Exhibit 99.1

        Contacts:

        John Farr

        Chief Financial Officer

        800.287.4383

        investor.relations@pervasive.com

PERVASIVE SOFTWARE REPORTS RESULTS

FOR ITS FIRST QUARTER OF FISCAL YEAR 2006

AUSTIN, TEXAS – October 25, 2005 - Pervasive Software^® Inc. (Nasdaq:PVSW), a global value leader in data infrastructure software, today announced financial results for the first fiscal quarter ending September 30, 2005. Revenue in the first quarter is within the range of guidance previously provided for the quarter in our press release dated July 26, 2005, while first quarter GAAP-basis diluted earnings per share is at the high end of the range of guidance previously provided for the quarter.

Revenue, as reported under generally accepted accounting principles (GAAP), was $11.7 million for the first quarter of fiscal year 2006, compared to $11.8 million for the first quarter of last fiscal year. Net income was $0.3 million, or $0.01 diluted earnings per share, for the first quarter, compared to net income of $0.8 million, or $0.03 diluted earnings per share, for the first quarter of last fiscal year. On a pro forma basis, as described below, Pervasive realized pro forma net income of $1.5 million, or $0.07 diluted earnings per share, in the first quarter of fiscal year 2006, compared to net income of $1.1 million, or $0.05 diluted earnings per share, in the first quarter of last fiscal year.

Pervasive began accounting for stock options in accordance with Financial Accounting Standards No. 123R, Share-Based Payment (“FAS 123R”), beginning on July 1, 2005, which means the quarter ending September 30, 2005 is the first quarter in which Pervasive has reflected expenses associated with stock options in its GAAP-basis income statement. GAAP-basis profitability includes amortization of purchased intangibles of approximately $0.3 million and, for the first time, stock option based compensation expense of approximately $0.9 million, together representing approximately $0.05 per share in the first quarter of fiscal year 2006.

Pervasive continued to generate positive cash flow from operations with $2.4 million in the first quarter of fiscal 2006, ending the quarter with $39.7 million in cash and marketable securities and no debt.

“We are pleased with the results we achieved in the September quarter, delivering revenue and profitability at the mid to high end of our expectations in the summer months,” said Dave Sikora, president and CEO, Pervasive Software. “Going forward, we’re focused on driving growth in our integration and open source database product lines, while maintaining healthy levels of revenue and customer satisfaction within our embedded database business. And, as always, we remain focused on the bottom line, a reflection of the thread of fiscal responsibility that drives our decision-making and underscores our view that earnings are the ultimate creator of shareholder value.”

Business Outlook

For the second fiscal quarter ending December 31, 2005, Pervasive expects revenue to be in the range of $11.5 million to $12.5 million and GAAP-basis diluted earnings per share of $0.00 to $0.03. GAAP-basis profitability is expected to include amortization of purchased intangibles of approximately $0.3 million and stock option based compensation expense of approximately $1.0 million, together representing approximately $0.05 per share in the second quarter of fiscal year 2006, resulting in pro forma diluted earnings per share, before amortization of purchased intangible and stock option based compensation expense, of approximately $0.05 to $0.08 compared to pro forma diluted earnings per share of $0.05 for the second quarter of fiscal year 2005.

Pervasive management believes that the pro forma results described in this release are useful for an understanding of Pervasive’s ongoing operations because GAAP results include non-cash charges associated with the amortization of purchased intangibles and stock option based compensation expense. Management uses these pro forma results to compare the company’s performance to that of prior periods for analysis of trends, and to evaluate the company’s financial strength, develop budgets, manage expenditures and develop a financial outlook. Pro forma results are supplemental and are not intended as a substitute for GAAP results.

Conference Call Details

Pervasive will host a conference call to discuss these results with the investment community today at 5 P.M. Eastern time. The dial-in numbers for the call are 800.862.9098 or 785.424.1051. The conference ID is “PVSW”. The conference call may also be accessed live over the Web at http://www.pervasive.com/ircalendar. Check the site before the call for login information. A replay will be available from approximately 6 P.M. Eastern Tuesday, October 25, to midnight, Friday, November 4, by dialing 888.219.1262 or 402.220.4942, or for a longer period through Pervasive’s Web site.

About Pervasive Software

Pervasive Software is a global value leader in data infrastructure software. The company’s award-winning products enable customers to manage, integrate, analyze and secure their critical data, providing the industry’s best combination of performance, reliability and cost. Pervasive’s strength is evidenced by the size and diversity of its customer base, serving tens of thousands of customers in virtually every industry market around the world. With headquarters in Austin, Texas, Pervasive was founded in 1994 and sells its products into more than 150 countries. More information may be found on the Web at http://www.pervasive.com.

Cautionary Statement

This document contains forward-looking statements that involve risks and uncertainties concerning the company, including the company’s expected performance for the second quarter 2005 and the company’s strategy going forward. Actual events or results may differ materially from those described in this document due to a number of risks and uncertainties. These risks and uncertainties include, among others, the company’s ability to attract and retain existing and/or new customers; the company’s ability to issue new

products or releases of solutions that meet customers’ needs or achieve acceptance by the company’s customers; changes to current accounting policies which may have a significant, adverse impact upon the company’s financial results; the introduction of new products by competitors or the entry of new competitors; the company’s ability to preserve its key strategic relationships; the company’s ability to hire and retain key employees; and economic and political conditions in the US and abroad. All of these factors may result in significant fluctuations in the company’s quarterly operating results and/or its ability to sustain or increase its profitability. More about potential factors that could affect the company’s business and financial results is included in Pervasive’s Form 10-K for the year ended June 30, 2005, which is on file with the SEC and available at the SEC’s website at www.sec.gov. Pervasive is not obligated to update these forward-looking statements to reflect events or circumstances after the date of this document.

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All Pervasive brand and product names are trademarks or registered trademarks of Pervasive Software Inc. in the United States and other countries. All other marks are the property of their respective owners.

Pervasive Software Inc.

Condensed Consolidated Statements of Operations (GAAP) (A)

(in thousands, except per share data)

(Unaudited)

	Three months ended September 30
	2005			2004
Revenues:
Product licenses	$	8,856		$	8,983
Services and other		2,834			2,801
Total revenue		11,690			11,784
Costs and expenses:
Cost of product licenses		573			512
Cost of services and other		1,451			1,392
Sales and marketing		5,041			5,398
Research and development		2,877			2,641
General and administrative		1,625			1,091
Total costs and expenses		11,567			11,034
Operating income		123			750
Interest and other income, net		259			84
Income tax provision		(50	)		(46	)
Net income	$	332		$	788
Diluted earnings per share:	$	0.01		$	0.03
Shares used in computing diluted earnings per share		22,536			23,622

(A) See pro forma results of operations and related reconciliation to GAAP results for the three months ended September 30, 2005 and 2004, respectively, on a subsequent page of this release.

Pervasive Software Inc.

Pro Forma Condensed Consolidated Statements of Operations (A)

(in thousands, except per share data)

(Unaudited)

	Three months ended September 30, 2005									Three months ended September 30, 2004
	Total Consolidated GAAP			Pro Forma Adjustments (B)			Pro Forma Adjusted			Total Consolidated GAAP			Pro Forma Adjustments (B)			Pro Forma Adjusted
Revenues:
Product licenses	$	8,856		$	—		$	8,856		$	8,983		$	—		$	8,983
Services and other		2,834			—			2,834			2,801			—			2,801
Total revenue		11,690			—			11,690			11,784			—			11,784
Costs and expenses:
Cost of product licenses		573			(317	)		256			512			(317	)		195
Cost of services and other		1,451			(29	)		1,422			1,392			—			1,392
Sales and marketing		5,041			(274	)		4,767			5,398			—			5,398
Research and development		2,877			(162	)		2,715			2,641			—			2,641
General and administrative		1,625			(405	)		1,220			1,091			—			1,091
Total costs and expenses		11,567			(1,187	)		10,380			11,034			(317	)		10,717
Operating income		123			1,187			1,310			750			317			1,067
Interest and other income, net		259			—			259			84			—			84
Income tax provision		(50	)		—			(50	)		(46	)		—			(46	)
Net income	$	332		$	1,187		$	1,519		$	788		$	317		$	1,105
Diluted earnings per share:	$	0.01					$	0.07		$	0.03					$	0.05
Shares used in computing diluted earnings per share		22,536			735			23,271			23,622						23,622

(A) See Unaudited Condensed Consolidated Statements of Operations on a prior page of this release. Pro forma presentation is not intended to replace GAAP presentation. Pro forma measures are calculated in the manner described in this release.

(B) Pro forma adjustments consist of $0.3 million of purchased intangibles amortization in the quarters ending September 30, 2005 and 2004, and $0.9 million of stock based compensation expense for the quarter ending September 30, 2005 in accordance with Statement of Financial Accounting Standards No. 123R.

Pervasive Software Inc.

Condensed Consolidated Balance Sheets

(in thousands)

	September 30, 2005		June 30, 2005
	(Unaudited)
ASSETS
Current assets:
Cash and marketable securities	$	39,655	$	37,391
Trade accounts receivable, net		7,340		7,398
Prepaid expenses and other current assets		1,756		1,572
Total current assets		48,751		46,361
Property and equipment, net		2,266		2,422
Purchased technology, net		5,718		6,079
Goodwill		38,953		38,953
Other assets		391		390
Total assets	$	96,079	$	94,205
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	6,777	$	5,781
Deferred revenue		5,336		5,681
Total current liabilities		12,113		11,462
Stockholders’ equity		83,966		82,743
Total liabilities and stockholders’ equity	$	96,079	$	94,205