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SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 10-Q

(Mark One)

|x                                                      | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 
|------------------------------------------------------ | ----------------------------------------------------------------------------------------
|                                                       |                                                                                         
|                                                       | for the quarterly period ended June 30, 2003                                            
|                                                       |                                                                                         
|or                                                    
|                                                       |                                                                                         
|o                                                      | 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: 0-26739                       
|                                                       |                                                                                         
|ITXC CORP.                                            
|(Exact name of registrant as specified in its charter)

|Delaware                                                       |  | 22-35-31960                         
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)
|                                                               |  |                                     
|750 College Road East                                         
|Princeton, New Jersey 08540                                   
|(Address of principal executive office, including zip code)   
|                                                              
|(609) 750-3333                                                
|(Registrants telephone number, including area code)          

Indicate by
checkmark 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 o
|----- | ----

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act.)

|Yes x | No o
|----- | ----

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

At July 31, 2003, there were 43,181,316
shares of Common Stock, par value $.001 per share, outstanding.

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ITXC CORP.

INDEX

|                                                                                               |                                                                                                               | Page
|---------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------- | ----
|                                                                                               |                                                                                                               |     
|Part I.  Financial Information                                                                 |                                                                                                              
|                                                                                               |                                                                                                              
|Item 1.  Financial Statements                                                                  |                                                                                                              
|                                                                                               |                                                                                                              
|                                                                                               | Condensed Consolidated Balance Sheets as of June 30, 2003 (Unaudited) and December 31, 2002                   | 1   
|                                                                                               |                                                                                                               |     
|                                                                                               | Condensed Consolidated Statements of Operations for the Three Months Ended June 30, 2003 and 2002 (Unaudited) | 2   
|                                                                                               |                                                                                                               |     
|                                                                                               | Condensed Consolidated Statements of Operations for the Six Months Ended June 30, 2003 and 2002 (Unaudited)   | 3   
|                                                                                               |                                                                                                               |     
|                                                                                               | Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2003 and 2002 (Unaudited)   | 4   
|                                                                                               |                                                                                                               |     
|                                                                                               | Notes to Condensed Consolidated Financial Statements (Unaudited)                                              | 5   
|                                                                                               |                                                                                                               |     
|Item 2.  Managements Discussion and Analysis of Financial Condition and Results of Operations | 10                                                                                                           
|                                                                                               |                                                                                                               |     
|Item 3.  Quantitative and Qualitative Disclosure About Market Risk                             | 20                                                                                                           
|                                                                                               |                                                                                                              
|Item 4.  Controls and Procedures                                                               | 20                                                                                                           
|                                                                                               |                                                                                                              
|Part II. Other Information                                                                     |                                                                                                              
|                                                                                               |                                                                                                              
|Item 1.  Legal Proceedings                                                                     | 20                                                                                                           
|                                                                                               |                                                                                                              
|Item 2.  Changes in Securities and Use of Proceeds                                             | 22                                                                                                           
|                                                                                               |                                                                                                              
|Item 6.  Exhibits and Reports on Form 8-K                                                      | 22                                                                                                           
|                                                                                               |                                                                                                              
|Signatures                                                                                     | 23                                                                                                           

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PART I - Financial Information

Item 1. Financial Statements

ITXC CORP. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets

|                                               |  | June 30, 2003 |              | December 31, 2002 |  
|---------------------------------------------- |  | ------------- | ------------ | ----------------- | -
|                                               |  |               |              |                   |  
|                                               |  | (Unaudited)   |              |                   |  
|Cash and cash equivalents                      |  | $             | 10,797,241   |                   | $
|Marketable securities                          |  |               | 47,791,420   |                   |  
|Accounts receivable, net                       |  |               | 30,586,617   |                   |  
|Prepaid expenses and other current assets      |  |               | 3,868,097    |                   |  
|Restricted cash                                |  |               | 2,235,877    |                   |  
|                                               |  |               |              |                   |  
|Total current assets                           |  |               | 95,279,252   |                   |  
|Property and equipment, net                    |  |               | 34,202,948   |                   |  
|Goodwill                                       |  |               | 7,913,319    |                   |  
|Intangible assets, net                         |  |               | 2,446,863    |                   |  
|Other assets                                   |  |               | 880,172      |                   |  
|                                               |  |               |              |                   |  
|Total assets                                   |  | $             | 140,722,554  |                   | $
|                                               |  |               |              |                   |  
|Accounts payable and accrued liabilities       |  | $             | 31,318,865   |                   | $
|Other liabilities                              |  |               | 774,582      |                   |  
|Current portion of capital lease obligations   |  |               | 1,779,177    |                   |  
|                                               |  |               |              |                   |  
|Total current liabilities                      |  |               | 33,872,624   |                   |  
|Capital lease obligation, less current portion |  |               | 1,144,346    |                   |  
|Common stock                                   |  |               | 46,911       |                   |  
|Additional paid in capital                     |  |               | 460,201,940  |                   |  
|Accumulated other comprehensive income         |  |               | 12,782       |                   |  
|Accumulated deficit                            |  |               | (344,742,238 | )                 |  
|Treasury stock                                 |  |               | (9,813,811   | )                 |  
|                                               |  |               |              |                   |  
|Total stockholders equity                     |  |               | 105,705,584  |                   |  
|                                               |  |               |              |                   |  
|Total liabilities and stockholders equity     |  | $             | 140,722,554  |                   | $
|                                               |  |               |              |                   |  

See accompanying notes.

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ITXC CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations  (Unaudited)

|                                                                                                                                                                                              |  | Three Months ended June 30, |            
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------- | -----------
|                                                                                                                                                                                              |  |                             |            
|                                                                                                                                                                                              |  | 2003                        |            
|                                                                                                                                                                                              |  |                             |            
|Total revenues                                                                                                                                                                                |  | $                           | 84,214,182 
|Costs and expenses:                                                                                                                                                                           |  |                             |            
|Data communications and telecommunications (exclusive of depreciation shown separately below)                                                                                                 |  |                             | 77,000,413 
|Network operations (exclusive of depreciation shown separately below and exclusive of $96,264 of equity related charges included in non-cash
employee compensation in 2002)                   |  |                             | 2,373,937  
|Selling, general and administrative (exclusive of depreciation shown separately below and exclusive of $601,098 of equity related charges
included in non-cash employee compensation in 2002) |  |                             | 10,984,147 
|Depreciation                                                                                                                                                                                  |  |                             | 5,372,390  
|Amortization                                                                                                                                                                                  |  |                             | 121,354    
|Restructuring charges                                                                                                                                                                         |  |                             | 283,736    
|Non-cash employee compensation                                                                                                                                                                |  |                             |           
|                                                                                                                                                                                              |  |                             |            
|Total costs and expenses                                                                                                                                                                      |  |                             | 96,135,977 
|                                                                                                                                                                                              |  |                             |            
|Loss from operations                                                                                                                                                                          |  |                             | (11,921,795
|Interest income, net                                                                                                                                                                          |  |                             | 249,351    
|                                                                                                                                                                                              |  |                             |            
|Loss before income taxes                                                                                                                                                                      |  |                             | (11,672,444
|Income tax expense                                                                                                                                                                            |  |                             | 178,723    
|                                                                                                                                                                                              |  |                             |            
|Net loss                                                                                                                                                                                      |  | $                           | (11,851,167
|                                                                                                                                                                                              |  |                             |            
|Basic and diluted net loss per share                                                                                                                                                          |  | $                           | (0.28      
|                                                                                                                                                                                              |  |                             |            
|Weighted average shares used in computation of basic and diluted net loss per share                                                                                                           |  |                             | 42,889,332 

See accompanying notes.

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ITXC CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations  (Unaudited)

|                                                                                                                                                                                                |  | Six Months ended June 30, |            
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------- | -----------
|                                                                                                                                                                                                |  |                           |            
|                                                                                                                                                                                                |  | 2003                      |            
|                                                                                                                                                                                                |  |                           |            
|Total revenues                                                                                                                                                                                  |  | $                         | 165,922,098
|Costs and expenses:                                                                                                                                                                             |  |                           |            
|Data communications and telecommunications (exclusive of depreciation shown separately below)                                                                                                   |  |                           | 149,619,926
|Network operations (exclusive of depreciation shown separately below and exclusive of $192,526 of equity related charges included in non-cash
employee compensation in 2002)                    |  |                           | 4,872,151  
|Selling, general and administrative (exclusive of depreciation shown separately below and exclusive of $1,202,196 of equity related charges
included in non-cash employee compensation in 2002) |  |                           | 29,688,270 
|Depreciation                                                                                                                                                                                    |  |                           | 11,008,315 
|Amortization                                                                                                                                                                                    |  |                           | 242,706    
|Restructuring charges                                                                                                                                                                           |  |                           | 283,736    
|Non-cash employee compensation                                                                                                                                                                  |  |                           |           
|                                                                                                                                                                                                |  |                           |            
|Total costs and expenses                                                                                                                                                                        |  |                           | 195,715,104
|                                                                                                                                                                                                |  |                           |            
|Loss from operations                                                                                                                                                                            |  |                           | (29,793,006
|Interest income, net                                                                                                                                                                            |  |                           | 603,196    
|                                                                                                                                                                                                |  |                           |            
|Loss before income taxes                                                                                                                                                                        |  |                           | (29,189,810
|Income tax expense                                                                                                                                                                              |  |                           | 352,257    
|                                                                                                                                                                                                |  |                           |            
|Net loss                                                                                                                                                                                        |  | $                         | (29,542,067
|                                                                                                                                                                                                |  |                           |            
|Basic and diluted net loss per share                                                                                                                                                            |  | $                         | (0.69      
|                                                                                                                                                                                                |  |                           |            
|Weighted average shares used in computation of basic and diluted net loss per share                                                                                                             |  |                           | 42,850,436 

See accompanying notes.

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ITXC CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)

|                                                                               |  | Six months ended June 30, |            
|------------------------------------------------------------------------------ |  | ------------------------- | -----------
|                                                                               |  |                           |            
|                                                                               |  | 2003                      |            
|                                                                               |  |                           |            
|Operating activities                                                           |  |                           |            
|Net loss                                                                       |  | $                         | (29,542,067
|Adjustments to reconcile net loss to net cash used in operating activities:    |  |                           |            
|Depreciation                                                                   |  |                           | 11,008,315 
|Amortization of intangibles                                                    |  |                           | 242,706    
|Provision for doubtful accounts                                                |  |                           | 9,633,768  
|Realized loss (gain) on sale of investments                                    |  |                           | 71,091     
|Amortization of original issue discounts                                       |  |                           | 97,338     
|Non-cash restructuring charges                                                 |  |                           |           
|Amortization of non-cash deferred employee compensation                        |  |                           |           
|Changes in operating assets and liabilities:                                   |  |                           |            
|Increase in accounts receivable                                                |  |                           | (14,887,820
|(Decrease) increase in prepaid expenses and other assets                       |  |                           | 1,483,470  
|Decrease in accounts payable and accrued expenses                              |  |                           | (3,345,367 
|Increase (decrease) in other liabilities                                       |  |                           | 150,015    
|                                                                               |  |                           |            
|Net cash used in operating activities                                          |  |                           | (25,088,551
|                                                                               |  |                           |            
|Investing activities                                                           |  |                           |            
|Purchase of property and equipment                                             |  |                           | (8,510,311 
|Purchase of Nexcom                                                             |  |                           |           
|Increase in restricted cash                                                    |  |                           | (20,804    
|Purchase of available for sale securities                                      |  |                           | (30,306,402
|Sale of available for sale securities                                          |  |                           | 31,068,859 
|Maturities of available for sale securities                                    |  |                           | 11,600,000 
|                                                                               |  |                           |            
|Net cash provided by (used in) investing activities                            |  |                           | 3,831,342  
|                                                                               |  |                           |            
|Financing activities                                                           |  |                           |            
|Repayment of capital lease obligations                                         |  |                           | (1,349,270 
|Proceeds from exercise of stock options                                        |  |                           | 109,114    
|Proceeds from issuance of common stock related to employee stock purchase plan |  |                           | 260,928    
|Repayment of equipment line of credit                                          |  |                           |           
|                                                                               |  |                           |            
|Net cash used in financing activities                                          |  |                           | (979,228   
|                                                                               |  |                           |            
|Effect of exchange rate fluctuations on cash                                   |  |                           | 6,309      
|                                                                               |  |                           |            
|Decrease in cash                                                               |  |                           | (22,230,128
|Cash and cash equivalents at beginning of period                               |  |                           | 33,027,369 
|                                                                               |  |                           |            
|Cash and cash equivalents at end of period                                     |  | $                         | 10,797,241 
|                                                                               |  |                           |            

See accompanying notes.

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ITXC CORP. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

1. Basis of Presentation

The June 30, 2003 and 2002 financial statements have been prepared by ITXC Corp. (the Company or ITXC) and are unaudited.  In the opinion of the Companys management, all
adjustments (consisting solely of normal recurring adjustments) necessary to present fairly the Companys consolidated financial position, results of operations and cash flows for the interim periods have been made. Certain information and
footnote disclosures required under accounting principles generally accepted in the United States have been condensed or omitted from the consolidated financial statements and notes thereto presented herein pursuant to the rules and regulations of
the Securities and Exchange Commission. The condensed consolidated financial statements and notes thereto presented herein should be read in conjunction with the Companys audited consolidated financial statements for the year ended December
31, 2002 and notes thereto included in the Companys Annual Report on Form 10-K for the year ended December 31, 2002 filed with the Securities and Exchange Commission. The results of operations for the three and six months ended June 30, 2003
are not necessarily indicative of the results to be expected for any other interim period or the entire fiscal year.

The consolidated financial statements include the accounts of ITXC Corp. and
its wholly-owned subsidiaries.  All significant intercompany balances and transactions have been eliminated in consolidation.

2. Comprehensive Income

The components of comprehensive loss for the three and six month periods ended June 30, 2003 and 2002 were as follows:

|                                         |  | Three Months ended June 30, |             | Six Months ended June 30, |  
|---------------------------------------- |  | --------------------------- | ----------- | ------------------------- | -
|                                         |  |                             |             |                           |  
|                                         |  | 2003                        |             | 2002                      |  
|                                         |  |                             |             |                           |  
|Net loss                                 |  | $                           | (11,851,167 | )                         | $
|Other comprehensive income:              |  |                             |             |                           |  
|Unrealized holding gains (losses)        |  |                             | (83,727     | )                         |  
|Foreign currency translation adjustments |  |                             | 5,754       |                           |  
|                                         |  |                             |             |                           |  
|Comprehensive loss                       |  | $                           | (11,929,140 | )                         | $

3.  Stock-Based Compensation

The Company accounts
for employee stock-based compensation in accordance with Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, using an intrinsic value approach to measure compensation expense, if any. Appropriate
disclosures using a fair value based method, as provided by Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (SFAS 123), as amended by Statement of Financial Accounting Standards
No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure, are also reflected in these notes to the financial statements. The Company has not issued any options other than to employees and directors and certain
consultants who are occupied full time in the Companys activities.

The following table summarizes relevant information as to reported results under the Companys intrinsic value method
of accounting for stock options, with supplemental information as if the fair value recognition

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provisions of SFAS No. 123 had been applied for the three and six month periods ended June 30, 2003 and 2002:

|                                                                                                 |  | Three Months ended June 30, |             | Six Months ended June 30, |  
|------------------------------------------------------------------------------------------------ |  | --------------------------- | ----------- | ------------------------- | -
|                                                                                                 |  |                             |             |                           |  
|                                                                                                 |  | 2003                        |             | 2002                      |  
|                                                                                                 |  |                             |             |                           |  
|Net loss applicable to common stockholders                                                       |  | $                           | (11,851,167 | )                         | $
|Add:  stock-based compensation, as reported pursuant to APB 25                                   |  |                             |            |                           |  
|Deduct:  total stock-based compensation determined under fair value based methods for all awards |  |                             | (3,455,245  | )                         |  
|                                                                                                 |  |                             |             |                           |  
|Adjusted net loss, fair value method for all stock-based awards                                  |  |                             | (15,306,412 | )                         |  
|                                                                                                 |  |                             |             |                           |  
|Basic and diluted net loss per share, as reported                                                |  | $                           | (0.28       | )                         | $
|                                                                                                 |  |                             |             |                           |  
|Basic and diluted net loss per share, SFAS 123 adjusted                                          |  | $                           | (0.36       | )                         | $
|                                                                                                 |  |                             |             |                           |  

4.  Acquisition

On May 2, 2002 the Company
purchased assets, which comprised the wholesale call completion business operated by privately-held Nexcom Telecommunications LLC (Nexcom) in 11 countries in Eastern Europe, for total consideration of $11.7 million which consisted of
$9.0 million in cash and 533,701 shares of the Companys common stock.  275,459 of those shares and $1.5 million in cash were subject to an escrow agreement supporting Nexcoms indemnification obligations to the Company.  All
escrow shares and cash were distributed to Nexcom in May 2003.  Nexcom had previously provided termination services to the Company in most of the countries in which the assets are located.In connection with the transaction, the
Company recorded goodwill of $7.9 million; and other intangibles of $2.9 million related to vendor agreements, customer lists and licenses, which will be amortized over periods ranging from 3 to 80 months.  These values were determined using an
independent third party valuation.  Also included in the purchase were $0.8 million of property, plant and equipment.  The acquisition was accounted for as a purchase in accordance with SFAS No. 141, Business Combinations, and accordingly,
the net assets and results of operations have been included in the Consolidated Financial Statements from the date of acquisition. The acquisition would not have had a material impact on the Companys results of operations, had the acquisition
been completed at the beginning of the periods presented.

5.  Restructuring Charges

During the second quarter and in the beginning of the
third quarter of 2003, the Company reduced headcount by approximately 10%.  The reductions were possible because of the network simplification and new technology deployed during the quarter as well as the elimination of some unprofitable
customers and affiliates.  Approximately $284,000 of related restructuring charges were recorded in the second quarter associated with a reduction of nine employees.  The Company anticipates recording an additional charge of approximately
$350,000 in the third quarter related to headcount reductions of twenty-two employees that took place in the third quarter.

During the first quarter of 2002, the Company recorded  $1.1
million in restructuring charges related to two of its lease facilities.  An additional $0.2 million in restructuring charges was recorded in the second quarter of 2002 associated with the lease for the closed office in Beaverton, Oregon. 
In the first quarter of 2003, the Company reached a settlement with the landlord for the Beaverton, Oregon facility resulting in a cash payment to the landlord of approximately $1.2 million.  The Company recorded an additional restructuring
charge in the

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fourth quarter of 2002 related to this settlement.  No further restructuring charges are expected in 2003 associated with this facility.

6.  Goodwill and Other Intangible Assets

The following table summarizes the activity in Goodwill for the periods indicated:

|                        |  | Three Months ended June 30, |           | Six Months ended June 30, |  
|----------------------- |  | --------------------------- | --------- | ------------------------- | -
|                        |  |                             |           |                           |  
|                        |  | 2003                        |           | 2002                      |  
|                        |  |                             |           |                           |  
|Beginning balance, net  |  | $                           | 7,913,319 |                           | $
|Additions               |  |                             |          |                           |  
|Amortization Write-offs |  |                             |          |                           |  
|                        |  |                             |           |                           |  
|Ending balance, net     |  | $                           | 7,913,319 |                           | $
|                        |  |                             |           |                           |  

The following table summarizes the Other Intangibles subject to amortization at the dates indicated:

|                            |  | June 30, 2003          |           | December 31, 2002        |  
|--------------------------- |  | ---------------------- | --------- | ------------------------ | -
|                            |  |                        |           |                          |  
|                            |  | Gross  Carrying Amount |           | Accumulated Amortization |  
|                            |  |                        |           |                          |  
|Patents                     |  | $                      | 108,000   |                          | $
|Customer lists and licenses |  |                        | 240,000   |                          |  
|Vendor agreements           |  |                        | 2,700,000 |                          |  
|                            |  |                        |           |                          |  
|Total other intangibles     |  | $                      | 3,048,000 |                          | $
|                            |  |                        |           |                          |  

Amortization expense for Other Intangibles totaled approximately $121,000 and $96,000 for the three
months ended June 30, 2003 and 2002, respectively and $242,000 and $103,000 for the six months ended June 30, 2003 and 2002, respectively.

7.  Recent Accounting Pronouncements

In June 2001, the Financial Accounting Standards Board issued SFAS No. 143, Accounting for Asset Retirement Obligations. This Statement is effective for fiscal years beginning after June 15, 2002,
with early adoption permitted. SFAS No. 143 addresses the recognition and measurement of obligations associated with the retirement of tangible long-lived assets resulting from acquisition, construction, development, or the normal operation of a
long-lived asset. SFAS No. 143 requires that the fair value of an asset retirement obligation be recognized as a liability in the period in which it is incurred. The asset retirement obligation is to be capitalized as part of the carrying amount of
the long-lived asset and the expense is to be recognized over the useful life of the long-lived asset. The adoption of this standard did not have a significant impact on the Companys consolidated results of operations and financial
position.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities.SFAS No. 146 requires recording costs
associated with exit or disposal activities at their fair values when a liability has been incurred. Under previous guidance, certain exit costs were accrued upon managements commitment to an exit plan, which is generally before an actual
liability has been incurred. Adoption of SFAS No. 146 was effective beginning January 1, 2003.  The adoption of this standard did not have a material impact on the Companys consolidated results of operations and financial position.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure.  SFAS No. 148 amends SFAS No. 123, Accounting for
Stock-Based Compensation, to provide alternative methods of transition to SFAS No. 123s fair value method of accounting for stock-based

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employee compensation.  In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial
statements about the impact of the method used on reported results.  The disclosure provisions of SFAS No. 148 are effective for fiscal years ended after December 15, 2002 and have been incorporated into the accompanying notes presented
herein.

In January 2003, the Financial Accounting Standards Board issued Interpretation No. 46, Consolidation of Variable Interest Entities, an Interpretation of Accounting Research Bulletin (ARB)
No. 51. The Interpretation introduces a new consolidation model, the variable interests model, based on potential variability in gains and losses of the entity being evaluated for consolidation. It provides guidance for determining whether an entity
lacks sufficient equity or the entitys equity holders lack adequate decision-making ability. These entities, variable interest entities (VIE), are evaluated for consolidation based on their variable interests. Variable interests are
contractual, ownership or other interests in an entity that expose their holders to the risks and rewards of the VIE. The Interpretations provisions are effective for variable interests in VIEs created after January 31, 2003, and for
variable interests in VIEs created before February 1, 2003, no later than the first reporting period beginning after June 15, 2003. The Company does not believe that adoption of this standard will have a material impact on the Companys
financial statements.

8.  Restricted Cash

In conjunction with its letter of credit facility for its Princeton, New Jersey lease, the
Company has $2.2 million in restricted cash as of June 30, 2003 and December 31, 2002 that represents the collateral supporting the letter of credit.  The Company is obligated to maintain the letter of credit for the term of the lease, which
expires on July 31, 2011.  As a result, the Company will be required to either maintain the restricted cash or provide an alternative means of collateral.

9.  Legal Proceedings

The Company is involved in certain claims and legal actions arising in the normal course of business. Management does not expect that the outcome of these cases will have a material effect on the
Companys financial position or results of operations.

In September, 2001, the Company was served with a complaint filed in Virginia state court on behalf of Hercules Communications Company,
LLC in which the plaintiff demanded damages, including punitive damages, based on the Companys alleged refusal to carry out a purported agreement to purchase certain assets from Hercules. The claims were primarily based on alleged breach of an
oral contract, breach of implied contract, promissory estoppel and fraud. The Court dismissed plaintiffs claim for promissory estoppel and fraud, but did allow the plaintiff to refile its fraud complaint.  In June 2002, plaintiff moved to
substitute Hercules Satellite Communications, L.L.C. for Hercules Communications, LLC, over the Companys objection.  The Court rejected plaintiffs motion, and thereafter the plaintiff voluntarily dismissed the case.  A new case
was then brought in the name of Hercules Satellite Communications, L.L.C.  The allegations in the new case are substantially similar to those which had survived in the prior case.   A trial date is scheduled for August 18, 2003, and
discovery is now essentially complete. The Company continues to believe the case is not meritorious and intends to vigorously defend its conduct. On August 6, 2003, the Company filed a lawsuit in New Jersey Superior Court against Hercules
Communications, Hercules Satellite and their principals, alleging malicious prosecution, abuse of process, injurious falsehood and violation of RICO for their actions in pursuing a series of litigations and other conduct aimed at damaging ITXC and
coercing it into paying money to Hercules despite the absence of any obligation on ITXCs part to do so.

On May 23, 2000, Connectel, LLC, filed suit against the Company in the United States
District Court for the Eastern District of Pennsylvania. Connectel alleges in its complaint that the Company is infringing on the claims of a patent owned by Connectel by, acting alone or with others, assembling, offering to sell, selling or using
communications networks or switching systems within the United States and for export worldwide without license from Connectel. Connectel also seeks unspecified damages. Discovery has closed and ITXC moved for summary judgment in October 2002. 
Thereafter, in December 2002, the case was reassigned to a newly appointed United States District judge, Hon. James Knoll Gardner.  Nothing has happened on the litigation since that time.  The Company believes that the Connectel claims are
without merit.

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The Company and certain of its officers/directors were named as defendants in several purported shareholder class action lawsuits. The lawsuits allege, among other things,
that, in connection with the Companys public offerings of securities, its Prospectus did not disclose certain alleged practices involving its underwriters and their customers. These actions seek compensatory and other damages, and costs and
expenses associated with the litigation. No discovery has taken place.  ITXC is one of hundreds of companies named in substantially identical lawsuits.  Management believes that ITXC and its officers/directors did not engage in any
improper or illegal conduct. All of these cases have been consolidated for pretrial purposes before Judge Scheindlin in the Southern District of New York, who refused to dismiss the cases in an opinion issued in February 2003.  All of the
individual defendants who had been named as defendants in the Companys case have now been dismissed from the proceeding without prejudice, pursuant to a stipulation with the plaintiffs.  Neither the individual defendants nor the Company
nor its insurers paid any consideration for these dismissals.  The parties have negotiated a settlement entirely funded by the directors and officers insurance carriers, and it is anticipated that this proposed settlement (the terms of which
are still confidential) will be approved within the next few weeks and go to the Court for approval.  Under the terms of the settlement, the Company will neither have future liability nor expenses in connection with the litigation, except for a
limited obligation to cooperate in discovery in the plaintiffs continuing cases against the underwriters.

Interactive Marketing Technologies, Inc., (IMT) is a telecommunications
service bureau headquartered in Erlanger, Kentucky, to whom ITXC had discontinued service on February 20, 2003, and from which ITXC had demanded payment of a multimillion dollar past due balance, after the parties were unsuccessful in efforts to
restructure IMTs obligations to ITXC. IMT then sued ITXC seeking unspecified compensatory and punitive damages in the United States District Court for the Eastern District of Kentucky alleging breach of contract, bad faith, tortuous[sic]
interference with contract and negligent misrepresentation, among other claims.  It was the Companys belief that this dispute is covered by the arbitration clause of the agreement between ITXC and IMT, and the Company therefore commenced
an arbitration action against IMT seeking to recover the amounts owed by IMT, and has moved to dismiss the pending action in Kentucky based on the arbitration clause.  On July 8, 2003, the Court granted ITXCs motion and dismissed the
case.  ITXC has pursued the arbitration action as well.  IMT has now asserted the dismissed claims in the arbitration.

The Company is not a party to any other legal proceeding, the
adverse outcome of which is expected to have a material adverse effect on its business, financial condition, operating results or future prospects.

10.  Income Taxes

On July 2, 2002, the State of New Jersey signed into law new corporate business tax legislation, which was retroactive to January 1, 2002.  Accordingly, corporations are now subject to a gross receipts and gross
profits tax.  For the quarter ended June 30, 2003, the Company has recorded a provision for New Jersey income tax expense of $50,000 in its condensed consolidated statement of operations.  The Company also recorded $129,000 of tax expense
related to its overseas offices.  Tax expense for the six months ended June 30, 2003 was $352,000.

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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations

The following discussion
and analysis should be read in conjunction with the Consolidated Financial Statements, the related Notes to Consolidated Financial Statements and Managements Discussion and Analysis of Financial Condition and Results of Operations included in
the Companys Annual Report on Form 10-K for the year ended December 31, 2002 (the 10-K) and the Unaudited Condensed Consolidated Financial Statements and related Notes to Consolidated Financial Statements included in Item 1 of Part
I of this Quarterly Report on Form 10-Q.

ITXC has included in this Quarterly Report certain forward-looking statements within the meaning of the Private Securities Litigation Reform
Act of 1995 concerning ITXCs business, operations and financial condition. Forward-looking statements consist of all non-historical information, and the analysis of historical information, including any references in this Quarterly
Report to future revenue growth, future expense growth, future credit exposure, future profitability, anticipated cash resources, anticipated capital expenditures, capital requirements, and the Companys plans for future periods. In addition,
the words could, expects, anticipates, objective, plan, may affect, may depend, believes, estimates, projects and similar words
and phrases are also intended to identify such forward-looking statements.

Actual results could differ materially from those projected in the Companys forward-looking statements due to
numerous known and unknown risks and uncertainties, including, among other things, difficulties in predicting the outcome of a contest for control; unanticipated technological difficulties; the volatile and competitive environment for Internet
telephony and telecommunications; changes in domestic and foreign economic, market, and regulatory conditions; the inherent uncertainty of financial estimates and projections; uncertainty inherent in litigation; uncertainty relating to the search
for a successor CEO; the creditworthiness of our customers; the impact of future transactions; and other considerations described as Risk Factors in Exhibit 99.1 to the Companys Annual Report on Form 10-K for the year ended
December 31, 2002 and in other filings by the Company with the SEC. All such forward-looking statements are current only as of the date on which such statements were made. ITXC does not undertake any obligation to publicly update any forward-looking
statement to reflect events or circumstances after the date on which any such statement is made or to reflect the occurrence of unanticipated events.

Critical Accounting Policies and
Estimates

ITXCs discussion and analysis of its financial condition and results of operations are based upon the Companys Condensed 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 the Company 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, the Company evaluates its estimates, including those related to bad debts, investments, intangible assets, restructuring and
litigation. The Company bases its estimates on historical experience and on various other assumptions that are believed 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.

The Company believes the
following critical accounting policies apply to and affect significant judgments and estimates used in the preparation of its Condensed Consolidated Financial Statements:

Allowance for Doubtful
Accounts. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. If the financial condition of the Companys customers were to deteriorate, resulting
in an impairment of their ability to make payments,

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additional allowances may be required. The Company estimates the amount of the allowance for doubtful accounts required to reduce accounts receivable to expected net realized
value by reviewing the status of significant past-due receivables and analyzing historical bad debt trends and industry and customer specific conditions.

Revenue Recognition. The Company
recognizes telecommunications revenue and the related costs at the time the services are rendered. Telecommunications revenue is derived from fees charged to terminate voice and fax services over the Companys network. Increased competition
from other providers of Internet telephony services and traditional telephony services could materially adversely affect revenue in future periods. To date, the Company has derived a significant portion of its revenue from a small number of
customers. The loss of a major customer could have a material adverse effect on the Companys business, financial condition, operating results and future prospects.

Goodwill and Other
Intangible Assets.  On January 1, 2002, the Company adopted Statement of Financial Accounting Standard No. 142, Goodwill and Other Intangible Assets.  In assessing the recoverability of its goodwill and other intangibles, the
Company must make assumptions regarding estimated future cash flows.  If such assumptions change in the future, the Company may be required to record impairment charges for these assets.

Property and Equipment.   On January 1, 2002, the Company adopted Statement of Financial Accounting Standard No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets.  If indicators of
impairment are present, the Company must determine whether the sum of the estimated undiscounted cash flows attributable to the assets in question is less than its carrying amount. If less, the Company will be required to recognize an impairment
loss based on the excess of the carrying amount of the assets over their respective fair values.  The Company is in the process of simplifying its network to eliminate the need for circuit switches in new installations, to lower costs and
improve quality and reliability for its customers, and to reduce further capital costs and operating complexity.  As a result, the Company recognized $7.5 million of impairment charges in 2002 related to this simplification.

Overview

We are a leading global provider of voice and fax services established in July 1997. We primarily use the Internet for
transport of these calls.

In April 1998, we launched our first service delivered over ITXC.net®-our WWeXchange® service. Our operations since that time have included:

| | increasing our voice traffic, from 2,746 minutes during April 1998 to approximately 999 million minutes carried through our WWeXchange service during the quarter ended June 30,
2003;
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                       
| | refining our monitoring and analysis software in order to achieve BestValue Routing;                                                                                                  
|  |                                                                                                                                                                                       
| | expanding our affiliate network to 241 affiliates at July 31, 2003;                                                                                                                   
|  |                                                                                                                                                                                       
| | increasing the global reach of ITXC.net to over 175 countries at July 31, 2003;                                                                                                       
|  |                                                                                                                                                                                       
| | applying for and securing patents on key technology;                                                                                                                                  
|  |                                                                                                                                                                                       
| | increasing our direct connection to customers using ITXC-owned SNARCs® located at the customers premises; and                                                                        

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| | increasing our employee headcount, from 29 employees on April 1, 1998 to 246 employees on July 31, 2003.
|- | --------------------------------------------------------------------------------------------------------

To date, our primary sources of revenue have been the fees that we receive from customers for terminating calls that they have originated. Our revenue for terminating calls over ITXC.net has depended primarily upon the
following factors:

| | the volume of voice traffic carried over ITXC.net, which is measured in terms of minutes of voice traffic;                                                                                                                            
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                       
| | the mix of voice traffic carried over ITXC.net, which reflects the fact that calls made over certain routes will generate greater revenues than calls of a similar duration made over other
routes;                                   
|  |                                                                                                                                                                                                                                       
| | pricing pressures resulting from competitive conditions in our markets; and                                                                                                                                                           
|  |                                                                                                                                                                                                                                       
| | our ability to maximize our buy-sell margin, i.e. the difference between what we pay to receive termination service and what we are able to charge our customers. We generally
seek to maximize buy-sell margin rather than revenue.

Competition from other providers of Internet telephony services and traditional telephony services, failure of customers
to meet payment obligations and regulatory developments could materially adversely affect revenue in future periods.

To date, we have derived a significant portion of our revenue from a small
number of customers. The loss of a major customer could have a material adverse effect on our business, financial condition, operating results and future prospects.

Our operating expenses have
been primarily:

| | Data Communications and Telecommunications Expenses. Internet-related expenses, consisting primarily of:                                                                                                                                          
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                  
|  |                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                  
|  |                                                                                                                                                                                                                                                   
| | Network Operations Expenses. Expenses associated with operating the network, consisting primarily of the salaries, payroll taxes and benefits that we pay for those employees
directly involved in the operation of ITXC.net and related expenses.
|  |                                                                                                                                                                                                                                                   
| | Selling, General and Administrative Expenses. There are three components of selling, general and administrative expenses, consisting of the following:                                                                                            
|  |                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                  

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|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | and marketing expenses will increase in the future as we expand our internal sales force, hire additional marketing personnel and increase expenditures for sales, promotion and
marketing on a global level, although at a slower rate than we have experienced in recent quarters.                                                                                                                                          
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Development Expenses. Salary, payroll tax and benefit expenses that we pay for employees and consultants who work on the development of our network management approaches and
future applications of our technology. We believe that investing in the enhancement of our technology is critical to our future success. Development expenses may increase or decrease in future periods, based upon various factors,
including:
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                              
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                              
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                              
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | General and Administrative Expenses. Salary, payroll tax and benefit expenses and related costs for general corporate functions, including executive management, finance,
administration, facilities, legal, information technology and human resources, together with accounts receivable reserves.                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Non-Cash Employee Compensation Expenses. Non-cash employee compensation represents compensation expense incurred in connection with the
grant of certain stock options to our employees with exercise prices less than the fair value of our Common Stock at the respective dates of grant. During 1999, but prior to our initial public offering, we granted options to purchase 3,413,500
shares of our Common Stock at exercise prices equal to or less than fair value, resulting in non-cash charges of approximately $12.4 million. Similarly, in connection with our eFusion acquisition during 2000, we were required to take non-cash
charges of approximately $0.7 million in connection with options granted in exchange for options previously granted by eFusion.  Our non-cash employee compensation charges were fully expensed at the end of the second quarter of 2002.

We believe that the services we provide over the Internet are not currently actively regulated in the U.S. Several efforts have been made, however, to enact federal legislation that would
regulate certain aspects of the Internet. In addition, the Federal Communications Commission has been considering various initiatives that could affect the provision of Internet telephony, its regulatory status, and the obligations to make payments
to the Universal Service Fund. An adverse outcome of either regulatory proceedings or legislation could increase our costs significantly and could materially adversely affect our business, operating results, financial condition and future prospects.

We anticipate that from time to time our operating expenses may increase on a per minute basis as a result of decisions to route additional traffic over the traditional telephone network or
private data networks in order to maintain quality transmissions during relatively short periods of time as we transition our network to increased levels of capacity, or to meet peak demands.  During these periods, we occasionally experience
reductions in volume from certain customers. Historically, we have satisfactorily resolved these transition issues. However, in the future other anticipated or unanticipated operating problems associated with the growth of ITXC.net may
develop.

On May 2, 2002 the Company purchased assets which comprised the wholesale call completion business operated by Nexcom Telecommunications, LLC in 11 countries in eastern Europe, for total
consideration of $11.7, million which consisted of $9 million in cash and 533,701 shares of the Companys common stock. 275,459 of those shares and $1.5 million in cash were subject to an escrow agreement supporting Nexcoms

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indemnification obligations to the Company. All escrow shares and cash were distributed to Nexcom in May 2003. Nexcom had previously provided termination services to the
Company in most of the countries in which the assets are located. In connection with this acquisition the Company acquired capital assets and hired a small number of Nexcoms employees located in those countries.

Since our inception in July 1997, we have experienced operating losses in each quarterly and annual period and negative cash flows from operations in each quarter since we commenced offering services over ITXC.net in April
1998. As of June 30, 2003, we had an accumulated deficit of $344.7 million. The profit potential of our business is unproven, and our limited operating history makes an evaluation of us and our prospects difficult. We may not achieve profitability
or, if we achieve profitability, we might not sustain profitability.

On April 10, 2003, IDT Corporation publicly announced that it intended to make an offer to purchase our outstanding shares of
common stock for $1.40 in IDT Class B common stock. On the same date, we announced that our Board of Directors had met and had made an initial determination that the IDT proposal would not be in the interests of the Companys stockholders.

We also announced on April 10, 2003 that our Board had approved a Shareholder Protection Rights Plan and declared a dividend of one Right on each outstanding share of ITXC common stock. Initially
the Rights will be evidenced by common stock certificates, will automatically trade with the Companys common stock, and will not be currently exercisable. The Rights become exercisable when and if an entity acquires 15% or more of the
Companys common stock and will entitle each stockholder, other than the acquiring entity, to purchase a number of shares of common stock with a market value of $14 for a payment of $7 at that time. The Board, at its option, may require that
each Right be exchanged for one share of common stock. This exchange feature would not apply to rights held by an entity which has acquired 15% of the common stock. The Rights may be redeemed by the Board of Directors for $0.001 per Right at any
time before they become exercisable.

On May 1, 2003, IDT issued a press release which stated, in pertinent part, that it had terminated its proposal to acquire all outstanding shares of
ITXC.

We previously announced that we engaged the investment banking firm of Morgan Stanley & Co., Incorporated as our financial advisor.  Since that announcement, several companies have
submitted proposals and/or expressions of interest.  We are currently in discussions about possible strategic transactions.  It is by no means a certainty that any such transaction will actually occur in either the short or long term and
we are prepared to continue with our stand-alone business plan.

Results of Operations - Comparison of the Three and Six Months Ended June 30, 2003 and 2002

Revenues

Telecommunications revenues amounted to $84.2 million during the quarter ended June 30, 2003 and $165.9 million during the six months ended
June 30, 2003.  Revenues increased 27.6 % versus the second quarter of 2002 and increased 34.1 % versus the first six months of 2002.  Almost all of our total revenue during 2003 was derived from our WWeXchange service, which provides
international call completion to our customers and enables them to offer their own customers phone-to-phone global voice service. The increase over the second quarter of 2002 was the result of more calls being carried on our network, ITXC.net.

We carried approximately 999 million minutes of traffic in the second quarter of 2003 and 1.9 billion minutes of traffic in the first six months of 2003 as compared with 778 million minutes
and 1.4 billion minutes during the comparable periods of 2002. During the quarter ended June 30, 2003, our average revenues per minute was 8.4 cents per minute, as compared with 8.5 cents per minute during the quarter ended June 30, 2002. The
decrease in average revenues per minute is primarily attributable to changes in our route mix and to an overall

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decline in rates experienced in telecommunications over the past year.

Approximately $8.7 million of revenues reported for
the first quarter of 2003 relates to amounts from Interactive Marketing Technologies, Inc., which may not be collectible. The Company has reserved for these amounts in its Selling, General and Administrative Expenses.

Operating Expenses

Data Communications and Telecommunications Expenses. During the three months ended June 30, 2003 and 2002, data communication and
telecommunications expenses amounted to $77.0 million and $56.3 million, respectively, or 91.4% and 85.3% of revenues, respectively.  During the six months ended June 30, 2003 and 2002, data communications expenses amounted to $149.6 million
and $104.9 million, respectively, or 90.2% and 84.8% of revenues, respectively.  The increase in the dollar amount of such costs primarily reflected the increased traffic during 2003, as well as costs associated with establishing an increasing
capacity at our hubs in anticipation of future growth in traffic.  We have a full quarter of expenses associated with our Germany SuperPoP, which opened in February of 2003.

During the second
quarter of 2003, we also experienced higher termination cost on several routes. The weaker dollar increased our costs as well.  The Companys ARPMs (average rate per minute) percentage decreased from the second quarter of 2002 to the
second quarter of 2003.  This was primarily caused by changes in our route mix and by an overall decline in rates experienced in telecommunications over the past year.

Network Operations
Expenses.  Network operations expenses increased to $2.4 million during the three months ended June 30, 2003 from $1.9 million during the three months ended June 30, 2002 and to $4.9 million during the six months ended June 30, 2003 from $3.9
million during the six months of 2002.  Such expenses primarily reflected the cost of operating our 24-hours-a-day, 7 days-a-week network operations center, as well as costs associated with the New Jersey, Los Angeles, London and Frankfurt
hubs.

Network operations expenses represented 2.8% and 2.9% of revenues during the three months ended June 30, 2003 and 2002, respectively, and 3.0% and 3.1% of revenues during the six months
ended June 30, 2003 and 2002, respectively. We anticipate that we will be able to leverage these costs over a larger revenue base in future quarters.

Selling, General and Administrative Expenses.
Selling, general and administrative (SG&A) expenses increased to $11.0 million during the three months ended June 30, 2003 from $7.1 million during the three months ended June 30, 2002 and to $29.7 million during the six months ended
June 30, 2003 from $14.1 million during the same period in 2002.  Expenses during the second quarter of 2003 include $2.1 million related to lump sum payments to investment banking and executive recruiting firms for previously announced
engagements, legal expense in connection with litigation, and severance for positions eliminated during the quarter.  The remaining increase was principally related to higher headcount.  During the second quarter and in the beginning of
the third quarter, we reduced headcount by 10%.  This reduction was possible because of network simplification and new technology deployed.  SG&A expenses for the second quarter of 2002 included a reserve of approximately $0.4 million
related to WorldCom.  As a percentage of revenues, SG&A expenses increased to 13.0% from 10.7% over the comparable three-month period and to 17.9% from 11.4% over the comparable six-month period.  For the six months ended June 30,
2003, the increase is primarily attributable to a provision of $8.7 million that we made to our accounts receivable reserve in the first quarter of 2003 and the $2.1 million of lump sum payments mentioned above.  The remaining increase was
principally related to higher headcount levels in 2003.  Accounts receivable reserves and bad debt experience have been in large part a function of the financial state of the telecommunications companies who are our customers.  In order to
minimize accounts receivable reserves and write-offs, we have closely monitored credit exposure to customers, rejected customers that represented unacceptable credit risks, limited the business we would accept from customers whom we judge to bear
excess credit risk and made significant efforts to assure that bilateral

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arrangements permit the offset of accounts receivable against accounts payable.  Nonetheless, during the first quarter of 2003, we took a reserve of $8.7 million for the
potential bad debt associated with Interactive Technologies Inc. (IMT).

We had 277 employees at June 30, 2003, as compared with 239 employees at the end of the second quarter of
2002.

As our revenues continue to grow, we expect SG&A expenses to decrease as a percentage of revenues and they are expected to decrease in absolute terms. Such expectation represents a
forward-looking statement under the Private Securities Litigation Reform Act of 1995. Actual results could differ from such expectation as a result of a number of factors, including the rate of revenue growth, if any, the extent to which we incur
unanticipated expenses associated with revenue growth and the extent to which our customers present unanticipated credit problems.

Depreciation

Depreciation expense decreased to $5.4 million during the three months ended June 30, 2003 from $6.2 million during the three months ended June 30, 2002, and decreased to $11.0 million during the six-months ended June 30, 2003
from $11.9 million during the six months ended June 30, 2002.  The decrease in depreciation expense from 2002 to 2003 was a result of the equipment we removed from our network and wrote off during the fourth quarter of 2002.  Depreciation
continues to decrease as we get greater efficiencies from our installed capital expenditures. As a percentage of revenue, depreciation expense for the three-month periods was 6.4% in 2003 and 9.4% in 2002, and for the six-month period was 6.6% and
9.6%.  We added $8.5 million of capital expenditures during the first six months of 2003.

Amortization of Intangibles

In connection with our May 2, 2002 acquisition of the assets of Nexcom, we recorded $7.9 million of goodwill and $2.9 million of other intangibles.  We amortized $121,000 and $96,000 of other intangibles during the three
months ended June 30, 2003 and June 30, 2002, respectively, and $242,000 and $103,000 of other intangibles during the six months ended June 30, 2003 and June 30, 2002, respectively.

Non-Cash Employee Compensation Expenses

We had no non-cash employee compensation expense during the quarter ended June 30, 2003 as compared with  $0.7 million
during the quarter ended June 30, 2002.  Non-cash employee compensation represented amortization of deferred compensation incurred in connection with the grant of options at exercise prices less than fair value. These costs were fully amortized
at the end of the second quarter of 2002.

Interest Income, Net

Our interest income, net principally represents income
from cash and investments, which, in turn, were derived from capital contributions made by our investors.  During the quarters ended June 30, 2003 and 2002, the interest on our marketable securities, including the interest earned on the
proceeds from our initial and follow-on public offerings, exceeded the interest that we paid on our capital leases and line of credit by $0.2 million and $0.7 million, respectively, and during the six months ended June 30, 2003 and 2002 by $0.6
million and $1.6 million, respectively. The reduction in our interest income reflects our usage of cash and yield reductions resulting from a decline in short-term interest rates.

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Restructuring Charges

During the second quarter and in the beginning of the third quarter of 2003,
the Company reduced headcount by approximately 10%.  The reductions were possible because of the network simplification and new technology deployed during the quarter as well as the elimination of some unprofitable customers and
affiliates.  Approximately $284,000 of related charges were recorded in the second quarter associated with a headcount reduction of nine employees.  The Company anticipates recording an additional charge of approximately $350,000 in the
third quarter related to headcount reductions of twenty-two employees that took place in the third quarter and a subsequent quarterly savings of approximately $750,000 related to the reductions effected in the second and third quarter.

During the first quarter of 2002, the Company recorded  $1.1 million in restructuring charges related to two of its lease facilities.  An additional $0.2 million in restructuring chargers was
recorded in the second quarter of 2002 associated with the lease for the closed office in Beaverton, Oregon.  In the first quarter of 2003, the Company reached a settlement with the landlord for the Beaverton, Oregon facility resulting in a
cash payment to the landlord of approximately $1.2 million.  The Company recorded an additional restructuring charge in the fourth quarter of 2002 related to this settlement.  No further restructuring charges are expected in 2003
associated with this facility.

Losses

We have reported net operating losses and net losses since our inception. We
believe that we will first report positive net income and cash flow by the first half of 2004. This estimate represents a forward-looking statement under the Private Securities Litigation Reform Act of 1995.   Due to the risk factors
described in the first paragraph of this Managements Discussion and Analysis, the Companys actual results could vary materially from this estimate.

Liquidity and Capital Resources

Prior to our initial public offering, we financed our operations primarily through the private placement of our capital stock and, to
a lesser extent, through equipment financing. Net proceeds from our initial public offering, including proceeds resulting from the exercise by the underwriters of their over-allotment option, were $78.4 million. This capital was supplemented by net
proceeds of $161.4 million raised upon consummation of our March 2000 follow-on offering of Common Stock.

Net cash used in financing activities was $1.0 million for the six months ended June 30,
2003, principally reflecting the repayment of certain capital lease obligations.

Net cash used in operating activities amounted to $25.1 million for the six months ended June 30, 2003, primarily
the result of net operating losses, increased accounts receivable and a decrease in accounts payable and accrued expenses.

Net cash provided by investing activities was $3.8 million for the six
months ended June30, 2003 and was primarily related to the sale and maturity of available for sale securities offset by purchases of property and equipment. During the first six months of 2003 the Company incurred $8.5 million in capital
expenditures.

As of June 30, 2003, our principal commitments consisted of obligations outstanding under operating and capital leases. At that date, future minimum payments for all non-cancelable
leases included required payments of $3.8 million during 2004 and $16.8 million for years 2005-2008 and thereafter under all leases.   The remaining future minimum payments for 2003 are estimated to be $3.2 million.  The minimum lease
payments have not been reduced by minimum operating sublease rentals of $1.5 million due in the future under noncancelable subleases. We anticipate an increase in capital expenditures and lease commitments consistent

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with the anticipated growth in operations, infrastructure and personnel.

On October 23, 2002 the Company announced that
its Board of Directors had authorized a stock repurchase program for up to $10 million.  On March 31, 2003 the Company announced that its Board of Directors had authorized a stock repurchase program for up to an additional $5 million.  Any
purchases under this repurchase program may be made from time-to-time either in the open market, through block trades or otherwise. Depending on market conditions and other factors, these purchases may be commenced or suspended at any time or from
time-to-time without prior notice.  As of June 30, 2003 the Company had used $9.8 million of these authorizations to repurchase a total of 3,883,700 shares.  Included in this total was the negotiated direct purchase of 3,783,000 shares
from VocalTec Communications Inc. at $2.53 per share, which took place on November 5, 2002, pursuant to a purchase agreement.

During the quarter ended June 30, 2002, the Company
terminated a credit facility with a bank and paid the remaining $1.1 million outstanding balance of the equipment note payable.  In conjunction with the Companys letter of credit facility for its Princeton, New Jersey lease, the Company
has $2.2 million of restricted cash.

The primary sources of our short-term funding continue to be the capital that we have raised.  Our capital requirements depend on numerous factors,
including market acceptance of our services, the responses of our competitors, the resources allocated to ITXC.net and the development of future applications of our technology, our success in marketing and selling our services, and other factors. We
have experienced substantial increases in our capital expenditures since our inception, consistent with growth in our operations and staffing.  While we anticipate continuing our capital expenditures, we do not expect an increase in capital
expenditures year over year.  We will evaluate possible acquisitions of, or investments in, complementary businesses, technologies or services and plan to expand our sales and marketing programs. Any such possible acquisition may be material
and may require us to incur a significant amount of debt or issue a significant number of equity securities. Further, any businesses that we acquire will likely have their own capital needs, which may be significant, which we would be called upon to
satisfy independent of the acquisition price. We currently believe that our available cash and cash equivalents will be sufficient to meet our anticipated needs for working capital and capital expenditures for at least the next 12 months. This
statement represents a forward-looking statement under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from our expectations. We may need to raise additional funds in order to fund more rapid expansion,
to develop new or enhance existing services, to respond to competitive pressures or to acquire or invest in complementary business, technologies or services. Additional funding may not be available on favorable terms or at all.

The following summarizes ITXCs contractual obligations at June 30, 2003, and the effect such obligations are expected to have on the Companys liquidity and cash flow in future periods.

|Contractual Obligations            |  | Payments Due by Period |           
|---------------------------------- |  | ---------------------- | ----------
|                                   |  |                        |           
|                                   |  | Total                  |           
|                                   |  |                        |           
|Capital lease obligations          |  | $                      | 3,228,552 
|Operating leases                   |  | $                      | 20,581,176
|                                   |  |                        |           
|Total contractual cash obligations |  | $                      | 23,809,728
|                                   |  |                        |           

|Other Commercial Commitments |  | Total Amounts Committed |           | Less than  1 Year |   | 1  3 years |  | 4  5 years |   | Over 5 years |  
|---------------------------- |  | ----------------------- | --------- | ----------------- | - | ----------- |  | ----------- | - | ------------ | -
|                             |  |                         |           |                   |   |             |  |             |   |              |  
|Lines of credit              |  | $                       |          |                   | $ |            |  | $           |  |              | $
|Standby letters of credit    |  | $                       | 2,133,923 |                   | $ | 50,000      |  | $           |  |              | $
|                             |  |                         |           |                   |   |             |  |             |   |              |  
|Total commercial commitments |  | $                       | 2,133,923 |                   | $ | 50,000      |  | $           |  |              | $
|                             |  |                         |           |                   |   |             |  |             |   |              |  
|                             |  |                         |           |                   |   |             |  |             |   |              |  

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Certain executive officers of the Company have employment agreements for a limited term that provides to each such executive officer certain benefits in the
event that his employment is terminated without cause. In such event, such individuals would be entitled to receive their salary through the end of the term and certain bonus payments, as well as related benefits described in the agreement. In
general, benefits will not extend more than one year after a change in the chief executive officer or a change in control; in no event will benefits extend beyond October 1, 2005 absent a subsequent amendment to the agreement. The potential future
obligations under these agreements will not exceed $1.8 million.

Income Taxes

On July 2, 2002, the State of New Jersey
signed into law new corporate business tax legislation.  Corporations will now be subject to a gross receipts and gross profits tax.  We have recorded a provision for New Jersey tax of $50,000 in our condensed consolidated statement of
operations reflecting this New Jersey tax and $128,000 of tax expense related to our overseas offices in the second quarter of 2003.  Tax expense for the six months ended June 30, 2003 was $352,000.

Recent Accounting Pronouncements

In June 2001, the Financial Accounting Standards Board issued SFAS No. 143, Accounting for Asset Retirement Obligations.
This Statement is effective for fiscal years beginning after June 15, 2002, with early adoption permitted. SFAS No. 143 addresses the recognition and measurement of obligations associated with the retirement of tangible long-lived assets resulting
from acquisition, construction, development, or the normal operation of a long-lived asset. SFAS No. 143 requires that the fair value of an asset retirement obligation be recognized as a liability in the period in which it is incurred. The asset
retirement obligation is to be capitalized as part of the carrying amount of the long-lived asset and the expense is to be recognized over the useful life of the long-lived asset. The adoption of this standard did not have a significant impact on
the Companys consolidated results of operations and financial position.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal
Activities.SFAS No. 146 requires recording costs associated with exit or disposal activities at their fair values when a liability has been incurred. Under previous guidance, certain exit costs were accrued upon managements
commitment to an exit plan, which is generally before an actual liability has been incurred. Adoption of SFAS No. 146 was adopted beginning January 1, 2003.  The Company believes that the adoption of this standard did not have a material impact
on its consolidated results of operations and financial position.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation - Transition and
Disclosure.  SFAS No. 148 amends SFAS No. 123, Accounting for Stock-Based Compensation, to provide alternative methods of transition to SFAS No. 123s fair value method of accounting for stock-based employee
compensation.  In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the impact of the method used on reported results.  The
disclosure provisions of SFAS No. 148 are effective for fiscal years ended after December 15, 2002 and have been incorporated into the consolidated financial statements and accompanying notes presented elsewhere herein.

In January 2003, the Financial Accounting Standards Board issued Interpretation No. 46, Consolidation of Variable Interest Entities, an Interpretation of Accounting Research Bulletin (ARB) No. 51. The Interpretation introduces
a new consolidation model, the variable interests model, based on potential variability in gains and losses of the entity being evaluated for consolidation. It provides guidance for determining whether an entity lacks sufficient equity or the
entitys equity holders lack adequate decision-making ability. These entities, variable interest entities (VIE), are evaluated for consolidation based on their variable interests. Variable interests are contractual, ownership or other interests
in an entity that expose their holders to the risks and rewards of the VIE. The Interpretations provisions are effective for variable interests in VIEs created after January 31, 2003, and for variable interests in VIEs created
before February 1, 2003, no later than the first reporting period beginning after June 15, 2003. Management does not believe that the adoption of this standard will have a material impact on the Companys financial statements.

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Subsequent Event

On August 5, 2003, the Company announced that Leo Cyr, an experienced
telecommunications executive, has been elected to its Board of Directors.  The Board currently has a vacancy and Cyr will serve out the unexpired portion of that term which ends in 2005.  As a result of this appointment, a majority of the
members of the Board will again be independent.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

We had investments of $52.4 million as of June 30, 2003 in
certain marketable securities, which primarily consist of short-term fixed income investments. Due to the short-term nature of our investments, we believe that the effects of changes in interest rates are limited and would not have a material impact
on our financial condition or operating results.

Item 4.  Controls and Procedures

a)  Disclosure Controls and Procedures.  The Company has established and
maintains disclosure controls and procedures which are designed to provide reasonable assurance that material information relating to us, including our consolidated subsidiaries, is made known to senior managers responsible for disclosure by others
within those entities, particularly during the period in which this quarterly report is being prepared. We have established a Disclosure Committee which is made up of several key management employees and reports directly to the Chief Financial
Officer and Chief Executive Officer, to monitor and evaluate these disclosure controls and procedures. The Audit Committee of the Board also has reviewed the report of the Disclosure Committee.  As of the end of the Companys most recently
completed fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) covered by this report, the Company carried out an evaluation, with the participation of the Companys management, including the
Companys Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Companys disclosure controls and procedures pursuant to Securities Exchange Act Rule 13a-15. Based upon that evaluation, the Companys Chief
Executive Officer and Chief Financial Officer concluded that the Companys disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SECs rules and forms.

b)  Changes in internal controls over financial
reporting.  There have been no changes in the Companys internal controls over financial reporting that occurred during the Companys last fiscal quarter to which this report relates that have materially affected, or are reasonably
likely to materially affect, the Companys internal control over financial reporting.

PART II - Other Information

Item 1. Legal Proceedings

From time to time, we are involved in various legal proceedings relating to claims arising
in the ordinary course of business.

In September, 2001, the Company was served with a complaint filed in Virginia state court on behalf of Hercules Communications Company, LLC in which the
plaintiff demanded damages, including punitive damages, based on the Companys alleged refusal to carry out a purported agreement to purchase certain assets

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from Hercules. The claims were primarily based on alleged breach of an oral contract, breach of implied contract, promissory estoppel and fraud. The Court dismissed
plaintiffs claim for promissory estoppel and fraud, but did allow the plaintiff to refile its fraud complaint.  In June 2002, plaintiff moved to substitute Hercules Satellite Communications, L.L.C. for Hercules Communications, LLC, over
the Companys objection.  The Court rejected plaintiffs motion, and thereafter the plaintiff voluntarily dismissed the case.  A new case was then brought in the name of Hercules Satellite Communications, L.L.C.  The
allegations in the new case are substantially similar to those which had survived in the prior case.   A trial date is scheduled for August 18, 2003, and discovery is now essentially complete. The Company continues to believe the case is
not meritorious and intends to vigorously defend its conduct. On August 6, 2003, the Company filed a lawsuit in New Jersey Superior Court against Hercules Communications, Hercules Satellite and their principals, alleging malicious prosecution, abuse
of process, injurious falsehood and violation of RICO for their actions in pursuing a series of litigations and other conduct aimed at damaging ITXC and coercing it into paying money to Hercules despite the absence of any obligation on ITXCs
part to do so.

On May 23, 2000, Connectel, LLC, filed suit against the Company in the United States District Court for the Eastern District of Pennsylvania. Connectel alleges in its complaint that
the Company is infringing on the claims of a patent owned by Connectel by, acting alone or with others, assembling, offering to sell, selling or using communications networks or switching systems within the United States and for export worldwide
without license from Connectel. Connectel also seeks unspecified damages. Discovery has closed and ITXC moved for summary judgment in October 2002.  Thereafter, in December 2002, the case was reassigned to a newly appointed United States
District judge, Hon. James Knoll Gardner.  Nothing has happened on the litigation since that time.  The Company believes that the Connectel claims are without merit.

The Company and
certain of its officers/directors were named as defendants in several purported shareholder class action lawsuits. The lawsuits allege, among other things, that, in connection with the Companys public offerings of securities, its Prospectus
did not disclose certain alleged practices involving its underwriters and their customers. These actions seek compensatory and other damages, and costs and expenses associated with the litigation. No discovery has taken place.  ITXC is one of
hundreds of companies named in substantially identical lawsuits.  Management believes that ITXC and its officers/directors did not engage in any improper or illegal conduct. All of these cases have been consolidated for pretrial purposes before
Judge Scheindlin in the Southern District of New York, who refused to dismiss the cases in an opinion issued in February 2003.  All of the individual defendants who had been named as defendants in the Companys case have now been dismissed
from the proceeding without prejudice, pursuant to a stipulation with the plaintiffs.  Neither the individual defendants nor the Company nor its insurers paid any consideration for these dismissals.  The parties have negotiated a
settlement entirely funded by the directors and officers insurance carriers, and it is anticipated that this proposed settlement (the terms of which are still confidential) will be approved within the next few weeks and go to the Court for
approval.  Under the terms of the settlement, the company will neither have future liability nor expenses in connection with the litigation, except for a limited obligation to cooperate in discovery in the plaintiffs continuing cases
against the underwriters.

Interactive Marketing Technologies, Inc., (IMT) is a telecommunications service bureau headquartered in Erlanger, Kentucky, to whom ITXC had discontinued
service on February 20, 2003, and from which ITXC had demanded payment of a multimillion dollar past due balance, after the parties were unsuccessful in efforts to restructure IMTs obligations to ITXC. IMT then sued ITXC seeking unspecified
compensatory and punitive damages in the United States District Court for the Eastern District of Kentucky alleging breach of contract, bad faith, tortuous[sic] interference with contract and negligent misrepresentation, among other claims.  It
was the Companys belief that this dispute is covered by the arbitration clause of the agreement between ITXC and IMT, and the Company therefore commenced an arbitration action against IMT seeking to recover the amounts owed by IMT, and has
moved to dismiss the pending action in Kentucky based on the arbitration clause.  On July 8, 2003, the Court granted ITXCs motion and dismissed the case.  ITXC has pursued the arbitration action as well.  IMT has now asserted
the dismissed claims in the arbitration.

We are not a party to any other legal proceeding, the adverse outcome of which is expected to have a material adverse effect on our business, financial
condition, operating results or future prospects.

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Item 2.  Changes in Securities and Use of Proceeds

On April 10, 2003, the Board of Directors of the Company adopted a
Shareholder Protection Rights Plan and declared a dividend of one Right on each outstanding share of ITXC common stock. Initially the Rights will be evidenced by common stock certificates, will automatically trade with the Companys common
stock, and will not be currently exercisable. The Rights become exercisable when and if an entity acquires 15% or more of ITXCs common stock and will entitle each shareholder, other than the acquiring entity, to purchase a number of shares of
common stock with a market value of $14 for a payment of $7 at that time.

The Board, at its option, may require that each Right be exchanged for one share of common stock. This exchange feature
would not apply to rights held by an entity which has acquired 15% of the common stock. The Rights may be redeemed by the Board of Directors for $0.001 per Right at any time before they become exercisable.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits:

|4.1 Shareholder Protection Rights Plan, dated as of April 10, 2003, between ITXC Corp. and American Stock & Transfer Company, as Rights Agent, is incorporated by reference
to Exhibit 4.1 to the Registrants Current Report on Form 8-K filed with the SEC on April 14, 2003.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                               
|10.1 Form of Executive Employment Agreement executed by the Company with each of Edward B. Jordan, Theodore M. Weitz, John E. Landau and Eric Weiss                                                                                                                            
|                                                                                                                                                                                                                                                                               
|10.2 Executive Employment Agreement by and between the Company and Steven J. Ott.                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                               
|31.1 Certification of the Chief Executive Officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                   
|                                                                                                                                                                                                                                                                               
|31.2 Certification of the Chief Financial Officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                   
|                                                                                                                                                                                                                                                                               
|32.1 Certification of the Chief Executive Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                    
|                                                                                                                                                                                                                                                                               
|32.2 Certification of the Chief Financial Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                    
|                                                                                                                                                                                                                                                                               
|99.1 Risk Factors (incorporated by reference to Exhibit 99.1 to the Companys Annual Report on Form 10-K for the year ended December 31, 2002).                                                                                                                                

(b) The registrant submitted seven Current Reports on Form 8-K during the quarter ended June 30, 2003. Information regarding the items reported on is as follows:

|Date           |  | Matter Reported On                                                                                                                      
|-------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|               |  |                                                                                                                                         
|April 3, 2003  |  | Disseminated a press release dated March 31, 2003 (disclosure under item 5).                                                            
|April 10, 2003 |  | Disseminated a press release dated April 10, 2003 (disclosure under item 5).                                                            
|April 14, 2003 |  | Shareholder Protection Rights Plan, dated as of April 10, 2003 (disclosure under item 5).                                               
|April 21, 2003 |  | Disseminated a press release dated April 21, 2003 (disclosure under items 7 and 12).                                                    
|May 1, 2003    |  | Disseminated a press release dated April 21, 2003 (disclosure under item 5).                                                            
|May 7, 2003    |  | Resignation of Liam Strong from ITXC Board of Directors to be announced at the Annual Meeting of Stockholders (disclosure under item 9).
|June 2, 2003   |  | Resignation of Liam Strong from ITXC Board of Directors (disclosure under item 5).                                                      

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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.

ITXC CORP.

| | By: | /s/ EDWARDB. JORDAN                                                                            
| | --- | -----------------------------------------------------------------------------------------------
| |     |                                                                                                
| |     | Edward B. Jordan Executive Vice President, Chief Financial Officer and Chief Accounting Officer

Dated: August 14, 2003

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EXHIBIT INDEX

| | 4.1  | Shareholder Protection Rights Plan, dated as of April 10, 2003, between ITXC Corp. and American Stock & Transfer Company, as Rights Agent, is incorporated by reference to
Exhibit 4.1 to the Registrants Current Report on Form 8-K filed with the SEC on April 14, 2003.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                            
| | 10.1 | Form of Executive Employment Agreement executed by the Company with each of Edward B. Jordan, Theodore M. Weitz, John E. Landau and Eric Weiss                                                                                                                             
| |      |                                                                                                                                                                                                                                                                            
| | 10.2 | Executive Employment Agreement by and between the Company and Steven J. Ott.                                                                                                                                                                                               
| |      |                                                                                                                                                                                                                                                                            
| | 31.1 | Certification of the Chief Executive Officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                    
| |      |                                                                                                                                                                                                                                                                            
| | 31.2 | Certification of the Chief Financial Officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                    
| |      |                                                                                                                                                                                                                                                                            
| | 32.1 | Certification of the Chief Executive Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                     
| |      |                                                                                                                                                                                                                                                                            
| | 32.2 | Certification of the Chief Financial Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                     
| |      |                                                                                                                                                                                                                                                                            
| | 99.1 | Risk Factors (incorporated by reference to Exhibit 99.1 to the Companys Annual Report on Form 10-K for the year ended December 31, 2002).                                                                                                                                 

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