<PAGE>   1




                       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 QUARTERLY PERIOD ENDED SEPTEMBER 30, 1997

                         COMMISSION FILE NUMBER 0-29204

                          HOMECOM COMMUNICATIONS, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                            DELAWARE                       58-2153309
     (STATE OR OTHER JURISDICTION OF        (I.R.S. EMPLOYER IDENTIFICATION NO.)
      INCORPORATION OR ORGANIZATION)

                             BUILDING 14, SUITE 100,
                               3535 PIEDMONT ROAD
                             ATLANTA, GEORGIA 30305
              (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)

                                  (404) 237-4646
              (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) and has been subject 
     to such filing requirements for the past 90 days.

                          Yes [X]               No [ ]

        As of November 3, 1997, there were 2,956,396 outstanding shares of the 
              Registrant's Common Stock, par value $.0001 per share.


<PAGE>   2


                          HOMECOM COMMUNICATIONS, INC.

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                        PAGE
                                                                                        ----
<S>                                                                                     <C>
PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS:

1) Balance Sheets as of September 30, 1997 and December 31, 1996                         2

2) Statements of Operations for the three and nine months ended
September 30, 1997 and 1996                                                              3

3) Statements of Cash Flows for the nine months ended
September 30, 1997 and 1996                                                              4

4) Notes to Financial Statements                                                         5

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS                                            6

PART II.  OTHER INFORMATION

 ITEM 6.        Exhibits and Reports on Form 8-K                                        12

Signatures                                                                              13

Exhibit Index                                                                           14
</TABLE>

                                        1


<PAGE>   3


PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS

                          HOMECOM COMMUNICATIONS, INC.
                                 BALANCE SHEETS
                 AS OF SEPTEMBER 30, 1997 AND DECEMBER 31, 1996

<TABLE>
<CAPTION>
                                                                                            September 30, 1997    December 31, 1996
                                                                                            ------------------    -----------------
                                                                                               (unaudited)            (audited)
                                                                                               -----------            ---------
<S>                                                                                         <C>                   <C>
ASSETS

CURRENT ASSETS:
    Cash and cash equivalents                                                                       $2,177,677           $  332,377
    Accounts receivable, net of allowance for uncollectible accounts of $219,055 and 
          $106,845 as of September 30, 1997 and December 31, 1996, respectively                        657,163              488,254
    Other current assets                                                                                   636                  621
                                                                                                    ----------           ----------
          Total current assets                                                                       2,835,476              821,252
FURNITURE, FIXTURES AND EQUIPMENT, NET                                                                 606,839              359,260
SOFTWARE DEVELOPMENT COSTS, NET                                                                         96,128               81,520
DEPOSITS                                                                                                57,530               57,527
DEFERRED DEBT ISSUE COSTS                                                                              127,500                   --
DEFERRED OFFERING COSTS                                                                                     --              406,963
                                                                                                    ----------           ----------
          Total assets                                                                              $3,723,473           $1,726,522
                                                                                                    ==========           ==========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
    Accounts payable and accrued expenses                                                           $  545,373           $  649,794
    Accrued salaries and payroll taxes payable                                                         143,813              309,377
    Accrued vacation                                                                                    14,935               14,935
    Current portion of notes payable to stockholders                                                        --              989,904
    Current portion of note payable to bank                                                             12,126               13,614
    Unearned revenue                                                                                   157,359              133,170
    Current portion of obligations under capital leases                                                     --               15,140
                                                                                                    ----------           ----------
          Total current liabilities                                                                    873,606            2,125,934

CONVERTIBLE DEBENTURES                                                                               1,700,000                   --
NOTE PAYABLE TO STOCKHOLDERS AND AFFILIATES                                                                 --               55,677
NOTE PAYABLE TO BANK                                                                                        --               47,032
OTHER LIABILITIES                                                                                       62,420               73,424
OBLIGATIONS UNDER CAPITAL LEASES                                                                        49,022               45,124
                                                                                                    ----------           ----------
          Total liabilities                                                                          2,685,048            2,347,191
                                                                                                    ----------            ---------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT):
    Commonstock, $.0001 par value, 15,000,000 shares authorized, 2,956,396 and 
        1,923,063 shares issued and outstanding at September 30, 1997 and December 
        31, 1996, respectively                                                                             296                  192
    Additional paid-in capital                                                                       5,370,212              472,726
    Subscriptions receivable                                                                          (318,753)            (468,004)
    Accumulated deficit                                                                             (4,013,330)            (625,583)
                                                                                                    ----------            ---------
              Total stockholders' equity (deficit)                                                   1,038,425             (620,669)
                                                                                                    ----------            ---------
                                                                                                    $3,723,473           $1,726,522
              Total liabilities and stockholders' equity (deficit)                                  ==========           ==========
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                       2


<PAGE>   4



                          HOMECOM COMMUNICATIONS, INC.
                            STATEMENTS OF OPERATIONS
         FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                           Three Months Ended                          Nine Months Ended
                                                 September 30, 1997   September 30, 1996     September 30, 1997   September 30, 1996
                                                 ------------------   ------------------     ------------------   ------------------
<S>                                              <C>                  <C>                    <C>                  <C>              
NET SALES:
      Service sales                                  $   667,806           $   623,068          $  2,268,377        $ 1,318,675
      Equipment sales                                     45,595                30,950                62,598            152,649  
                                                     -----------           -----------          ------------        -----------
              Total net sales                            713,401               654,018             2,330,975          1,471,324
                                                     -----------           -----------          ------------        -----------
COST OF SALES:
        Cost of services                                 557,799               152,866             1,252,507            271,887
        Cost of equipment sold                            42,730                37,076                52,294            114,552
                                                     -----------           -----------          ------------        -----------
               Total cost of sales                       600,529               189,942             1,304,801            386,439
                                                     -----------           -----------          ------------        -----------
GROSS PROFIT                                             112,872               464,076             1,026,174          1,084,885
                                                     -----------           -----------          ------------        -----------
OPERATING EXPENSES:                                
        Sales and marketing                              627,962               190,596             1,163,072            408,131
        Product development                              177,961                37,242               375,977             63,823
        General and administrative                     1,381,769               276,963             2,739,374            664,244
        Depreciation and amortization                     58,225                24,887               138,832             52,835
                                                     -----------           -----------          ------------        -----------
               Total operating expenses                2,245,917               529,688             4,417,255          1,189,033
                                                     -----------           -----------          ------------        -----------
OPERATING LOSS                                        (2,133,045)              (65,612)           (3,391,081)          (104,148)

OTHER EXPENSES (INCOME)
        Interest expense                                       -                11,257                53,665             26,833
        Other expense (income), net                      (37,096)                    -               (56,999)                 -
                                                     -----------           -----------          ------------        -----------
LOSS BEFORE INCOME TAXES                              (2,095,949)              (76,869)           (3,387,747)          (130,981)

                                                               -                     -                     -                  -
INCOME TAXES                                         -----------           -----------          ------------          ---------

NET LOSS                                             $(2,095,949)          $   (76,869)         $ (3,387,747)       $  (130,981)
                                                     ===========           ===========          ============        ===========
NET LOSS PER SHARE                                   $     (0.71)          $     (0.04)         $      (1.36)       $     (0.07)
                                                     ===========           ===========          ============        ===========

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING          2,956,396             1,870,156             2,483,258          1,870,156
                                                     ===========           ===========          ============        ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                        3


<PAGE>   5
                          HOMECOM COMMUNICATIONS, INC.
                            STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                   Nine Months Ended
                                                                         September 30, 1997 September 30, 1996
                                                                         ------------------ ------------------
<S>                                                                      <C>                <C>              
CASH FLOWS FROM OPERATING ACTIVITIES:
        Net loss                                                               $(3,387,747)      $(130,981)
        Adjustments to reconcile net income (loss) to
              cash provided by (used in) operating activities:
                     Depreciation                                                  138,486          52,835
                     Amortization                                                   14,547               -
                     Forgiveness of subscriptions receivable                       149,251               -
                     Provision for bad debts                                       194,894          33,515
                     Deferred rent expense                                         (11,004)         51,486
                     Change in operating assets and liabilities:
                            Accounts receivable                                   (363,803)       (383,630)
                            Other current assets                                       (15)         (4,663)
                            Deposits                                                    (3)        (55,800)
                            Accounts payable and accrued expenses                  (81,001)         87,810
                            Accrued salaries and payroll taxes payable            (165,564)        147,009
                            Accrued vacation                                             -          29,533
                            Unearned revenue                                        24,189          84,314
                                                                               -----------       ---------
              Net cash used in operating activities                             (3,487,770)        (88,572)
                                                                               -----------       ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
        Purchase of furniture, fixtures and equipment                             (364,265)       (329,569)
        Software development costs                                                 (29,155)        (53,245)
                                                                               -----------       ---------
               Net cash used in investing activities                              (393,420)       (382,814)
                                                                               -----------       ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
        Payment of deferred offering costs                                        (438,867)        (63,618)
        Payment of deferred debt issue costs                                      (127,500)              -
        Proceeds of issuance of convertible debentures                           1,700,000               -
        Proceeds from note payable                                                       -          70,000
        Repayment of note payable                                                  (48,520)         (7,487)
        Proceeds from notes payable to stockholders                                490,000         444,904
        Repayment of notes payable to stockholders                              (1,335,581)         (4,187)
        Repayment of capital lease obligations                                     (33,042)             --
        Proceeds from sale of stock, net of underwriting discounts and           
          commissions                                                            5,520,000             100
                                                                               -----------       ---------
               Net cash provided by financing activities                         5,726,490         439,712
                                                                               -----------       ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                             1,845,300         (31,674)

CASH AND CASH EQUIVALENTS at beginning of period                                   332,377         129,095
                                                                               -----------       ---------

CASH AND CASH EQUIVALENTS at end of period                                     $ 2,177,677       $  97,421
                                                                               ===========       =========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
     AND NON CASH INVESTING AND FINANCING ACTIVITIES:
     Cash paid during the period for interest                                  $    53,664       $   5,190
                                                                               ===========       =========
</TABLE>
        During the nine month period ended September 30, 1997, capital lease
        obligations of $21,800 were incurred when the Company entered into
        leases on computer equipment.

        During the nine month period ended September 30, 1997, the Company
        issued 33,333 shares of common stock in satisfaction of a $200,000 note
        payable to stockholder.

The accompanying notes are an integral part of these financial statements.

                                        4









<PAGE>   6



                          HOMECOM COMMUNICATIONS, INC.

                          NOTES TO FINANCIAL STATEMENTS

1.  BASIS OF PRESENTATION

     Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to Article 10 of Regulation S-X of the
Securities and Exchange Commission. The accompanying unaudited financial
statements reflect, in the opinion of management, all adjustments necessary to
achieve a fair statement of the financial position and results of operations of
HomeCom Communications, Inc. (the "Company") for the interim periods presented.
All such adjustments are of a normal and recurring nature. These financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's Registration Statement on Form S-1 (File No.
333-12219), which was declared effective by the Securities and Exchange
Commission on May 6, 1997.

2.  STOCK OFFERING

     In May 1997, the Company completed an initial public offering of its common
stock. The Company issued 1,000,000 shares at an initial public offering price
of $6.00 per share. The total proceeds of the offering, net of underwriting
discounts, commissions and offering expenses, were approximately $4,700,000. The
Company used a portion of the proceeds from the initial public offering to repay
outstanding principal amounts of approximately $1,300,000 loaned to the Company
by stockholders and affiliates plus accrued interest of approximately $65,000.
The Company issued 33,333 shares of common stock as payment in full of the
outstanding principal balance of a $200,000 loan from an investor.

3.  ISSUANCE OF CONVERTIBLE DEBENTURES

     In September 1997, the Company issued $1,700,000 of 5% Convertible
Debentures due September 26, 2000. The Debentures are convertible into shares of
the Company's Common Stock at the lesser of (a) 75% of the average closing bid
price of the Common Stock on the Nasdaq SmallCap(TM) Market for the three (3)
trading days preceding notice of conversion; or (b) $4.00. The number of shares
issuable upon conversion of the Debentures is equal to the aggregate principle
balance of the Debentures divided by the conversion price. Net proceeds to the
Company from the issuance of the Debentures totaled approximately $1,500,000.
In addition, the Company granted three-year warrants to acquire an aggregate
400,000 shares of Common Stock.  Of these warrants, 200,000 are exercisable at a
price of $4.00 and 200,000 are exercisable at a price of $6.00 per share.

4.  NET LOSS PER SHARE

     Net loss per common share is based on the Company's common stock and is
computed using the weighted average number of common and dilutive common
equivalent shares outstanding during the period. Dilutive common equivalent
shares consist of stock options and warrants (calculated using the treasury
stock method at the initial public offering price of $6.00 per share). Pursuant
to Securities and Exchange Commission Staff Accounting Bulletin No. 83, common
stock issued for consideration below the initial public offering price per share
and stock options issued with exercise prices below such price during the
twelve-month period preceding the date of the initial filing of the registration
statement have been included in the calculation of common shares, using the
treasury stock method, as if they were outstanding for all periods presented.
All per share data has been retroactively adjusted to reflect the 93.07-for-one
stock split approved by the Board of Directors on September 11, 1996 and
effective September 11, 1996.

5.  INCOME TAXES

     There was no provision for or cash payment of income taxes for the nine
months ended September 30, 1997 and 1996, respectively, as the Company
anticipates a net taxable loss for the year ended December 31, 1997, and, prior
to February 9, 1996, the Company qualified as a S Corporation for federal and
state income tax purposes.

                                        5


<PAGE>   7


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

     Except for historical information contained herein, some matters discussed
in this report constitute forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Company notes that a variety of
risk factors could cause the Company's actual results and experience to differ
materially from the anticipated results or other expectations expressed in the
Company's forward-looking statements. Reference is made in particular to the
discussion set forth below in this report and set forth in the Company's
Registration Statement on Form S-1 (File No. 333-12219) which was declared
effective by the Securities and Exchange Commission on May 6, 1997.

GENERAL

     The Company generates revenues through Internet and Intranet customized
software application development, web site development, web site hosting
services, computer hardware resales, consulting services and fees charged for
the maintenance of web sites. Most customized software application projects are
generally completed within six to eight weeks, although certain past, current
and future projects have taken and are expected to take longer to complete.
Revenues on customized application and web site development projects are
recognized using the percentage of completion method. Web site maintenance and
hosting revenues represent recurring revenues and are deferred and recognized
ratably over the period.

     During the nine month period ended September 30, 1997, expenses
substantially exceeded net sales as the Company continued to develop its
products and services, institute its marketing and sales programs and implement
the operational and administrative support structure necessary to support its
business. The Company anticipates that it will continue to incur losses for an
indefinite period as it develops its products and markets and continues to
build its corporate infrastructure.

     The Company's revenues and operating results have varied substantially from
period to period, and should not be relied upon as an indication of future
results. The Company historically has operated with no significant backlog
because its services are provided as requested by customers. As a result,
revenues in any quarter are substantially affected by the amount of services
requested by its customers. Moreover, unanticipated variations in the number and
timing of the Company's projects or in employee utilization rates may cause
significant variations in revenues in any particular quarter. An unanticipated
termination of a major project, a client's decision not to pursue a new project
or proceed to succeeding stages of a current project, or the completion during a
quarter of several major client projects, could require the Company to pay
underutilized employees and therefore have a material adverse effect on the
Company's results of operations and financial condition.

RESULTS OF OPERATIONS

  Three Months Ended September 30, 1997 Compared to Three Months Ended 
September 30, 1996

     Net Sales. Net sales increased 9.1% from $654,018 in the third quarter of
1996 to $713,401 in the third quarter of 1997. Revenues from service sales
increased 7.2% from $623,068 in the third quarter of 1996 to $667,806 in the
third quarter of 1997. This increase of $44,738 is primarily attributable to
increases in security consulting revenues of approximately $100,000, offset by
decreases in web development revenues of approximately $45,000. Revenue from 
equipment sales were $45,595 during the third quarter of 1997 as compared to 
$30,950 for the third quarter of 1996.

     Cost of Sales. Cost of sales for services includes salaries for
programmers, technical staff and customer support. Cost of sales for services
increased from $152,866, or 23.4% of revenues in the third quarter of 1996 to
$557,799, or 78.2% of revenues in the third quarter of 1997. This increase
reflects the Company's significant increase in payroll costs associated with the
hiring of additional technical personnel. Increases in the Company's cost of
sales as a percentage of sales reflects the hiring of technical personnel to
create available capacity for anticipated revenue growth.

                                        6


<PAGE>   8



     Gross Profit. Gross profit decreased by $351,204 from $464,076 in the third
quarter of 1996 to $112,872 in the third quarter of 1997. Gross profit margins
decreased from 71.0% during the third quarter of 1996 to 15.8% during the third
quarter of 1997. This decrease as a percentage of revenues primarily reflects
increased costs incurred by the Company for technical personnel hired in advance
of anticipated revenue growth, which did not occur.

     Sales and Marketing. Sales and marketing expenses include salaries,
variable commissions and bonuses for the sales force, advertisement and
promotional marketing materials, travel and telephone charges. Sales and
marketing expenses increased 229.5% from $190,596 in the third quarter of 1996
to $627,962 in the third quarter of 1997. This increase was primarily
attributable to an increase in advertising and marketing expenses. As a
percentage of revenues, these expenses increased from 29.1% of revenues in the
third quarter of 1996 to 88.0% of revenues in the third quarter of 1997. 
During the third quarter of 1997, the Company implemented procedures intended
to substantially reduce future advertising and marketing expenses.

     Product Development. Product development expenses consist of personnel
costs required to conduct the Company's product development effort. Management
believes that significant continuing investments in product development are
required to compete effectively in the Company's industry. As a consequence, the
Company has increased expenditures on product development primarily through the
employment of additional development personnel. Total expenditures for product
development were $177,961, or 24.9% of net sales in the third quarter of 1997,
of which none were capitalized. This compares to total product development
expenditures of $70,606, or 10.8% of sales, in the third quarter of 1996, of
which $33,364 were capitalized.

     General and Administrative. General and administrative expenses include
salaries for administrative personnel, rents, telephone charges, insurance and
other administrative expenses. General and administrative expenses increased
from $276,963 in the third quarter of 1996 to $1,381,769 in the third quarter
of 1997. As a percentage of net sales, these expenses increased from 42.3% in
the third quarter of 1996 to 193.7% in the third quarter of 1997. This increase
as a percentage of net sales primarily reflects increases for operational and
administrative support personnel incurred to support anticipated growth. The
Company has taken several actions to reduce general and administrative expenses
during the current quarter including reductions in general and administrative 
staff and reductions in public relations and other professional services. As a
consequence of these actions, the Company expects general and administrative
costs as a percentage of net sales to decrease if the Company is successful in
increasing its revenues.

     Depreciation and Amortization. Depreciation and amortization includes
depreciation and amortization of computers, network equipment, office equipment
and equipment under capital leases. Depreciation and amortization increased from
$24,887, or 3.8% of revenues in the third quarter of 1996 to $58,225, or 8.2% in
the third quarter of 1997, reflecting increased expenditures on capital
equipment. The Company expects additional capital investments during 1997 as it
continues to develop the infrastructure needed to support higher levels of
operations. However, the Company may choose to forego additional capital
investments if sales do not increase to the levels targeted by management.

     Interest Expense. Interest expense decreased from $11,257 in the third
quarter of 1996 to $0 during the third quarter of 1997, principally
reflecting the repayment of notes payable subsequent to the Company's initial
public stock offering in May 1997.
                                        7


<PAGE>   9


Nine Months Ended September 30, 1997 Compared to Nine Months Ended September 30,
1996

     Net Sales. Net sales increased 58.4% from $1,471,324 in the first nine
months of 1996 to $2,330,975 in the first nine months of 1997. Revenues from
service sales increased 72.0% from $1,318,675 in the first nine months of 1996
to $2,268,377 in the first nine months of 1997. This increase of $949,702 is
primarily attributable to increases in hosting revenues of approximately
$563,000, Web site development and customized applications revenues of
approximately $184,000 and security consulting revenue of approximately
$237,000. Revenues from equipment sales were $62,598 during the first nine
months of 1997 as compared to $152,649 during the first nine months of 1996.

     Cost of Sales. Cost of sales for services increased from $271,887, or 18.5%
of revenues in the first nine months of 1996 to $1,252,507, or 53.7% of revenues
in the first nine months of 1997. This increase reflects the Company's
significant increase in payroll costs associated with the hiring of additional
technical personnel. Increases in the Company's cost of sales as a percentage of
sales reflects the hiring of technical personnel to create available capacity
for anticipated revenue growth, which did not occur. The Company increased its
technical staff to approximately 60 persons in July 1997. Subsequently, the
Company reduced this staff to approximately 30 persons as of September 30, 1997.

     Gross Profit. Gross profit decreased by $58,711 from $1,084,885 in the
first nine months of 1996 to $1,026,174 in the first nine months of 1997. Gross
profit margins decreased from 73.7% during the first nine months of 1996 to
44.0% during the first nine months of 1997. This decrease as a percentage of net
sales primarily reflects increased costs incurred by the Company for technical
personnel hired in advance of anticipated revenue growth, which did not occur.

     Sales and Marketing.  Sales and marketing expenses increased 185.0% from
$408,131 in the first nine months of 1996 to $1,163,072 in the first nine
months of 1997. This increase was primarily attributable to an increase in
advertising and marketing expenses. As a percentage of net sales, these
expenses increased from 27.7% in the first nine months of 1996 to 49.9% in the
first nine months of 1997. During the third quarter of 1997, the Company has
implemented procedures intended to substantially reduce future advertising and
marketing expenses.

     Product Development.  Total expenditures for product development were
$405,132, or 17.4% of net sales in first nine months of 1997, of which $29,155
were capitalized. This compares to total product development expenditures of
$117,068, or 8.0% of sales, in the first nine months of 1996, of which $53,245
were capitalized. The product development staff was 8 persons in July 1997.
Subsequently, the Company reduced its product development staff, which was
2 persons at September 30, 1997.

     General and Administrative.  General and administrative expenses increased
from $664,244 in the first nine months of 1996 to $2,739,374 in the first nine
months of 1997. As a percentage of net sales, these expenses increased from
45.1% in the first nine months of 1996 to 117.5% in the first nine months of
1997. This increase as a percentage of net sales reflects primarily increases
for operational and administrative support personnel incurred to support
anticipated growth in revenues, which did not occur. During the third quarter of
1997, the Company implemented steps to significantly reduce its future general
and administrative costs. These steps included: (i) reductions in general and
administrative staff; and (ii) reductions in public relations and other
professional services.

     Depreciation and Amortization.  Depreciation and amortization increased
from $52,835, or 3.6% of net sales in the first nine months of 1996 to
$138,832, or 6.0% in the first nine months of 1997, reflecting increased
expenditures on capital equipment. 

                                        8


<PAGE>   10



     Interest Expense. Interest expense increased from $26,833 in the first nine
months of 1996 to $53,665 during the first nine months of 1997, principally
reflecting increased debt levels associated with notes payable to investors
entered into in 1996.

LIQUIDITY AND CAPITAL RESOURCES

     General

     Following completion of its initial public offering, the Company increased
its expenses in anticipation of potential increased sales which did not occur.
During the quarter ended June 30, 1997, the Company realized that sales had not
increased at the rate anticipated. In response, the Company took efforts during
the quarter ended September 30, 1997 to reduce its general and administrative
costs. These efforts included (i) a reduction in staff from a high of
approximately 100 persons in July 1997 to approximately 50 persons at September
30, 1997; and (ii) reductions in advertising, public relations and other
professional services.

     The Company has substantially limited unused sources of capital. As of
September 30, 1997, the Company had net working capital of approximately $2.0
million. Because the Company expects to continue to incur substantial operating
losses, the Company will continue to use substantial sums of cash in its
operations throughout the remainder of this calendar year, and possibly for an
indefinite period thereafter. Accordingly, the Company will be required to
obtain additional capital.  No assurance can be given that the Company will be
successful in its efforts to obtain additional capital, or that capital will be
available on terms acceptable to the Company or on terms that will not
significantly dilute the interests of existing stockholders. If the Company
exhausts its current sources of capital and is not able to obtain additional
capital, the Company will be required to undertake certain steps to continue its
operations. Such steps may include immediate reduction of the Company's
operating costs and other expenditures, including potential reductions of
personnel and suspension of salary increases and capital expenditures. If such
measures are not sufficient, the Company may elect to implement other cost
reduction actions as the Company may determine are necessary and in the
Company's best interests, including the possible sale of certain of the
Company's assets. Any such actions undertaken may limit the Company's
opportunities to realize continued increases in sales and the Company may not be
able to reduce its costs in amounts sufficient to achieve break-even or
profitable operations. If the Company exhausts its sources of capital, and
subsequent cost reduction measures are not sufficient to allow the Company to
achieve break-even or profitable operations, the Company will be forced to seek
protection from its creditors.


                                       9
<PAGE>   11
     Net cash used in operating activities was $3,487,770 for the nine month
period ended September 30, 1997. The Company has primarily financed its
operations to date through public and private sales of equity securities and
loans from its principal stockholders and affiliates. Net cash provided by
financing activities was $5,726,490 and $439,712 during the nine month periods
ended September 30, 1997 and 1996, respectively. During May 1997, the Company
completed an initial public offering of its common stock, issuing 1,000,000
shares at a price of $6.00 per share. The net proceeds to the Company from the
initial public offering were approximately $4,700,000. The Company has repaid
all outstanding principal amounts loaned to the Company by stockholders and
affiliates. In September 1997, the Company completed the issuance of an
aggregate $1,700,000 principal amount of the Company's 5% convertible debentures
due September 22, 2000 (the "Debentures").  The Debentures are convertible at
the option of the holders thereof; provided that such holders have agreed they
may convert not more than one-third of the aggregate value of the Debentures
until 90 days after the date of the closing of the sale of the Debentures (the
"Closing Date") or upon the date on which a registration statement covering the
shares of Common Stock issuable upon conversion of the Debentures is declared
effective (the "Registration Effective Date") (whichever is sooner), an
additional one-third of the aggregate value of the Debentures commencing 120
days after the Closing Date or 30 days after the Registration Effective Date
(whichever is sooner), and the final one-third of the aggregate value of the
Debentures commencing 150 days after the Closing Date or 60 days after the
Registration Effective Date (whichever is sooner).  The conversion price is the
lesser of: (a) 75% of the average closing bid price of the Common Stock for the
three (3) trading days preceding notice of conversion; or (b) $4.00.  The number
of shares issuable upon conversion of the Debentures is equal to the aggregate
principal balance of the Debentures divided by the conversion price.  Net
proceeds from the sale of the Debentures was approximately $1.5 million.

     The Company spent $364,265 and $329,569 during the nine month periods ended
September 30, 1997 and 1996, respectively, for the purchase of capital
equipment. These amounts were expended primarily for computer equipment,
communications equipment and software necessary for the Company to increase its
presence in the Internet and Intranet applications marketplace. The Company's
commitments as of September 30, 1997 consist primarily of leases on its Atlanta
and Washington, DC facilities. At September 30, 1997, there were no material
commitments for capital expenditures.

     Accounts receivable, net of allowance for doubtful accounts, totaled
$657,163 as of September 30, 1997. Trade receivables are monitored by the
Company through ongoing credit evaluations of its customers' financial
conditions. The allowance for doubtful accounts is considered by management to
be an adequate reserve for known and estimated bad debts of the Company. A
revision in this reserve due to actual results differing from this estimate
could have a material impact on the results of operations, financial position
and liquidity of the Company.




                                       10
<PAGE>   12
     HISS Acquisition

     In August 1996, HomeCom acquired all of the outstanding capital stock of
HomeCom Internet Security Services, Inc. ("HISS"), a Delaware corporation formed
in July 1996 to provide Internet and Intranet security system consulting
services. In the transaction, the former holders of HISS's capital stock
received the right to receive their pro rata share of four annual earnout
payments to be paid not later than March 31 of 1998, 1999, 2000 and 2001 (each,
an "Annual Earnout"). Each Annual Earnout will be one-fourth of an amount equal
to 30% of HISS's gross revenues for the 12 month period ending December 31,
1997; provided, however, that (i) the amount of each Annual Earnout will be
limited to an amount (the "Profit Cap") equal to HISS's net profits for the
12-month period ended December 31 immediately preceding the payment date; (ii)
amounts not paid in a year as a result of the Profit Cap will be carried forward
to the subsequent year; and (iii) amounts not paid in the fourth year as a
result of the Profit Cap will be forfeited. Each Annual Earnout can be paid in
whole or in part in cash or, at HomeCom's option, in shares of Common Stock
based upon the average trading price of the Common Stock for the ten trading
days immediately preceding payment of the Annual Earnout. An Annual Earnout will
not be paid if the recipient is then in violation of the non-solicitation and
non-competition provisions contained in the Stock Purchase Agreement to which
the former holders of HISS's capital stock are subject. Roger Nebel, Vice
President and a director of the Company, owned 48% of HISS's outstanding capital
stock and will be entitled to receive 48% of the Annual Earnouts. HISS was
merged with and into the Company on September 11, 1996. The Company currently
anticipates that any and all amounts earned under this Agreement shall be paid
in the form of shares of the Company's common stock, rather than cash. HISS's
gross revenues for the nine months ended September 30, 1997 were approximately
$237,000.

RECENTLY ISSUED ACCOUNTING STANDARDS

     In June 1997, Statement of Financial Accounting Standards No. 130
"Reporting Comprehensive Income" ("FAS 130") was issued. FAS 130 establishes
standards for reporting and display of comprehensive income and its components.
FAS 130 is effective for fiscal years beginning after December 15, 1997. The
effect on the Company's financial statements will be immaterial. The Company
will adopt FAS 130 on its effective date.

     In June 1997, Statement of Financial Accounting Standards No. 131
"Disclosures about Segments of an Enterprise and Related Information" ("FAS
131") was issued. FAS 131 is designed to improve the information provided in
financial statements about the different types of business activities in which
the enterprise engages and economic environments in which the enterprise
operates. FAS 131 is effective for fiscal years beginning after December 15,
1997. Earlier application is encouraged. The Company will adopt FAS 131 on its
effective date. Such adoption will have no effect on net income of the Company.

                                       11
<PAGE>   13



                           PART II. OTHER INFORMATION

ITEMS 1-5.  NOT APPLICABLE

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

   (a) Exhibits

       27.1  Financial Data Schedule (For SEC use only)

   (b) Reports on Form 8-K

       None.

                                       12


<PAGE>   14



                                   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.

                                               HomeCom Communications, Inc.

Date:  November 12, 1997                       /s/ Harvey W. Sax
                                               -----------------

                                               President and
                                               Chief Executive Officer

Date:  November 12, 1997                       /s/ Norman H. Smith
                                               -------------------

                                               Vice President Finance and
                                               Administration
                                               (Principal Financial Officer)

                                       13


<PAGE>   15




                          HOMECOM COMMUNICATIONS, INC.

                                  EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number                          Description                    Page
------                          -----------                    ----
<S>             <C>                                            <C>
27.1            Financial Data Schedule (For SEC Use only)      
</TABLE>






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