the chief marketing officer for Onyx Software, where he led all marketing functions, including product management, corporate marketing, and channel support. He also held senior marketing positions for Clarify, Vantive, Octel, and Aspect Communications.

• Interwoven GearUp ’06 Europe Conference – Earlier this month, hundreds of Interwoven customers and partners joined industry experts and media at Interwoven’s GearUp ’06 Europe conference in London, England. The filled-to-capacity event, with more than twice as many customers attending as last year, enabled Interwoven users to share information and best practices. Dozens of presentations were given by Interwoven and its customers, including AXA Group, DLA Piper, Eurocontrol, Garrigues, HBOS, Hilton Hotels, HSBC, SJ Berwin, SKY Italia, Telenor, Tesco, and more. Partners sponsoring with Interwoven included Microsoft, Sun Microsystems, Avenue A| Razorfish, Tikit, LexisNexis, eCopy, Morningstar Systems, SDL International, and others.

Non-GAAP Financial Information

To supplement the company’s consolidated financial statements presented in accordance with generally accepted accounting principles, Interwoven uses measures of operating results, net income (loss), net income (loss) per share, and shares used in the net income (loss) per share calculation, which are adjusted to exclude restructuring charges, retirement benefit costs associated with the retirement of the company’s former chief executive officer recorded in the first quarter of 2006, stock-based compensation, amortization of intangible assets, and the related tax impact of these adjustments and, where applicable, to include the dilutive impact of common stock options. These non-GAAP results are not in accordance with, or an alternative for, results prepared in accordance with accounting principles generally accepted in the United States of America, and the company’s non-GAAP measures may be different from non-GAAP measures used by other companies. Interwoven believes that the presentation of non-GAAP results provides useful information to management and investors regarding underlying trends in its consolidated financial condition and results of operations. Interwoven also believes that where the adjustments used in calculating non-GAAP net income and non-GAAP net income per share are based on specific, identified charges that impact different line items in the consolidated statements of operations (including cost of

revenues-license, cost of revenues-support and service, sales and marketing, research and development, and general and administrative expenses), it is useful to investors to know how these specific line items in the consolidated statements of operations are affected by these adjustments. For its internal budgets, Interwoven’s management uses consolidated financial statements that do not include restructuring and excess facilities charges, retirement benefit costs associated with retirement of the company’s former chief executive officer, stock-based compensation, amortization of intangible assets, and the related tax impact of these adjustments. Interwoven uses these non-GAAP measures in assessing corporate performance and determining incentive compensation. Readers are advised to review and consider carefully the financial information prepared in accordance with accounting principles generally accepted in the United States of America contained in this press release and Interwoven’s periodic filings with the Securities and Exchange Commission.

Conference Call Information

Interwoven’s 2006 third quarter results and its business outlook for the fourth quarter of 2006 will be discussed today, October 26, 2006 at 2:00 p.m. PT (5:00 p.m. ET).

Live dial-in number: (719) 457-2630
Replay number: (719) 457-0820 or (888) 203-1112
Pass code: 4656841

Audio Web cast instructions will be available on Interwoven’s Website at http://www.interwoven.com/investors. The call replay will be available starting October 26, 2006 at approximately 5:00 p.m. PT for a limited period.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains “forward-looking” statements, including statements about historical results that may suggest trends in our business. These statements are based on estimates and information available to us at the time of this press release and are not guarantees of future performance. Our forward-looking statements include management quotations, statements about customer momentum, solutions and products, activities with strategic business alliances, and statements about technology leadership. Actual results could differ materially from our current expectations as a result of many factors including: our ability to develop new products, services, features and functionality successfully and on a timely basis; customer acceptance of our solutions; changes in customer spending on enterprise content management initiatives; our ability to cross-sell and up-sell additional products into our installed base of customers; the success of our strategic business alliances; intense competition in our markets; changes in key personnel, the introduction of new products or services by competitors; and the ongoing consolidation in our markets. These and other risks and uncertainties associated with our business are described in our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Forms 8-K, which are on file with the Securities and Exchange Commission and available through www.sec.gov.

About Interwoven

Interwoven, Inc., provider of Enterprise Content Management solutions for business, enables organizations to unify people, content and processes to minimize business risk, accelerate time-to-value and sustain lower total cost of ownership. Interwoven delivers deep industry-specific solutions which reduce business process cycle time from initial collaboration through design, production, sales, marketing, legal review, IT and service. Interwoven leads the industry with a service-oriented architecture today and easy-to-use, best-in-class components and solutions. Today, nearly 3,700 companies, law firms, and professional services organizations worldwide are Interwoven customers including adidas, Airbus, Avaya, Cisco, DLA Piper, the Federal Reserve Bank, FedEx, HSBC, LexisNexis, Microsoft, Samsung, Shell International, Samsonite, White & Case, and Yamaha. Interwoven is headquartered in Sunnyvale, Calif., with offices around the world. For more information visit: www.interwoven.com.

Investor Relations Contact:

Brian Andersen
Interwoven, Inc.
(408) 530-5801
bandersen@interwoven.com

Media Relations Contact:

Melisa Bleasdale
Interwoven, Inc.
(408) 530-7043
mbleasda@interwoven.com

INTERWOVEN, INC.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)

	Three Months Ended					Nine Months Ended
	Sept. 30,					Sept. 30,
	2006		2005			2006			2005
Revenues:
License	$	18,580	$	17,417		$	54,657		$	48,500
Support and service		32,335		26,522			91,745			78,958
Total revenues		50,915		43,939			146,402			127,458
Cost of revenues:
License		4,426		3,951			13,015			10,781
Support and service		13,140		10,731			37,324			30,987
Total cost of revenues		17,566		14,682			50,339			41,768
Gross profit		33,349		29,257			96,063			85,690
Operating expenses:
Sales and marketing		18,877		17,966			56,446			51,965
Research and development		8,902		7,639			25,984			23,649
General and administrative		3,964		3,673			13,015			10,403
Amortization of intangible assets		828		834			2,484			2,472
Restructuring and excess facilities charges		41		35			(887	)		(598	)
Total operating expenses		32,612		30,147			97,042			87,891
Income (loss) from operations		737		(890	)		(979	)		(2,201	)
Interest income and other, net		1,631		984			4,436			2,605
Income before provision for income taxes		2,368		94			3,457			404
Provision for income taxes		595		278			1,350			903
Net income (loss)	$	1,773	$	(184	)	$	2,107		$	(499	)
Basic net income (loss) per common share	$	0.04	$	(0.00	)	$	0.05		$	(0.01	)
Shares used in computing basic net income (loss) per common share		43,045		41,988			42,701			41,586
Diluted net income (loss) per common share	$	0.04	$	(0.00	)	$	0.05		$	(0.01	)
Shares used in computing diluted net income (loss) per common share		43,922		41,988			43,446			41,586

INTERWOVEN, INC.
Consolidated Balance Sheets
(In thousands)

	Sept. 30, 2006			Dec. 31, 2005
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	79,019		$	73,618
Short-term investments		81,349			63,581
Accounts receivable, net		29,851			31,542
Prepaid expenses and other current assets		6,524			5,193
Total current assets		196,743			173,934
Property and equipment, net		4,873			5,044
Goodwill		191,620			191,595
Other intangible assets, net		13,904			25,527
Other assets		2,037			2,506
Total assets	$	409,177		$	398,606
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	4,772		$	4,491
Accrued liabilities		27,484			22,198
Restructuring and excess facilities accrual		6,520			7,266
Deferred revenues		53,112			54,010
Total current liabilities		91,888			87,965
Accrued liabilities		2,504			2,761
Restructuring and excess facilities accrual		3,966			9,681
Total liabilities		98,358			100,407
Commitments and contingencies
Stockholders’ equity:
Preferred stock		—			—
Common stock		43			42
Additional paid-in capital		715,235			705,908
Deferred stock-based compensation		—			(1,002	)
Accumulated other comprehensive loss		(176	)		(359	)
Accumulated deficit		(404,283	)		(406,390	)
Total stockholders’ equity		310,819			298,199
Total liabilities and stockholders’ equity	$	409,177		$	398,606

INTERWOVEN, INC.
Impact of Non-GAAP Adjustments on Reported Net Income (Loss)
(In thousands, except per share data)
(Unaudited)

	Three Months Ended							Three Months Ended
	Sept. 30, 2006							Sept. 30, 2005
	As reported		Adjustments*			Non-GAAP		As reported			Adjustments*			Non-GAAP
Revenues:
License	$	18,580	$	—		$	18,580	$	17,417		$	—		$	17,417
Support and service		32,335		—			32,335		26,522			—			26,522
Total revenues		50,915		—			50,915		43,939			—			43,939
Cost of revenues:
License (1)		4,426		(3,643	)		783		3,951			(3,099	)		852
Support and service (2)		13,140		(157	)		12,983		10,731			(77	)		10,654
Total cost of revenues		17,566		(3,800	)		13,766		14,682			(3,176	)		11,506
Gross profit		33,349		3,800			37,149		29,257			3,176			32,433
Operating expenses:
Sales and marketing (2)		18,877		(352	)		18,525		17,966			(78	)		17,888
Research and development (2)		8,902		(230	)		8,672		7,639			(4	)		7,635
General and administrative (2)		3,964		(232	)		3,732		3,673			(167	)		3,506
Amortization of intangible assets (1)		828		(828	)		—		834			(834	)		—
Restructuring and excess facilities charges (3)		41		(41	)		—		35			(35	)		—
Total operating expenses		32,612		(1,683	)		30,929		30,147			(1,118	)		29,029
Income (loss) from operations		737		5,483			6,220		(890	)		4,294			3,404
Interest income and other, net		1,631		—			1,631		984			—			984
Income before taxes		2,368		5,483			7,851		94			4,294			4,388
Provision for income taxes (4)		595		2,074			2,669		278			1,214			1,492
Net income (loss)	$	1,773	$	3,409		$	5,182	$	(184	)	$	3,080		$	2,896
Net income (loss) per share	$	0.04				$	0.12	$	(0.00	)				$	0.07
Shares used in computing net income (loss) per share (5)		43,922					43,922		41,988						42,509

(1)

For the three months ended September 30, 2006 and 2005, adjustments reflect the reversal of $3.6 million and $3.1 million, respectively, associated with the amortization of purchased technology and $828,000 and $834,000, respectively, associated with the amortization of intangible assets.

(2)

As of January 1, 2006, the Company adopted Statement of Financial Accounting Standard No. 123R, Share-based Payment. For the three months ended September 30, 2006, adjustments reflect the reversal of stock-based compensation expense of $157,000 in cost of revenues – support and service, $352,000 in sales and marketing, $230,000 in research and development and $232,000 in general and administrative. For the three months ended September 30, 2005, adjustments reflect the reversal of amortization of deferred stock-based compensation of $77,000 in cost of revenues – support and service, $78,000 in sales and marketing, $4,000 in research and development and $167,000 in general and administrative.

(3)	For the three months ended September 30, 2006 and 2005, adjustments reflect the reversal of $41,000 and $35,000, respectively, in adjustments associated with the Company’s restructuring and excess facilities accrual.
(4)	For the three months ended September 30, 2006 and 2005, adjustments reflect an additional tax provision of $2.1 million and $1.2 million, respectively, associated with the non-GAAP adjustments.
(5)	For the three months ended September 30, 2005, the shares used in computing non-GAAP net income per share include the dilutive impact of common stock options of 521,000 shares.

INTERWOVEN, INC.
Impact of Non-GAAP Adjustments on Reported Net Income (Loss)
(In thousands, except per share data)
(Unaudited)

	Nine Months Ended								Nine Months Ended
	Sept. 30, 2006								Sept. 30, 2005
	As reported			Adjustments*			Non-GAAP		As reported			Adjustments*			Non-GAAP
Revenues:
License	$	54,657		$	—		$	54,657	$	48,500		$	—		$	48,500
Support and service		91,745			—			91,745		78,958			—			78,958
Total revenues		146,402			—			146,402		127,458			—			127,458
Cost of revenues:
License (1)		13,015			(10,763	)		2,252		10,781			(8,549	)		2,232
Support and service (2)		37,324			(494	)		36,830		30,987			(123	)		30,864
Total cost of revenues		50,339			(11,257	)		39,082		41,768			(8,672	)		33,096
Gross profit		96,063			11,257			107,320		85,690			8,672			94,362
Operating expenses:
Sales and marketing (2)		56,446			(967	)		55,479		51,965			(334	)		51,631
Research and development (2)		25,984			(590	)		25,394		23,649			(146	)		23,503
General and administrative (2) (3)		13,015			(1,959	)		11,056		10,403			(516	)		9,887
Amortization of intangible assets (1)		2,484			(2,484	)		—		2,472			(2,472	)		—
Restructuring and excess facilities charges (4)		(887	)		887			—		(598	)		598			—
Total operating expenses		97,042			(5,113	)		91,929		87,891			(2,870	)		85,021
Income (loss) from operations		(979	)		16,370			15,391		(2,201	)		11,542			9,341
Interest income and other, net		4,436			—			4,436		2,605			—			2,605
Income before taxes		3,457			16,370			19,827		404			11,542			11,946
Provision for income taxes (5)		1,350			5,391			6,741		903			3,159			4,062
Net income (loss)	$	2,107		$	10,979		$	13,086	$	(499	)	$	8,383		$	7,884
Net income (loss) per share	$	0.05					$	0.30	$	(0.01	)				$	0.19
Shares used in computing net income (loss) per share (6)		43,446						43,446		41,586						42,147

(1)

For the nine months ended September 30, 2006 and 2005, adjustments reflect the reversal of $10.8 million and $8.5 million, respectively, associated with the amortization of purchased technology and $2.5 million and $2.5 million, respectively, associated with the amortization of intangible assets.

(2)

As of January 1, 2006, the Company adopted Statement of Financial Accounting Standard No. 123R, Share-based Payment. For the nine months ended September 30, 2006, adjustments reflect the reversal of stock-based compensation expense of $494,000 in cost of revenues – support and service, $967,000 in sales and marketing, $590,000 in research and development and $339,000 in general and administrative. For the nine months ended September 30, 2005, adjustments reflect the reversal of amortization of deferred stock-based compensation of $123,000 in cost of revenues – support and service, $334,000 in sales and marketing, $146,000 in research and development and $516,000 in general and administrative.

(3)	For the nine months ended September 30, 2006, adjustments reflect the reversal of $1.6 million in benefit costs associated with the retirement of the Company’s former chief executive officer recorded in the first quarter of 2006.
(4)	For the nine months ended September 30, 2006 and 2005, adjustments reflect the reversal of $887,000 and $598,000, respectively, in adjustments associated with the Company’s restructuring and excess facilities accrual.
(5)	For the nine months ended September 30, 2006 and 2005, adjustments reflect an additional tax provision of $5.4 million and $3.2 million, respectively, associated with the non-GAAP adjustments.
(6)	For the nine months ended September 30, 2005, the shares used in computing non-GAAP net income include the dilutive impact of common stock options of 561,000, respectively.