================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 10-Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2003

                                       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 0-020992


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

                 DELAWARE                               04-2842217
      (STATE OR OTHER JURISDICTION OF                (I.R.S. EMPLOYER
     INCORPORATION  OR  ORGANIZATION)               IDENTIFICATION NO.)


      1700 WESTLAKE AVENUE NORTH, SUITE 500, SEATTLE, WASHINGTON 98109-3044
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

                                 (206) 283-8802
               REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE


           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                          COMMON STOCK, $0.01 PAR VALUE
                                (TITLE OF CLASS)


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

     Indicate  by  check  mark  whether  registrant  is an accelerated filer (as
defined  in  Rule  12b-2  of  the  Exchange  Act).     Yes  [ ]    No  [X]

     The  number  of  shares outstanding of the Registrant's Common Stock, $0.01
par  value,  was  11,434,519  as  of  May  1,  2003.

================================================================================

<PAGE>
<TABLE>
<CAPTION>
                                               TABLE OF CONTENTS


                                                                                                       PAGE
                                                                                                       ----

<S>         <C>                                                                                         <C>
PART I.          FINANCIAL INFORMATION

  ITEM 1.   Consolidated Financial Statements (Unaudited)

              Consolidated Balance Sheets as of March 31, 2003 and December 31, 2002                      1

              Consolidated Statements of Operations for the three months ended March 31, 2003 and 2002    2

              Consolidated Statements of Cash Flows for the three months ended March 31, 2003 and 2002    3

              Notes to Consolidated Financial Statements                                                  4

  ITEM 2.     Management's Discussion and Analysis of Financial Condition and Results of Operations       8

  ITEM 3.     Quantitative and Qualitative Disclosures about Market Risk                                 21

  ITEM 4.     Controls and Procedures                                                                    22

PART II.         OTHER INFORMATION

  ITEM 1.     Legal Proceedings                                                                          23

  ITEM 2.     Changes in Securities and Use of Proceeds                                                  23

  ITEM 4.     Submission of Matters to a Vote of Security Holders                                        23

  ITEM 5.     Other Information                                                                          23

  ITEM 6.     Exhibits and Reports on Form 8-K                                                           24

SIGNATURES                                                                                               25

CERTIFICATIONS                                                                                           26
</TABLE>

     Trademarks

Insightful,  the  Insightful  logo,  "intelligence  from  data"  and 'human-like
intelligence"  are trademarks of Insightful Corporation. S-PLUS, S-PLUS Analytic
Server,  StatServer  and  InFact  are  registered  trademarks  of  Insightful
Corporation.  All  other brand names, trademarks or service marks referred to in
the  report  are  the  property  of  their  owners.

                                        i
<PAGE>
PART  I.     FINANCIAL  INFORMATION

ITEM  1.     CONSOLIDATED  FINANCIAL  STATEMENTS

<TABLE>
<CAPTION>
                              INSIGHTFUL CORPORATION AND SUBSIDIARIES

                                    CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS, EXCEPT SHARE DATA)
                                            (UNAUDITED)


                                                                             MARCH 31,    DECEMBER 31,
                                                                               2003           2002
                                                                            -----------  --------------
<S>                                                                         <C>          <C>
                                       ASSETS
Current Assets:
  Cash and cash equivalents                                                 $    5,979   $       6,819
  Accounts receivable, net                                                       2,332           2,346
  Other receivables                                                                875             955
  Inventories                                                                      161             102
  Prepaid expenses                                                                 693             204
                                                                            -----------  --------------

      Total current assets                                                      10,040          10,426

Property and equipment, net                                                      1,841           2,055
Goodwill                                                                         1,229           1,230
Other intangibles, net                                                             226             276
Other assets                                                                        49              49
                                                                            -----------  --------------
                                                                            $   13,385   $      14,036
                                                                            ===========  ==============

                    LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Current portion of long-term debt                                         $      128   $         129
  Accounts payable                                                               1,006           1,030
  Accrued expenses and other current liabilities                                 2,210           2,371
  Deferred revenue                                                               4,765           4,780
                                                                            -----------  --------------

    Total current liabilities                                                    8,109           8,310

Long-term debt, less current portion                                               257             289

Commitments and contingencies

Stockholders' equity:
  Preferred stock, $0.01 par value-
    Authorized-1,000,000 shares
    Issued and outstanding-none                                                      -               -
  Common stock, $0.01 par value-
    Authorized-20,000,000 shares
    Issued and outstanding-11,434,519 and 11,518,277, shares at
      March 31, 2003 and December 31, 2002, respectively                           114             115
  Additional paid-in capital                                                    34,083          34,316
  Deferred stock-based compensation                                                (26)           (162)
  Accumulated deficit                                                          (29,235)        (28,881)
  Cumulative translation adjustment                                                 83              49
                                                                            -----------  --------------

    Total stockholders' equity                                                   5,019           5,437
                                                                            -----------  --------------

                                                                            $   13,385   $      14,036
                                                                            ===========  ==============
</TABLE>

    The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                        1
<PAGE>
<TABLE>
<CAPTION>
                    INSIGHTFUL CORPORATION AND SUBSIDIARIES

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

                                                                          THREE MONTHS ENDED
                                                                               MARCH 31,
                                                                          ------------------
                                                                            2003      2002
                                                                          --------  --------
<S>                                                                       <C>       <C>
Revenues:
  Software licenses                                                       $ 1,790   $ 1,559
  Software maintenance                                                      1,663     1,327
  Professional services and other                                             843     1,505
                                                                          --------  --------

    Total revenues                                                          4,296     4,391
                                                                          --------  --------
Cost of revenues:
  Software related                                                            515       447
  Professional services and other                                             710     1,060
                                                                          --------  --------

    Total cost of revenues                                                  1,225     1,507
                                                                          --------  --------

    Gross profit                                                            3,071     2,884
                                                                          --------  --------
Operating expenses:
  Sales and marketing                                                       1,805     1,742
  Research and development                                                  1,682     2,026
  Less-Funded research                                                       (972)   (1,254)
                                                                          --------  --------
    Research and development, net                                             710       772
  General and administrative                                                  790       581
  Amortization of other intangibles                                            60        45
                                                                          --------  --------

    Total operating expenses                                                3,365     3,140
                                                                          --------  --------

    Loss from operations                                                     (294)     (256)
Interest and other income                                                      15        55
Interest expense                                                               (5)       (3)
                                                                          --------  --------

  Loss before income taxes                                                   (284)     (204)
Income tax provision                                                           71        12
                                                                          --------  --------

    Net loss                                                              $  (355)  $  (216)
                                                                          ========  ========
Basic and diluted net loss per share                                      $ (0.03)  $ (0.02)
                                                                          ========  ========

Weighted average number of common shares outstanding - Basic and Diluted   11,399    11,188
                                                                          ========  ========
</TABLE>

    The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                        2
<PAGE>
<TABLE>
<CAPTION>
                     INSIGHTFUL CORPORATION AND SUBSIDIARIES

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

                                                                THREE MONTHS ENDED
                                                                    MARCH 31,
                                                                ------------------
                                                                  2003      2002
                                                                 -------  -------
<S>                                                              <C>      <C>
Operating activities:
Net loss                                                         $ (355)  $ (216)
  Adjustments to reconcile net loss to net cash provided by
    (used in) operating activities:
    Depreciation and amortization                                   351      291
    Amortization (reversal) of stock-based compensation            (131)      45
    Currency translation adjustment                                  34      (51)
    Changes in current assets and liabilities:
      Accounts and other receivables                                 94      442
      Inventories                                                   (59)     (57)
      Prepaid expenses                                             (490)    (465)
      Accounts payable                                              (24)    (426)
      Accrued expenses and other current liabilities               (136)    (458)
      Deferred revenue                                              (15)     125
                                                                 -------  -------
        Net cash used in operating activities                      (731)    (770)
                                                                 -------  -------
Investing activities:
  Purchases of property and equipment                               (64)    (116)
  Decrease (increase) in other assets                                30       18
  Capitalized patent costs                                          (39)     (22)
  Net cash used in acquisitions                                       -     (176)
                                                                 -------  -------
        Net cash used in investing activities                       (73)    (296)
                                                                 -------  -------
Financing activities:
  Payments on long-term debt                                        (32)     (23)
  Cash received on subscription receivable from director              -      380
  Proceeds from long-term debt                                        -      179
  Proceeds from exercise of stock options, employee stock
    purchase plan, and cancellation of returned shares (Note 8)      (4)     234
                                                                 -------  -------
        Net cash provided by (used in) financing activities         (36)     770
                                                                 -------  -------
Net cash used in continuing operations                             (840)    (296)
                                                                 -------  -------
Net cash used in discontinued operations                              -      (98)
                                                                 -------  -------
Net decrease in cash and cash equivalents                          (840)    (394)
                                                                 -------
  Cash and cash equivalents, beginning of period                  6,819    6,278
                                                                 -------  -------
  Cash and cash equivalents, end of period                       $5,979   $5,884
                                                                 =======  =======
Supplemental disclosure of cash flow information:
  Cash paid  for:
    Interest                                                     $    5   $    3
                                                                 =======  =======
    Income taxes paid, net                                       $   16   $   12
                                                                 =======  =======
</TABLE>

    The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                        3
<PAGE>
                     INSIGHTFUL CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                 MARCH 31, 2003

(1)    DESCRIPTION  OF  BUSINESS

     Insightful  Corporation and subsidiaries provides enterprises with scalable
data  analysis  solutions  that  drive  better  decisions  faster  by  revealing
patterns,  trends  and  relationships.  The  company  is  a  leading supplier of
software and services for statistical data mining, business analytics, knowledge
management, and information retrieval enabling clients to gain intelligence from
numerical  data,  text  and  images

     Insightful's  products  include  InFact(R),  Insightful  Miner,  S-PLUS(R),
StatServer(R), and S-PLUS Analytic Server(R).   Insightful's consulting services
provide  specialized  expertise and proven processes for the design, development
and  deployment  of  *analytical  solutions.

     Insightful has been delivering data analysis solutions for fifteen years to
companies  in  financial  services,  pharmaceuticals,  biotechnology,
telecommunications  and  manufacturing,  as  well  as  government  and  research
institutions.

     Headquartered in Seattle, Washington, Insightful has North American offices
in  New  York  City  and  North Carolina. Insightful's international offices are
located  in  France,  Germany,  Switzerland,  and  the  United  Kingdom,  with
distributors  around  the  world.

(2)    SIGNIFICANT  ACCOUNTING  POLICIES

(a)    UNAUDITED  INTERIM  FINANCIAL  INFORMATION

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared  by  Insightful  Corporation  (or the "Company") pursuant to accounting
principles generally accepted in the United States and the rules and regulations
of the Securities and Exchange Commission regarding interim financial reporting.
Accordingly,  they  do not include all of the information and footnotes required
by  generally  accepted accounting principles for complete financial statements.
The  balance  sheet at December 31, 2002 has been derived from audited financial
statements  at  that  date,  but  does  not  include all disclosures required by
generally  accepted  accounting  principles  for  complete financial statements.
These  condensed  financial  statements  should  be read in conjunction with the
consolidated  financial statements and notes thereto for the year ended December
31, 2002 included in the Company's Annual Report on Form 10-K.  The accompanying
consolidated  financial statements reflect all adjustments (consisting solely of
normal,  recurring  adjustments),  which,  in  the  opinion  of  management, are
necessary  for a fair presentation of results for the interim periods presented.
The  results  of  operations for the three-month period ended March 31, 2003 are
not  necessarily  indicative of the results to be expected for the entire fiscal
year  or  future  years.

(b)    PRINCIPLES  OF  CONSOLIDATION

     The  accompanying consolidated financial statements include the accounts of
Insightful  and  its  wholly  owned  subsidiaries. All intercompany accounts and
transactions  have  been  eliminated  in  consolidation.

(c)    REVENUE  RECOGNITION

     Insightful  offers  a variety of scalable data analysis software solutions,
maintenance  contracts,  training  and  consulting  services  to  its customers.
Insightful  records  revenue  in accordance with Statement of Position (SOP) No.
97-2, Software Revenue Recognition, as amended by SOP No. 98-9, Software Revenue
Recognition,  with  Respect  to Certain Transactions and related interpretations
including  Technical  Practice  Aids.  License  revenue  consists principally of
revenue  earned  under  perpetual  software  license agreements and is generally
recognized  upon  shipment of the software, after execution of a non-cancellable
signed  license  agreement  or  receipt  of  a  definitive  purchase order (when
appropriate),  if collection of the resulting receivable is probable, the fee is
fixed  or  determinable,  and  vendor-specific objective evidence exists for all
undelivered  elements.  Revenues  under  such  arrangements,  which  may include
several  different  software  products and services sold together, are allocated
based on the residual method in accordance with SOP No. 98-9. Under the residual
method,  the  fair  value of the undelivered non-essential  elements is deferred
and  subsequently  recognized  when  earned.  Insightful  has  established
vendor-specific  objective evidence ("VSOE") for professional services, training
and  support  services.  In  addition,  we have established VSOE for maintenance
related  to  most  of  our  products. VSOE is based on the price charged when an
element  is  sold  separately or, in case of an element not yet sold separately,
the  price  established  by  authorized  management,  if it is probable that the

                                        4
<PAGE>
price,  once  established,  will  not change before market introduction. Revenue
from  fixed-term licenses sold with maintenance is recognized on a straight-line
basis  over  the  license  term  if all other aspects of SOP 97-2 are satisfied.
Standard terms for license agreements typically call for payment within 30 days.
Probability  of  collection  is  based  upon  the  assessment  of the customer's
financial  condition  through  review  of  their current financial statements or
credit  reports.  For  existing customers, prior payment history is also used to
evaluate probability of collection. Insightful provides for estimated returns at
the  time  of  sale  under  an  unconditional  30  day  return  policy.

     Maintenance  revenue  is  recognized  ratably  over the term of the related
contracts  generally  for one year or less. We require our customers to purchase
one-year  maintenance contracts on most of our products. Maintenance fees, which
include unspecified product upgrades on a when-and-if available basis, are based
on  a  percentage of the current list price of the licensed software products as
determined  by  the  price  the  customer  would  pay  for  maintenance renewal.
Maintenance  renewals  are  optional.

     Consulting  revenues  include  deployment  assistance,  project management,
integration  with  existing customer applications and related services performed
on a time-and-materials basis under separate service arrangements. Revenues from
consulting  and  training  services  are  recognized  as services are performed.
Standard  terms  for  renewal of customer support contracts, consulting services
and  training  call  for  payment  within  30  days.

     Fees  from  licenses sold together with consulting are generally recognized
upon shipment of the software, provided that the above criteria are met, payment
of  the license fees are not dependent upon the performance of the services, and
the  consulting  services are not essential to the functionality of the licensed
software. If the services are essential to the functionality of the software, or
payment  of  the license fees is dependent upon the performance of the services,
both  the  software  license  and  consulting  fees  are  recognized  under  the
percentage of completion method of contract accounting. If a software product is
sold  with  other  elements, including maintenance, and VSOE for the maintenance
element  has  not  been  established,  all  revenue  under  the  arrangement  is
recognized  over  the  maintenance  term  provided all other revenue recognition
criteria have been met. All sales made through indirect channels including value
added  resellers,  or  VARs,  and  distributors  are  accounted  for  using  the
sell-through  method.

     If  the fee is not fixed or determinable, revenue is recognized as payments
become  due from the customer. If an acceptance period is required, revenues are
recognized  upon  the  earlier  of  customer acceptance or the expiration of the
acceptance  period.

     Amounts  received  in  advance  for  maintenance agreements are recorded as
deferred  revenue  on  the  accompanying  consolidated  balance  sheets.

(d)    RECLASSIFICATION  OF  AMOUNTS

     Certain prior year amounts have been reclassified to conform to the current
year  presentation.  Specifically,  amortization  of  deferred  stock-based
compensation  expense,  which was disclosed as a separate line item in the first
quarter  2002  Form 10-Q, was reclassified to the appropriate functional expense
line  items  in  the  accompanying  consolidated  statements  of  operations.

(3)    GOODWILL  AND  OTHER  INTANGIBLES

     Goodwill  is not amortized to earnings but is reviewed for impairment on an
annual  basis  or on an interim basis if circumstances change or if events occur
that  reduce  the  fair  value  of  a  reporting  unit below its carrying value.
Insightful  determines  fair  value using the market value method or the present
value  method  of  measurement  of  future  cash  flows.  In  assessing  the
recoverability  of  goodwill  and  other intangible assets, Insightful must make
assumptions regarding estimated future cash flows and other factors to determine
the  fair  value  of  the  respective assets. Insightful's future cash flows are
based  on current volume and pricing levels with anticipated rates of growth and
change.  If  our estimated future cash flow or their related assumptions were to
change,  the  company  would  be required to record impairment charges for these
assets  for  which the carrying value is not supported by the future cash flows.
Separable  intangible  assets that do not have indefinite lives will continue to
be  amortized  over  their  useful  lives.

     In the fourth quarter of 2002, we recorded an impairment of goodwill charge
associated  with  our  acquisition  of  Predict AG. We will continue to evaluate
goodwill  for  impairment  and,  should  an  impairment  be  indicated,  the
corresponding  charge  will  be  taken  in  that  period.

(4)    FINANCING  ARRANGEMENTS

     In  March 2003, Insightful renewed a $3.5 million working capital revolving
line  of  credit  and  security agreement with Silicon Valley Bank (SVB) that is
secured  by Insightful's accounts receivable. This facility allows Insightful to
borrow up to the lesser of (a) 75% of its eligible accounts receivable (advances
against  US  Government  accounts  will  be  permitted  up  to 20% of the amount
outstanding  under the line of credit) or (b) $3.5 million and bears interest at
the  prime  rate,  which  was  4.25% as of March 31, 2003, plus 1%. At March 31,
2003,  no  amounts  had  been  borrowed  and $1,138,000 was available for future
borrowings  under  the  line  of  credit  facility.

                                        5
<PAGE>
     In  March 2003, Insightful also renewed an equipment term loan and security
agreement  with  SVB,  which  provides  an  additional  $750,000  to finance the
purchase  of  equipment  and  fixtures.  This facility allows Insightful to take
advances  on the cost of eligible equipment less than 90 days old and is secured
by  the  underlying  equipment.  The  advances  may  be  made in two tranches of
$375,000 each, which expire September 27, 2003 and March 27, 2004, respectively,
and  bear  interest  at  the  prime  rate  (4.25% as of March 31, 2003) plus 1%.
Interest only is due until the expiration of each tranche period, at which point
monthly  payments  of  principal and interest begin.  Advances are repaid over a
42-month  period  and  a  36-month  period,  for  the  first and second tranche,
respectively.  In  2002,  borrowings  under  this  equipment  term  loan totaled
$450,000  and  the  outstanding balance at March 31, 2003 was $385,000. At March
31,  2003  $750,000  was  available  under  this  facility  for future equipment
borrowings.

      The  line  of  credit  and equipment term loan agreements with SVB require
Insightful to maintain certain financial covenants. Insightful was in compliance
with  these  covenants  at  March  31,  2003.

     The  following  are  repayments  associated  with  our equipment term loan:

<TABLE>
<CAPTION>
           NINE MONTHS
             ENDING
            DECEMBER
               31,         YEAR ENDING DECEMBER 31,
            ---------  ---------------------------------
               2003      2004      2005      2006   2007  THEREAFTER   TOTAL
            ---------  --------  --------  -------  ----  ----------  --------
<S>        <C>         <C>       <C>       <C>      <C>   <C>         <C>
Equipment
term loan  $ 96,000   $129,000   $129,000  $31,000     -           -  $385,000
</TABLE>

(5)    NET  LOSS  PER  SHARE

     Basic net loss per share is calculated using the weighted-average number of
shares  of  common  stock  outstanding. Stock issued subject to restrictions are
excluded  from the calculation. Diluted net loss per share reflects the dilutive
effect  of  common  stock  equivalents  (including  stock options and warrants),
unless  their  effect  on  earnings  per  share  from  continuing  operations is
anti-dilutive.

(6)    OTHER  COMPREHENSIVE  LOSS

     SFAS  No.  130,  Reporting  Comprehensive Income, establishes standards for
reporting  and  display  of  comprehensive  income  and  its  components  in the
financial  statements.  The  only  item  of  other comprehensive loss, which the
Company  currently  reports,  is  foreign  translation  adjustments.  Total
comprehensive  loss  is  as  follows:

<TABLE>
<CAPTION>
                                                THREE MONTHS ENDED
                                                     MARCH 31,
                                             ----------------------
                                                2003        2002
                                             ----------  ----------
<S>                                          <C>         <C>
Net loss                                     $(355,000)   (216,000)
Change in cumulative translation adjustment     34,000     (48,000)
                                             ----------  ----------

Comprehensive loss                           $(321,000)  $(264,000)
                                             ==========  ==========
</TABLE>

(7)    SEGMENT  REPORTING

     SFAS  131,  "Disclosures  About  Segments  of  an  Enterprise  and  Related
Information,"  establishes  standards  for reporting information about operating
segments  in  annual  financial  statements.  It  also establishes standards for
related  disclosures  about  products,  services,  geographical  areas and major
customers. Insightful currently operates in a single business segment related to
statistical analysis, data mining and knowledge access software and services. No
additional  disclosure  is  required.

(8)    STOCK-BASED  COMPENSATION

    A reconciliation of net loss as reported to pro-forma net loss that includes
stock-based  employee  compensation  cost  as  if the fair value method had been
applied  to  all  option  awards  is  as  follows:

                                        6
<PAGE>
<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED MARCH 31,
                                                              2003           2002
                                                           ----------  ----------------
<S>                                                        <C>         <C>
Net loss as reported                                       $(355,000)  $      (216,000)
Add: Stock-based compensation as reported                  $(131,000)  $        44,000
Deduct: Stock-based compensation determined under FAS 123  $(205,811)  $      (508,000)
                                                           ----------  ----------------
Pro forma net loss                                         $(691,811)  $      (680,000)
                                                           ==========  ================
Basic and diluted net loss per share as reported           $   (0.03)  $         (0.02)
                                                           ==========  ================
Pro forma basic and diluted net loss per share             $   (0.06)  $         (0.06)
                                                           ==========  ================
</TABLE>

In  the  first  quarter of 2003, $139,000 in deferred stock compensation expense
previously  recognized  was  reversed  as  a  result of the return of restricted
shares  issued  in  the  acquisition  of  Predict  AG.

(9)    ACQUISITIONS

     On January 1, 2002, Insightful completed the acquisition of a data analysis
software  business  from  Graphische  Systeme  GmbH  (GraS), Insightful's former
German  distributor. The acquisition provides Insightful with an expanded direct
sales  channel  in  Germany.  Consideration  for  the  acquisition  was  cash of
$157,000.  This  transaction  was  accounted  for  as  an  asset  purchase.

     The  results  of  GraS  have  been  included  in  the  operating results of
Insightful  since  it's  acquisition  date.

(10)    COMMITMENTS  AND  CONTINGENCIES

     On or about December 13, 2002, Wajih Alaiyan, a former Insightful employee,
filed  a  complaint  against  the Company in the Superior Court for King County,
Washington.  Mr.  Alaiyan alleges that his employment was wrongfully terminated,
and he seeks an unspecified amount of damages.  The Company denies Mr. Alaiyan's
claim  and  will vigorously defend the lawsuit.  An evaluation of the likelihood
of  an  adverse  outcome  cannot  be expressed with sufficient certainty at this
time.  An  unfavorable  outcome  could  have  a material effect on our operating
position,  results  of  operations,  and  cash  flows.

     On  April  24,  2003,  an  employee  of  the  company  was  involved  in  a
multi-vehicle,  multiple  injury automobile accident while traveling on business
in  Virginia.  Our  automobile  liability  insurance  carrier is handling claims
associated  with  the  incident.  We  are not able to offer an evaluation of the
likelihood  of  an  adverse  outcome  that  would result in liability beyond the
limits  of  our  insurance  policy  wuth  any  certainty  at  this  time.

                                        7
<PAGE>
ITEM  2.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
             RESULTS  OF  OPERATIONS

FORWARD-LOOKING  STATEMENTS

     Our  disclosure  and  analysis  in  this  report  contain  forward-looking
statements,  which  provide  our  current  expectations  or  forecasts of future
events.  Forward-looking  statements in this report include, without limitation:

     -     information concerning possible or assumed future results of
           operations, trends in financial results and business plans,
           including those relating to earnings growth and revenue growth;

     -     statements about the level of our costs and operating expenses
           relative to our revenues, and about the expected composition of our
           revenues;

     -     statements about expected future sales trends for our products;

     -     statements about our future capital requirements and the sufficiency
           of our cash, cash equivalents, investments and available bank
           borrowings to meet these requirements;

     -     information about the anticipated release dates of new products;

     -     other statements about our plans, objectives, expectations and
           intentions; and

     -     other statements that are not historical facts.

     Words  such  as  "believes,"  "anticipates"  and  "intends"  may  identify
forward-looking  statements, but the absence of these words does not necessarily
mean  that  a  statement  is not forward-looking. Forward-looking statements are
subject  to  known  and  unknown  risks  and  uncertainties  and  are  based  on
potentially  inaccurate  assumptions  that  could cause actual results to differ
materially from those expected or implied by the forward-looking statements. Our
actual  results  could  differ  materially  from  those  anticipated  in  the
forward-looking  statements for many reasons, including the factors described in
the  section  entitled  Important  Factors  That  May  Affect  Our Business, Our
Operating  Results  and  Our  Stock  Price in this report. Other factors besides
those  described  in  this  report  could also affect actual results. You should
carefully  consider  the  factors  described  in  the section entitled Important
Factors  That May Affect Our Business, Our Operating Results and Our Stock Price
in  evaluating  our  forward-looking  statements.

     You should not unduly rely on these forward-looking statements, which speak
only  as  of  the  date  of  this report. We undertake no obligation to publicly
revise  any  forward-looking  statement to reflect circumstances or events after
the  date  of this report, or to reflect the occurrence of unanticipated events.
You  should, however, review the factors and risks we describe in the reports we
file  from  time  to  time  with the Securities and Exchange Commission, or SEC.

DESCRIPTION  OF  THE  COMPANY

     We  provide  enterprises  with  scalable data analysis solutions that drive
better decisions faster by revealing patterns, trends and relationships.  We are
a  leading  supplier  of  software  and  services for statistical analysis, data
mining and knowledge access enabling clients to gain intelligence from numerical
data,  text,  and  images.

     Our products include InFact(R), Insightful Miner, S-PLUS(R), StatServer(R),
and  S-PLUS  Analytic  Server(R).   Our  consulting services provide specialized
expertise  and  proven  processes  for the design, development and deployment of
analytical  solutions.

     We  have  been  delivering  data  analysis  solutions  for fifteen years to
companies  in  financial  services,  pharmaceuticals,  biotechnology,
telecommunications  and  manufacturing  as  well  as  government  and  research
institutions.

     Headquartered in Seattle, Washington, Insightful has North American offices
in New York and North Carolina. Our international offices are located in France,
Germany,  Switzerland,  and  the  United  Kingdom,  with distributors around the
world.

HISTORY  OF  OPERATIONS

     We  were originally incorporated in Massachusetts in October 1984 under the
name  Engineering  Specific Products Corp. We changed our name to MathSoft, Inc.
in  January  1986.

     As  of December 31, 1999 we operated three divisions consisting of our Data
Analysis  Products  Division (DAPD), Engineering and Education Products Division
(EEPD),  and  FreeScholarships.com  (FSC).  In  September  2000, we discontinued
operations  of  our  Internet  business,  FSC.  We  sold  the  operations of our
technical  calculation  software business, EEPD, to a third party on January 23,
2001.  Following  the  closing  of  FSC  and  the sale of EEPD, we relocated our
headquarters  from Boston, Massachusetts, to Seattle, Washington, where DAPD was
located.

                                        8
<PAGE>
     In  June  2001,  our  stockholders  voted  to  change our company name from
MathSoft,  Inc.  to  Insightful  Corporation  and  to change the jurisdiction of
incorporation  from  Massachusetts  to  Delaware.

CRITICAL  ACCOUNTING  POLICIES  AND  ESTIMATES

     We  have  based  our discussion and analysis of our financial condition and
results  of  operations  upon  our consolidated financial statements, which have
been prepared in accordance with accounting principles generally accepted in the
United States. The preparation of these financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues  and  expenses,  and  related  disclosure  of  contingent  assets  and
liabilities.  On an on-going basis, we evaluate our critical accounting policies
and  estimates,  including  those  related  to  revenue  recognition, bad debts,
intangible  assets, restructuring, and contingencies and litigation. We base our
estimates  on  historical  experience  and  on various other assumptions that we
believe  to be reasonable under the circumstances, the results of which form the
basis  for  making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these  estimates  under  different  assumptions  or  conditions.  We believe the
following critical accounting policies affect the more significant judgments and
estimates  used  in  the  preparation  of our consolidated financial statements.

Revenue  Recognition

     Revenue recognition rules for software companies are complex and subject to
constant  refinement.  We  follow  specific and detailed guidelines in measuring
revenue;  however,  certain  judgments  affect  the  application  of our revenue
policy.  Revenue  results are difficult to predict, and any shortfall in revenue
or  delay  in  recognizing  revenue  could  cause  our operating results to vary
significantly  from  quarter  to  quarter  and  could result in future operating
losses.

     We  record  revenue  in  accordance with Statement of Position, or SOP, No.
97-2,  Software  Revenue  Recognition,  as amended by SOP 98-9, Software Revenue
Recognition,  with  Respect to Certain Transactions, and related interpretations
including  Technical  Practice  Aids.  License  revenue  consists principally of
revenue  earned  under  perpetual  software  license agreements and is generally
recognized  upon  shipment  of  the  software  if  collection  of  the resulting
receivable  is  probable, the fee is fixed or determinable, undelivered elements
are  not deemed essential, and vendor-specific objective evidence exists for all
undelivered  elements.  Revenues  under  such  arrangements,  which  may include
several  different  software  products and services sold together, are allocated
based  on  the  residual  method in accordance with SOP 98-9. Under the residual
method,  the fair value of the undelivered elements is deferred and subsequently
recognized  when  earned. We have established vendor-specific objective evidence
for  professional  services,  training  and  maintenance  and  support services.
Vendor-specific objective evidence is based on the price charged when an element
is  sold separately or, in case of an element not yet sold separately, the price
established  by  authorized  management,  if it is probable that the price, once
established,  will  not  change  before  market  introduction. In the event that
vendor-specific  objective  evidence may not be established for maintenance, and
maintenance  is  the  only remaining element of an arrangement, then all revenue
associated  with  the arrangement is recognized ratably starting the month after
installation  or  acceptance,  whichever  occurs  later,  to  the  end  of  the
maintenance  period.  Revenue  from fixed-term licenses sold with maintenance is
recognized  on  a straight-line basis over the license term if all other aspects
of  SOP  97-2  are  satisfied.  Standard  terms  for license agreements call for
payment  within  30 days. Probability of collection is based upon the assessment
of  the  customer's  financial  condition  through  the  review of their current
financial  statements  or  credit reports. For existing customers, prior payment
history  is  also  used  to  evaluate  probability of collection. We provide for
estimated  returns  at  the  time  of  sale.

     We offer maintenance contracts, training and consulting services on certain
of  our products. Maintenance revenue is recognized ratably over the term of the
related  contracts  generally  for  one  year  or  less. Consulting revenues are
primarily  related  to implementation services performed on a time-and-materials
basis under separate service arrangements. Revenues from consulting and training
services are recognized as services are performed. Standard terms for renewal of
customer  support  contracts,  consulting services and training call for payment
within  30  days.

     Fees  from  licenses sold together with consulting are generally recognized
upon shipment of the software, provided that the above criteria are met, payment
of  the license fees are not dependent upon the performance of the services, and
the  consulting  services are not essential to the functionality of the licensed
software. If the services are essential to the functionality of the software, or
payment  of the license fees are dependent upon the performance of the services,
both  the  software  license  and  consulting  fees  are  recognized  under  the
percentage  of  completion method of contract accounting. All sales made through
indirect channels including value added resellers, or VARs, and distributors are
accounted  for  using  the  sell  through  method.

     If  the fee is not fixed or determinable, revenue is recognized as payments
become  due from the customer. If an acceptance period is required, revenues are
recognized  upon  the  earlier  of  customer acceptance or the expiration of the
acceptance  period.

     Amounts  received  in  advance  for  maintenance agreements are recorded as
deferred  revenue  on  the  balance  sheets.

Sales Returns

     We provide an estimated returns and allowances reserve for return rights at
the  time  of  sale. We offer our customers a 30-day return policy on all of our
products.  Refunds  are  provided to customers upon return to us of the complete
product  package,  including  all original materials, CD-ROM or other media. Our
provision  for sales returns is estimated based on historical returns experience
and  our  judgment  of  future return  risk.


                                        9
<PAGE>
Bad  Debts

     We  are required to estimate the collectibility of our trade receivables. A
considerable  amount  of  judgment  is  required  when  we  assess  the ultimate
realization  of  receivables  including  assessing  the aging of the amounts and
reviewing  the  current  credit-worthiness  of  each  customer.  Customer credit
worthiness  is  subject  to many business and finance risks facing each customer
and  is  subject  to  sudden  changes.

     Impairment  of  Goodwill  and  Other  Long  Lived  Assets

     We  periodically  evaluate  acquired  businesses  for  potential impairment
indicators.  Our  judgments regarding the existence of impairment indicators are
based  on  legal  factors,  market conditions and operational performance of our
acquired  businesses.  Future  events could cause us to conclude that impairment
indicators  exist  and  that  goodwill  associated with our acquired business is
impaired.

     Goodwill represents the excess of the purchase price over the fair value of
net  tangible  assets  acquired.  Before  2002,  we amortized goodwill and other
intangibles  on a straight-line basis over lives ranging from two to five years.
With  required adoption of SFAS No. 142, "Goodwill and Other Intangible Assets,"
beginning  January 1, 2002, we no longer amortize goodwill and other intangibles
with  indefinite  lives  to  earnings.  Instead  goodwill  will  be reviewed for
impairment  on an annual basis or on an interim basis if circumstances change or
if  events  occur  that  reduce  the  fair  value  of a reporting unit below its
carrying  value.  Impairment losses will be charged to earnings in the period in
which  they  are  identified.  Separable  intangible  assets  that  do  not have
indefinite  lives  will  continue  to  be  amortized  over  their  useful lives.

     In the fourth quarter of 2002, we recorded an impairment of goodwill charge
associated  with  our  acquisition  of  Predict AG. We will continue to evaluate
goodwill  for  impairment  and,  should  an  impairment  be  indicated,  the
corresponding  charge  will  be  taken  in  that  period.

Contingencies

     We are engaged in legal actions arising in the ordinary course of business.
We are required to assess the likelihood of any adverse judgments or outcomes to
these matters as well as potential ranges of possible losses. A determination of
the  amount of reserves required, if any, for these contingencies are made after
careful  analysis  of each individual matter. The required reserves, if any, may
change  in  the  future  due  to  new  developments in each matter or changes in
approach,  such  as  a  change  in  settlement strategy for a particular matter.

RESULTS  OF  OPERATIONS  FOR  THE  THREE  MONTHS  ENDED  MARCH 31, 2003 AND 2002

REVENUES

     Total  revenues,  which  consist  of  software  license,  subscription,
maintenance  and  service  revenues,  were $4,296,000 for the three months ended
March  31,  2003,  and  $4,391,000  for  the  three months ended March 31, 2002,
representing  a  decrease  of  $95,000,  or  2%  between  these  periods.

     Software  licenses  accounted  for  42% of total revenues and increased 15%
from  $1,559,000 for the three months ended March 31, 2002 to $1,790,000 for the
three  months  ended  March 31, 2003. This increase is primarily attributable to
revenues  recognized from the amortization of revenue attributable to the InFact
product.

      Maintenance revenues accounted for 39% of total revenues and increased 25%
from  $1,327,000 for the three months ended March 31, 2002 to $1,663,000 for the
three  months  ended  March 31, 2003. This increase is primarily attributable to
increased  renewals  of  maintenance  agreements.

     Professional  services  revenues  generated  from  consulting  and training
activities  represented  20% of total revenues and decreased 44% from $1,505,000
for the three months ended March 31, 2002 to $843,000 for the three months ended
March  31,  2003. We expect professional services revenues to fluctuate based on
sales  of  our  products,  as  well  as demand associated with implementation of
future  product  sales,  upgrades,  enhancements  of  our  products and training
services.

     Revenues from international operations were $1,336,000 for the three months
ended  March 31, 2003, and $1,377,000 for the three months ended March 31, 2002.
This  represents  a decrease of $41,000, or 3%, for the three months ended March
31,  2003  over  the three months ended March 31, 2002.   This decrease resulted
primarily from reduced professional services revenues from our Swiss operations.

                                       10
<PAGE>
COST  OF  REVENUES

     Total cost of revenues were $1,225,000 for the three months ended March 31,
2003,  and  $1,507,000 for the three months ended March 31, 2002, representing a
decrease  of  $282,000, or 19% between these periods. The decrease in total cost
of  revenues  for the three-month period ended March 31, 2003 resulted primarily
from  actions  taken  by  management  in  July  2002 to reduce Insightful's cost
structure.

     Software-related  costs,  which  consists  of  royalties  for  third-party
software,  product  media,  product  duplication, manuals and maintenance costs,
remained  consistent  as  a percentage of total software related revenues at 15%
for  the three months ended March 31, 2003 and 2002. We are a worldwide licensee
of the "S" programming language from Lucent Technologies Inc. Under the license,
we have the right to use, sublicense and support the "S" programming language in
exchange  for royalties, which are included in the cost of software licenses. We
expect that the cost of software licenses will continue to fluctuate modestly in
relation  to  changes  in  the  overall  demand  for  our  license  products.

     The  cost  of  professional  services  includes primarily the salaries, and
other  operating  costs of employees who provide consulting services and product
training.  The  cost  of professional services was $710,000 for the three months
ended  March  31,  2003,  representing  a  decrease  of  350,000,  or  33%, from
$1,060,000 for the three months ended March 31, 2002.   The decrease in the cost
of  professional  services  for  the three-month period ended March 31, 2003 and
2002  is primarily due to workforce reductions implemented in July 2002 to lower
Insightful's  cost  structure.  We  expect  the cost of professional services to
remain  at  a  level  consistent  with the results reported for the three months
ended  March  31,  2003,  but decrease as a percentage of related revenue if and
when utilization of our existing resources and demand for our services improves.

OPERATING  EXPENSES

     Sales  and  marketing  expenses  consist  primarily  of  salaries,  travel,
facility  costs  for  sales and marketing personnel, promotional activities, and
costs  of  advertising  and  trade  shows.  Sales  and  marketing  expenses were
$1,805,000  for  the three month period ended March 31, 2003, and $1,742,000 for
the  period  ended  March  31,  2002, representing an increase of $63,000, or 4%
between  these  periods.  This  increase primarily reflected increased marketing
expense  to  better  support  our  sales activities worldwide and were partially
offset  by  the  reversal  of  $139,000  in  deferred stock compensation expense
previously  recognized. The reversal of stock compensation expense resulted from
the  return  of  restricted  shares  issued in the acquisition of Predict AG. We
expect  future  sales  and marketing expense increases for the remainder of 2003
due  to  increased  head  count  and  the  one  time  reversal of deferred stock
compensation expense in the first quarter of 2003.  However, we expect sales and
marketing  expenses  to  decrease as a percentage of software revenues if demand
for  our  products  improves.

     Net  research  and  development expenses decreased 8% from $772,000 for the
three  months  ended March 31, 2002 to $710,000 for the three months ended March
31,  2003,  and decreased as a percentage of total revenues from 18% to 17% over
the  same  period.  Net  research  and development expenses consist primarily of
salaries  and  related  benefits,  equipment  for  software developers, facility
costs, and payments to outside contractors, less funded research. Gross research
and  development  expenses  decreased  17%  from $2,026,000 for the three months
ended  March  31,  2002 to $1,682,000 for the three months ended March 31, 2003.
This decrease was primarily attributable to the workforce reductions implemented
in July 2002. Funded research, which consists primarily of government grants for
research  projects,  decreased  22%  from  $1,254,000 for the three months ended
March  31,  2002  to  $972,000  for  the three months ended March 31, 2003.  The
decrease  in funded research for the three-month period ended March 31, 2003, is
primarily  due  to a decrease in research activity due to cost-savings measures.
We expect our gross research and development expenses and our funded research to
continue  to  fluctuate  based  on  contract  awards.

     General  and  administrative  expenses, which consist primarily of salaries
and  related  costs  associated  with  finance,  accounting, investor relations,
administration  and  facilities  activities, increased 36% from $581,000 for the
three  months  ended March 31, 2002 to $790,000 for the three months ended March
31,  2003.  The  increase  is primarily due to increases in insurance, legal and
audit  expenses  as  well as general and administrative expenses associated with
the  increasing  costs  of being a public company. We expect future increases in
general  and  administrative  expenses  relating  to  continuing  increases  in
insurance,  legal,  compliance  and  audit  expenses.

     Amortization  of  other  intangibles  increased  from $45,000 for the three
months  ended  March  31,  2002  to $60,000 for the three months ended March 31,
2003.  This  increase  in amortization expense is attributable to an increase in
capitalized  patent  costs.

     Insightful  amortizes  deferred  stock-based  compensation  recorded  in
connection  with  the issuance of restricted stock as part of the acquisition of
Predict  AG  in the third quarter of 2001. The value of the restricted shares is
being  amortized  over  a  three-year  vesting  period  using  a  graded vesting
approach.  In  the  first quarter of 2003, our European General Manager resigned
prior  to  the expiration of the restriction on his shares.  Consequently, these
shares  were  returned  to  us  and  related  stock-based  compensation  expense
recognized  in  previous  periods was reversed resulting in a reduction in sales
and  marketing  expense  of  $139,000 for the three months ended March 31, 2003.
Stock  compensation  expense  was  $44,000 for the quarter ended March 31, 2002,
including  $28,000  classified  as sales and marketing and $16,000 classified as
professional  services  costs  or  research  and  development  expense.

                                       11
<PAGE>
NET  OPERATING  RESULTS

     The  net loss from operations for the three months ended March 31, 2003 was
$294,000  compared  to  an operating loss of $256,000 for the three months ended
March  31,  2002.  The  first  quarter 2003 net operating loss reflects slightly
lower  revenues  and  higher  sales and marketing and general and administrative
expenses  offset  by improved gross profit resulting from a higher percentage of
software-related  revenues.

INTEREST  AND  OTHER  INCOME

     Total  interest  and  other  income  was $15,000 for the three months ended
March  31,  2003,  and  $55,000  for  the  three  months  ended  March 31, 2002,
representing  a  decrease of $40,000 or 73%.  The decrease in interest and other
income  was  primarily due to a decrease in cash and cash equivalents upon which
we  earn  interest  as  well  as  a  decrease  in the prevailing interest rates.

INCOME  TAX  PROVISION

     The increase in the tax provision from $12,000 in the first quarter of 2002
to  $71,000  in  the  first  quarter  of  2003  was  primarily due to income tax
obligations  generated  in  the  Company's  European  operations.

LIQUIDITY  AND  CAPITAL  RESOURCES

     Cash  and cash equivalents decreased from $6.8 million at December 31, 2002
to  $6.0  million  at  March 31, 2003. Operating activities resulted in net cash
outflows  of  $731,000 for the first quarter of 2003 as compared to $770,000 for
the  first  quarter  of  2002.  Operating  cash  outflows  for both periods were
primarily  the result of a net loss and a large increase in prepaid expenses due
to  a  royalty  payment  of  $450,000  made  annually.

     Investing  activities  resulted  in  cash outflows of $73,000 for the first
quarter  of  2003  and $296,000 for the first quarter of 2002. The first quarter
2003 cash outflow was primarily due to capital expenditures of $64,000 while the
first quarter 2002 cash outflow was primarily the result of capital expenditures
and  acquisition-related  transaction  costs.

     Financing  activities  resulted  in  cash outflows of $36,000 for the first
quarter  of  2003  and  a  cash  inflow of $770,000 in the comparable prior year
quarter.  The  first  quarter  2003  cash  outflow  was  primarily the result of
principal  payments  on equipment financings. The cash inflows in the comparable
prior  year  quarter  resulted  from  payment  received  from  a  director  on
subscriptions  receivable,  proceeds  from  stock  option  exercises  and  stock
purchases  under  an  employee  stock purchase plan, and proceeds from equipment
financings.

     In  March 2003, Insightful renewed a $3.5 million working capital revolving
line  of credit and security agreement with Silicon Valley Bank, or SVB, that is
secured  by Insightful's accounts receivable. This facility allows Insightful to
borrow  up  to  the  lesser  of  (a)  75% of its eligible accounts receivable as
determined  by  SVB's  accounts receivable audit (advances against US Government
accounts will be permitted up to 20% of the amount outstanding under the line of
credit)  or  (b)  $3.5  million  and bears interest at the prime rate, which was
4.25% as of March 31, 2003, plus 1%. At March 31, 2003, $1,138,000 was available
for  future  borrowings  under  the  line  of  credit  facility.

     In  March 2003, Insightful also renewed an equipment term loan and security
agreement  with  SVB,  which  provides  an  additional  $750,000  to finance the
purchase  of  equipment  and  fixtures.  This facility allows Insightful to take
advances  on  the  cost  of  eligible  equipment  less  than 90 days old and the
advances  bear interest at the prime rate, which was 4.25% as of March 31, 2003,
plus 1%. At March 31, 2003, $750,000 was available under the equipment term loan
for  future  borrowings.

     These  credit  facilities contain covenants that restrict the amount of net
loss  we  can  incur  in any quarter. These credit facilities may be utilized to
finance  future  capital  investments, including technology necessary to support
our  new  product  lines and expand Insightful's liquid resources and ability to
maintain  an  adequate  balance  of  cash-on-hand.

     At  March  31,  2003,  Insightful's  principal  unused sources of liquidity
consisted  of  cash and cash equivalents of $6.0 million. Insightful's liquidity
needs  are  principally  for  financing  of accounts receivable, capital assets,
strategic  investments,  product  development,  and flexibility in a dynamic and
competitive  operating  environment.

     The following are our contractual commitments associated with our operating
and  equipment  financings:

                                       12
<PAGE>
<TABLE>
<CAPTION>
                     NINE MONTHS ENDING
                          DECEMBER 31,           YEAR ENDING DECEMBER 31,
                     ------------------  ----------------------------------------
                             2003            2004       2005      2006      2007    THEREAFTER    TOTAL
                     ------------------  ----------  --------  --------  --------  ----------  ----------
<S>                  <C>                 <C>         <C>       <C>       <C>       <C>        <C>
Commitments:
Equipment financings $           96,000  $  129,000  $129,000  $ 31,000  $      -  $        -  $  385,000
Operating leases                689,000     910,000   164,000   107,000   107,000      40,000   2,037,000
                     ------------------  ----------  --------  --------  --------  ----------  ----------
  Total commitments  $          785,000  $1,039,000  $293,000  $158,000  $107,000  $   40,000  $2,422,000
                     ------------------  ----------  --------  --------  --------  ----------  ----------
</TABLE>

     As  of  March  31,  2003  we  had  net  operating  loss  carryforwards  of
approximately  $22  million and research and development credit carryforwards of
approximately  $3  million. The net operating loss and credit carryforwards will
expire  at  various dates through 2021, if not used. Under the provisions of the
Internal Revenue Code, substantial changes in our ownership may limit the amount
of  net  operating  loss  carryforwards  that  could be utilized annually in the
future to offset taxable income. A full valuation allowance has been established
in  our  financial  statements  to reflect the uncertainty of our ability to use
available  tax  loss  carryforwards  and  other  deferred  tax  assets.

     We  believe  that  our  existing cash and cash equivalents, investments and
available  bank  borrowings  will be sufficient to meet our capital requirements
for  at  least  the  next  12 months. However, if during that time, we choose to
increase  our  investment  in  current or new product and marketing initiatives,
market  conditions  worsen, or if other unforeseen events should occur, we would
likely  deem  it  necessary  to  seek additional funds through public or private
equity  financing  or  from  other  sources  in order to fund our operations and
pursue  our  growth strategy. Any financing we obtain may contain covenants that
restrict  our  freedom  to  operate  our  business  or  may  require us to issue
securities  that  have  rights,  preferences  or privileges senior to our common
stock  and  may  dilute  stockholder  ownership  interest  in  Insightful.

BUSINESS  OUTLOOK

     We  provide  our customers with useful and innovative software and services
to  derive intelligence from the data they collect. Today, organizations collect
far  more  data,  of  varied  forms, than they actually analyze and meaningfully
apply.  The  analysis  of  this data can lead to significant improvements in the
quality  and  efficacy of products built, marketed, and sold. Furthermore, there
are  large  amounts of additional information that organizations will collect in
the  future  to  drive  higher  return  on investment. Overall, as recognized by
industry  analysts,  this  implies  significant  long-term  potential  for  data
analysis  companies  such  as  Insightful.

     Throughout  our  history,  we  have,  to varying degrees, tailored our data
analysis  solutions  to  the  needs  of the following industries: securities and
banking,  life  sciences,  manufacturing, telecommunications, environmental, and
defense/intelligence. We also serve the academic community, though our objective
there  is  not to drive short-term increased revenues but rather seed for future
commercial  sales.  The  present  and  future  outlook  for spending on software
solutions  in  the industries we serve varies based on macro- and micro-economic
factors.  Competition  for the reduced software budgets which organizations have
available  within  these  industries  has been fierce. In addition, we're seeing
more  of our customers explore and adopt open-source data analysis technologies,
instead of purchasing commercial software products. As a result of these factors
and others, our software license and service revenues have declined, despite the
significant returns that our data analysis solutions can provide. To compensate,
we  are  focusing  our  resources  in  on  higher-value initiatives in the three
industries  that  currently  account  for  the  majority  of  our revenues: life
sciences,  securities  and  banking,  and  defense/intelligence.

     To broaden the type of data analysis problems that our products can handle,
we  undertook  initiatives to expand our portfolio of products beyond statistics
to encompass data mining and knowledge access. As a result, in the first half of
2002,  we've  augmented  S-PLUS(R)  with the newly released Insightful Miner and
InFact(R),  to  address  the emerging need to analyze structured (numerical) and
unstructured  (linguistic  and  textual)  data sets. Initial sales for these new
products,  though  encouraging,  have  not  met  our  objectives.

     We  will  continue to invest in both our existing and new products, as well
as  in  expanding  our  sales  and  marketing  efforts,  but at slower pace than
historical  levels.  Looking  forward,  we expect that our professional services
revenue  will  remain at its current depressed levels until there is a sustained
economic  recovery  for  IT  spending.  However,  we anticipate that growth will
resume  for  our  software  license  and  maintenance  revenues,  and  will  be
predominantly  driven  by  increased  resources  and efficiency of our sales and
marketing  efforts worldwide, and subject to our efficiency in closing deals and
winning  new  customers  for  our  products.

                                       13
<PAGE>
IMPORTANT  FACTORS  THAT  MAY AFFECT OUR BUSINESS, OUR OPERATING RESULTS AND OUR
STOCK  PRICE

     In  addition  to  the other information in this report, you should consider
the  following  cautionary  factors carefully in evaluating us and our business.
From  time to time we may furnish certain "forward-looking" information, as that
term  is defined by (i) the Private Securities Litigation Reform Act of 1995, or
the  Act,  and  (ii) in releases made by the SEC. We are making these cautionary
statements  pursuant  to  the  provisions  of  the Act and with the intention of
obtaining  the  benefits  of  the  "safe  harbor"  provisions  of  the  Act.

OUR  OPERATING RESULTS FLUCTUATE AND COULD FALL BELOW EXPECTATIONS OF SECURITIES
ANALYSTS  AND  INVESTORS,  RESULTING  IN  A  DECREASE  IN  OUR  STOCK  PRICE.

     Our  operating  results  have varied widely in the past, and we expect that
they  could  continue to fluctuate in the future. If our operating results for a
particular  quarter  or  year fall below the expectations of securities analysts
and  investors,  it  could  result in a decrease in our stock price. Some of the
factors  that  could  affect  the  amount and timing of our revenues and related
expenses  and  cause  our  operating  results  to  fluctuate  include:

     -    our primary reliance on a one product family;

     -    our ability to penetrate new markets;

     -    our ability to develop, introduce and market new products on a timely
          basis;

     -    market acceptance of our products;

     -    our ability to compete in the highly competitive markets;

     -    our ability to obtain government research contracts;

     -    our ability to expand our sales and support infrastructure;

     -    our ability to maintain our relationships with key partners;

     -    our ability to successfully expand our international operations;

     -    loss of third-party licenses;

     -    our inability to protect our intellectual property rights;

     -    the loss of any of our key employees or management team members; and

     -    general economic conditions, which may affect our customers'
          purchasing decisions;

     As  a  result  of  these  factors,  we  cannot  predict  our  revenues with
certainty,  and  future product revenues may differ from historical patterns. It
is  particularly  difficult  to  predict  the  timing  or  amount of our license
revenues  because:

     -    our sales cycles are lengthy and variable, typically ranging between
          two and eight months from our initial contact with a potential
          customer;

     -    for our newest products, we have no history by which to gauge the
          sales cycles or acceptance rates;

     -    a substantial portion of our sales are completed at the end of the
          quarter and, as a result, a substantial portion of our license
          revenues are recognized in the last days of a quarter;

     -    the amount of unfulfilled orders for our products at the beginning of
          a quarter is typically small; and

     -    delay of new product releases can result in a customer's decision to
          delay execution of a contract or, for contracts that include the new
          release as an element of the contract, will result in deferral of
          revenue recognition until such release.

     Even  though  our revenues are difficult to predict with certainty, we base
our  decisions  regarding  our operating expenses on anticipated revenue trends.
Many of our expenses are relatively fixed, and we cannot quickly reduce spending
if  our  revenues are lower than expected. As a result, revenue shortfalls could
result  in  significantly  lower income or greater loss than anticipated for any
given  period,  which  could  result  in  a  decrease  in  our  stock  price.

                                       14
<PAGE>
IF  POTENTIAL  CUSTOMERS  DO NOT CONTINUE TO PURCHASE THE S-PLUS PRODUCT FAMILY,
OUR  REVENUES  WILL  FALL  AND  WE  MAY  INCUR  MORE  LOSSES.

     Since  the divestiture of our Engineering and Educational Products Division
in  January 2001we have relied on a one-product family, the S-PLUS line, for the
success of our business, and license revenues from the S-PLUS product and add-on
modules  accounted  for  nearly  all  of our license revenues in 2002. We expect
license  revenues  from  the  S-PLUS product family to continue to account for a
substantial  amount  of  our  future  revenues.  As  a result, factors adversely
affecting  the  pricing  of  or  demand  for  the S-PLUS product family, such as
competition  or  technological  change,  could dramatically affect our operating
results.  If we are unable to successfully deploy current versions of the S-PLUS
product  family  and  to develop, introduce and establish customer acceptance of
new  and enhanced versions of the S-PLUS product family, our revenues will fall,
leading  to  more  losses.

IF WE ARE UNABLE TO PENETRATE NEW VERTICAL AND END-USER MARKETS WITH OUR CURRENT
AND  FUTURE  PRODUCTS,  THE  GROWTH  OF  OUR  BUSINESS  WILL  BE  LIMITED.

     We  currently  serve  a  relatively  small  number of customers in a narrow
market,  and  we  believe that the statistics market we currently serve with the
S-PLUS  product  family  will  grow at a slower rate than it has in the past. In
order  to  grow our business at a satisfactory rate, we will need to expand into
new  end-user  markets and new vertical markets for our statistics software, and
we  must  simultaneously  develop  and  sell new products that address these and
other markets. We will need to invest in the expansion of our statistics product
and service offerings beyond the sophisticated statistics user into the business
mainstream,  in  the  expansion  of  our  product and service offerings into new
vertical markets, and in the development of our data mining and knowledge access
products.  These simultaneous investments may strain our financial resources and
diffuse  management's  time and attention. If any of these initiatives fails, or
if  we  fail  to maintain adequate revenues from our traditional business during
the transition to any of these initiatives, our business will not grow and could
fail.

IF  WE  ARE  UNSUCCESSFUL  IN  THE MARKETING AND SELLING OF OUR NEWEST PRODUCTS,
INFACT  AND  INSIGHTFUL  MINER, OUR REVENUE GROWTH WILL BE LIMITED, OUR REVENUES
WILL  FALL  AND  WE  MAY  INCUR  MORE  LOSSES.

     We  believe  that  revenues  from  our  new products, InFact and Insightful
Miner,  will  help  offset  potential  weakness in our core statistics business.
However,  we  cannot predict the degree to which these new products will achieve
market  acceptance  or  the  extent  to which they will perform as our customers
expect.  If  our new products contain defects or errors, or otherwise do not run
as  expected,  their  market  acceptance  may  be  delayed  or  limited, and our
reputation  may  be  damaged.  Moreover,  InFact and Insightful Miner have price
points  that are many times higher than our core statistics products.  We cannot
forecast  our  customers' ability to make such a significant capital expenditure
in  this  economic  climate.  If  we  are  unsuccessful  in  selling  InFact and
Insightful  Miner,  the  growth of our business and our revenue will be limited.

MANY  POTENTIAL  CUSTOMERS  ARE NOT YET AWARE OF THE BENEFITS OF DATA MINING AND
KNOWLEDGE  ACCESS SOLUTIONS, AND OUR PRODUCTS MAY NOT ACHIEVE MARKET ACCEPTANCE.

     The  markets  for  data  mining  and  knowledge  access solutions are still
emerging  and  continued  growth in demand for and acceptance of these solutions
remains  uncertain.  Even  if  these  markets  grow, businesses may purchase our
competitors'  solutions  or  develop  their own. We intend to spend considerable
resources  educating  potential  customers not only about our solutions but also
about the value of such systems in general. Even with these educational efforts,
however, market acceptance of our solutions may not increase. If our products do
not  achieve  market  acceptance,  our  results  will  suffer.

IF  WE  ARE  UNABLE  TO  COMPETE SUCCESSFULLY IN THE STATISTICS, DATA MINING AND
KNOWLEDGE  ACCESS  MARKETS,  OUR  BUSINESS  WILL  FAIL.

     Our  S-PLUS  product  suite  targets  the statistics market. This market is
highly competitive, fragmented and mature. We face competition in the statistics
market  primarily  from  large  enterprise  software  vendors  and our potential
customers'  information  technology  departments.  These departments may seek to
develop  data analysis solutions that utilize R, an open-source software package
that  performs  operations  similar  to  the  S  language that forms the core of
S-PLUS.  The  dominant  competitor  in  our  industry  is  SAS  Institute. Other
companies  with  which  we  compete include, but are not limited to, SPSS, Inc.,
StatSoft  Inc.  and  Minitab,  Inc.  In  addition  to  competition  from  other
statistical  software  companies,  we  also  face  competition from providers of
software  for  specific  statistical  applications.

     In  the  data mining and knowledge access markets, we face competition from
many  companies,  including  SAS  Institute,  SPSS,  IBM, NCR, Autonomy, Verity,
Inxight,  ClearForest  and  Iphrase,  many of which are much larger than we are.
With the exception of SAS Institute and SPSS, these competitors do not currently
offer the range of analytical capability that we offer, and as a result are both
competitors  and  potential  partners  for  our  technology.

     In  addition,  as  we  develop other new products, or attempt to expand our
sales  into  new  vertical  and  end-user  markets,  we may begin competing with
companies  with  whom  we have not previously competed. It is also possible that
new  competitors  will enter the market. An increase in competitive pressures in
our  market  or  our  failure  to  compete  effectively  may  result  in pricing
reductions,  reduced  gross  margins  and  loss  of  market  share.  Many of our
competitors  have  longer  operating histories, greater name recognition, larger
customer  bases  and  significantly  greater financial, technical, marketing and
other  resources than we do. We could also experience competition from companies
in  other sectors of the broader market for business intelligence software, like
providers  of  OLAP  (On-Line  Analytical Processing), business intelligence and
analytical  application  software,  as  well as from companies in other sectors.

                                       15
<PAGE>
OUR  BUSINESS  IS  SENSITIVE  TO  THE  RISKS  ASSOCIATED WITH GOVERNMENT FUNDING
DECISIONS.

     We regularly apply for and are granted research contracts from a variety of
government  agencies  and  funding  programs.  Over the last three fiscal years,
these contracts have generated an average of $4.7 million per year in offsets to
our  research  and  development expenses. We may not receive new funded research
contracts  or  any  renewals of government-funded projects currently in process.
The  personnel  and  other  costs  associated with these programs are relatively
fixed  in  the  short  run,  and a sudden cancellation or non-renewal of a major
funding  program  or  multiple  smaller  programs would be harmful to our annual
results. A substantial portion of the research grant money we receive is granted
to  us  based  on our status as a small business, the definition of which varies
depending  on  the  individual  contract  terms.  If  and when the number of our
employees or the amount of our revenues grow beyond the limits prescribed in any
of  these  contracts,  we will no longer be eligible for such research contracts
and  we will have to incur certain research and development expenses without the
benefit  of  offsets.

     Furthermore,  a  significant  portion  of  our  license  revenues come from
foreign  and  domestic  government entities, as well as institutions, healthcare
organizations  and  private  businesses  that  contract  with  or  are funded by
government  entities.  Government  appropriations  processes  are often slow and
unpredictable  and may be affected by factors outside of our control. Reductions
in government expenditures and termination or renegotiation of government-funded
programs  or  contracts will seriously affect our revenue and operating results.

WE  MAY BE UNABLE TO EXPAND OUR SALES ORGANIZATION, WHICH COULD HARM OUR ABILITY
TO  EXPAND  OUR  BUSINESS.

     To  date, we have sold our desktop products primarily through our telesales
department  while  we  have  relied  on  our  field  sales  force  to  sell  our
server-based  solutions  and  place  orders  for  multiple  desktop licenses. We
believe  our  future  revenue  growth  will  depend in large part on recruiting,
training  and retaining direct sales personnel, including those whose experience
and qualifications differ from those of our current sales force. Our growth will
further  depend  on expanding our indirect distribution channels. These indirect
channels  include  value  added  resellers,  or  VARs,  distributors,  original
equipment  manufacturer  (OEM)  partners, system integrators and consultants. We
have  experienced  and continue to experience difficulty in recruiting qualified
direct  sales personnel and in establishing third-party relationships with VARs,
distributors,  OEM partners and systems integrators and consultants. Our efforts
to  restructure  or  expand  our  sales  force  may not prove successful and our
ability  to  retain  top sales personnel may be affected, which could reduce our
sales  or limit our sales growth. Even if we successfully expand our sales force
and  other  distribution  channels,  the  expansion  may  not result in expected
revenue  growth.

IF  WE ARE UNABLE TO DEVELOP AND MAINTAIN EFFECTIVE LONG-TERM RELATIONSHIPS WITH
OUR  KEY  PARTNERS,  OR IF OUR KEY PARTNERS FAIL TO PERFORM, OUR ABILITY TO SELL
OUR  SOLUTION  WILL  BE  LIMITED.

     We  rely  on  our  existing  relationships  with  a number of key partners,
including  management  consulting  firms, system integrators, VARs, distributors
and  third-party  technology  vendors, that are important to worldwide sales and
marketing  of  our solutions. We expect an increasing percentage of our revenues
to  be  derived  from  sales  that arise out of our relationships with these key
partners.  In  addition,  to  be  successful  and  to  more effectively sell our
products  to larger customers, we must develop successful new relationships with
other  key  partners.  These  key  partners  often  provide enterprise software,
consulting,  implementation  and  customer  support  services,  and  endorse our
solution during the competitive evaluation stage of the sales cycle. Although we
seek  to  maintain  relationships  with  our  key  partners,  and  to  develop
relationships  with  new  partners,  many  of  these  existing and potential key
partners  have  similar,  and  often  more  established,  relationships with our
competitors.  These  existing  and  potential  partners,  many  of  which  have
significantly  greater resources than we have, may in the future market software
products  that  compete  with  our  solution  or  reduce  or  discontinue  their
relationships  with  us  or  their  support  of  our  solution.

OUR  SALES CYCLE IS VARIABLE, AND SALES DELAYS COULD CAUSE OUR OPERATING RESULTS
TO  FLUCTUATE,  WHICH  COULD  CAUSE  A  DECLINE  IN  OUR  STOCK  PRICE.

     An  enterprise's decision to purchase statistics, data mining and knowledge
access software and services is discretionary, involves a significant commitment
of  its  resources  and is influenced by its budget cycles. Our sales cycles are
long  and  variable,  typically  ranging  between  two and eight months from our
initial contact with a potential customer to the issuance of a purchase order or
signing  of  a license or services agreement, although the amount of time varies
substantially  from  customer  to  customer  and  occasionally  sales  require
substantially  more  time.  When  economic  conditions  weaken, sales cycles for
software  products  and  related  services tend to lengthen, and as a result, we
experienced longer sales cycles in the past 12 months, and we expect to continue
to  experience  longer sales cycles over the next several quarters. Sales delays
could  cause  our operating results to fall below the expectations of securities
analysts  or  investors,  which  could  result in a decrease in our stock price.

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<PAGE>
IF  WE  DO NOT EXPAND OUR INTERNATIONAL OPERATIONS AND SUCCESSFULLY OVERCOME THE
RISKS  INHERENT IN INTERNATIONAL BUSINESS ACTIVITIES, THE GROWTH OF OUR BUSINESS
WILL  BE  LIMITED.

     To  be  successful, we must continue to expand our international operations
and  enter  new international markets. This expansion may be delayed as a result
of  operating  expense reduction measures and general economic conditions. If we
do  expand internationally, it will require significant management attention and
financial resources to successfully translate and localize our software products
to  various languages and to develop direct and indirect international sales and
support channels. Even if we successfully translate our software and develop new
channels, we may not be able to maintain or increase international market demand
for  our solutions. We, or our VARs or distributors, may be unable to sustain or
increase  international  revenues  from licenses or from consulting and customer
support.  In addition, our international sales are subject to the risks inherent
in  international  business  activities,  including

     -    costs of customizing products for foreign countries;

     -    export and import restrictions, tariffs and other trade barriers;

     -    the need to comply with multiple, conflicting and changing laws and
          regulations;

     -    reduced protection of intellectual property rights and increased
          liability exposure; and

     -    regional economic, cultural and political conditions, including the
          direct and indirect effects of terrorist activity and armed conflict
          in countries in which we do business.

     Our  foreign  subsidiaries operate primarily in local currencies, and their
results are translated into U.S. dollars. We do not currently engage in currency
hedging  activities, but we may do so in the future. Changes in the value of the
U.S.  dollar  relative  to  foreign  currencies have not materially affected our
operating  results  in  the  past.  Our  operating  results  could,  however, be
materially  harmed  if we enter into license or service agreements providing for
significant  amounts  of  foreign  currencies  with  extended  payment  terms or
extended  implementation  timeframes  if  the values of those currencies fall in
relation  to  the  U.S.  dollar  over  the  payment  period  of  the  agreement.

DELIVERY  OF  OUR  SOLUTION  MAY  BE  DELAYED  IF  WE CANNOT CONTINUE TO LICENSE
THIRD-PARTY  TECHNOLOGY  THAT IS IMPORTANT TO THE FUNCTIONALITY OF OUR SOLUTION.

     We  incorporate  into  our  products  software  that  is  licensed to us by
third-party  software  developers,  including  Lucent Technologies, from whom we
license  the  S  programming language that forms the core of our S-PLUS product.
Under  the  license,  we  have  the worldwide, exclusive right, through February
2007, to use, sublicense and support the "S" language in exchange for royalties.
Any  modifications, enhancements, adaptations or derivations of the language are
our  property.  After  February  18,  2007, we, at our election, may extend this
license  for  five-year terms in perpetuity, provided that we continue to comply
with  our  obligations  under  the license. A sudden termination of this license
would  significantly harm our operations because Lucent Technologies is the sole
licensor  of  the  "S"  programming  language.

     The third-party software currently offered in conjunction with our solution
may  become  obsolete  or  incompatible  with  future  versions of our products.
Further,  numerous  individual  and  institutional  licensors  have  contributed
software  code to S-PLUS in exchange for little or no consideration, and some of
these  third  parties  may choose to revise or revoke their licensing terms with
us.  A significant interruption in the supply of this technology could delay our
sales until we can find, license and integrate equivalent technology. This could
take a significant amount of time, perhaps several months, which would cause our
operating  results  to  fall  below  the  expectations of securities analysts or
investors  and  result  in  a  decrease  in  our  stock  price

INTEGRATION  OF  PAST  OR  FUTURE  ACQUISITIONS MAY BE DIFFICULT AND DISRUPTIVE.

     In  the past two years we have completed several acquisitions of businesses
with  complementary  technologies  or  service  offerings.  In  addition  to our
acquisition  of Predict AG in Switzerland, we acquired the statistics businesses
of Waratah Corporation in North Carolina, Graphische Systeme GmbH in Germany and
Sigma-Plus  SA in France. In the future, we may acquire additional complementary
companies  or technologies. Managing these acquisitions has entailed, and may in
the  future  entail,  numerous  operational  and  financial  risks  and strains,
including

     -    dilution of stockholders' equity;

     -    difficulty and cost in combining the operations and personnel of
          acquired businesses with our operations and personnel;

     -    disruption of our ongoing business and diversion of management's time
          and attention to integrating or completing the development or
          commercialization of any acquired technologies;

                                       17
<PAGE>
     -    impairment of relationships with key customers of acquired businesses
          due to changes in management and ownership of the acquired businesses;

     -    impairment of goodwill arising as a result of completed or future
          acquisitions, resulting in a financial loss; and

     -    inability to retain key employees of any acquired businesses.

     If  we  do not successfully integrate any technologies, products, personnel
or  operations  of companies that we have acquired or that we may acquire in the
future,  our  business  will  be  harmed.

WE  HAVE  INCURRED  LOSSES  IN  RECENT PERIODS, AND MAY CONTINUE TO DO SO, WHICH
COULD  CAUSE  A  DECREASE  IN  OUR  STOCK  PRICE.

     If  we  do  not return to profitability in future quarters, our stock price
could  decrease.  We  have  posted  net losses for each fiscal quarter since the
fourth  quarter  of 2001. As of December 31, 2002, we had an accumulated deficit
of  nearly  $29 million. In the near-term, we believe our revenues will increase
to a level that is closer to our expected costs and operating expenses, allowing
us  to  continue  to  invest in accordance with our strategic priorities. We may
not, however, realize the anticipated revenue increases from our new product and
positioning  initiatives  in  future  periods.  In addition, we may be unable to
achieve  cost  savings  without  adversely  affecting our business and operating
results.  We  may  continue  to experience losses and negative cash flows in the
near  term,  even  if  sales  of  our  products  and  services continue to grow.

     We  believe  that  we  may  need  to  significantly  increase our sales and
marketing,  product  development and professional services efforts to expand our
market  position  and further increase acceptance of our products. We may not be
able  to  increase  our  revenues  sufficiently  to keep pace with these growing
expenditures,  if  at  all, and as a result may be unable to achieve or maintain
profitability  in  the  future.

CONTINUED  DECREASES  IN  SERVICE  REVENUES COULD DECREASE OUR TOTAL REVENUES OR
DECREASE  OUR  GROSS  MARGINS,  WHICH COULD CAUSE A DECREASE IN OUR STOCK PRICE.

     In  2002,  our  services  revenues  decreased  23%  from  the  prior  year.
Consulting and training (service) revenues represented 26% of our total revenues
for  2002,  and we anticipate that service revenues will continue to represent a
significant  percentage  of  total  revenues.  If  we  are unable to maintain or
increase  our  consulting  and  training  revenues, our total revenues may fall.

WE  HAVE  A LIMITED OPERATING HISTORY UNDER OUR NEW BUSINESS MODEL, NO OPERATING
HISTORY  WITH OUR NEW PRODUCTS, AND ARE SUBJECT TO THE RISKS OF NEW ENTERPRISES.

     In  connection  with  our  divestiture  of  our Engineering and Educational
Products  Division  in  2001  we  changed  our  name,  headquarters  location,
jurisdiction  of  incorporation, and more significantly, our management team and
business  model. Our new business model calls for significant contributions from
our  data mining and knowledge access products. Our limited operating history in
these  markets  makes  it  difficult  to  predict how our business will develop.
Accordingly,  we  face  all  of  the  risks  and  uncertainties  encountered  by
early-stage  companies,  such  as:

     -    no history of sustained profitability under our new business model;

     -    uncertain growth in the market for, and uncertain market acceptance
          of, our new solutions;

     -    the evolving nature of the data mining and knowledge access markets;

     -    reliance on new and unproven products to maintain our revenue
          projections;

     -    the risk that competition, technological change or evolving customer
          preferences could harm sales of our products or services.

OUR  WORKFORCE  REDUCTIONS AND FINANCIAL PERFORMANCE MAY PLACE ADDITIONAL STRAIN
ON  OUR  RESOURCES  AND MAY HARM THE MORALE AND PERFORMANCE OF OUR PERSONNEL AND
OUR  ABILITY  TO  HIRE  NEW  PERSONNEL.

     In  connection  with  our effort to streamline our operations, reduce costs
and  bring  our  staffing  and  structure  in  line  with  our  revenue base, we
restructured  our  organization with reductions in our workforce by 31 employees
in  July  2002.  There  have  been  and  may  continue  to  be substantial costs
associated  with  the  workforce  reduction  related  to  severance  and  other
employee-related  costs,  and  our  restructuring  plan  may yield unanticipated
consequences,  such  as  attrition beyond our planned reduction in workforce. In
addition, many of the employees who were terminated possessed specific knowledge
or  expertise,  and that knowledge or expertise may prove to have been important
to  our  operations.  In  that  case,  their  absence  may  create  significant
difficulties. Further, the reduction in workforce may reduce employee morale and
may  create concern among potential and existing employees about job security at
Insightful, which may lead to difficulty in hiring and increased turnover in our
current  workforce.  In addition, this headcount reduction may subject us to the
risk  of  litigation,  which  could  result in substantial costs to us and could
divert  management's  time  and  attention  away  from  business operations. Any
further  workforce  reductions  may  significantly  strain  our  operational and
financial  resources  and  may result in increasing responsibilities for each of
our  management  personnel.  As  a  result, our ability to respond to unexpected
challenges  may  be  impaired,  and  we  may  be unable to take advantage of new
opportunities.

                                       18
<PAGE>
WE MAY BE UNABLE TO OBTAIN THE FUNDING NECESSARY TO SUPPORT THE EXPANSION OF OUR
BUSINESS.

     Our  future  revenues  may  be  insufficient to support the expenses of our
operations  and  the expansion of our business. We may therefore need additional
equity  or  debt capital to finance our operations. If we are unable to generate
sufficient  cash  flow  from  operations  or  to obtain funds through additional
financing,  we  may  have to reduce some or all of our development and sales and
marketing  efforts  and  limit  the  expansion  of  our  business.

     We  believe  that  our  existing cash and cash equivalents, investments and
available bank borrowings will be sufficient to meet the capital requirements of
our  core  business for at least the next twelve months. However, if during that
time  market  conditions  worsen, or if other unforeseen events should occur, we
may  need  additional  funds  through public or private equity financing or from
other sources in order to fund our operations and pursue our growth strategy. We
have no commitment for additional financing, and we may experience difficulty in
obtaining  funding  on  favorable  terms,  if  at  all.

     Our  credit  line  and equipment term loan with Silicon Valley Bank contain
covenants  that require us to maintain a certain level of net income.  In August
2002,  we  renegotiated  these  covenants to exclude the restructuring charge we
expected  to  incur as a result of the July 2002 reduction in our workforce.  In
January  2003  we  again  negotiated  a  waiver  of the covenants to exclude the
impairment  charge  we  expected  to  incur  with  respect to our acquisition of
Predict  AG  in  2001.  Any additional financing we obtain may contain covenants
that  restrict  our  freedom  to operate our business or may require us to issue
securities  that  have  rights,  preferences  or privileges senior to our common
stock  and  may  dilute  your  ownership  interest  in  us.

WORLD  EVENTS  AND ECONOMIC CONDITIONS COULD ADVERSELY AFFECT OUR REVENUE GROWTH
AND  ABILITY  TO  FORECAST  REVENUE.

     Our  revenue  growth  and potential for profitability depend on the overall
demand  for  statistics, data mining and knowledge access software and services.
Because  our  sales  are  primarily  to  corporate  customers, our business also
depends  on  general economic and business conditions. A softening of demand for
computer  software  caused  by  the  weakened  economy,  both  domestic  and
international,  has  affected  our sales and may continue to result in decreased
revenues  and  growth  rates. As a result of the economic downturn, we have also
experienced  and  may  continue  to  experience  difficulties  in  collecting
outstanding  receivables from our customers. In addition, armed conflict in Iraq
and  the  threat  of  additional  terrorist  attacks  on  the  United States may
exacerbate  economic,  political  and other uncertainties, which could adversely
affect  our  sales  and  thus  our  revenue  growth.

PRIVACY  AND  SECURITY  CONCERNS  MAY  LIMIT THE EFFECTIVENESS OF AND REDUCE THE
DEMAND  FOR  OUR  SOLUTION.

     The  effectiveness  of  our  solution relies on the storage and use of data
collected  from  various sources, including personal information. The collection
and  use  of such data by our customers for customer profiling may raise privacy
and  security  concerns.  Our  customers  generally  have  implemented  security
measures  to  protect  customer  data  from  disclosure or interception by third
parties.  However,  the  security  measures  may  not  be  effective against all
potential  security  threats.  If  a  well-publicized  breach  of  customer data
security  were  to occur, our solution may be perceived as less desirable, which
could  limit  our  revenue  growth.

     In  addition, due to privacy concerns, some Internet commentators, consumer
advocates  and  governmental or legislative bodies have suggested legislation to
limit  the  use  of customer profiling technologies. The European Union and some
European countries have already adopted some restrictions on the use of customer
profiling  data.  If  major  countries  or  regions  adopt  legislation or other
restrictions  on  the use of customer profiling data, our solution would be less
useful  to  customers,  and  our  sales  could  decrease.

IF  WE DO NOT RETAIN OUR KEY EMPLOYEES OR MANAGEMENT TEAM, AND INTEGRATE OUR NEW
SENIOR  MANAGEMENT  PERSONNEL, OUR ABILITY TO EXECUTE OUR BUSINESS STRATEGY WILL
BE  LIMITED.

     Our  future performance will depend largely on the efforts and abilities of
our  key  technical, sales, customer support and managerial personnel and on our
ability  to  attract  and  retain  them. In addition, our ability to execute our
business  strategy  will depend on our ability to recruit additional experienced
senior  managers  and  to retain our existing executive officers. We have in the
past  experienced  difficulty  in  hiring  qualified  technical, sales, customer
support  and  managerial  personnel,  and we may be unable to attract and retain
such  personnel  in  the  future.  In addition, due to competition for qualified
employees,  we  may  be  required  to increase the level of compensation paid to
existing  and  new  employees,  which  could  materially  increase our operating
expenses.  Our key employees are not obligated to continue their employment with
us  and  could  leave  at  any  time.

RAPID  CHANGES IN TECHNOLOGY COULD RENDER OUR PRODUCTS OBSOLETE OR UNMARKETABLE,
AND  WE MAY BE UNABLE TO INTRODUCE NEW PRODUCTS AND SERVICES SUCCESSFULLY AND IN
A  TIMELY  MANNER.

                                       19
<PAGE>
     The  business  software  market  is  characterized  by  rapid change due to
changing  customer  needs,  rapid  technological  developments  and  advances
introduced  by  competitors.  Existing  products  can  become  obsolete  and
unmarketable  when  products  using  new  technologies  are  introduced  and new
industry  standards  emerge. New technologies, including the rapid growth of the
Internet,  could  change the way software is sold or delivered. We may also need
to modify our products when third parties change software that we integrate into
our  products.  As  a  result,  the life cycles of our products are difficult to
estimate.

     To  be successful, we must continue to enhance our current product line and
develop  new  products  that  successfully  respond  to changing customer needs,
technological developments and competitive product offerings. We may not be able
to  successfully  develop  or  license  the applications necessary to respond to
these  changes,  or to integrate new applications with our existing products. We
may  not  be able to introduce enhancements or new products successfully or in a
timely  manner  in  the  future. If we delay release of our products and product
enhancements,  or  if  they  fail to achieve market acceptance when released, it
could  harm  our reputation and our ability to attract and retain customers, and
our  revenues  may decline. In addition, customers may defer or forego purchases
of  our  products  if we, our competitors or major hardware, systems or software
vendors  introduce  or  announce  new  products  or  product  enhancements.

WE  MAY  BE UNABLE TO ADEQUATELY PROTECT OUR PROPRIETARY RIGHTS, WHICH MAY LIMIT
OUR  ABILITY  TO  COMPETE  EFFECTIVELY.

     Our  success  depends  in  part  on  our ability to protect our proprietary
rights. To protect our proprietary rights, we rely primarily on a combination of
patent,  copyright,  trade secret and trademark laws, confidentiality agreements
with  employees  and third parties and protective contractual provisions such as
those  contained  in license agreements with consultants, vendors and customers,
although  we have not signed these agreements in every case. Despite our efforts
to  protect our proprietary rights, unauthorized parties may copy aspects of our
products  and  obtain  and  use  information  that  we  regard  as  proprietary.
Generally,  our  products  are not physically copy-protected. In order to retain
exclusive  ownership  rights  to  all  software  developed by us, we license all
software  and  provide it in executable code only, with contractual restrictions
on  copying, disclosure and transferability. As is customary in the industry, we
generally  license  our products to end-users by use of a 'shrink-wrap' license.
Certain  specialized  products  may  utilize a written, signed license agreement
with  the  customer.  The source code for most of our products is protected as a
trade  secret  and  as  unpublished  copyrighted  work. Other parties may breach
confidentiality  agreements and other protective contracts we have entered into,
and  we  may  not  become aware of, or have adequate remedies in the event of, a
breach.  We face additional risk when conducting business in countries that have
poorly  developed  or inadequately enforced intellectual property laws. While we
are  unable  to  determine  the  extent to which piracy of our software products
exists,  we  expect  piracy  to  be  a  continuing  concern,  particularly  in
international markets and as a result of the growing use of the Internet. In any
event, competitors may independently develop similar or superior technologies or
duplicate  the  technologies  we have developed, which could substantially limit
the  value  of  our  intellectual  property.

INTELLECTUAL  PROPERTY  CLAIMS  AND  LITIGATION  COULD SUBJECT US TO SIGNIFICANT
LIABILITY  FOR  DAMAGES  AND  RESULT  IN INVALIDATION OF OUR PROPRIETARY RIGHTS.

     In  the  future,  we  may  have  to  resort  to  litigation  to protect our
intellectual  property  rights, to protect our trade secrets or to determine the
validity  and  scope  of  the  proprietary  rights  of  others.  Any litigation,
regardless of its success, would probably be costly and require significant time
and  attention  of  our key management and technical personnel. Although we have
not  been  sued for intellectual property infringement, we may face infringement
claims from third parties in the future. The software industry has seen frequent
litigation over intellectual property rights, and we expect that participants in
the  industry  will be increasingly subject to infringement claims as the number
of  products,  services  and competitors grows and the functionality of products
and  services  overlaps.  Infringement  litigation  could  also  force  us  to

     -    stop or delay selling, incorporating or using products that
          incorporate the challenged intellectual property;

     -    pay damages;

     -    enter into licensing or royalty agreements, which may be unavailable
          on acceptable terms; or

     -    redesign products or services that incorporate infringing technology,
          which we might not be able to do at an acceptable price, in a timely
          fashion or at all.

OUR  PRODUCTS  MAY  SUFFER FROM DEFECTS OR ERRORS, WHICH COULD RESULT IN LOSS OF
REVENUES,  DELAYED OR LIMITED MARKET ACCEPTANCE OF OUR PRODUCTS, INCREASED COSTS
AND  REPUTATIONAL  DAMAGE.

     Software  products as complex as ours frequently contain errors or defects,
especially  when  first  introduced  or  when  new  versions  are  released. Our
customers  are  particularly sensitive to such defects and errors because of the
importance  of accuracy in software used in analyzing data. We have had to delay
commercial release of past versions of our products until software problems were
corrected,  and in some cases have provided product updates to correct errors in
released  products.  Our  new  products  or releases may not be free from errors
after  commercial  shipments  have  begun.  Any errors that are discovered after
commercial  release  could  result  in  loss  of  revenues  or  delay  in market
acceptance,  diversion  of  development  resources,  damage  to  our reputation,
increased  service  and  warranty  costs  or  claims  against  us.

                                       20
<PAGE>
     In addition, the operation of our products could be compromised as a result
of  errors  in the third-party software we incorporate into our software. It may
be  difficult  for  us  to  correct  errors in third-party software because that
software  is  not  in  our  control.

OUR  STOCK  PRICE  MAY  BE  VOLATILE.

     The  price  of  our common stock has been volatile over the past 12 months.
Our  common stock reached a high of $3.40 per share on April 19, 2002 and May 3,
2002,  and  traded as low as $0.66 per share on October 10, 2002. As a result of
fluctuations  in  the  price of our common stock, you may be unable to sell your
shares  at or above the price you paid for them. The trading price of our common
stock  could  be  subject  to  fluctuations  for  a number of reasons, including

     -    future announcements concerning us or our competitors;

     -    actual or anticipated quarterly variations in operating results;

     -    changes in analysts' earnings projections or recommendations;

     -    announcements of technological innovations;

     -    the introduction of new products;

     -    changes in product pricing policies by us or our competitors;

     -    loss of key personnel;

     -    proprietary rights litigation or other litigation; or

     -    changes in accounting standards that adversely affect our revenues and
          earnings.

     In  addition,  stock  prices for many technology companies fluctuate widely
for reasons that may be unrelated to operating results of these companies. These
fluctuations, as well as general economic, market and political conditions, such
as national or international currency and stock market volatility, recessions or
military  conflicts, may materially and adversely affect the market price of our
common stock, regardless of our operating performance and may expose us to class
action  securities  litigation  which,  even if unsuccessful, would be costly to
defend  and  distracting  to  management.  In  the  past,  following  periods of
volatility  in  the  market  price  of  a company's securities, securities class
action  litigation has often been instituted against these companies. Litigation
brought  against  us  could  result  in  substantial  costs  and  a diversion of
management's attention and resources, which could have a material adverse effect
on  our  business,  financial  condition  and  operating  results.

ITEM  3.    QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK.

     We  develop  products  in  the  United States and sell them worldwide. As a
result,  our  financial  results could be affected by factors such as changes in
foreign  currency exchange rates or weak economic conditions in foreign markets.
Since  our  sales are currently priced in U.S. dollars and translated into local
currency  amounts,  a  strengthening  of the dollar could make our products less
competitive  in  foreign  markets.  We  operate  in the United Kingdom, Germany,
France and Switzerland and incur expenses denominated in those local currencies.
However,  we  do not believe that these operating expenses will harm our results
of  operations.  Interest  income  and  expense  are sensitive to changes in the
general  level  of  U.S.  interest  rates,  particularly  since  the  Company's
investments  are  in  short-term instruments. Based on the short term nature and
current  levels  of  our  investments  and debt, however, we do not believe that
there  is  any  material  market  risk  or  exposure.

     Our  general  investing  policy  is to limit the risk of principal loss and
ensure  the  safety  of  invested  funds  by limiting credit and market risk. We
currently  invest  in  highly  liquid  money  market  accounts  and  short-term
investments.  All  highly  liquid  investments with original maturities of three
months  or  less  are  considered  to  be  cash  equivalents.

                                       21
<PAGE>
ITEM  4.  CONTROLS  AND  PROCEDURES

QUARTERLY EVALUATION OF THE COMPANY'S DISCLOSURE CONTROLS AND INTERNAL CONTROLS.
Within  the 90 days prior to the date of this Quarterly Report on Form 10-Q, the
company  evaluated  the  effectiveness  of  the  design  and  operation  of  its
"disclosure  controls  and  procedures" (Disclosure Controls), and its "internal
controls  and  procedures  for  financial  reporting"  (Internal Controls). This
evaluation (the Controls Evaluation) was done under the supervision and with the
participation  of  management,  including  our Chief Executive Officer (CEO) and
Chief  Financial  Officer  (CFO).  Rules adopted by the SEC require that in this
section  of  the  Quarterly Report we present the conclusions of the CEO and the
CFO  about  the  effectiveness  of our Disclosure Controls and Internal Controls
based  on  and  as  of  the  date  of  the  Controls  Evaluation.

CEO  AND  CFO  CERTIFICATIONS.  Appearing  immediately  following the Signatures
section  of  this  Quarterly  Report  there  are  two  separate  forms  of
"Certifications"  of  the  CEO  and  the CFO. The first form of Certification is
required  in  accord  with  Section  302  of the Sarbanes-Oxley Act of 2002 (the
Section  302  Certification). This section of the Quarterly Report which you are
currently reading is the information concerning the Controls Evaluation referred
to  in  the  Section  302  Certifications and this information should be read in
conjunction  with  the  Section  302  Certifications  for  a  more  complete
understanding  of  the  topics  presented.

DISCLOSURE  CONTROLS  AND  INTERNAL CONTROLS. Disclosure Controls are procedures
that are designed with the objective of ensuring that information required to be
disclosed  in  our  reports  filed  under  the  Securities  Exchange Act of 1934
(Exchange  Act),  such  as  this  Quarterly  Report,  is  recorded,  processed,
summarized  and reported within the time periods specified in the Securities and
Exchange  Commission's  (SEC)  rules  and  forms.  Disclosure  Controls are also
designed with the objective of ensuring that such information is accumulated and
communicated  to  our  management,  including the CEO and CFO, as appropriate to
allow  timely  decisions  regarding  required  disclosure. Internal Controls are
procedures  which  are  designed  with  the  objective  of  providing reasonable
assurance  that (1) our transactions are properly authorized; (2) our assets are
safeguarded  against  unauthorized or improper use; and (3) our transactions are
properly  recorded  and reported, all to permit the preparation of our financial
statements  in  conformity  with  generally  accepted  accounting  principles.

LIMITATIONS  ON  THE  EFFECTIVENESS  OF  CONTROLS.  The  company's  management,
including  the  CEO and CFO, does not expect that our Disclosure Controls or our
Internal  Controls  will  prevent  all error and all fraud. A control system, no
matter  how  well  conceived  and  operated,  can  provide  only reasonable, not
absolute,  assurance that the objectives of the control system are met. Further,
the  design  of  a  control system must reflect the fact that there are resource
constraints,  and  the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of  fraud,  if  any,  within  the  company  have  been  detected. These inherent
limitations  include  the  realities  that  judgments  in decision-making can be
faulty,  and  that  breakdowns  can  occur  because  of simple error or mistake.
Additionally,  controls  can  be  circumvented  by  the  individual acts of some
persons,  by  collusion  of two or more people, or by management override of the
control. The design of any system of controls also is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance
that  any  design will succeed in achieving its stated goals under all potential
future  conditions;  over time, control may become inadequate because of changes
in  conditions,  or the degree of compliance with the policies or procedures may
deteriorate.  Because  of  the  inherent limitations in a cost-effective control
system,  misstatements  due  to  error  or  fraud may occur and not be detected.

SCOPE  OF  THE  CONTROLS  EVALUATION.  The  CEO/CFO evaluation of our Disclosure
Controls and our Internal Controls included a review of the controls' objectives
and  design,  the  controls' implementation by the company and the effect of the
controls  on  the information generated for use in this Quarterly Report. In the
course  of  the Controls Evaluation, we sought to identify data errors, controls
problems  or  acts  of  fraud and to confirm that appropriate corrective action,
including  process  improvements, were being undertaken. This type of evaluation
will  be  done  on a quarterly basis so that the conclusions concerning controls
effectiveness  can  be reported in our Quarterly Reports on Form 10-Q and Annual
Report  on  Form  10-K.  Our  Internal Controls are also evaluated on an ongoing
basis  by  personnel in our Finance organization and by our independent auditors
in connection with their audit and review activities. The overall goals of these
various  evaluation  activities  are  to monitor our Disclosure Controls and our
Internal  Controls  and  to  make modifications as necessary; our intent in this
regard  is  that  the  Disclosure  Controls  and  the  Internal Controls will be
maintained  as  dynamic  systems  that  change  (including with improvements and
corrections)  as  conditions  warrant.

Among other matters, we sought in our evaluation to determine whether there were
any  "significant  deficiencies"  or  "material  weaknesses"  in  the  company's
Internal  Controls,  or  whether  the  company  had identified any acts of fraud
involving  personnel  who  have  a  significant  role  in the company's Internal
Controls.  This  information  was  important  both  for  the Controls Evaluation
generally and because items 5 and 6 in the Section 302 Certifications of the CEO
and  CFO  require  that the CEO and CFO disclose that information to our Board's
Audit Committee and to our independent auditors and to report on related matters
in  this  section  of  the  Quarterly  Report.  In  the  professional  auditing
literature,  "significant  deficiencies"  are  referred  to  as  "reportable
conditions";  these  are  control  issues  that could have a significant adverse
effect on the ability to record, process, summarize and report financial data in
the  financial  statements.  A  "material  weakness"  is defined in the auditing
literature  as  a  particularly  serious reportable condition where the internal
control  does  not  reduce to a relatively low level the risk that misstatements
caused by error or fraud may occur in amounts that would be material in relation
to  the  financial  statements  and  not  be  detected within a timely period by
employees  in  the normal course of performing their assigned functions. We also
sought  to  deal  with other controls matters in the Controls Evaluation, and in
each  case if a problem was identified, we considered what revision, improvement
and/or  correction  to  make  in  accord  with  our  on-going  procedures.

CONCLUSIONS.  Based upon the Controls Evaluation, our CEO and CFO have concluded
that,  subject  to  the  limitations  noted  above,  our Disclosure Controls are
effective  to  ensure  that  material information relating to Insightful and its
consolidated  subsidiaries  is  made  known to management, including the CEO and
CFO,  particularly  during  the  period  when  our  periodic  reports  are being
prepared,  and  that  our  Internal Controls are effective to provide reasonable
assurance  that our financial statements are fairly presented in conformity with
generally  accepted  accounting  principles.

                                       22
<PAGE>
PART  II.     OTHER  INFORMATION

ITEM  1.    LEGAL  PROCEEDINGS

On or about December 13, 2002, Wajih Alaiyan, a former employee of ours, filed a
complaint  against  us  in  the Superior Court for King County, Washington.  Mr.
Alaiyan  alleges  that his employment was wrongfully terminated, and he seeks an
unspecified  amount of damages.  We deny Mr. Alaiyan's claim and will vigorously
defend  the  lawsuit.  An  evaluation  of  the  likelihood of an adverse outcome
cannot  be  expressed  with  sufficient  certainty  at  this  time.

On  April  24, 2003, an employee of the company was involved in a multi-vehicle,
multiple injury automobile accident while traveling on business in Virginia. Our
automobile  liability  insurance  carrier is handling claims associated with the
incident. We are not able to offer an evaluation of the likelihood of an adverse
outcome that would result in liability beyond the limits of our insurance policy
with  any  certainty  at  this  time.

ITEM  2.    CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS

     None

ITEM  4.    SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

     None

ITEM  5.    OTHER  INFORMATION

     None

                                       23
<PAGE>
ITEM  6.    EXHIBITS  AND  REPORTS  ON  FORM  8-K

     (a)    Exhibits

EXHIBIT
 NUMBER                            DESCRIPTION
-------                            -----------
 3.1     Amended and Restated Certificate of Incorporation of the Registrant (A)

 3.2     Amended  and  Restated  Bylaws  of  the  Registrant  (A)

10.1     Amendment No. 1 to Loan and Security Agreement, dated March 28,
         2003, by and between Insightful Corporation and Silicon Valley Bank (B)

99.1     Certification  of  Financial  Statements by Chief Executive Officer of
         Insightful Corporation as Required by Section 906 of Sarbanes-Oxley Act
         of 2002 (B)

99.2     Certification  of  Financial  Statements by Chief Financial Officer of
         Insightful Corporation as Required by Section 906 of Sarbanes-Oxley Act
         of 2002 (B)

-----------
(A)  Incorporated by reference to the designated exhibit included with
     Insightful's Quarterly Report on Form 10-Q (No. 0-020992) for the period
     ended September 30, 2001, filed on November 14, 2001.
(B)  Filed  herewith.

     (b)    Reports  on  Form  8-K.

     On January 21, 2003, we filed a Current Report on Form 8-K dated January
17, 2003 announcing preliminary guidance for fourth quarter 2002 results.

     On  April  24,  2003, we filed a Current Report on Form 8-K dated April 24,
2003  containing  a  press  release  announcing  first  quarter  2003  results.

                                       24
<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.


May  12,  2003                  INSIGHTFUL  CORPORATION

                                By:        /s/  Shawn F. Javid
                                   --------------------------------------------
                                              Shawn F. Javid
                                     President and Chief Executive Officer
                                     (Principal  Executive  Officer)


May  12,  2003                  INSIGHTFUL  CORPORATION

                                By:        /s/  Fred Schapelhouman
                                   --------------------------------------------
                                              Fred Schapelhouman
                                            Chief Financial Officer
                                   (Principal Financial and Accounting Officer)


                                       25
<PAGE>

             QUARTERLY CERTIFICATION PURSUANT TO SECTION 302 OF THE
                           SARBANES-OXLEY ACT OF 2002

I,  Shawn  F.  Javid,  certify  that:

     1.   I have reviewed this quarterly report on Form 10-Q of Insightful
          Corporation;

     2.   Based on my knowledge, this quarterly report does not contain any
          untrue statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this quarterly report, fairly present in all
          material respects the financial condition, results of operations and
          cash flows of the registrant as of, and for, the periods presented in
          this quarterly report;

     4.   The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
          and we have:

               a)   designed such disclosure controls and procedures to ensure
                    that material information relating to the registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others within those entities, particularly during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the effectiveness of the registrant's disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this quarterly report (the "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness of the disclosure controls and procedures
                    based on our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation, to the registrant's auditors and the
          audit committee of registrant's board of directors (or persons
          performing the equivalent function):

               a)   all significant deficiencies in the design or operation of
                    internal controls which could adversely affect the
                    registrant's ability to record, process, summarize and
                    report financial data and have identified for the
                    registrant's auditors any material weaknesses in internal
                    controls; and

               b)   any fraud, whether or not material, that involves management
                    or other employees who have a significant role in the
                    registrant's internal controls; and

     6.   The registrant's other certifying officer and I have indicated in this
          quarterly report whether or not there were significant changes in
          internal controls or in other factors that could significantly affect
          internal controls subsequent to the date of our most recent
          evaluation, including any corrective actions with regard to
          significant deficiencies and material weaknesses.



Date:  May 12, 2003                     By:         /s/  Shawn F. Javid
     --------------                        -------------------------------------
                                                       Shawn F. Javid
                                           President and Chief Executive Officer


                                       26
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             QUARTERLY CERTIFICATION PURSUANT TO SECTION 302 OF THE
                           SARBANES-OXLEY ACT OF 2002

I,  Fred  Schapelhouman,  certify  that:

     1.   I have reviewed this quarterly report on Form 10-Q of Insightful
          Corporation;

     2.   Based on my knowledge, this quarterly report does not contain any
          untrue statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this quarterly report, fairly present in all
          material respects the financial condition, results of operations and
          cash flows of the registrant as of, and for, the periods presented in
          this quarterly report;

     4.   The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
          and we have:

               a)   designed such disclosure controls and procedures to ensure
                    that material information relating to the registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others within those entities, particularly during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the effectiveness of the registrant's disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this quarterly report (the "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness of the disclosure controls and procedures
                    based on our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation, to the registrant's auditors and the
          audit committee of registrant's board of directors (or persons
          performing the equivalent function):

               a)   all significant deficiencies in the design or operation of
                    internal controls which could adversely affect the
                    registrant's ability to record, process, summarize and
                    report financial data and have identified for the
                    registrant's auditors any material weaknesses in internal
                    controls; and

               b)   any fraud, whether or not material, that involves management
                    or other employees who have a significant role in the
                    registrant's internal controls; and

6.   The registrant's other certifying officer and I have indicated in this
     quarterly report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.



Date:  May 12, 2003                     By:       /s/ Fred Schapelhouman
     --------------                        -------------------------------------
                                                    Fred Schapelhouman
                                                 Chief Financial Officer

                                       27
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                                  EXHIBIT INDEX

EXHIBIT
 NUMBER                            DESCRIPTION
-------                            -----------
 3.1     Amended and Restated Certificate of Incorporation of the Registrant

 3.2     Amended  and  Restated  Bylaws  of  the  Registrant

10.1     Amendment No. 1 to Loan and Security Agreement, dated March 28,
         2003, by and between Insightful Corporation and Silicon Valley Bank

99.1     Certification  of  Financial  Statements by Chief Executive Officer of
         Insightful Corporation as Required by Section 906 of Sarbanes-Oxley Act
         of 2002

99.2     Certification  of  Financial  Statements by Chief Financial Officer of
         Insightful Corporation as Required by Section 906 of Sarbanes-Oxley Act
         of 2002
-----------

                                       28
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