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                July 31, 1997
                                                          ------------- 

 [   ]   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 July 31,  1997,  was
5,412,591 shares.
<PAGE>


                               V BAND CORPORATION
                           FORM 10-Q QUARTERLY REPORT
                FOR THE THREE AND NINE MONTHS ENDED JULY 31, 1997




                                TABLE OF CONTENTS

                                                   
                          PART I. Financial Information 

Item 1.        Financial Statements

               Consolidated balance sheets at July 31, 1997 (unaudited) and
                  October 31, 1996         
                   
               Consolidated statements of operations for the three and nine 
                  months ended July 31, 1997 and 1996 (unaudited) 
                                                                                
               Consolidated statements of cash flows for the nine months
                  ended July 31, 1997 and 1996(unaudited)  

               Notes to consolidated financial statements(unaudited)  
                   
Item 2.        Management's Discussion and Analysis of Financial Condition and 
                   Results of Operations               
                   

                           PART II. Other Information 


Item 6.         Exhibits and Reports on Form 8-K              
                    


SIGNATURES  
<PAGE>
<TABLE>
<CAPTION>
                                            V BAND CORPORATION AND SUBSIDIARIES
                                                CONSOLIDATED BALANCE SHEETS
                                             JULY 31, 1997 AND OCTOBER 31, 1996
                                               (in 000's, except share data)


                                                                                   July 31,                    October 31,
                                                                                    1997                          1996
                                                                                -----------                    ----------- 
         ASSETS                                                                  (unaudited)
<S>                                                                             <C>                            <C>
     Current Assets:                                                       
     Cash and cash equivalents                                                  $       374                    $     2,258 
     Accounts receivable, less allowance for
     doubtful accounts of $383 in 1997 and $381 in  1996                              7,517                          6,737  
     Inventories, net                                                                 7,202                          7,798
     Deferred tax asset                                                                 700                            700
     Prepaid expenses and other current assets                                          536                            680
                                                                                -----------                    ----------- 
                             Total current assets                                    16,329                         18,173
                                                                                -----------                    ----------- 
     Fixed Assets:
     Furniture, fixtures, equipment and leasehold improvements                        9,474                          9,701
     Less: Accumulated depreciation and amortization                                 (8,661)                        (8,591)
                                                                                -----------                    ----------- 
                             Total fixed assets                                         813                          1,110
                                                                                -----------                    ----------- 

     Other Assets                                                                     2,580                          2,759
                                                                                -----------                    ----------- 

         TOTAL ASSETS                                                           $    19,722                    $    22,042
                                                                                ===========                    =========== 
                                                                        
         LIABILITIES AND SHAREHOLDERS' EQUITY
     Current Liabilities:
     Short-term debt                                                            $     2,314                    $        --
     Accounts payable                                                                   889                          3,196
     Accrued wages                                                                      778                            973
     Customer deposits                                                                1,171                          1,773
     Other accrued expenses                                                             760                          1,612
                                                                                -----------                    ----------- 
                                                                                  
                             Total  current liabilities                               5,912                          7,554
                                                                                -----------                    ----------- 
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                            V BAND CORPORATION AND SUBSIDIARIES
                                                CONSOLIDATED BALANCE SHEETS
                                             JULY 31, 1997 AND OCTOBER 31, 1996
                                               (in 000's, except share data)
                                                        (continued)

                                                                                   July 31,                    October 31,
                                                                                    1997                           1996
                                                                                -----------                    ----------- 
                                                                                (unaudited)
<S>                                                                             <C>                            <C>
                                                                                
     Shareholders' Equity:
     Common stock, $.01 par value; authorized 20,000,000 shares;
         issued  and outstanding 7,131,913 in 1997 and 7,042,492 in 1996                 71                             70
     Capital in excess of par value                                                  19,872                         19,776 
     Retained earnings                                                                5,461                          6,242
     Cumulative translation adjustment                                                  174                            168
                                                                                 ----------                    ----------- 
                                                                                     25,578                         26,256
     Less  -  Treasury stock, at cost; 1,719,322 shares                             (11,768)                       (11,768)
                                                                                -----------                    ----------- 
                             Total shareholders' equity                              13,810                         14,488
                                                                                -----------                    ----------- 

         TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                             $    19,722                    $    22,042
                                                                                ===========                    =========== 


                 See notes to consolidated financial statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                            V BAND CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED STATEMENTS OF OPERATIONS
                            FOR THE THREE AND NINE MONTHS ENDED
                             JULY 31, 1997 AND 1996 (unaudited)
                             (in 000's, except per share data)

                                                Three Months Ended      Nine Months Ended
                                                     July 31,                July 31,
                                              --------------------    -------------------- 

                                                 1997         1996       1997        1996
                                                 ----         ----       ----        ----
<S>                                          <C>          <C>          <C>         <C>       
Sales
     Equipment ............................     $5,407    $  6,725     $19,617     $19,872           
     Service ..............................      1,448       1,228       4,196       3,836
                                              --------    --------    --------    --------
        Total sales .......................      6,855       7,953      23,813      23,708
                                              --------    --------    --------    --------

Cost of Sales
     Equipment ............................      3,406       3,846      12,228      11,768
     Service ..............................        990         758       2,874       2,454
                                              --------    --------    --------    --------
        Total cost of sales ...............      4,396       4,604      15,102      14,222
                                              --------    --------    --------    --------

        Gross profit ......................      2,459       3,349       8,711       9,486
                                              --------    --------    --------    --------

Operating Expenses
     Selling, general and administrative ..      2,470       2,542       6,990       7,380
     Research and development .............        787         800       2,478       2,335
                                              --------    --------    --------    --------
        Total operating expenses ..........      3,257       3,342       9,468       9,715
                                              --------    --------    --------    --------

        Operating income (loss) ...........       (798)          7        (757)       (229)

Interest Income (Expense) .................        (19)          9         (15)         41
Other Income (Expense) ....................          3          25          (9)        (47)
                                              --------    --------    --------    --------
        Net income (loss) .................   $   (814)   $     41    $   (781)   $   (235)                             
                                              ========    ========    ========    ========
Per share data
     Net income (loss) ....................   $   (.15)   $    .01    $   (.15)   $   (.04)
                                              ========    ========    ========    ========

Weighted average number of shares of common
    stock and common stock equivalents ....      5,413       5,328       5,385       5,327
                                              ========    ========    ========    ========

                 See notes to consolidated financial statements  
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                         V BAND CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE NINE MONTHS ENDED JULY 31, 1997 AND 1996 (unaudited)
                                      (in 000's)

                                                                   1997       1996
                                                                  -------    -------
<S>                                                               <C>        <C>
Cash Flows from Operating Activities
     Net loss .................................................   $  (781)   $  (235)   
     Adjustments to reconcile net loss to net
     cash used in operating activities:
         Depreciation .........................................       432        570    
         Amortization of other assets .........................       309        337    
         Provision (benefit) for doubtful accounts ............         2        (34)   
         Provision for inventory reserves .....................        --         75    
         Changes in assets and liabilities
              Accounts receivable .............................      (782)    (2,094)   
              Inventories .....................................       596       (442)   
              Prepaid expenses and other current assets........       144         26
              Other assets ....................................       (26)        72    
              Accounts payable and other current liabilities ..    (3,957)      (349)   
              Foreign currency translation adjustment .........         6        (36)   
                                                                  -------    -------    
                   Net cash used in operating activities ......    (4,057)    (2,110)   
                                                                  -------    -------   

Cash Flows from Investing Activities
     Sales of marketable securities ...........................       --         187    
     Capital  expenditures ....................................      (133)      (112)   
                                                                  -------    -------   
                   Net cash (used in) provided by investing
                   activities .................................      (133)        75     
                   
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                         V BAND CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE NINE MONTHS ENDED JULY 31, 1997 AND 1996 (unaudited)
                                      (in 000's)
                                     (continued)

                                                                   1997       1996
                                                                  -------    -------
<S>                                                               <C>        <C>
Cash Flows from Financing Activities
     Proceeds from short-term debt.............................    3,032          --
     Payments of short-term debt...............................     (718)         --
     Proceeds from issuance of common stock....................       97          --
     Debt issuance cost........................................     (105)         --
                                                                  -------    -------
                   Net cash provided by financing activities...    2,306          --    
                                                                  -------    -------

Net decrease in cash and cash equivalents .....................    (1,844)    (2,035)
Cash and Cash Equivalents, at beginning of period .............     2,258      2,740
                                                                  -------    -------
Cash and Cash Equivalents, at end of period ...................   $   374    $   705
                                                                  =======    =======

Supplementary Disclosures
     Income taxes paid ........................................   $   230    $    65
                                                                  =======    =======
     Interst paid..............................................   $   204    $    --
                                                                  =======    =======

                 See notes to consolidated financial statements 

</TABLE>
<PAGE>
                       V BAND CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 
                                   (in 000's)

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, 1996 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 July 31, 1997 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,  which includes  maintenance  contract revenue and repairs,  is
recognized when the service has been completed.

Reclassifications - Certain prior year amounts have been reclassified to conform
with the current period presentation.

Adoption  of SFAS 128 - The  Company  will  adopt  the  Statement  of  Financial
Accounting  Standard No. 128,  "Earnings  Per Share"  ("SFAS 128") in the fourth
quarter of 1997,  as required.  The Company  will  continue to apply APB No. 15,
"Earnings Per Share" until the adoption of SFAS 128. The new standard  specifies
the  computation,  presentation  and  disclosure  requirements  for earnings per
share.  The pro forma earnings per common share computed under the provisions of
SFAS 128 for the three and nine month periods ended July 31, 1997 and 1996 would
not be materially different than the reported amounts.

Adoption  of SFAS 123 - The  Company  will  adopt the  Statemenet  of  Financial
Accounting Standards No. 123,  "Accounting for Stock-Based  Compensation" ("SFAS
123") in the fourth  quarter of 1997,  as  required.  The Company has elected to
continue to measure such  compensation  expense  using the method  prescribed by
Accounting  Principles  Board  Opinion No. 25,  "Accounting  for Stock Issued to
Employees",  as permitted by SFAS 123. When adopted,  SFAS 123 will not have any
effect on the Company's  financial  position or results of operations,  but will
required the Company to provide  expanded  disclosure  regarding its stock-based
employee compensation plans.
<PAGE>
Note C -- Inventories

Inventories are summarized as follows:
<TABLE>
<CAPTION>
                                                     July 31,          October 31,
                                                       1997               1996
                                                     -------            -------
<S>                                                  <C>                <C>
Finished goods ...........................           $ 5,059            $ 4,757
Parts and components .....................             4,255              5,144
                                                     -------            -------
                                                       9,314              9,901
Less:  Inventory reserves.................            (2,112)            (2,103)
                                                     -------            -------
                                                     $ 7,202            $ 7,798
                                                     =======            =======
</TABLE>
 
Note D  -- Short-Term Debt

On May 28, 1997, the Company entered into a Credit  Agreement by and between the
Company and  National  Bank of Canada,  New York  Branch,  and  associated  loan
documentation  (collectively,  the  "Credit  Agreement").  The Credit  Agreement
provides a revolving loan and letter of credit facility of up to $4 million with
interest rates (at the Company's option) of prime plus 1/4 percent or libor plus
2 1/4 percent. The Company's  obligations under the Credit Agreement are secured
by  security  interests  in all of the  assets  of V Band  Corporation  and  its
domestic  subsidiaries.  Additionally,  on May 29, 1997,  the Company repaid the
amount borrowed from its Chairman and Chief Executive Officer in full, including
interest.


Note E  -- Income Taxes

The  Company's  deferred  tax asset of $700 is net of a valuation  allowance  of
$4,818 and the Company has available net operating  loss  carryforwards  for tax
return purposes of approximately $8,900 which begin to expire in 2009.
<PAGE>
Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations. (in 000's except per share data)

         
Results of Operations

Sales for the third quarter of 1997, ended July 31, 1997, of $6,855 were $1,098,
or 14%, lower than the $7,953 reported for the third quarter of 1996.  Sales for
the nine months ended July 31, 1997 of $23,813 were $105, or 1%, higher than the
$23,708  reported in the same period of 1996.  Equipment  sales of $5,407 in the
third quarter of 1997 decreased by $1,318,  or 20%, from the equipment  sales of
$6,725 in third quarter of 1996.  This  decrease in the third quarter  equipment
sales was due  primarily  to delays of  scheduled  shipments  which  were due to
shortages of certain long lead time components for the Company's products. These
shipments  are  expected to be  completed  in the fourth  quarter.  For the nine
months ended July 31, 1997,  equipment  sales of $19,617 were $255, or 1%, lower
than the  $19,872  reported in the same  period for 1996.  This  decrease in the
equipment  sales was due in part to the  aforementioned  shipment  delays due to
component  shortages and a decrease in the sales of the  Company's  wholly-owned
subsidiary,  Licom, Incorporated.  Equipment sales for Licom for the nine months
ended July 31, 1997 were $536 compared to $1,786 reported in the same period for
1996, a decrease of $1,250, or 70%. The decrease in Licom sales was attributable
to reduced  demand and increased  competition  in the markets  served by Locom's
products.  Equipment sales,  excluding Licom sales, were $19,081 and $18,086 for
the nine months ended July 31, 1997 and 1996,  respectively,  for an increase of
$995, or 6%. This increase,  excluding Licom sales was due to an increase in the
Company's eXchange Phone, Power Deck and DXi products.  Sales from the Company's
service business of $1,448 for the third quarter of 1997 were $220 or 18% higher
than the $1,228 of sales for the third  quarter of 1996.  Service  sales for the
nine months ended July 31,  1997,  of $4,196 were $360,  or 9%,  higher than the
$3,836 reported in 1996 due to an increase in the Company's maintenance sales.

Gross  profit  margins for the third  quarter  ended July 31, 1997 were 35.9% as
compared to 42.1% for the same period in 1996. Gross profit margins for the nine
months  ended July 31,  1997 were 36.6% as compared to 40.0% for the same period
in 1996.  Gross profit  margins for equipment  sales for the third quarter ended
July 31, 1997 were 37.0% as compared to 42.8% for the same period in 1996. Gross
profit margins for equipment  sales for the nine months ended July 31, 1997 were
37.7% as  compared  to 40.8% for the same  period in 1996.  The  decrease in the
gross profit margin for equipment sales was  attributable to a number of factors
- the impact of fixed cost in the  production  facility which were absorbed over
lower  third  quarter  sales due to the  aforementioned  shipment  delays due to
component  shortages;  the  decline  of Licom  sales and sales to  non-financial
customers  which  typically  generated  higher  gross  margins;  and lower gross
margins attained for international  sales due to increased  competitive  pricing
pressures in the  international  market for the  Company's  products.  The gross
profit  margin for service  sales for the third  quarter ended July 31, 1997 was
31.6% as compared to 38.1% for the same periods in 1996. The gross profit margin
for service  sales for the nine months ended July 31, 1997 was 31.5% as compared
to 36.1% for the same periods in 1996.  The decrease in the gross profit  margin
for service  sales was  primarily  due to higher costs to support  international
service sales.

Operating  expenses for the third quarter of 1997 were $3,257, or $85 lower than
the $3,342  reported for the third  quarter of 1996.  The decrease was primarily
attributable  to the  reduction  in Licom's  operating  expenses  as achieved by
<PAGE>
downsizing  and  relocating  Licom's  operations  to  the  Company's   corporate
headquarter.  For the nine months ended July 31, 1997,  operating  expenses were
$9,468,  or $247 lower than $9,715 for the same period in 1996. The decrease was
primarily  attributable  to the  reduction  in  Licom's  operating  expenses  as
achieved by  downsizing  and  relocating  Licom's  operations  to the  Company's
corporate  headquarters.  This decrease was partially  offset by the increase in
costs to develop customized products for specific customer contracts.
 
The net loss reported in the third quarter ended July 31, 1997 was $814, or $.15
per share  compared  to a net income of $41,  or $.01 per  share,  for the third
quarter of 1996.  The net loss  reported for the nine months ended July 31, 1997
was $781,  or $.15 per share,  as  compared  to a net loss of $235,  or $.04 per
share, for the same period in 1996.

The average shares  outstanding for the quarter ended July 31, 1997 increased to
5,413  versus  5,328 for the same period in 1996,  due to the  issuance of stock
under the Company's Employee Stock Purchase Plan.

Financial Condition

The Company's  aggregate of cash and cash equivalents was $374 at July 31, 1997,
a decrease of $1,884 from the  October 31, 1996  balance of $2,258.  The decline
was attributable primarily to the net loss and decreases in accounts payable and
other  current  liabilities,  which  were  partially  offset by an  increase  in
short-term debt and a decrease in inventory.

On May 28, 1997, the Company  obtained a $4 million secured credit facility from
the National Bank of Canada,  New York Branch.  As of July 31, 1997,  the amount
due National Bank of Canada was $2.3 million.
<PAGE>
Item 6.           Exhibits and Reports on Form 8-K

        (a)        Exhibits

                   10.15  Agreement  dated May 28, 1997  between the Company and
                   National Bank of Canada, New York Branch.

        (b)        Reports on Form 8-K

         On June 11,  1997,  the Company  filed a Current  Report,  on Form 8-K,
reporting,  under Item 5, that the  Company  entered  into a $4 million  secured
credit facility with the National Bank of Canada, New York Branch.
<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:  September 12, 1997
                                              /s/ Thomas E. Feil
                                              ------------------
                                              Thomas E. Feil
                                              Chairman & Chief Executive Officer
                                              (Duly Authorized Officer)



Date:  September 12, 1997
                                              /s/ Mark R. Hahn
                                              ----------------
                                              Mark R. Hahn
                                              Chief Financial Officer
                                              (Principal Accounting Officer)