================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                -----------------



                                    FORM 10-Q


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

                  For the quarterly period ended March 31, 2001

                                       or

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

             For the transition period from __________ to __________

                         COMMISSION FILE NUMBER 0-18708


                                MICROGRAFX, INC.
             (Exact name of registrant as specified in its charter)


           TEXAS                                                  75-1952080
(State or other jurisdiction of                                 (IRS Employer
incorporation or organization)                               Identification No.)


               8144 WALNUT HILL LANE, SUITE 1050, DALLAS, TX 75231
               (Address of principal executive offices) (Zip Code)

                                 (469) 232-1000
              (Registrant's telephone number, including area code)


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


As of April 30, 2001, 11,846,669 shares of the Company's common stock were
outstanding.
================================================================================



<PAGE>
<TABLE>
<CAPTION>



                                MICROGRAFX, INC.

                                    FORM 10-Q

                      FOR THE QUARTER ENDED MARCH 31, 2001


                                TABLE OF CONTENTS

                                                                                       PAGE
<S>                     <C>                                                             <C>

                                     PART I.

Item 1.           Financial Statements

                  Consolidated Balance Sheets as of                                       3
                  March 31, 2001 (unaudited), and June 30, 2000

                  Consolidated Statements of Operations for the three and nine            5
                  months ended March 31, 2001 and 2000 (unaudited)

                  Consolidated Statements of Cash Flows for the                           6
                  nine months ended March 31, 2001 and 2000 (unaudited)

                  Notes to Consolidated Financial Statements                              7

Item 2.           Management's Discussion and Analysis of Financial                       9
                  Condition and Results of Operations

Item 3.           Quantitative and Qualitative Disclosures About Market Risk             16

                                    PART II.

Item 1.           Legal Proceedings                                                      16

Item 4.           Submission of Matters to a vote of Security Holders                    17

Item 6.           Exhibits and Reports on Form 8-K                                       17

                  SIGNATURES                                                             18


</TABLE>


                                       2
<PAGE>



ITEM 1.  FINANCIAL STATEMENTS
<TABLE>
<CAPTION>

                                               MICROGRAFX, INC.
                                          CONSOLIDATED BALANCE SHEETS
                                                (In thousands)
                                                  (Unaudited)

<S>                                                                                     <C>           <C>
                                                                                  MARCH 31,      JUNE 30,
                                                                                     2001          2000
                                                                                  -----------   -----------
     ASSETS

     Current assets:
           Cash and cash equivalents                                               $  2,745      $   2,843
           Accounts receivable, net of allowances of $1,740 and $2,788                4,556          3,926
           Other current assets                                                       1,245          1,477
                                                                                  -----------   -----------
               Total current assets                                                   8,546          8,246

     Property and equipment, net                                                      1,028          1,570

     Capitalized software development costs, net                                      5,634          5,530

     Acquired product rights, net                                                       957          1,612

     Goodwill, net                                                                    1,470          1,749

     Other assets                                                                       622            772
                                                                                  -----------   -----------
               Total assets                                                        $ 18,257      $  19,479
                                                                                  ===========   ===========
     See accompanying notes.

</TABLE>



                                       3
<PAGE>


<TABLE>
<CAPTION>


                                               MICROGRAFX, INC.
                                          CONSOLIDATED BALANCE SHEETS
                                     (In thousands, except per share data)
                                                  (Unaudited)

        <S>                                                                        <C>              <C>

                                                                                 MARCH 31,       JUNE 30,
                                                                                    2001           2000
                                                                               ---------------  -----------
     LIABILITIES AND SHAREHOLDERS' EQUITY

     Current liabilities:
           Accounts payable                                                        $  3,320      $   3,606
           Accrued compensation and benefits                                          1,508          1,597
           Other accrued liabilities                                                  1,996          3,503
           Deferred revenue                                                           2,284          1,584
           Subordinated Convertible Debenture                                         5,797              -
           Notes payable                                                                837            138
           Receivable facility                                                           49            767
           Income taxes payable                                                         134            271
                                                                                  -----------   -----------
               Total current liabilities                                             15,925         11,466

     Long-term debt                                                                       -          5,797
     Other non-current liabilities                                                      234            437

     Shareholders' equity:
           Preferred stock, $.01 par value, 10,000 shares authorized;
            issued series A convertible 1,120 shares at stated value                  1,680             -
           Common stock, $.01 par value, 20,000 shares authorized;
            12,612 and 12,263 shares issued                                             126            123
           Additional capital                                                        38,375         38,029
           Accumulated deficit                                                      (30,549)       (28,915)
           Accumulated other comprehensive loss                                      (1,735)        (1,659)
           Less - treasury stock (766 shares), at cost                               (5,799)        (5,799)
                                                                                  -----------   -----------
            Total shareholders' equity                                                2,098          1,779
                                                                                  -----------   -----------
            Total liabilities and shareholders' equity                             $ 18,257      $  19,479
                                                                                  ===========   ===========
     See accompanying notes.

</TABLE>



                                       4
<PAGE>


<TABLE>
<CAPTION>




                                                    MICROGRAFX, INC.
                                          CONSOLIDATED STATEMENTS OF OPERATIONS
                                          (In thousands, except per share data)
                                                       (Unaudited)

        <S>                                               <C>               <C>           <C>               <C>

                                                            THREE MONTHS ENDED             NINE MONTHS ENDED
                                                                 MARCH 31,                      MARCH 31,
                                                       ------------------------------   ------------------------------
                                                            2001             2000            2001             2000
                                                       -------------    -------------   -------------    -------------

     Net revenues                                         $   8,392     $      9,932      $   22,608      $    28,110
     Cost of revenues                                         1,362            2,241           4,540            7,019
                                                       -------------    -------------   -------------    -------------
          Gross profit                                        7,030            7,691          18,068           21,091

     Operating expenses:
        Sales and marketing                                   4,021            5,694          12,177           18,251
        General and administrative                            1,142            1,641           3,089            5,598
        Net research and development                          1,024            1,879           3,328            5,669
        Restructuring charge                                      -                -            (330)               -
                                                       -------------    -------------   -------------    -------------
          Total operating expenses                            6,187            9,214          18,264           29,518
                                                       -------------    -------------   -------------    -------------
     Income (loss) from operations                              843           (1,523)           (196)          (8,427)

     Interest income                                             22                7              46               50
     Interest expense                                          (261)            (142)           (683)            (418)
     Other (expense) income, net                               (401)            (123)           (363)               5
                                                       -------------    -------------   -------------    -------------
          Total non operating expense                          (640)            (258)         (1,000)            (363)
                                                       -------------    -------------   -------------    -------------
     Income (loss) before income taxes                          203           (1,781)         (1,196)          (8,790)

     Income tax provision                                        85              188             251              463
                                                       -------------    -------------   -------------    -------------
     Net income (loss)                                          118           (1,969)         (1,447)          (9,253)

     Preferred stock dividends                                  (25)               -             (58)               -
                                                       -------------    -------------   -------------    -------------
     Net income (loss) applicable to common
     shareholders                                         $      93     $     (1,969)     $   (1,505)     $    (9,253)

                                                       =============    =============   =============    =============

     Basic and diluted income (loss) per common share
                                                          $    0.01      $     (0.17)     $    (0.13)      $    (0.81)
                                                       =============    =============   =============    =============

     See accompanying notes.

</TABLE>



                                       5
<PAGE>





<TABLE>
<CAPTION>



                                               MICROGRAFX, INC.
                                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                (In thousands)
                                                 (Unaudited)
<S>                                                                                <C>                <C>
                                                                                 NINE MONTHS ENDED MARCH 31,
                                                                           ---------------------------------------
                                                                                 2001                 2000
                                                                           -----------------   -------------------
Cash flows from operating activities:
Net loss                                                                     $  (1,447)          $  (9,253)
Adjustments to reconcile net loss to net cash
    Provided by operating activities:
      Depreciation and amortization                                              3,162               5,404
      Deferred income taxes and other                                              (44)                 63
      Restructuring accrual                                                       (704)                  -
      Changes in operating assets and liabilities:
           Accounts receivable                                                    (675)              1,425
           Inventories                                                             202                 (58)
           Other current assets                                                   (229)                600
           Payables and accruals                                                (1,113)                (34)
           Deferred revenue                                                        701                 160
           Income taxes payable                                                    122                (131)
                                                                           -----------------   -------------------
                Net cash used in operating activities                              (25)             (1,824)
                                                                           -----------------   -------------------

Cash flows from investing activities:
      Proceeds from maturities of short-term investments                             -               3,440
      Purchases of short-term investments                                            -              (1,039)
      Capitalization of software development costs and
           purchases of acquired product rights                                 (1,460)             (2,434)
      Purchases of property and equipment, net                                    (289)             (1,671)
                                                                           -----------------   -------------------
                Net cash used in investing activities                           (1,749)             (1,704)
                                                                           -----------------   -------------------

Cash flows from financing activities:
      Proceeds from preferred stock issuance                                     1,680                   -
      Proceeds from employee stock programs                                         93                 348
      (Payments) proceeds on receivable facility                                  (719)              1,082
      Proceeds (payments) of notes payable                                         699              (2,600)
                                                                           -----------------   -------------------
                Net cash provided by (used in) financing activities              1,753              (1,170)
                                                                           -----------------   -------------------

Effect of exchange rates on cash and cash equivalents                              (77)                (27)
                                                                           -----------------   -------------------

Net decrease in cash and cash equivalents                                          (98)             (4,726)
Cash and cash equivalents, beginning of period                                   2,843               8,819
                                                                           -----------------   -------------------
Cash and cash equivalents, end of period                                     $   2,745           $   4,093
                                                                           =================   ===================
See accompanying notes.

</TABLE>





                                       6
<PAGE>



                                MICROGRAFX, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements of Micrografx,
Inc., and subsidiaries (the "Company") at March 31, 2001, and for the three and
nine-month periods ended March 31, 2001, and 2000 are unaudited but reflect all
adjustments, which are of a normal recurring nature and, in the opinion of
management, necessary for a fair presentation of the financial position and
results of operations for the periods presented. The accompanying consolidated
balance sheet at June 30, 2000 is derived from the audited consolidated
financial statements for the year ended June 30, 2000. The accompanying
financial statements and notes thereto should be read in conjunction with the
Company's audited consolidated financial statements for the year ended June 30,
2000, included in the 2000 Annual Report to Shareholders. The results of
operations for the three and nine-month periods ended March 31, 2001, are not
necessarily indicative of results to be expected for the year ending June 30,
2001.

CHANGE IN ESTIMATE
During the quarter, the Company reevaluated the amortization period of its
capitalized software for its Image2Web products. As a result, the amortization
period was adjusted from eighteen months to forty-eight months, which is
consistent with other amortization periods within Micrografx. The Image2Web
technology automates the lengthy and complex processes necessary to prepare,
maintain and personalize product information for e-commerce with a special focus
on product imagery. This solution also allows the customer to fully utilize
their content from syndication, to personalization to repurposing old content to
new mediums like the web. As result of the change, the Company recorded
amortization expense of approximately $30,000. Had the change in estimate not
occurred, the Company would have recorded amortization expense of approximately
$90,000. Unamortized capitalized software for Image2Web at March 31, 2001 was
approximately $421,000.

REVENUE RECOGNITION
Revenue from packaged product sales to distributors and resellers is recognized
when related products are sold through to the end user. Maintenance and
subscription revenue is recognized ratably over the contract period. Revenue
from products licensed to original equipment manufacturers ("OEMs") is recorded
when OEMs ship licensed products while revenue from multi-user licenses is
recorded when the software has been delivered. In connection with the sale of
certain products, the Company provides free telephone support service to
customers. The Company does not defer the recognition of any revenue associated
with sales of these products, since the cost of providing this free support is
insignificant, the support is provided within one year after the associated
revenue is recognized (the vast majority of the support actually occurs within
three months) and enhancements are minimal and infrequent. The estimated cost of
providing this free support is accrued upon product shipment. Provisions are
recorded for returns and bad debts based on historical experience.

COMPREHENSIVE INCOME
Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting
Comprehensive Income" established rules for the reporting and presentation of
comprehensive income and its components. The Company's comprehensive loss is
comprised of net loss and foreign currency translation adjustments.
Comprehensive income is approximately $116,000 and comprehensive loss is
approximately $1.5 million for the three and nine months ended March 31, 2001,
respectively, compared to comprehensive loss of approximately $2.0 million and
$9.3 million for the three and nine months ended March 31, 2000.

NOTES PAYABLE
In January 2001, the Company received approximately $800,000 from the issuance
of short-term convertible notes payable. The notes, which bear interest at 8%
per annum, are classified as current liabilities at March 31, 2001 because the
original agreements have a maturity date of April 30, 2001. On April 30, 2001,
the notes payable were amended and the maturity date was extended to May 31,
2001. As part of a larger capital funding program, it is the Company's intention
to convert these notes into either common or preferred stock before maturity.



                                       7
<PAGE>



PREFERRED STOCK
In the first quarter of fiscal 2001, the Company designated 4,000,000 shares of
Series A Convertible Preferred Stock ("Series A Preferred Stock"), with a par
value of $0.01 per share. The shares of Series A Preferred Stock are originally
convertible into equal shares of Micrografx Common Stock at a price that is
initially equal to the purchase price, adjusted for dilutive issuances and
changes in market price of the Micrografx common stock. Up to one-half of the
Series A Preferred Stock may be converted into Image2Web, Inc. Common Stock at
the investor's option. Image2Web, Inc. is a wholly-owned subsidiary of the
Company. The purchasers of the Series A Preferred Stock consisted of certain
institutional investors and other unaffiliated parties. The Company issued
1,120,000 shares in September, 2000 receiving net proceeds of $1,680,000.

INCOME (LOSS) PER SHARE
Income (loss) per share for all periods presented is based on the weighted
average basic and dilutive equivalent shares outstanding using the treasury
stock method. Amounts are shown in thousands except for per share data.
<TABLE>
<CAPTION>
      <S>                                                 <C>              <C>         <C>            <C>

                                                          Three Months Ended            Nine Months Ended
                                                               March 31,                    March 31,
                                                       --------------------------    ------------------------
                                                         2001            2000          2001          2000
                                                       ----------     -----------    ---------    -----------
   Numerator:
     Net income (loss) applicable to common
       shareholders                                    $     93       $ (1,969)      $ (1,505)    $ (9,253)
   Denominator:
     Denominator for basic earnings per
          share - weighted average shares                11,761         11,436         11,606       11,372
     Effect of dilutive employee stock options               33              -              -            -
                                                       --------       ---------      ---------    ---------
     Denominator for diluted earnings per
          share - adjusted weighted average
          shares and assumed conversions                 11,794         11,436         11,606       11,372

   Basic and diluted income (loss) per share           $   0.01       $  (0.17)      $  (0.13)    $  (0.81)
                                                       ========       =========      =========    =========

</TABLE>



Options and convertible securities to purchase approximately 5,467,574 shares of
Common Stock were excluded from the diluted loss per share calculation because
they were anti-dilutive for the three and nine months ended March 31, 2001.
These included 3,767,874 options outstanding as of March 31, 2001, plus 579,700
shares related to the subordinated convertible debentures issued in connection
with the InterCAP Graphics Systems, Inc. ("InterCAP") acquisition as well as
1,120,000 shares related to the Series A Preferred Stock issuance. Due to
adjustment factors, the Preferred shares are convertible into a range of shares
of Micrografx Common Stock from as low as 1,120,000 to as high as 1,680,000.




                                       8
<PAGE>



LEGAL PROCEEDINGS
On February 5, 2001, the Company received from the United States District Court
a notice dated January 19, 2001, that Hallmark Inc. had voluntarily dismissed
its patent infringement lawsuit filed against American Greetings Inc. on June 6,
2000. The lawsuit had asserted that American Greetings infringed two of
Hallmark's patents. American Greetings gave notice to Micrografx pursuant to the
Master Agreement between Micrografx and American Greetings, a provision of which
contains an agreement by Micrografx to indemnify American Greetings in certain
circumstances. No estimated loss was recorded by Micrografx when the lawsuit was
filed.

The Company is party to various other legal proceedings arising from the normal
course of business activities, none of which, in management's opinion, is
expected to have a material adverse impact on the Company's results of
operations or its financial position.

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

FORWARD-LOOKING STATEMENTS
This Form 10-Q contains certain "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"),
and Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Specifically, all statements other than statements of
historical facts included in this report regarding the Company's financial
position, business strategy and plans, and objectives of management of the
Company for future operations are forward-looking statements. These
forward-looking statements are based on the beliefs of the Company's management,
as well as assumptions made by and information currently available to the
Company's management. When used in this report, the words "anticipate,"
"believe," "estimate," "expect," and "intend," and words or phrases of similar
import, as they relate to the Company or Company management, are intended to
identify forward-looking statements. Such statements (the "cautionary
statements") reflect the current view of the Company with respect to future
events and are subject to risks, uncertainties, and assumptions related to
various factors including, without limitation, changes in the product release
schedule, acceptance or the lack thereof of the Company's iGrafx(TM) and
Image2Web products, growth or the lack thereof in the enterprise solutions
business of the Company, changes in distribution channels, changes in the
market, new products and announcements from other companies, changes in
technology, changes in levels of operating expenses and competition from larger,
more established competitors. Although the Company believes that expectations
are reasonable, it can give no assurance that such expectations will prove to be
correct. Based upon changing conditions, should any one or more of these risks
or uncertainties materialize, or should any underlying assumptions prove
incorrect, actual results may vary materially from those described herein as
anticipated, believed, estimated, expected, or intended. All subsequent written
and oral forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by the applicable
cautionary statements.

OVERVIEW
Micrografx, Inc. ("Micrografx" or the "Company") develops and markets software
for business use in the areas of process management, management of technical
graphics, and visual commerce. Additionally, the Company desires to leverage its
technology base by partnering with organizations to maximize the distribution
and value of its intellectual property.

Historically, the Company has developed and marketed a variety of graphics
oriented software products. These products included various technologies for
flowcharting, process simulation, and technical drawing, image editing, 3D
object rendering, basic drawing tools for both the consumer and corporate
markets, greeting card software for the personal creativity market. In fiscal
year 1997, management and the board of directors concluded that Micrografx did
not have the critical mass to continue supporting the number of technologies it
was pursuing. It was determined that the greatest future value was in pursuing
solutions for the corporate market and in de-emphasizing the consumer market.
While pursuing this change in direction, the challenge has been to achieve
profitability in the face of phasing out technologies that did not fit into the
long-term strategy of the Company and changing the internal infrastructure and
employee skill sets to line up with the Company's long-term strategy.



                                       9
<PAGE>





The Company was initially organized as a partnership in June 1982 and was
subsequently incorporated in the State of Texas in March 1984. The principal
executive offices of the Company are located at 8144 Walnut Hill Lane, Suite
1050, Dallas, Texas, 75231, and its telephone number is (469) 232-1000. The
Company's U.S. operations are based in Dallas, Texas, with business units
located in Dallas, Texas, Portland, Oregon and Annapolis, Maryland.
International subsidiaries are located in the United Kingdom, France, Germany,
Italy, the Netherlands, Switzerland, Australia, and Japan.

RECENT DEVELOPMENTS
On April 27, 2001, the Company received notification from the Nasdaq Listing
Qualifications Panel ("Nasdaq") that the Company's common stock will not
continue to be listed on the Nasdaq National Market. Effective April 30, 2001,
the Company's stock will trade Over the Counter Bulletin Board. The Company was
first contacted with a Nasdaq Staff Determination, dated October 17, 2000,
stating that the Company was not in compliance with the minimum $4,000,000 net
tangible assets requirement as set forth in Marketplace Rule 4450(a)(3). The
Company appealed the Nasdaq Staff Determination and was granted an "exception"
by Nasdaq whereby the Company must demonstrate a closing bid price of at least
$1.00 per share for a minimum of ten consecutive trading days, and meet the
minimum net tangible asset requirement by May 15, 2001. Pending completion of
the appeal process, Nasdaq would continue to list the Company's common stock on
the Nasdaq National Market. On the delisting notification received on April 27,
2001, Nasdaq noted that even though the Company met the $1.00 per share
requirement for 15 consecutive trading days between February 13, 2001 and March
6, 2001, the Company had failed to demonstrate compliance with that requirement
since March 6, 2001. The Company plans to pursue the appeal process within the
fourth quarter of fiscal 2001. There can be no assurances that the Company will
be successful in getting its common stock relisted on the Nasdaq National
Market.

In March 2001, John M. Carradine resigned as Chief Financial Officer of the
Company. Effective April 1, 2001, Greg DeWitt assumed the role of Chief
Financial Officer and Treasurer. Greg DeWitt was most recently the Corporate
Controller of 3dfx Interactive for two years and served as Corporate Controller
for STB Systems, Inc. for eight years. Until recently, 3dfx was a publicly
traded manufacturer of graphics accelerator chips, boards and software. 3dfx
acquired STB Systems of Richardson, Texas in May 1999.





                                       10
<PAGE>



RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, the percentage
relationship to net revenues of certain items in the Company's Consolidated
Statements of Operations. Historical results and percentage relationships are
not necessarily indicative of operating results for any future period.
<TABLE>
<CAPTION>
        <S>                           <C>            <C>          <C>            <C>

                                     THREE MONTHS ENDED            NINE MONTHS ENDED
                                          MARCH 31,                    MARCH 31,
                                 ---------------------------- -----------------------------
                                    2001           2000           2001           2000
                                 ------------ --------------- ------------- ---------------


Net revenues                           100%         100%            100%          100%
Cost of revenues                        16%          20%             20%           22%
                                        ---          ---             ---           ---
Gross profit                            84%          80%             80%           78%

Operating expenses:
    Sales and marketing                 48%          60%             54%           68%
    General and administrative          14%          16%             14%           20%
    Research and development            12%          19%             15%           20%
    Restructuring charge                  -           -             (2%)             -
                                    -------     --------             ----     ---------
Total operating expenses                74%          95%             81%          108%

Income (loss) from operations           10%         (15%)            (1%)         (30%)

Non operating (expense)
   income, net                          (8%)         (3%)            (4%)          (1%)

Income (loss) before income
    taxes                                2%         (18%)            (5%)         (31%)


Income taxes                             1%           2%              1%            2%

Net income (loss)                        1%         (20%)            (6%)         (33%)
</TABLE>




                                       11
<PAGE>



Previously the Company had viewed revenues in three principal "categories" -
Enterprise Process Management, Technical Graphics and Heritage Products. During
the quarter, the Company began to further refine its business model in a plan to
bring more focus to core businesses. To that end, the Technical Graphics and
Heritage Product groups were combined into a single organization known as the
Graphics Products Group. The following table sets forth net revenues (in
thousands) by the revised product categories and the percentage relationship to
total net revenues. The Enterprise Process Management category includes iGrafx
Professional(TM), iGrafx Process(TM), Micrografx FlowCharter(R), Optima(R) and
related products. The Graphics Product category includes what was previously the
Technical Graphics category, which includes Micrografx Designer(R), iGrafx
Designer(TM), the ActiveCGM(TM) products, and related products. The Graphics
Product category also includes what was previously the Heritage Products and
other category which includes Micrografx Graphics Suite(R), iGrafx Business(TM),
NetworkCharter(TM), Picture Publisher(R), Simply3D(R), Webtricity(TM), and
revenues generated by the Company's Image2Web subsidiary.
<TABLE>
<CAPTION>
        <S>                             <C>          <C>       <C>      <C>        <C>     <C>       <C>       <C>

                                          Three Months Ended March 31,             Nine Months Ended March 31,
                                     ----------------------------------------  -------------------------------------
                                        2001        %        2000        %        2001       %       2000       %
                                     ------------ ------- -----------  ------  ----------- ------ ----------- ------

  Enterprise Process Management        $  4,989      60%    $  4,691     47%    $  11,270    50%   $  12,075    43%
  Graphics Products Group                 3,403      40%       5,241     53%       11,338    50%      16,035    57%
                                     ------------ ------- -----------  ------  ----------- ------ ----------- ------
  Total net revenues                   $  8,392     100%    $  9,932    100%    $  22,608   100%   $  28,110   100%
                                     ============ ======= ===========  ======  =========== ====== =========== ======
</TABLE>

ENTERPRISE PROCESS MANAGEMENT REVENUES
Enterprise Process Management ("EPM") revenues were slightly higher in the third
fiscal quarter of 2001, than in the same period of fiscal 2000 because revenues
from the increase in sales of iGrafx Professional(TM) and iGrafx Process(TM) are
offsetting the decline in sales of FlowCharter(R). Management believes that its
EPM related revenue base will continue to grow in the future as more companies
adopt business process and quality related programs such as Six Sigma(TM) (Six
Sigma is a trademark of Motorola, Inc.). Management also believes that it can
expand the scope of process related activities addressed by its software
products (e.g., ISO compliance, Activity Based Costing, etc.) and is evaluating
marketing opportunities such as co-marketing arrangements, joint ventures,
partnerships, joint development agreements, and OEM arrangements with other
companies. Management believes that recent agreements with Six Sigma Academy and
other premier "Six Sigma" consulting firms evidences the market opportunities
and the value-added nature of Micrografx products. The Company's products have
been adopted for use in Six Sigma applications by companies such as Ford Motor
Company, Dupont, Toshiba and Ernst & Young.

Upgraded versions of iGrafx Professional (re-named iGrafx FlowCharter 2000
Professional to capitalize on the historically strong brand identity of the
FlowCharter(R) name) and iGrafx Process (re-named iGrafx Process 2000) were
released at the end of the second quarter of fiscal 2001. Additionally, two new
products, iGrafx Process for Six Sigma(TM) and iGrafx Process Central were also
released at the end of the second quarter of fiscal 2001. Management expects all
of these products to contribute to revenue growth in the near term.

GRAPHICS PRODUCTS REVENUES
Revenues from the Technical Illustration sub-category of Graphics Products were
lower in the third quarter of fiscal 2001 than in the same quarter of fiscal
2000 primarily because sales of iGrafx Designer and the Company's Active CGM
products have declined. The current version of iGrafx Designer was released in
the fourth quarter of fiscal 1999, with localized versions released in the
following quarter. As is typical in the software industry, sales increased
significantly upon the new release, sales of the current version peaked in the
second quarter of fiscal 2000, and sales have declined slowly since. The Company
has plans to release a new version of the iGrafx Designer product. Sales of the
Company's ActiveCGM products have declined due to a reallocation of sales
resources from the ActiveCGM products to the Designer products.



                                       12
<PAGE>




Revenues declined in the Heritage and Other product sub-category because of the
Company's change in strategic direction from the consumer market to the
enterprise market. The largest decline has been in the Company's Graphics
Suite(R) product line. As in the case of iGrafx Designer, no new version of this
product has been released in several years. The Company plans a new release of
Graphics Suite during the first half of next fiscal year. The Company also
experienced revenue declines from products such as Windows Draw(R) which were
subject to OEM agreements in place prior to the Cendant Software Corporation and
The Learning Company agreements, which ended Micrografx development and
distribution of these products. Most of the OEM arrangements expired during
fiscal years 1999 and 2000. Lastly, revenues from retail products such as
Picture Publisher(R), Webtricity(TM), and Simply3D(R) have declined as the
Company's investment in the retail channel has been reduced. The Company plans
to release a new version of Picture Publisher to capitalize on the interest in
digital photography.

GEOGRAPHICAL DISTRIBUTION OF REVENUE
Net revenues by geographical region (in thousands) for the three and nine months
ended March 31, 2001 and 2000 were as follows:
<TABLE>
<CAPTION>
        <S>         <C>          <C>       <C>      <C>             <C>     <C>          <C>       <C>

                       THREE MONTHS ENDED MARCH 31,                   NINE MONTHS ENDED MARCH 31,
                 -----------------------------------------     ------------------------------------------
                    2001         %        2000        %           2001        %         2000        %
                 ------------  ------  -----------  -------    -----------  -------  -----------  -------
   Americas        $  4,016      48%     $  4,140      42%      $  10,625      47%    $  10,736      38%
   Europe             3,696      44%        4,641      47%         10,294      46%       14,628      52%
   Asia Pacific         680       8%        1,151      11%          1,689       7%        2,746      10%
                 ------------  ------  -----------  -------    -----------  -------  -----------  -------
   Total           $  8,392     100%     $  9,932     100%      $  22,608     100%    $  28,110     100%
                 ============  ======  ===========  =======    ===========  =======  ===========  =======
</TABLE>

Americas revenue is comparatively unchanged in both the three and nine months
periods as the increase in enterprise process management sales offset the
decline in graphics products. The decline in European revenues was primarily the
result of a decline in Graphics Suite revenues and declines in other product
versions significantly past the height of the product revenue cycle. European
revenues were also negatively impacted by foreign currency exchanges rates. If
exchange rates had not changed from their fiscal 2000 levels, European revenues
would have been approximately 6% higher for the three months ended March 31,
2001. The Asia Pacific decline resulted as sales of iGrafx Designer, Graphics
Suite and other Graphics Products have declined. Management believes
international revenues may improve as the Company places more emphasis on its
products with strong brand identity, leveraging the FlowCharter, Designer and
Picture Publisher names.

The Company's operating results are affected by changes in foreign currency
exchange rates. These variations result from the change in exchange rates of
European currencies and the Japanese yen versus the U.S. dollar. Exchange rates
thus far during fiscal 2001 have had an unfavorable impact on net revenues
reported by the Company. If exchange rates had not changed from their fiscal
2000 levels, the Company would have reported approximately $270,000 and $1.1
million more in net revenues for the three and nine months ended March 31, 2001,
respectively. Additionally, the income from operations would have been increased
by $76,000 for the three months ended March 31, 2001 and the loss from
operations would have been reduced by $286,000 for the nine months ended March
31, 2001. Because European manufacturing costs and European and Japanese
operating expenses are also incurred in those local currencies, the impact of
exchange rates on net loss is less than on revenues.

COST OF REVENUES
Cost of revenues for the three months ended March 31, 2001 were $1.4 million, or
16 percent of net revenues, compared to $2.0 million, or 20 percent of net
revenues, for the three months ended March 31, 2000. Cost of revenues includes
the direct cost of the products manufactured (typically CD-ROMs, manuals, and
boxes), external royalties, and the amortization of capitalized software and
acquired product rights. The Company made the determination in fiscal 2001 that
certain consulting and training costs should be categorized as cost of revenues.
These costs were previously reported as sales and marketing operating costs. All
periods presented have been restated to conform to the current year
presentation.



                                       13
<PAGE>



OPERATING EXPENSES
Sales and marketing expenses declined to approximately $4.0 million, or 48
percent of net revenues in the three months ended March 31, 2001, compared to
$5.9 million, or 60 percent of net revenues in the same period last year. The
reduction in selling costs resulted primarily from a reduced direct sales force
in the United States, curtailed spending for variable marketing costs,
particularly in Europe, and generally tighter spending controls throughout the
Company's worldwide sales organization. The Company believes that greater focus
on core businesses by the sales and marketing organization, and the resulting
efficiencies in reaching the customer, will result in a decline in this expense
category by the middle of its next fiscal year. The Company expects sales and
marketing expenses to remain at the current level through the end of the fiscal
year.

General and administrative expenses for the three months ended March 31, 2001
were approximately $1.1 million, or 14 percent of net revenues, compared to $1.6
million, or 16 percent of net revenues, for the three months ended March 31,
2000. The decrease in general and administrative costs is primarily due to the
corporate restructuring and reduction in workforce that occurred on June 30,
2000, whereby the Company reduced its U.S. workforce by approximately forty
percent. The Company expects general and administrative costs to decline as a
percentage of sales for the near term. As a result, management is planning
changes to simplify its organizational structure to achieve the desired level of
spending.

Net research and development expenses for the three months ended March 31, 2001
were $1.0 million, or 12 percent of net revenues, compared to $1.9 million, or
19 percent of net revenues, for the quarter ended March 31, 2000. Gross research
and development expenses, before capitalization, for the three months ended
March 31, 2001, were $1.5 million, or 18 percent of net revenues, compared to
$2.6 million, or 26 percent of net revenues for the quarter ended March 31,
2000. Gross research and development spending has declined as a result of the
corporate restructuring and reduction in workforce that occurred on June 30,
2000, and the Company's development of fewer products, all focused on corporate
customers. The Company expects research and development costs to rise as a
percentage of sales as sales, marketing and general and administrative costs
decline as a percentage of sales. During the three months ended March 31, 2001,
the Company capitalized approximately $500,000 in software development costs and
amortized approximately $400,000 in software development costs. This compares to
capitalization of $700,000 and amortization of approximately $600,000 during the
three months ended March 31, 2000.

For the three months ended March 31, 2001, interest income was relatively
unchanged compared with the three months ended March 31, 2000. Interest expense
of approximately $260,000 resulted primarily from the convertible debenture to
Intergraph and the Company's receivable facility. Changes in exchange rates
resulted in a loss of approximately $400,000, the largest loss since the first
quarter of fiscal 2000, for the three months ended March 31, 2001 compared to a
loss of approximately $126,000 for the three months ended March 31, 2000. The
exchange rate loss is primarily a result of the Japanese Yen and the European
currencies weakening to the United States Dollar.

Pursuant to the requirements of SFAS 109, a valuation allowance must be provided
when it is more likely than not that deferred tax assets will not be realized.
Based on the fact that the Company has a cumulative net operating loss for the
prior three years and there are no prior tax payments that could be refunded, it
is the Company's belief that the realization of the deferred tax assets in the
near term is remote. As a result of the previous operating losses, the Company
did not recognize a tax provision on the current quarter net income. The Company
did record a tax provision resulting from taxes due in international
subsidiaries.



                                       14
<PAGE>



LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2001, the Company's principal sources of liquidity consisted of
cash and cash equivalents of approximately $2.7 million. For the nine months
ended March 31, 2001, cash used in operating, investing and financing activities
resulted in a net decrease in cash and cash equivalents of approximately
$100,000, compared to cash usage of $4.7 million for the nine months ended March
31, 2000. Cash used in operating activities improved 99% from $1.8 million for
the nine months ended March 31, 2000 to $25,000 for the nine months ended March
31, 2001. The net change in cash for the nine months ended March 31, 2001 also
includes approximately $1.5 million of cash used in product development
activities and approximately $2.5 million in proceeds from the issuance of notes
payable and Series A Preferred Stock.

During the third quarter of fiscal year 2001, the Company generated positive
cash flow from operations of approximately $2.1 million. The positive cash flow
is primarily due to approximately $2.2 million of collections of accounts
receivable and generating net income for the quarter. Cash used in operations
during the first and second fiscal quarters was approximately equal, at $1.0
million. During the first quarter, the principal negative factor in the
operational cash usage was the Company's net loss of $1.4 million and the net
change in operating assets and liabilities resulted in an additional cash usage
of approximately $884,000. In the second quarter, the Company's net loss was
$165,000, an improvement of $1.24 million. However, the net change in operating
assets and liabilities during this period was an increase of approximately $1.1
million caused principally by higher accounts receivable which were collected in
the third fiscal quarter.

The Company has been successful in the following areas of its plan to reduce the
rate of cash usage, as detailed in the Company's 2000 Annual Report:

o    Quarterly cash operating expenses (operating costs before consideration of
     capitalized software development and amortization) have declined from
     approximately $9.4 million for the three months ended June 30, 2000 to
     approximately $6.2 million for the three months ended March 31, 2001. The
     34% decline resulted primarily from lower personnel costs due to the June
     30, 2000 restructuring and from lower rent and related operating expenses
     due to the move of the corporate headquarters to smaller leased space.

o    Management had expected revenues to decline during the first fiscal quarter
     and to improve during the second fiscal quarter and third fiscal quarter.
     These expectations were met and management believes that revenues will
     remain near the current level for the fourth quarter of fiscal 2001.

o    Capital spending has been restricted in fiscal year 2001 to requirements
     for replacement only. Capital expenditures for the first nine months of
     fiscal 2001 were approximately $289,000, compared to approximately $1.7
     million for the first nine months of fiscal 2000. Management does not
     expect a material change in the current level of capital spending for the
     remainder of fiscal 2001.

In January 2001, the Company received approximately $800,000 from the issuance
of short-term convertible notes payable. The notes, which bear interest at 8%
per annum, are classified as current liabilities because they matured on April
30, 2001. Effective April 30, 2001, these notes were amended to extend the
maturity date to May 31, 2001. As part of a larger capital funding program, it
is the Company's intention to convert these notes into either common or
preferred stock before maturity.




                                       15
<PAGE>



As reported in the Company's 2000 Annual Report, management continues to examine
various financing methods that would ensure that the capital resources of the
Company are sufficient to meet its requirements. In addition to the potential
sale of equity discussed above, management is also evaluating other sources of
capital including the issuance of debt securities in one or more private
transactions, the sale or spin-off of certain assets to third parties, and/or
traditional bank lines secured by international accounts receivable. The failure
of the Company to acquire additional external financing could result in severe
operational difficulties. Such difficulties could result in a further reduction
in workforce, a further reduction in the scope of operations, or ultimately in a
forced reorganization or bankruptcy. The Company believes it should be
successful in obtaining the necessary revenue levels and/or additional funding
necessary to operate the Company in the near term, however, there can be no
assurance that under its current conditions, external funds will be available
or, if available, will not potentially dilute shareholders' interests or
returns.

EURO CONVERSION
The Company is addressing issues regarding the European Economic Monetary
Union's ("EMU") single eurocurrency (the "Euro") and is currently able to
transact business using this currency. The Company intends to convert the
appropriate European ledgers to the Euro after fiscal year ended June 30, 2001,
and anticipates no material costs associated with this conversion.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For the period ended March 31, 2001, the Company did not experience any material
changes in market risk exposures that affect the quantitative and qualitative
disclosures presented in the Company's 2000 Annual Report on Form 10-K.


PART II.  OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS

On February 5, 2001, the Company received from the United States District Court
a notice dated January 19, 2001, that Hallmark Inc. had voluntarily dismissed
its patent infringement lawsuit filed against American Greetings Inc. on June 6,
2000. The lawsuit had asserted that American Greetings infringed two of
Hallmark's patents. American Greetings gave notice to Micrografx pursuant to the
Master Agreement between Micrografx and American Greetings, a provision of which
contains an agreement by Micrografx to indemnify American Greetings in certain
circumstances. No estimated loss was recorded by Micrografx when the lawsuit was
filed.

The Company is party to various legal proceedings arising from the normal course
of business activities, none of which, in management's opinion, is expected to
have a material adverse impact on the Company's results of operations or its
financial position.




                                       16
<PAGE>



ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS

At the Company's Annual Meeting of Shareholders held on January 10, 2001, the
following persons were elected to the Board of Directors:

                               Affirmative Votes    Votes Withheld
John M. Carradine                  10,842,922            437,861
George W. Macintyre                10,842,577            438,206
P. Michael Sullivan                10,842,427            438,356

The following  proposals  were also approved at the Company's  Annual Meeting of
Shareholders
<TABLE>
<CAPTION>
                <S>                                  <C>             <C>            <C>             <C>

                                                  Affirmative                                     Broker
                                                     Votes      Negative Votes   Abstentions     Non-Votes

Amendment of the Company's 1995 Incentive
and Nonstatutory Stock Option Plan to
increase the number of shares of stock
subject to options annually granted to
the Company's employees from 3,700,000
shares to 4,700,000 shares.                        3,245,875       628,466         33,250        7,373,192



Amendment of the Company's Employee Stock
Purchase Plan to increase the number of
shares of common stock available for issue
from 1,300,000 shares to 2,000,000 shares.         3,670,881       204,860         31,850        7,373,192

Appointment of Ernst & Young LLP as independent
public accountants for the Company.               11,240,718        32,615          7,450            -
</TABLE>



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits

10   Amendment to Form of Convertible  Promissory Note agreement dated April 30,
     2001.

(b)      Reports on Form 8-K:
1.   On March 7, 2001 the Company filed a current report on form 8-K reporting a
     news release  dated  February 23, 2001 under Item 7 "Exhibits"  of the Item
     601 of regulation S-K.





                                       17
<PAGE>




                                   SIGNATURES


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

                                                              MICROGRAFX, INC.



Date:    May 10, 2001                                By:/s/ James L. Hopkins
                                                       ------------------------
                                                     James L Hopkins
                                                     Chief Executive Officer






                                       18
<PAGE>




                                INDEX TO EXHIBITS


Exhibit No.                Description


10   Amendment to Form of Convertible  Promissory Note agreement dated April 30,
     2001.







<PAGE>



                                                                      EXHIBIT 10

                                    AMENDMENT

                  MICROGRAFX, INC. CONVERTIBLE PROMISSORY NOTE


This Amendment to the Micrografx, Inc. Convertible Promissory Note is entered
into on April 30, 2001, by and between Micrografx, Inc., a Texas Corporation
having its principal address at 8144 Walnut Hill Lane, Suite 1050, Dallas, Texas
75231 and ---------------------------------.


Changes in Terms:

1) The purpose of this Amendment is to extend the Maturity Date of the
Micrografx, Inc. Convertible Promissory Note from April 30, 2001, as referenced
in the opening paragraph to, May 31, 2001.

2) Under Section 3, "Mandatory Conversion", the last paragraph shall be changed
to read:

         "Qualified Financing" shall mean an equity financing of the Company in
which Preferred Stock is issued and in which the investor invest a aggregate of
up to $4.5 million including principal an accrued interest converted under this
Note and other similar convertible promissory notes on or before MAY 31, 2001.

By signing, the holder of the Micrografx, Inc. Convertible Promissory Note
agrees to the changes set forth above.


Micrografx, Inc.

By: /s/Greg DeWitt
    -----------------------
Greg DeWitt, CFO


Investor

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

By:___________________


<PAGE>