UPDATE 2-Autonomy's Q1 beats expectations, shares rise

* Q1 sales up 23 pct, adjusted pretax up 87 pct

* Says pipeline strong and "cautiously optimistic"

* Will discuss analysts' upgrades for 2009

* Shares rise 3 percent

(Adds company comment, analyst reaction, shares)

By Paul Sandle

LONDON, April 23 (Reuters) - British software firm Autonomy (AUTN.L) beat analyst expectations for pretax profit on Thursday, reflecting a demand for its search solutions and the integration of its Interwoven acquisition.

The company, whose software helps firms search data across phone calls, emails, video and instant messages, posted a 23 percent rise in revenue of $129.8 million for the three months to the end of March and an 87 percent rise in adjusted pretax profit of $58.2 million.

Autonomy said earlier in the month that it expected first-quarter sales of $128 million to $130 million. Analysts in a Reuters poll expected first-quarter adjusted pretax profit to be $48.0 million.

Shares in the Cambridge-based group, which has outperformed its peers in the Dow Jones STOXX Technology Index .SX8P by 60 percent in the last 12 months, were 3 percent higher at 1325 pence by 0927 GMT.

Panmure Gordon analyst George O'Connor, who has a "buy" rating on the stock, said Autonomy had delivered a "blow-out quarter", with a confident outlook statement.

"The numbers address the criticisms on growth and deferred revenue," O'Connor said.

Chief Executive Mike Lynch said regulation and higher compliance levels meant companies had to organise and find data, which in turn created demand for Autonomy's software.

The upheaval in the financial sector would lead to even more regulation, Lynch said.

"(The financial crisis) has been quite good for us," he said in an interview. ""Sorting out the mess generates work."

Lynch said the integration of U.S. firm Interwoven, bought for $775 million in January, was ahead of plan.