SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-Q


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

            For the quarterly period ended              January 31, 1996
                                                        ----------------

-----    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 0-13284

                               V BAND CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


           New York                                           13-2990015
-------------------------------                           -------------------
(State or other jurisdiction of                            (IRS Employer
incorporation or organization)                            Identification No.)


                   565 Taxter Road, Elmsford, New York 10523
              ----------------------------------------------------
              (Address and zip code of principal executive office)


                                 (914) 789-5000
              ----------------------------------------------------
              (Registrant's telephone number, including area code)


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


The number of shares of Common Stock  outstanding,  as of January 31, 1996,  was
5,323,170 shares.
<PAGE>
                               V BAND CORPORATION
                           FORM 10-Q QUARTERLY REPORT
                   FOR THE THREE MONTHS ENDED JANUARY 31, 1996




                                TABLE OF CONTENTS


                          PART I. Financial Information

Item 1. Financial Statements

        Consolidated  balance sheets at January 31, 1996 (unaudited) and October
            31, 1995

        Consolidated statements of operations for the three months ended January
            31, 1996 and 1995 (unaudited)

        Consolidated statements of cash flows for the three months ended January
            31, 1996 and 1995 (unaudited)

        Notes to consolidated financial statements  (unaudited)


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


SIGNATURES
<PAGE>
                       V BAND CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                      JANUARY 31, 1996 AND OCTOBER 31, 1995
                          (in 000's, except share data)
<TABLE>
<CAPTION>
                                                                 January 31,       October 31,
                                                                     1996             1995
                                                                   --------         --------
                                                                 (unaudited)
<S>                                                                <C>              <C>     
  ASSETS
Current Assets
Cash and cash equivalents .................................        $    698         $  2,740
Marketable securities, at cost (approximates market) ......             101              187
Accounts receivable, less allowance for doubtful
  accounts of $459 in 1996 and $456 in 1995 ...............           6,722            4,783
Inventories, net ..........................................           7,320            7,596
Deferred tax asset ........................................             700              700
Prepaid expenses and other current assets .................             480              430
                                                                   --------         --------
            Total current assets ..........................          16,021           16,436
                                                                   --------         --------
Fixed Assets
Furniture, fixtures equipment and leasehold improvements ..           9,322            9,392
Less: Accumulated depreciation and amortization ...........          (7,933)          (7,821)
                                                                   --------         --------
            Total fixed assets ............................           1,389            1,571
                                                                   --------         --------
Other Assets ..............................................           2,993            3,205
                                                                   --------         --------
  TOTAL ASSETS ............................................        $ 20,403         $ 21,212
                                                                   ========         ========
  LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable ..........................................        $  1,763         $  1,538
Accrued wages .............................................             719            1,097
Customer deposits .........................................           1,330            1,846
Other accrued expenses ....................................           2,212            2,333
                                                                   --------         --------
            Total current liabilities .....................           6,024            6,814
                                                                   --------         --------
Shareholders' Equity
Common stock, $.01 par value; authorized 20,000,000 shares;
  issued 7,042,492 shares .................................              70               70
Capital in excess of par value ............................          19,776           19,776
Retained earnings .........................................           6,283            6,215
Cumulative translation adjustment .........................              18              105
                                                                   --------         --------
                                                                     26,147           26,166
Less - Treasury stock, at cost; 1,719,322 shares ..........         (11,768)         (11,768)
                                                                   --------         --------
            Total shareholders' equity ....................          14,379           14,398
                                                                   --------         --------
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ..............        $ 20,403         $ 21,212
                                                                   ========         ========
</TABLE>
                 See notes to consolidated financial statements
<PAGE>
                       V BAND CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
        FOR THE THREE MONTHS ENDED JANUARY 31, 1996 AND 1995 (unaudited)
                        (in 000's, except per share data)
<TABLE>
<CAPTION>
                                                            1996          1995
                                                          -------       -------
<S>                                                       <C>           <C>    
Sales
  Equipment ........................................      $ 7,312       $ 4,855
  Service ..........................................        1,238         1,444
                                                          -------       -------
    Total sales ....................................        8,550         6,299
                                                          -------       -------
Cost of Sales
  Equipment ........................................        4,388         3,562
  Service ..........................................          784           818
                                                          -------       -------
    Total cost of sales ............................        5,172         4,380
                                                          -------       -------
    Gross profit ...................................        3,378         1,919
                                                          -------       -------
Operating Expenses
  Selling, general and administrative ..............        2,455         3,427
  Research and development .........................          794           956
                                                          -------       -------
    Total operating expenses .......................        3,249         4,383
                                                          -------       -------

    Operating income (loss) ........................          129        (2,464)

Net Investment Income ..............................           19            74
Other Income (Expense) .............................          (80)           39
                                                          -------       -------
    Net income (loss) ..............................      $    68       $(2,351)
                                                          =======       ======= 
Per share data
  Net income (loss) ................................      $   .01       $  (.44)
                                                          =======       ======= 
Weighted average number of shares of common
 stock and common stock equivalents ................        5,328         5,322
                                                          =======       ======= 
</TABLE>
                 See notes to consolidated financial statements
<PAGE>
                       V BAND CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
        FOR THE THREE MONTHS ENDED JANUARY 31, 1996 AND 1995 (unaudited)
                                   (in 000's)
<TABLE>
<CAPTION>
                                                                              1996            1995
                                                                             -------         ------- 
<S>                                                                          <C>             <C>     
Cash Flows from Operating Activities
  Net income (loss) .................................................        $    68         $(2,351)
  Adjustments to reconcile net income (loss) to net
   cash used in operating activities
    Depreciation ....................................................            197             207
    Amortization of other assets ....................................            113             233
    Provision for doubtful accounts .................................              3              34
    Provision for inventory reserves ................................             25             185
    Gain on disposal of fixed assets ................................           --                (5)
    Changes in assets and liabilities (net of  business acquisitions)
       (Increase) decrease in accounts receivable ...................         (1,942)          1,324
       Decrease (increase) in inventories ...........................            251          (1,112)
       Increase in prepaid expenses and other current assets ........            (50)             (7)
       Decrease in other assets .....................................            101              73
       Decrease in accounts payable and accrued expenses ............           (790)           (780)
       Foreign currency translation adjustment ......................            (87)            (13)
                                                                             -------         ------- 
          Net cash used in operating activities .....................         (2,111)         (2,212)
                                                                             -------         ------- 
Cash Flows from Investment Activities
  Purchases of marketable securities ................................                           (365)
  Sales of marketable securities, net ...............................             86             348
  Capital expenditures ..............................................            (17)            (48)
                                                                             -------         ------- 
          Net cash provided by (used in) investing activities .......             69             (65)
                                                                             -------         ------- 
          Net decrease in cash and cash equivalents .................         (2,042)         (2,277)

Cash and Cash Equivalents, at beginning of Period ...................          2,740           3,122
                                                                             -------         ------- 
Cash and Cash Equivalents, at end of Period .........................        $   698         $   845
                                                                             =======         =======
Supplementary Disclosures
  Income taxes paid .................................................        $    65         $    78
                                                                             =======         =======
</TABLE>
                 See notes to consolidated financial statements
<PAGE>

                       V BAND CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




Note A -- Basis of Presentation

The accompanying  consolidated  financial  statements  include the accounts of V
Band  Corporation  and  its  wholly-owned  subsidiaries  (the  "Company").   All
significant intercompany balances and transactions have been eliminated. Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance with generally accepted  accounting  principles have been
condensed or omitted.  These consolidated financial statements should be read in
conjunction with the Company's audited financial  statements for the fiscal year
ended October 31, 1995 as set forth in the Company's annual report on Form 10-K.
In the  opinion of  management,  all  adjustments  (which  include  only  normal
recurring  adjustments)  necessary  to present  fairly the  financial  position,
results  of  operations  and cash  flows at  January  31,  1996 and all  periods
presented have been made.


Note B -- Significant accounting policies

Revenue recognition - Equipment revenue,  which includes equipment and labor for
new system  installations  and  modifications  to  existing  systems at customer
locations,  is  recognized as the product is shipped.  For long-term  contracts,
equipment  revenue is recognized  under the  percentage  of  completion  method.
Service revenue is recognized when the service has been completed.

Reclassifications - Certain  reclassifications  have been made to the prior year
quarter's information to conform to the current quarter's presentation.

Note C -- Inventories

Inventories are summarized as follows:
<TABLE>
<CAPTION>
                                                January 31,         October 31,
                                                   1996                1995
                                               ------------        ------------
<S>                                            <C>                 <C>         
Finished goods .........................       $  6,459,000        $  6,270,000
Parts and components ...................          5,261,000           5,761,000
                                               ------------        ------------
                                                 11,720,000          12,031,000
Less:  Inventory reserves ..............         (4,400,000)         (4,435,000)
                                               ------------        ------------
                                               $  7,320,000        $  7,596,000
                                               ============        ============
</TABLE>

Note D  -- Income Taxes

The  deferred  tax asset  valued at $700,000 is net of a valuation  allowance of
$5,026,000. As of October 31, 1995, the Company had available net operating loss
carryfowards for tax return purposes of approximately  $6,800,000 which begin to
expire in 2009.  Management has not recorded a provision for income taxes in the
three months ended  January 31, 1996 as a result of the  available net operating
loss carryfowards.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations.


Results of Operations

Sales  for the  first  quarter  of fiscal  1996,  ended  January  31,  1996,  of
$8,550,000 were $2,251,000,  or 36%, higher than the $6,299,000  reported in the
first  quarter of 1995.  Equipment  sales of  $7,312,000 in the first quarter of
1996  represents an increase of $2,457,000,  or 51%, from the equipment sales of
$4,855,000  in  first  quarter  of  1995.  This  increase  was due in part to an
increase in sales for the Company's eXchange Phone, Power Deck and DXi products.
Sales from the Company's  service business were $1,238,000 for the first quarter
of 1996,  a decrease of 14%,  compared to  $1,444,000  for the first  quarter of
1995,  resulting  from  periodic  variances  in the  completion  of repair sales
orders.

Gross  profit  margin for the first  quarter of 1996 was 40% compared to 30% for
the first  quarter of 1995.  The gross  profit  margin for the  equipment  sales
increased  to 40% in the  first  quarter  of 1996  compared  to 26% for the same
period in 1995. The increase in equipment  gross profit margin was  attributable
to several  factors -- a higher  volume of  equipment  sales;  a changing mix of
equipment  sold in favor of products  with  higher  gross  margins;  and reduced
production  costs  as  result  of  the  manufacturing  restructuring  initiative
completed  in fiscal  1995.  In  addition,  in the fourth  quarter of 1995,  the
Company wrote-off certain assets and increased certain inventory reserves.  As a
result,  the gross margin for the first  quarter 1996  reflects a lower level of
amortization  expense and reserves for inventory than the level of such items in
the first quarter of 1995. The gross profit margin for service sales was 37% for
the first  quarter of 1996 as compared to 41% for the same period in 1995.  This
decrease was primarily  attributable to the decreased  repair  department  sales
which typically earn a higher gross profit.

Operating expenses for the first quarter of 1996 were $3,249,000,  or $1,134,000
lower than the $4,383,000  reported for the first quarter of 1995. This decrease
in operating costs was  attributable  primarily to reduced payroll expenses as a
result of the Company-wide  restructuring  initiative undertaken in fiscal 1995.
Additionally,  during the first quarter of 1995, the Company recorded a $400,000
charge  related  to  the  transition  of  its  manufacturing  facility  to a new
location.

The net income  reported in the first quarter ended January 31, 1996 was $68,000
or $.01 per share  compared to a net loss of $2,351,000  or $.44 per share,  for
the first quarter of 1995. The average shares  outstanding for the quarter ended
January 31, 1996 increased to 5,328,000  versus 5,322,000 for the same period in
1995.

Financial Condition

The Company's aggregate of cash, cash equivalents and marketable  securities was
$799,000 at January 31, 1996, a decrease of $2,128,000 from the October 31, 1995
balances of $2,927,000.  The decline was attributable  primarily to the increase
in accounts  receivable for several large orders the Company  shipped during the
quarter for which, at October 31, 1995, the Company held partial deposits.

The  Company's  cash  management  practice  has been to invest  mainly in United
States  Treasury and United States  Government  Agency  securities and medium to
high-grade municipal  securities,  with maturities ranging from 90 days to three
years.
<PAGE>
                               V BAND CORPORATION


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.


                                                     V BAND CORPORATION
                                            ------------------------------------
                                                         (Registrant)



Date:  February 26, 1996                     /s/ Thomas E. Feil
                                            ------------------------------------
                                            Thomas E. Feil
                                            Chairman & Chief Executive Officer
                                            (Duly Authorized Officer)



Date:  February 26, 1996                    /s/ Mark R. Hahn    
                                            ------------------------------------
                                            Mark R. Hahn    
                                            Chief Financial Officer
                                            (Principal Accounting Officer)