U.S. Securities and Exchange Commission
                             Washington, D. C. 20549
                    ----------------------------------------

                                   Form 10-QSB

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

                For the quarterly period ended September 30, 1999

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

            For the transition period from ___________ to ___________

                               ------------------

                        Commission file number 000-26213

                            ARC COMMUNICATIONS, INC.
        (Exact name of small business issuer as specified in its charter)


               New Jersey                                  22-3201557
(State or other jurisdiction of incorporation or        (I.R.S. Employer
              organization)                             Identification No.)

                              788 Shrewsbury Avenue
                         Tinton Falls, New Jersey 07724
                    (Address of principal executive offices)


                                 (732) 219-1766
                           (Issuer's telephone number)


     Check  whether  the issuer (1) 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 outstanding of the issuer's common stock
                     as of November 10, 1999 was 13,753,132



<PAGE>


                                      INDEX

PART I FINANCIAL INFORMATION

     ITEM 1. FINANCIAL STATEMENTS

        a)  Balance Sheets as of September 30, 1999 ..................   3

        b)  Statements of Operations for the
            Three and Nine Months Ended
            September 30, 1999 and 1998 ..............................   4

        c)  Statements of Cash Flows for the
            Nine Months Ended September 30, 1999
            and 1998 .................................................   5

        d)  Notes to Financial Statements ............................   6 to 7


     ITEM 2. MANAGEMENT'S DISCUSSION AND
             ANALYSIS OF FINANCIAL CONDITION
             AND RESULTS OF OPERATIONS ...............................   8 to 10


PART II  OTHER INFORMATION


     ITEM 6. EXHIBITS AND REPORTS
             ON FORM 8-K .............................................   11

        a)  EXHIBITS .................................................   11

        b)  REPORTS ON FORM 8-K ......................................   11


<PAGE>


PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS


                    ARC COMMUNICATIONS, INC. AND SUBSIDIARIES

                      UNAUDITED CONSOLIDATED BALANCE SHEET

                                     ASSETS

<TABLE>
<CAPTION>
                                                                       September 30,
                                                                           1999
                                                                       -----------
<S>                                                                    <C>
CURRENT ASSETS
Cash and cash equivalents                                              $   406,529
Accounts Receivable - net                                                  857,626
Inventory                                                                   15,765
Prepaid expenses                                                             9,429
                                                                       -----------
Total Current Assets                                                     1,289,349

PROPERTY AND EQUIPMENT - NET                                               350,223

OTHER ASSETS
Goodwill - net                                                              79,284
Security deposits                                                            9,410
Due from Related Party                                                      25,815
                                                                       -----------
Total Other Assets                                                         114,509

TOTAL ASSETS                                                           $ 1,754,081
                                                                       ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Line of credit                                                         $   453,725
Accounts Payable and Accrued Expenses                                      317,353
                                                                       -----------
Total Liabilities                                                          771,078


STOCKHOLDERS' EQUITY
Preferred stock, $.20 par value, authorized 5,000,000 shares, issued
and outstanding 720,000 in 1999                                            144,000
Common stock, $.001 par value, authorized 45,000,000 shares, issued
and outstanding 13,753,132 in 1999                                          13,754
Additional paid-in capital                                               1,355,063
Retained earnings (accumulated deficit)                                   (529,814)
                                                                       -----------
     Total Stockholders' Equity                                            983,003
                                                                       -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                             $ 1,754,081
                                                                       ===========
</TABLE>

<PAGE>

                    ARC COMMUNICATIONS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                    UNAUDITED

<TABLE>
<CAPTION>
                                  9 Months          9 Months          3 Months           3 Months
                                September 30,     September 30,      September 30,      September 30,
                                    1999              1998               1999               1998
                                ------------      ------------       ------------      --------------
<S>                             <C>               <C>                <C>               <C>
NET SALES                          2,837,311         2,099,768            997,262           805,116


Cost and Expenses:

Salaries and Other
employee compensation              1,263,356         1,319,402            522,341           553,001

Selling, general
 and administrative                1,247,702         1,124,708            449,982           314,584
                                ------------      ------------       ------------      ------------

Total Cost and Expenses            2,511,058         2,444,110            972,323           867,585
                                ------------      ------------       ------------      ------------




NET INCOME (LOSS)               $    326,253      $   (344,342)      $     24,939      $    (62,469)
                                ============      ============       ============      ============


BASIC AND DILUTED NET
INCOME (LOSS) PER SHARE                 0.02             (0.03)              0.00             (0.00)




Weighted Average Number of
Shares Outstanding                13,750,650        13,564,382         13,750,686        13,564,382
</TABLE>


<PAGE>

                    ARC COMMUNICATIONS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                    UNAUDITED


<TABLE>
<CAPTION>
                                                            Nine Months Ended September 30,
                                                                1999            1998
                                                                ----            ----
<S>                                                          <C>             <C>

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)                                              326,253        (344,342)
Adjustments to reconcile net income or loss to net cash
provided by operating activities:
Depreciation and amortization                                  113,613          90,023
Bad Debt                                                       (25,653)         10,776
Issuance of stock for services                                     469           6,250
    Increase (decrease) in cash from changes in:
Accounts receivable                                           (296,135)       (316,273)
Inventory                                                           --          13,387
Prepaid expenses                                                 1,793           5,794
Other Receivables                                                               17,872
Security deposits                                                   --           2,800
Due from related party                                          (4,906)          1,691
Accounts payable and accrued expenses                           74,076         (85,383)
                                                             ---------       ---------

Total Adjustments                                             (136,743)       (253,063)
                                                             ---------       ---------

Net Cash Provided (Used) in Operating Activities               189,510        (597,405)
                                                             ---------       ---------


CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property and equipment                        (60,284)        (60,781)
                                                             ---------       ---------

Net Cash Used in Investing Activities                          (60,284)        (60,781)
                                                             ---------       ---------


CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable                                     53,610         303,000
Proceeds from sale of stock                                                    140,000
                                                             ---------       ---------

Net Cash Provided by Financing Activities                       53,610         443,000
                                                             ---------       ---------


NET INCREASE (DECREASE) IN CASH                                182,836        (215,186)


CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                 223,693         428,329
                                                             ---------       ---------


CASH AND CASH EQUIVALENTS AT END OF PERIOD                   $ 406,529       $ 213,143
                                                             =========       =========


SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION

Cash paid for interest                                          39,974           8,655
Cash paid for income taxes                                         -0-             -0-
</TABLE>

<PAGE>

                    ARC COMMUNICATIONS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                    Unaudited

                               September 30, 1999

1.   Basis of Presentation

In  the  opinion  of  the  Company,  the  accompanying   consolidated  financial
statements  contain  all  adjustments   (consisting  only  of  normal  recurring
adjustments)  necessary to fairly present the Company's  financial  position and
its  results of  operations  and cash flows as of the dates and for the  periods
indicated.

Certain  information and footnote  disclosures  normally  contained in financial
statements prepared in accordance with generally accepted accounting  principles
have been omitted.  These condensed  consolidated financial statements should be
read in conjunction  with the audited December 31, 1998  consolidated  financial
statements  and related  notes  included  in the  Company's  year end  certified
Financial  Statement.  The  results of  operations  for the Nine  months are not
necessarily indicative of the operating results for the full year.

Amounts for the nine months ended  September  30,1998 have been  reclassified to
conform with the September 30,1999 presentation.

2.   Principles of Consolidations

The consolidated  financial  statements  include the accounts of the Company and
all of its  subsidiaries  in which a  controlling  interest is  maintained.  All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation.  For those  consolidated  subsidiaries where Company ownership is
less than  100%,  the  outside  stockholders'  interests  are shown as  minority
interests.  Investments  in  affiliates  over which the Company has  significant
influence but not a controlling interest are carried on the equity basis.

3.   Revenue Recognition

The Company recognizes revenue from sales at the date the product is shipped and
as professional services are performed.


<PAGE>


                    ARC COMMUNICATIONS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                    Unaudited

                               September 30, 1999


4.   Segment Information

                                                September 30,      September 30,
                                                    1999               1998
                                                 -----------        -----------
 Revenues
    Multi-Media                                  $ 2,337,290        $ 1,860,474
    Continuing professional education                500,021            239,294
                                                 -----------        -----------
      Total Consolidated Revenue                 $ 2,837,311        $ 2,099,768
                                                 -----------        -----------

 Net Income (Loss)
    Multi-Media                                  $   371,793        $   (49,831)
    Continuing professional education                (44,571)          (295,761)
                                                 -----------        -----------
       Total Consolidated Net Loss               $   327,222        $  (345,592)
                                                 -----------        -----------
 International Sales
     Multi-Media                                 $   470,793        $   429,578
     Continuing professional education                   -0-                -0-
                                                 -----------        -----------
Total Consolidated International Sales           $   470,793        $   429,578
                                                 -----------        -----------
 Assets
    Multi-Media                                  $ 1,534,430
    Continuing professional education                219,651
                                                 -----------
       Total Consolidated Net Assets             $ 1,754,081
                                                 -----------


<PAGE>


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Nine Months Ended September 30, 1999 and September 30, 1998

     Net sales for ARC Communications,  Inc. (the "Company") for the nine months
ended  September 30, 1999 and September 30, 1998 were  $2,837,311 and $2,099,768
respectively,  an increase of 35.13%.  The  increase is due to  expansion of the
continuing  professional  education  segment  along with an increase in revenues
from our multi-media segment.

     Costs  and  expenses  for the nine  months  ended  September  30,  1999 and
September 30, 1998 were $2,511,058 and $2,444,110 respectively.  The increase in
costs and expenses of 2.76% is primarily due to the  continued  expansion in the
continuing  professional  education  segment which included the increased use of
outsourcing of certain labor while decreasing payroll expenses for the period.

     Net income for the nine  months  ended  September  30,  1999 was  $326,253,
compared to a loss of $(344,342)  for the same period ended  September 30, 1998,
an increase of 194%.  Management  attributes  this increase in net income to the
increase in sales.


Three Months Ended September 30, 1999 and September 30, 1998

     The Company's  net sales for the three months ended  September 30, 1999 and
September  30, 1998 were  $997,262  and  $805,116  respectively,  an increase of
23.87%.  The  increase  in  sales  is  primarily  due  to the  expansion  of the
continuing  professional  education segment. In the three months ended September
30,1999 the Company introduced  professional education seminars.  These seminars
provide  professionals  in the medical  field  another  avenue for meeting their
continuing professional education requirements.

     Costs and  expenses  for the three  months  ended  September  30,  1999 and
September  30, 1998 were  $972,323  and  $867,585  respectively,  an increase of
12.31%.  The increase in costs and expenses is primarily  due to the increase in
production  costs in the  multi-media  segment and costs  incurred to expand the
professional education segment.

     Net income the three months ended September 30, 1999 was $24,939,  compared
to a loss of $(62,469) for the same period ended September 30, 1998, an increase
of 137%.  Management  attributes  this increase in net income to the increase in
sales.

<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

     The  Company  maintains  a credit line of $750,000 as a part of its ongoing
effort to ensure an  appropriate  level of liquidity.  As of September 30, 1999,
$296,275 of this line of credit remains unused and available for future use.

     The cash flow generated  (used) by operations  were $189,510 and ($597,405)
for  the  nine  months  ended   September   30,  1999  and  September  30,  1998
respectively.  The  decrease  in cash  flows  from  operations  for  the  period
September 30, 1998 is attributed  to an increase in accounts  receivable  due to
some slower paying customers and a decrease in accounts payable.  Cash generated
from  operations  for the period ended  September 30, 1999 was  attributed to an
increase  in net  income  for the nine  months  which  increased  the  Company's
accounts  receivable  and caused an  increase  in  accounts  payable and accrued
expenses.

     Cash used for investing  activities  during the nine months ended September
30,1999 and  September 30, 1998 was $60,284 and $60,781  respectively.  The cash
used in investing activities was primarily used for equipment purchased for each
year.

     Cash flows generated from financing activities during the nine months ended
September 30, 1999 and September 30, 1998 was $53,610 and $443,000 respectively.
In the first nine months of 1999 cash was provided from drawing down on the line
of credit.  In the first nine months of 1998  $303,000 of cash flow was provided
from drawing down on the line of credit and $140,000 was provided  from the sale
of preferred stock.

     For the nine months ended September 30, 1999 operating  activities provided
$189,510,  investing  activities  accounted  for  the  expenditure  $60,284  and
financing  activities  provided  $53,610 for a cash increase of $182,836 for the
period.

     For the nine months ended September 30, 1998 operating activities accounted
for  the  expenditure  of  $597,405,  investing  activities  accounted  for  the
expenditure of $60,781,  and financing  activities  provided $443,000 for a cash
decrease of $215,186 for the period.


<PAGE>

YEAR 2000 COMPLIANCE

     The Year 2000 issue arises as the result of computer  programs  having been
written, and systems having been designed,  using two digits rather than four to
define the  applicable  year.  Consequently,  such software has the potential to
recognize  a date  using "00" as the Year  2000.  This could  result in a system
failure or miscalculations causing disruptions of operations,  including,  among
other things, a temporary inability to process  transactions,  send invoices, or
engage in similar normal business activities.

     The  Company's  current  accounting  and  other  bookkeeping  software  was
purchased "off-  the-shelf"  through retail vendors and were  represented to the
Company by such manufacturers as being Year 2000 compliant.

     As a user of leading edge technology, the Company has taken steps to ensure
that it is Year 2000 compliant.  Further,  the nature of the Company's  business
requires  that its systems  and  programs be  evaluated  on an ongoing  basis to
ensure that they continue to be Year 2000 compliant.

     In addition  to testing  its  programs  internally,  the Company  hired IBS
Interactive ("IBS"), an independent consultant,  to perform a Year 2000 audit on
the  Company's   network.   IBS  determined   that  there  were  no  substantial
deficiencies  in its report dated August 27, 1999.  However,  the IBS report did
identify some noncritical software which was questionable. Non-critical software
consists of programs that are either graphic or  spreadsheet  in nature.  It has
been determined  that such  questionable  programs will not necessarily  fail on
January 1, 2000, but may apply  incorrect dates (such as 1900) to files saved or
created after December 31, 1999.

     Notwithstanding  the fact that  approximately 80% of all of its software is
compliant,  the Company continues to test,  evaluate and update the questionable
programs  and  anticipates  that it will  complete  such  testing and updates by
November 1,1999. The Company has no contingency plans in place in the event that
it is unable to complete its testing and updating of the  questionable  software
by January 1, 2000. However, as such software is non-critical,  the Company does
not expect to suffer irreparable economic harm or loss of critical data. To date
the Company has spent approximately $1,200 to address the Year 2000 problem.

     The Company  believes  that the servers it uses to interact on the Internet
are Year 2000 compliant.  Further, the companies which presently supply products
or services to the Company  have  informed  management  that they have taken the
appropriate  steps to ready their hardware and software for Year 2000.  However,
the Company cannot  guarantee any other company's Year 2000 readiness and in the
event that any company which the Company relies upon for services or products is
not Year 2000 ready, the Company may suffer irreparable economic harm.


<PAGE>


                                   SIGNATURES

     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                             ARC COMMUNICATIONS, INC.

Dated: November 12, 1999                     By:  /s/  Michael Rubel
                                                  -----------------------------
                                                  Michael Rubel,
                                                  Chief Operating Officer



<PAGE>

PART II   OTHER INFORMATION

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          a)   Exhibit 27 - Financial Data Schedule.

          b)   The  Registrant  did not file any  reports on Form 8-K for events
               which occurred during the nine months ended September 30, 1999.