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                       SECURITIES AND EXCHANGE COMMISSION


                             WASHINGTON, D.C. 20549
                             ----------------------



                                    FORM 10-Q



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



 For the Quarter ended: June 30, 1997          Commission File Number 000-21685



                       INTELIDATA TECHNOLOGIES CORPORATION
             (Exact name of registrant as specified in its charter)

 DELAWARE                                                            54-1820617
 (State of incorporation)               (I.R.S. Employer Identification Number)

               13100 Worldgate Drive, Suite 600, Herndon, VA 20170
                    (Address of Principal Executive Offices)
                                 (703) 834-8500
                         (Registrant's telephone number)




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 the  registrant's  Common Stock  outstanding on June 30,
1997 was 31,844,527.



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<PAGE>

                       INTELIDATA TECHNOLOGIES CORPORATION

                          QUARTERLY REPORT ON FORM 10-Q

                                TABLE OF CONTENTS




                                                                            Page
PART I - FINANCIAL INFORMATION

         Item 1.  Unaudited Condensed Consolidated Financial Statements

                  Condensed Consolidated Balance Sheets
                  June 30, 1997 and December 31, 1996 ........................ 3

                  Condensed Consolidated Statements of Operations
                  Three and Six Months Ended June 30, 1997 and 1996 ........   4

                  Condensed Consolidated Statement of Stockholders' Equity
                  Six Months Ended June 30, 1997 ...........................   5

                  Condensed Consolidated Statements of Cash Flows
                  Six Months Ended June 30, 1997 and 1996 ..................   6

                  Notes to Condensed Consolidated Financial Statements .....   7

         Item 2.  Management's Discussion and Analysis of Financial Condition
                  and Results of Operations ................................  10


PART II - OTHER INFORMATION

         Item 6.  Exhibits and Reports on Form 8-K .........................  18



SIGNATURES..................................................................  19

<PAGE>
PART I:  FINANCIAL INFORMATION
------------------------------

ITEM 1:  FINANCIAL STATEMENTS
-----------------------------
<TABLE>
                       INTELIDATA TECHNOLOGIES CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                       JUNE 30, 1997 AND DECEMBER 31, 1996
                        (in thousands, except share data)
<CAPTION>
                                                                                   1997           1996
                                                                                -----------    -----------
                                                                                (unaudited)
<S>                                                                             <C>            <C>
ASSETS
 CURRENT ASSETS
     Cash and cash equivalents                                                  $    12,842    $    26,644
     Short-term investments                                                          11,412         12,418
     Accounts receivable, net of reserves of
         $1,323 in 1997 and $1,788 in 1996                                           18,813         12,925
     Inventories                                                                     30,646         28,420
     Prepaid expenses and other current assets                                        1,610          2,582
                                                                                -----------    -----------

         Total current assets                                                        75,323         82,989
                                                                                -----------    -----------

 NONCURRENT ASSETS
     Costs in excess of net assets acquired                                          48,477         50,061
     Property, plant and equipment, net                                               7,076          9,143
     Investments                                                                      2,120            253
     Other assets                                                                     1,249          1,300
                                                                                -----------    -----------
 TOTAL ASSETS                                                                   $   134,245    $   143,746
                                                                                ===========    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
 CURRENT LIABILITIES
     Accounts payable                                                           $     4,892    $     4,684
     Accrued expenses and other liabilities                                           7,578         12,773
     Short-term borrowings                                                               --          2,000
                                                                                -----------    -----------

TOTAL LIABILITIES                                                                    12,470         19,457
                                                                                -----------    -----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value; authorized 5,000,000 shares; no shares
  issued and outstanding                                                                 --             --
Common stock, $0.001 par value; authorized 60,000,000 shares; issued and
  outstanding 31,844,527 shares in 1997 and 31,816,693 shares in 1996                    32             32
Additional paid-in capital                                                          243,857        243,757
Receivable from sale of stock                                                        (2,456)        (2,456)
Deferred compensation                                                                   (75)          (133)
Accumulated deficit                                                                (119,583)      (116,911)
                                                                                -----------    -----------

TOTAL STOCKHOLDERS' EQUITY                                                          121,775        124,289
                                                                                -----------    -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                      $   134,245    $   143,746
                                                                                ===========    ===========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.
<PAGE>
<TABLE>
                       INTELIDATA TECHNOLOGIES CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
                (in thousands, except per share data; unaudited)

<CAPTION>
                                                               Three months ended                   Six months ended
                                                                    June 30,                            June 30,
                                                          ----------------------------        ---------------------------
                                                              1997             1996               1997            1996
                                                          -----------      -----------        -----------     -----------
<S>                                                       <C>              <C>                <C>             <C>
REVENUES
     Consumer telecommunications                          $    15,784      $        69        $    36,192     $       846
     Electronic commerce                                        1,063              479              2,211           1,028
     Interactive services                                          16               --                 24              --
                                                          -----------      -----------        -----------     -----------

         Total revenues                                        16,863              548             38,427           1,874
                                                          -----------      -----------        -----------     -----------

COST OF REVENUES
     Consumer telecommunications                               11,598               81             24,625             693
     Electronic commerce                                          707              261              1,502             579
     Interactive services                                          14               --                 20              --
                                                          -----------      -----------        -----------     -----------

         Total cost of revenues                                12,319              342             26,147           1,272
                                                          -----------      -----------        -----------     -----------

         Gross profit                                           4,544              206             12,280             602

OPERATING EXPENSES
     General and administrative                                 2,496            2,681              5,594           4,522
     Selling and marketing                                      3,774               54              5,810              83
     Research and development                                   2,501              616              4,584           1,175
     Goodwill amortization                                        903               --              1,673              --
                                                          -----------      -----------        -----------     -----------

         Total operating expenses                               9,674            3,351             17,661           5,780
                                                          -----------      -----------        -----------     -----------

         Operating loss                                        (5,130)          (3,145)            (5,381)         (5,178)
                                                          -----------      -----------        -----------     -----------

OTHER INCOME (EXPENSE)
     Interest, net                                                446              333                885             693
     Equity in affiliate                                        1,867             (468)             1,867            (894)
     Other, net                                                    --               74                 --             185
                                                          -----------      -----------        -----------     -----------

         Total other income (expense)                           2,313              (61)             2,752             (16)
                                                          -----------      -----------        -----------     -----------

Loss before income taxes                                       (2,817)          (3,206)            (2,629)         (5,194)
     Income taxes                                                  20               --                 43              --
                                                          -----------      -----------        -----------     -----------

Net loss                                                  $    (2,837)     $    (3,206)       $    (2,672)    $    (5,194)
                                                          ===========      ===========        ===========     ===========

Net loss per common share                                 $     (0.09)     $     (0.20)       $     (0.08)    $     (0.33)
                                                          ===========      ===========        ===========     ===========

Weighted average outstanding shares                            31,819           15,882             31,818          15,833
                                                          ===========      ===========        ===========     ===========
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
<PAGE>
<TABLE>
                       INTELIDATA TECHNOLOGIES CORPORATION
            CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                         SIX MONTHS ENDED JUNE 30, 1997
                            (in thousands; unaudited)

<CAPTION>
                                            Common Stock       Additional   Receivable
                                         ------------------     paid-in      from sale      Deferred      Accumulated
                                         Shares     Amount      capital      of stock     Compensation      Deficit        Total
                                         ------   ---------    ----------   ----------    ------------    -----------   ----------
<S>                                      <C>      <C>          <C>          <C>           <C>             <C>           <C>
Balance at December 31, 1996             31,817   $      32    $ 243,757     $ (2,456)      $ (133)       $ (116,911)   $  124,289
  Issuance of common stock upon
   exercise of stock options                  5          --            5           --           --                --             5
  Issuance of common stock related
   to employee stock purchase plan           23          --           95           --           --                --            95
  Compensation expense                       --          --           --           --           58                --            58
  Net loss                                   --          --           --           --           --            (2,672)       (2,672)
                                         ------   ---------    ---------     ---------      -------       -----------   ----------
Balance at June 30, 1997                 31,845   $      32    $ 243,857     $ (2,456)      $  (75)       $ (119,583)   $  121,775
                                         ======   =========    =========     =========      =======       ===========   ==========
</TABLE>


























     See accompanying notes to condensed consolidated financial statements.

<PAGE>
<TABLE>
                       INTELIDATA TECHNOLOGIES CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                     SIX MONTHS ENDED JUNE 30, 1997 AND 1996
                            (in thousands; unaudited)

<CAPTION>
                                                                                   1997           1996
                                                                                -----------    -----------
<S>                                                                             <C>            <C>
Cash flows from operating activities
Net loss                                                                        $    (2,672)   $    (5,194)
Adjustments to reconcile net loss to net cash used in
operating activities:
   Depreciation and amortization                                                      3,972            203
   Equity in affiliate                                                               (1,867)           894
   Restructuring credit                                                              (1,167)            --
   Other noncash activities                                                              23            (67)
   Changes in certain assets and liabilities, net of effects of noncash
     transactions:
       Accounts receivable                                                           (5,888)           512
       Inventories                                                                   (2,226)            88
       Prepaid expenses and other current assets                                        972           (439)
       Other assets                                                                      51            163
       Accounts payable                                                                 208           (498)
       Accrued expenses and other liabilities                                        (4,028)          (169)
                                                                                -----------    -----------
                 Net cash used in operating activities                              (12,622)        (4,507)
                                                                                -----------    -----------

Cash flows from investing activities
       Net activity of short-term investments and restricted cash                     1,006         (3,500)
       Purchases of property and equipment                                             (286)        (1,021)
       Proceeds from sale of property and equipment                                      --            344
                                                                                -----------    -----------
                 Net cash provided by (used in) investing activities                    720         (4,177)
                                                                                -----------    -----------

Cash flows from financing activities
       Payment of short-term borrowings                                              (2,000)            --
       Proceeds from issuance of common stock                                           100            684
                                                                                -----------    -----------
                 Net cash provided by (used in) financing activities                 (1,900)           684
                                                                                -----------    -----------

                 Decrease in cash and cash equivalents                              (13,802)        (8,000)

Cash and cash equivalents, beginning of period                                       26,644         25,120
                                                                                -----------    -----------

Cash and cash equivalents, end of period                                        $    12,842    $    17,120
                                                                                ===========    ===========
</TABLE>








     See accompanying notes to condensed consolidated financial statements.
<PAGE>
               INTELIDATA TECHNOLOGIES CORPORATION AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


(1)      Basis of Presentation

                  The condensed  consolidated balance sheet as of June 30, 1997,
         and the related  condensed  consolidated  statements of operations  and
         cash flows for the three and six month  periods ended June 30, 1997 and
         1996  presented in this Form 10-Q  represent  the results of InteliData
         Technologies  Corporation  for 1997 and the  historical  results  of US
         Order,  Inc.  ("US Order") for 1996.  On November 7, 1996, US Order and
         Colonial Data Technologies Corp. ("Colonial Data") merged with and into
         InteliData Technologies Corporation ("InteliData" or the "Company").

                  The condensed  consolidated  balance sheet of InteliData as of
         June 30, 1997,  and the related  condensed  consolidated  statements of
         operations  and cash  flows for the three and six month  periods  ended
         June 30, 1997 and 1996,  are  unaudited.  In the opinion of management,
         all  adjustments  necessary for a fair  presentation  of such financial
         statements  have been  included.  Interim  results are not  necessarily
         indicative  of  results  for a full  year.  Certain  amounts  have been
         reclassified to conform to the current year presentation.

                  The condensed  consolidated financial statements and notes are
         presented  as  required  by  Form  10-Q,  and  do not  contain  certain
         information   included  in  the  Company's  annual  audited   financial
         statements  and notes.  These  financial  statements  should be read in
         conjunction with the annual audited financial statements of the Company
         and the  notes  thereto,  together  with  management's  discussion  and
         analysis of financial condition and results of operations, contained in
         the Form 10-K for the fiscal year ended December 31, 1996.

(2)      New Accounting Standards

                  Statement of Financial  Accounting Standards No. 128, Earnings
         Per Share ("SFAS 128") was issued in February 1997 and is effective for
         financial  statements  issued after  December 15, 1997.  This statement
         establishes  new standards for  computing and  presenting  earnings per
         share ("EPS") and will require restatement of prior years' information.
         This  statement  simplifies  the standards for computing EPS previously
         found in APB Opinion 15. It replaces  the  presentation  of primary and
         fully  diluted EPS with a  presentation  of basic EPS and diluted  EPS,
         requires a dual  presentation on the face of the financial  statements,
         and  requires  a  reconciliation  of  basic  EPS to  diluted  EPS.  The
         presentation  of basic EPS and  diluted EPS would have been the same as
         EPS actually reported for the respective periods.
<PAGE>
                  Statement of Financial Accounting Standards No. 130, Reporting
         Comprehensive  Income  ("SFAS  130")  was  issued  in June  1997 and is
         effective for financial statements issued after December 15, 1997. This
         statement  establishes  new  standards  for  reporting  and  display of
         comprehensive income and its components (revenues, expenses, gains, and
         losses)  in  a  full  set  of  general-purpose   financial  statements.
         Management  has not yet  determined  the  impact  of SFAS 130 on future
         financial statement presentations.

                  Statement  of   Financial   Accounting   Standards   No.  131,
         Disclosures  about  Segments of an Enterprise  and Related  Information
         ("SFAS  131") was issued in June 1997 and is  effective  for  financial
         statements  issued after December 15, 1997. This statement  establishes
         standards  for  the  way  that  public  business   enterprises   report
         information about operating segments in annual financial statements and
         requires  that those  enterprises  report  selected  information  about
         operating segments in interim financial reports issued to shareholders.
         It also establishes  standards for related  disclosures  about products
         and services, geographic areas, and major customers. Management has not
         yet  determined  the impact of SFAS 131 on future  financial  statement
         presentations.

(3)      Stock Options

                  On May 21, 1997, the Company offered  employees  participating
         in the  Company's  Stock  Option Plans the  opportunity  to replace any
         remaining  unvested  stock  options  as of May 21,  1997  with an equal
         number of options at an  exercise  price of $6.00,  which was above the
         closing  market  price on such  date.  The  Company  did not offer this
         opportunity to the Chairman of the Board or the President,  but offered
         this opportunity to other key employees as an incentive. Approximately,
         642,000 stock options with exercise prices ranging from $6.38 to $23.75
         were replaced.  The replacement  options vest over three years from May
         21, 1997 in equal annual increments.

(4)      Corporate Restructuring

                  In June 1997, the Company  reduced its accrued  liabilities by
         $1,167,000 for certain  restructuring  charges recognized in the fourth
         quarter of 1996. The Company's  management has determined  that certain
         liabilities  associated  with  the  facilities  consolidations  were no
         longer necessary and, accordingly, such accruals were reversed.

(5)      Equity in Affiliate

                  During the second  quarter of 1997,  the Company  revalued its
         investment in Home Financial Network,  Inc. ("HFN") by $1,867,000.  The
         revaluation related to HFN selling shares of stock thereby reducing the
         Company's ownership  percentage from 40% to 25%. This gain was recorded
         net of expected HFN operating losses accounted for on an equity basis.
<PAGE>
(6)      Subsequent Events

                  On August 4, 1997,  the Company  provided  notice to its joint
         venture partner, Blau Marketing Technologies,  Inc. of its intention to
         terminate  the parties'  joint venture in Worldwide  Telecom  Partners,
         Inc. ("WTP")  effective  September 5, 1997 or such other date as may be
         necessary  to  wind-down  WTP.  The joint  venture  provides  marketing
         services to the telecommunications industry. The Company's intention in
         providing  notice to its joint  venture  partner is to bring  marketing
         services  in-house and reduce costs. The Company's  management does not
         expect that costs  associated with the termination of the joint venture
         will be material to the Company's financial statements.

                  In  August  1997,  the  Board of  Directors  approved  a stock
         repurchase  program  whereby the Company may repurchase up to 2,000,000
         shares of its common stock from time to time on the open market.

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

RESULTS OF OPERATIONS
---------------------

The following  represents the results of operations for InteliData for the three
and six  months  ended  June 30,  1997 and 1996.  Results  for the three and six
months ended June 30, 1997 represent the  operations of InteliData;  results for
the three and six  months  ended  June 30,  1996 were  based on the stand  alone
operations  of US  Order,  Inc.,  the  predecessor  corporation  to  InteliData.
Consolidated  total  revenues and all  categories of expenses are  significantly
greater  in 1997 than 1996  because  1997  results  include  the  operations  of
Colonial  Data  Technologies  Corp.  ("Colonial  Data") and 1996  results do not
include any of Colonial Data's operations.

THREE MONTHS ENDED JUNE 30, 1997 AND 1996

Revenues

         The Company's second quarter revenues were $16,863,000 in 1997 compared
to  $548,000  in 1996 an  increase of  $16,315,000.  Revenues  generated  by the
consumer  telecommunications division were $15,784,000 during the second quarter
of 1997. Consumer  telecommunications  division revenues are generated primarily
from  marketing  and  promotional  campaigns  for  Caller ID units and  services
conducted by telephone operating companies and the Company.  Contributing to the
consumer   telecommunications   revenues  were  $13,132,000  from  the  sale  of
approximately 452,500 Caller ID adjuncts;  7,500 integrated telephones and 2,376
multi-line  systems;  $2,203,000 from customers within a US West  Communications
leasing program; and $449,000 in the telephone repair business.

         The electronic commerce division contributed  $1,063,000 in revenues in
the second  quarter of 1997, a 122%  increase  over the same period in the prior
year.  The increase is primarily  attributed to the expansion of the  division's
product  sales and related  services  which  aggregated  $676,000 for the second
quarter of 1997.  Service  fees  revenues  for the  second  quarter of 1997 were
$387,000  compared  to  $479,000  for the same  period in 1996,  a  decrease  of
$92,000.  The Company's customer support revenues,  which are remarketed by Visa
InterActive to Visa member banks,  decreased 12% and aggregated $295,000 for the
second  quarter of 1997,  compared to $335,000  for the same period in the prior
year. The decrease is attributed to a wind-down  relating to the  termination of
the customer  service  agreement  with Visa  InterActive  announced in the first
quarter of 1997. The customer service  agreement  terminated  effective July 31,
1997.  The  Company's  decision to exit the customer  service  business was in a
manner  mutually  agreed upon by the Company  and Visa  InterActive.  During the
first quarter of 1997, the Company ceased  technical  support  services for Visa
InterActive,  and in the second  quarter,  the Company  decreased  its  customer
service  support levels.  Monthly service fees revenues  decreased to $92,000 in
1997 from  $140,000 for the same period in 1996.  Monthly  service fees revenues
are from customers who use the Company's  previous  generation  smart telephones
and associated interactive  applications,  and the decrease was primarily due to
the  Company's  continuing  efforts to convert  these  customers  to Visa member
banks.
<PAGE>
         The interactive  services  division  recorded revenue of $16,000 during
the second quarter of 1997 related to SmartTime(R)  services that are offered to
customers on a variety of small screen devices, primarily screen telephones.

Cost of Revenues

         The Company's second quarter cost of revenues  increased to $12,319,000
for  1997  from   $342,000   for  the  same   period  in  1996.   The   consumer
telecommunications  division  contributed  $11,598,000  of  the  total  cost  of
revenues,  consisting  of  $10,068,000  from the  sale of  Caller  ID  adjuncts,
integrated  telephones and multi-line system shipments;  $1,220,000 from leasing
activities and $310,000 from telephone repair services.

         The electronic commerce division reported cost of revenues  aggregating
$707,000 for the second  quarter of 1997 or a 171% increase over the same period
in the prior year. Cost of revenues from the electronic commerce division during
the second  quarter of 1997  consisted  of $118,000 in software  product  sales,
$250,000  in  customer  service   expenses,   and  $339,000  in  consulting  and
professional  services  including  service cost of revenue related to generating
monthly fee revenues.

         Overall gross profit margins decreased to 27% for the second quarter of
1997 from 38% for the  second  quarter of 1996.  Gross  profit  margins  for the
consumer  telecommunications,   electronic  commerce  and  interactive  services
divisions  were 27%, 33% and 13%,  respectively  for the second quarter of 1997.
The gross profit margin derived from the sale of Caller ID adjuncts,  integrated
telephones and multi-line systems was 23% for the second quarter of 1997. During
the quarter,  the Company  experienced  pricing  pressures  from  competition in
Caller ID adjuncts. The market for the Company's  telecommunications products is
highly  competitive  and is also subject to increased  pressures  resulting from
rapid technological change and the emergence of new market entrants.
The  Company's  management  expects  such  pricing  pressures to continue in the
future.

General and Administrative

         General and  administrative  expenses  were  $2,496,000  for the second
quarter  of 1997 as  compared  to  $2,681,000  in the  second  quarter  of 1996.
Included in the general and administrative expenses was a reversal of $1,167,000
for certain  restructuring charges recognized in the fourth quarter of 1996. The
Company's  management has determined  that certain  liabilities  associated with
facilities  consolidations  were  no  longer  necessary  and  accordingly,  such
accruals  were  reversed  in the  second  quarter  of  1997.  Exclusive  of this
restructuring  charge,  the  increase of $982,000  was  primarily  the result of
additional  staff  obtained  through  the  merger  with  Colonial  Data  and the
acquisition of Braun,  Simmons & Co., Inc. ("Braun  Simmons") in September 1996,
and upgrading  network systems and operations.  Throughout the year, the Company
expects to control general and administrative  expenses and plans to continually
assess its  operations  in managing the continued  development  of the Company's
infrastructure.
<PAGE>
Selling and Marketing

         Selling and marketing  expenses  increased to $3,774,000 for the second
quarter of 1997 from  $54,000  for the same  period  last year.  The  Company is
increasing its marketing efforts in promoting its residential and small business
telecommunications  product  lines to retail  markets and to the  regional  Bell
operating  companies  and  other  telephone  operating  companies  with whom the
Company generates its product, lease and service revenues. In the second quarter
of  1997,   selling  and  marketing  expenses  were  related  primarily  to  the
development  of  innovative   marketing  programs,   advertising  through  trade
publications and trade shows,  introducing the multi-line  systems in the retail
market,  initiating a direct sales force,  organizing  direct mail campaigns for
smart  telephones,  paying salaries and commissions to the Company's sales force
and working with telemarketers and other third party vendors.

Research and Development

         Research and development costs were $2,501,000 in the second quarter of
1997 as  compared  to  $616,000  for the same  period in 1996.  The  increase of
$1,885,000 was largely  attributable  to  developing,  designing and testing new
telecommunications products and the Company's home banking connectivity products
and support  services and the Company's next generation  smart telephone and its
associated  interactive  services.  The  Company  has been  actively  engaged in
research and development  since its inception and expects that these  activities
will be essential to the  operations  of the Company in the future.  The Company
expects research and development costs to remain consistent during the remainder
of 1997.

Goodwill Amortization

         The Company incurred  $903,000 in goodwill  amortization as a result of
the  Company's  acquisition  of Braun  Simmons and merger with  Colonial Data in
September and November 1996,  respectively.  With respect to goodwill from these
transactions,  goodwill is amortized on a  straight-line  basis over seven years
for the  acquisition  of Braun  Simmons  and  fifteen  years for the merger with
Colonial Data.

Other Income (Expense), Net

     Other income  (expense),  net was $2,313,000 for the second quarter of 1997
compared to $(61,000)  for the same period in the prior year.  Interest  income,
net was  $446,000  for the second  quarter of 1997  compared to $333,000 for the
second  quarter of 1996.  The increase of $113,000  was due to  increased  cash,
equivalents  and short-term  investment  balances for the second quarter of 1997
compared  to the second  quarter of 1996,  primarily  related to the merger with
Colonial  Data  which  provided  additional  cash,   equivalent  and  short-term
investment balances. The Company incurred minimal interest expense in the second
quarter  of 1997 and 1996.  During  the  second  quarter  of 1997,  the  Company
revalued its investment in Home Financial  Network,  Inc. ("HFN") by $1,867,000.
The  revaluation  related to HFN selling  shares of stock  thereby  reducing the
Company's  ownership  percentage  from 40% to 25%. This gain was recorded net of
expected
<PAGE>
HFN operating  losses  accounted for on an equity  basis.  In 1996,  the Company
incurred a loss of $468,000  in its  proportionate  share of HFN and  recognized
other income from the sale of assets of $74,000.

Weighted Average Outstanding Shares and Net Loss Per Common Share

         The primary and fully  diluted  weighted  average  shares  increased to
31,819,000  for the second quarter of 1997 compared to 15,882,000 for the second
quarter  of  1996.  The  increase  resulted  primarily  from  shares  issued  in
connection  with the  acquisition  of Braun,  Simmons & Co. and the merger  with
Colonial Data in September and November 1996,  respectively.  As a result of the
foregoing,  net loss per common share was $(0.09) for the second quarter of 1997
compared to $(0.20) for the second quarter of 1996.


SIX MONTHS ENDED JUNE 30, 1997 AND 1996

Revenues

     The Company's first six month revenues were $38,427,000 in 1997 compared to
$1,874,000  in 1996,  an  increase of  $36,553,000.  Revenues  generated  by the
consumer  telecommunications  division  were  $36,192,000  during  the first six
months of 1997.  Consumer  telecommunications  division  revenues are  generated
primarily  from  marketing  and  promotional  campaigns  for Caller ID units and
services   conducted  by  telephone   operating   companies   and  the  Company.
Contributing to the consumer  telecommunications  revenues were $29,823,000 from
the  sale  of  approximately  938,500  Caller  ID  adjuncts,  63,750  integrated
telephones and 3,071 multi-line  systems;  $5,021,000 from customers within a US
West  Communications  leasing  program;  and $1,348,000 in the telephone  repair
business.

         The electronic commerce division contributed  $2,211,000 in revenues in
the first six months of 1997, a 115%  increase over the same period in the prior
year.  The increase is primarily  attributed to the expansion of the  division's
product sales and related services which aggregated $1,312,000 for the first six
months of 1997.  Service  fees  revenues  for the first six  months of 1997 were
$899,000  compared  to  $1,028,000  for the same  period in 1996,  a decrease of
$129,000.  The service fees  revenues  were  generated  primarily  from customer
support  services and monthly  service  fees.  The  Company's  customer  support
revenues,  which  are  remarketed  by Visa  InterActive  to Visa  member  banks,
aggregated  $751,000 for the first six months of 1997,  compared to $716,000 for
the same period in the prior year.  Monthly  service fees revenues  decreased to
$152,000 in 1997 from $304,000 for the same period in 1996. Monthly service fees
revenues are from  customers who use the  Company's  previous  generation  smart
telephones  and  associated  interactive  applications,  and  the  decrease  was
primarily due to the Company's  continuing efforts to convert these customers to
Visa member banks.

         The interactive  services division recorded revenues of $24,000 for the
first six months related to bill-pay  subscriptions  and  SmartTime(R)  services
that are offered to customers on a variety of small  screen  devices,  primarily
screen telephones.
<PAGE>
Cost of Revenues

         The  Company's   first  six  months  cost  of  revenues   increased  to
$26,147,000  for 1997 from  $1,272,000 for the same period in 1996. The consumer
telecommunications  division  contributed  $24,625,000  of  the  total  cost  of
revenues,  consisting  of  $21,144,000  from the  sale of  Caller  ID and  small
business product shipments; $2,666,000 from leasing activities and $815,000 from
telephone repair services.

         The electronic commerce division reported cost of revenues  aggregating
$1,502,000  for the first six  months of 1997 or a 159%  increase  over the same
period in the prior year. Cost of revenues from the electronic commerce division
during the first six months of 1997  consisted  of $223,000 in software  product
sales,  $590,000 in customer  service  expenses,  and $689,000 in consulting and
professional  services  including  service cost of revenue related to generating
monthly fee revenues.

         Overall gross profit margins  remained  consistent at 32% for the first
six  months  of 1997  compared  to the first six  months of 1996.  Gross  profit
margins for the consumer telecommunications, electronic commerce and interactive
services divisions were 32%, 32% and 17%,  respectively for the first six months
of 1997.  The gross profit  margin  derived from the sale of Caller ID and small
business units was 29% for the first six months of 1997. During the quarter, the
Company  experienced  pricing  pressures from competition in Caller ID adjuncts.
The market for the Company's  telecommunications  products is highly competitive
and is also subject to increased  pressures  resulting from rapid  technological
change  and the  emergence  of new market  entrants.  The  Company's  management
expects such pricing pressures to continue in the future.

General and Administrative

         General and  administrative  expenses were $5,594,000 for the first six
months of 1997 as  compared  to  $4,522,000  in the  first  six  months of 1996.
Included in the general and administrative expenses was a reversal of $1,167,000
for certain  restructuring charges recognized in the fourth quarter of 1996. The
Company's  management has determined  that certain  liabilities  associated with
facilities  consolidations  were  no  longer  necessary  and  accordingly,  such
accruals  were  reversed  in the first six  months  of 1997.  Exclusive  of this
restructuring  charge,  the increase of  $2,239,000  was primarily the result of
additional  staff  obtained  through  the  merger  with  Colonial  Data  and the
acquisition  of Braun Simmons,  and upgrading  network  systems and  operations.
Throughout the year, the Company expects to control  general and  administrative
expenses  and  plans to  continually  assess  its  operations  in  managing  the
continued development of the Company's infrastructure.

Selling and Marketing

     Selling and marketing  expenses  increased to $5,810,000  for the first six
months of 1997 from  $83,000  for the same  period  last  year.  The  Company is
increasing its marketing efforts in promoting its residential and small business
telecommunications product lines to retail markets
<PAGE>
and to the regional  Bell  operating  companies  and other  telephone  operating
companies  with whom the  Company  generates  its  product,  lease  and  service
revenues.  In the first six months of 1997,  selling and marketing expenses were
related  primarily  to  the  development  of  innovative   marketing   programs,
advertising  through  trade  publications  and  trade  shows,   introducing  the
multi-line  systems in the  retail  market,  initiating  a direct  sales  force,
organizing  direct mail  campaigns  for smart  telephones,  paying  salaries and
commissions  to the  Company's  sales force and working with  telemarketers  and
other third party vendors.

Research and Development

         Research and development  costs were $4,584,000 in the first six months
of 1997 as compared to $1,175,000  for the same period in 1996.  The increase of
$3,409,000 was largely  attributable  to  developing,  designing and testing new
telecommunications products and the Company's home banking connectivity products
and support  services and the Company's next generation  smart telephone and its
associated  interactive  services.  The  Company  has been  actively  engaged in
research and development  since its inception and expects that these  activities
will be essential to the  operations  of the Company in the future.  The Company
expects research and development costs to remain consistent during the remainder
of 1997.

Goodwill Amortization

         The Company incurred $1,673,000 in goodwill amortization as a result of
the  Company's  acquisition  of Braun  Simmons and merger with  Colonial Data in
September and November 1996,  respectively.  With respect to goodwill from these
transactions,  goodwill is amortized on a  straight-line  basis over seven years
for the  acquisition  of Braun  Simmons  and  fifteen  years for the merger with
Colonial Data.

Other Income (Expense), Net

         Other income (expense),  net was $2,752,000 for the first six months of
1997  compared to  $(16,000)  for the same  period in the prior  year.  Interest
income,  net was $885,000 for the first six months of 1997  compared to $693,000
for the first six months of 1996.  The increase of $192,000 was due to increased
cash, equivalents and short-term investment balances for the first six months of
1997 compared to the first six months of 1996,  primarily  related to the merger
with Colonial Data which  provided  additional  cash,  equivalent and short-term
investment balances.  The Company incurred minimal interest expense in the first
six  months of 1997 and 1996.  During the second  quarter of 1997,  the  Company
revalued its investment in HFN by  $1,867,000.  The  revaluation  related to HFN
selling shares of stock thereby reducing the Company's ownership percentage from
40% to 25%.  This  gain  was  recorded  net of  expected  HFN  operating  losses
accounted for on an equity basis. In the first half 1996, the Company incurred a
loss of $894,000 in its proportionate  share of HFN and recognized other income,
primarily from the sale of assets of $185,000.
<PAGE>
Weighted Average Outstanding Shares and Net Loss Per Common Share

         The primary and fully  diluted  weighted  average  shares  increased to
31,818,000 for the first six months of 1997 compared to 15,833,000 for the first
six months of 1996.  The  increase  resulted  primarily  from  shares  issued in
connection  with the  acquisition  of Braun,  Simmons & Co. and the merger  with
Colonial Data in September and November 1996,  respectively.  As a result of the
foregoing,  net loss per common  share was  $(0.08)  for the first six months of
1997 compared to $(0.33) for the second half of 1996.


LIQUIDITY AND CAPITAL RESOURCES

         During the first six months of 1997,  the Company's  cash,  equivalents
and short-term  investments  decreased by $14,818,000 resulting from the payment
of  outstanding  liabilities  at year-end and the financing of certain  accounts
receivable balances and inventory  purchases.  At June 30, 1997, the Company had
$24,254,000 in cash,  equivalents and short-term  investments that were invested
in  financial  instruments  that  are  diversified  among  high  credit  quality
securities.  The investments  are reported at cost,  which  approximates  market
value,  and are  classified  as  short-term  investments  and cash  equivalents.
Additionally,  at June 30, 1997, the Company had working  capital of $62,853,000
with no long-term debt. The Company's total assets exceeded total liabilities by
$121,775,000.

         During the first six months of 1997, cash used in operating  activities
was $12,622,000 compared to $4,507,000 in the same period in 1996. This increase
was  primarily  related to  financing  an  increase in  accounts  receivable  of
$5,888,000,  inventories  of  $2,226,000  and funding net payments from accounts
payable  and accrued  expenses of  $3,820,000,  offset in part by  decreases  in
prepaid expenses and other assets aggregating $1,023,000.

         Investing  activities  provided $720,000 during the first six months of
1997 compared to using  $4,177,000 in the same period in 1996.  Cash provided by
investing  activities  was  primarily  contributed  by the  sale  of  short-term
investments  offset in part by the purchase of certain  property and  equipment,
primarily to support an upgrade for the Company's internal networks.

         Financing  activities  used  $1,900,000 in the first six months of 1997
compared  to  providing  $684,000  in the  same  period  in 1996.  Current  year
activities consisted of the repayment of short-term borrowings from December 31,
1996 in the amount of $2,000,000  offset by proceeds  received from the issuance
of common stock during the first six months of 1997. During the first six months
of 1996, the Company received $684,000 from the issuance of common stock.

     The Company's  primary needs for cash in the future are for  investments in
product  development,  working capital,  the financing of operations,  potential
acquisitions,  strategic ventures,  capital  expenditures and the upgrade of the
Company's systems and operations. In addition, the Company may from time to time
repurchase shares of its common stock on the open
<PAGE>
market.  In order to meet the Company's  needs for cash throughout the year, the
Company will utilize cash, short-term investments and may utilize, to the extent
available,  funds  generated from  operations in the second half of 1997 through
the collections of accounts receivable and sale of inventories.


CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995

         The  above  information  includes   forward-looking   statements,   the
realization  of which  may be  impacted  by the  factors  discussed  below.  The
forward-looking  statements  are made pursuant to the safe harbor  provisions of
the Private  Securities  Litigation Reform Act of 1995 (the "Act").  This report
contains forward looking statements that are subject to risks and uncertainties,
including,  but not  limited  to, the impact of  competitive  products,  pricing
pressure,  product  demand  and  market  acceptance  risks,  timing of  customer
programs,  uncertainty as to future financial results,  developing  marketplace,
fluctuations in operating results, reliance on Caller ID revenues, concentration
of  products  and  services,   InteliData   common  stock  owned  by  WorldCorp,
technological  considerations,  dependence on foreign production,  dependence on
key  employees,  regulation,  volatility  of stock  price,  limited  proprietary
protection,   and  limited  sources  of  supply,   manufacturing   delays,   the
availability of key component parts, product obsolescence,  inventory levels and
valuations and other risks  detailed from time to time in the Company's  filings
with  the  Securities  and  Exchange  Commission,  including  the  risk  factors
disclosed  in the  Company's  Form 10-K for the fiscal year ended  December  31,
1996.  These risks could cause the Company's  actual results for 1997 and beyond
to differ materially from those expressed in any forward looking statements made
by, or on behalf of, the Company.  The foregoing  list of factors  should not be
construed  as  exhaustive  or  as  any  admission   regarding  the  adequacy  of
disclosures made by the Company prior to the date hereof or the effectiveness of
said Act.

<PAGE>
PART II:  OTHER INFORMATION
---------------------------

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

(a)   Exhibits
      --------

      None

(b)   Reports on Form 8-K
      -------------------

      None

<PAGE>


                                   SIGNATURES



         Pursuant  to the  requirements  of the  Securities  Act  of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.


                                INTELIDATA TECHNOLOGIES CORPORATION



                                By:   /s/ John C. Backus
                                      ------------------------------------------
                                      John C. Backus
                                      President and Chief Executive Officer




                                By:   /s/ John W. Hillyard
                                      ------------------------------------------
                                      John W. Hillyard
                                      Vice President and Chief Financial Officer