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 May 4, 1997 or

[ ]  Transition  report  pursuant  to  Section  13 or  15(d)  of the  Securities
     Exchange Act of 1934

Commission file number 0-15995

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

Delaware                                                         86-0321346
(State of incorporation)                                    (I. R. S. Employer
                                                             Identification No.)

2400 South MicroAge Way
Tempe, AZ                                                                85282
(Address of principal executive offices)                              (Zip Code)

Registrant's telephone number, including area code: (602) 804-2000

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 and
(2) has been subject to such filing requirements for the past 90 days.

                                Yes [ x ] No [  ]
                                     ---

The number of shares of the registrant's Common Stock (par value $.01 per share)
outstanding at June 11, 1997 was 15,490,822.
<PAGE>
                                      INDEX

                                 MICROAGE, INC.


PART I.         FINANCIAL INFORMATION

Item 1.         Financial Statements (Unaudited)

                Consolidated balance sheets -- May 4, 1997 and November 3, 1996.

                Consolidated  statements of income -- Quarters ended May 4, 1997
                and April  28,  1996;  26 weeks  ended May 4, 1997 and April 28,
                1996.

                Consolidated  statements  of cash flows -- 26 weeks ended May 4,
                1997 and April 28, 1996.

                Notes to consolidated financial statements.

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

PART II.        OTHER INFORMATION

Item 1.         Legal Proceedings

Item 4.         Submission of Matter to a Vote of Security Holders

Item 6.         Exhibits and Reports on Form 8-K

SIGNATURES
                                        1
<PAGE>
PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements (Unaudited)


                                 MICROAGE, INC.
                     CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                        (in thousands, except share data)

                                     Assets
                                                       May 4,      November 3,
                                                        1997           1996
                                                    ------------   ------------
Current assets:
     Cash and cash equivalents                      $     30,653   $     21,331
     Accounts and notes receivable, net                  245,759        257,637
     Inventory, net                                      461,328        325,313
     Other                                                10,561         11,135
                                                    ------------   ------------
         Total current assets                            748,301        615,416

Property and equipment, net                               60,637         53,361
Intangible assets, net                                    20,318         17,499
Other                                                      9,452          9,126
                                                    ------------   ------------
         Total assets                               $    838,708   $    695,402
                                                    ============   ============

                      Liabilities and Stockholders' Equity
Current liabilities:
     Accounts payable                               $    554,568   $    474,516
     Accrued liabilities                                  25,127         23,497
     Current portion of long-term obligations              2,329          2,121
     Line of credit                                       46,500              -
     Other                                                 4,879          3,617
                                                    ------------   ------------
         Total current liabilities                       633,403        503,751

Long-term obligations                                      3,946          3,892

Stockholders' equity:
     Preferred stock, par value $1.00 per share;
         Shares authorized: 5,000,000
         Issued and outstanding:  none
     Common stock, par value $.01 per share;                 -              -
         Shares authorized: 40,000,000
         Issued:  May 4, 1997       -  15,552,965
                  November 3, 1996  -  15,320,133            156            153
     Additional paid-in capital                          126,898        124,308
     Retained earnings                                    74,900         64,229
     Loan to ESOT                                            -             (207)
     Treasury stock, at cost;
         Shares:  May 4, 1997      -   71,836
                  November 3, 1996 -   97,028               (595)          (724)
                                                    ------------   ------------
         Total stockholders' equity                      201,359        187,759
                                                    ------------   ------------
         Total liabilities and stockholders' equity $    838,708   $    695,402
                                                    ============   ============

   The accompanying notes are an integral part of these financial statements.
                                        2
<PAGE>
                                 MICROAGE, INC.
                  CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
                      (in thousands, except per share data)




                                    Quarter ended             26 weeks ended
                               -----------------------   -----------------------
                                 May 4,      April 28,     May 4,      April 28,
                                  1997         1996         1997         1996
                               ----------   ----------   ----------   ----------

Revenue                        $1,035,719   $  866,705   $1,896,038   $1,650,456

Cost of sales                     968,711      820,165    1,773,078    1,562,071
                               ----------   ----------   ----------   ----------

Gross profit                       67,008       46,540      122,960       88,385

Operating expenses                 49,333       36,688       92,397       72,370
                               ----------   ----------   ----------   ----------

Operating income                   17,675        9,852       30,563       16,015

Other expenses - net                7,166        4,419       11,926        7,662
                               ----------   ----------   ----------   ----------

Income before income taxes         10,509        5,433       18,637        8,353

Provision for income taxes          4,506        2,331        7,966        3,608
                               ----------   ----------   ----------   ----------

Net income                     $    6,003   $    3,102   $   10,671   $    4,745
                               ==========   ==========   ==========   ==========

Net income per common share    $     0.37   $     0.20   $     0.66   $     0.31
                               ==========   ==========   ==========   ==========

Weighted average common and
   common equivalent
   shares outstanding              16,016       15,294       16,201       15,148

   The accompanying notes are an integral part of these financial statements.
                                        3
<PAGE>
                                 MICROAGE, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                Increase (Decrease) in Cash and Cash Equivalents
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                26 weeks ended
                                                                            ----------------------
                                                                             May 4,      April 28,
                                                                              1997         1996
                                                                            ---------    ---------
<S>                                                                         <C>          <C>      
Cash flows from operating activities:
   Net income                                                               $  10,671    $   4,745
   Adjustments to reconcile net income to
      net cash provided by (used in) operating activities:
         Depreciation and amortization                                         11,590        9,205
         Provision for losses on accounts and notes receivable                  3,245        3,113
         Changes in assets and liabilities, net of business acquisitions:
            Accounts and notes receivable                                      10,367      (40,767)
            Inventory                                                        (135,378)       7,720
            Other current assets                                                  588         (188)
            Other assets                                                          101       (1,108)
            Accounts payable                                                   74,822       16,485
            Accrued liabilities                                                 1,562        4,932
            Other liabilities                                                     847          107
                                                                            ---------    ---------
      Net cash provided by (used in) operating activities                     (21,585)       4,244

Cash flows from investing activities:
   Purchases of property and equipment                                        (16,508)      (9,239)
   Purchases of businesses and investments
      in unconsolidated companies                                                (989)           -
                                                                            ---------    ---------
      Net cash used in investing activities                                   (17,497)      (9,239)

Cash flows from financing activities:
   Amounts received from ESOT                                                     207          321
   Proceeds from issuance of stock - stock option and
      employee stock purchase plans                                             2,722          541
   Net borrowings under line of credit                                         46,500          880
   Principal payments on long-term obligations                                 (1,025)      (2,216)
                                                                            ---------    ---------
      Net cash provided by (used in) financing activities                      48,404         (474)
                                                                            ---------    ---------
Net increase (decrease) in cash and cash equivalents                            9,322       (5,469)

Cash and cash equivalents at beginning of period                               21,331       14,016
                                                                            ---------    ---------
Cash and cash equivalents at end of period                                  $  30,653    $   8,547
                                                                            =========    =========
</TABLE>
   The accompanying notes are an integral part of these financial statements.
                                        4
<PAGE>
                                 MICROAGE, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)




NOTE A - BASIS OF PRESENTATION

The accompanying unaudited  consolidated financial statements of MicroAge,  Inc.
(the "Company") do not include all of the information and footnotes  required by
generally accepted accounting principles for complete financial  statements.  In
the opinion of  management,  all  adjustments  (consisting  of normal  recurring
accruals)  considered  necessary for a fair statement of results for the periods
have been included. Operating results for the 26 weeks ended May 4, 1997 are not
necessarily  indicative  of the results that may be expected for the year ending
November 2, 1997. For further information,  refer to the consolidated  financial
statements and footnotes thereto included in the Company's Annual Report on Form
10-K for the year ended November 3, 1996.

On January 15, 1997,  the Company  issued shares of its common stock in exchange
for all of the outstanding shares of a previously  franchised reseller location.
The merger has been  accounted for as a pooling of interests  and,  accordingly,
the Company's  consolidated  financial  statements have been restated to include
the accounts and operations of the acquired company for all periods presented.

The results of operations  previously  reported by the separate  enterprises and
the  combined  amounts  presented  in the  accompanying  consolidated  financial
statements are summarized below (in thousands).


            Quarter ended April 28, 1996:

                            MicroAge, Inc.  Acquired Co.  Combined
                            --------------  ------------  ----------

            Revenue              $863,648      $  3,057   $  866,705
            Net income           $  2,938      $    164   $    3,102


            26 weeks ended April 28, 1996:

                            MicroAge, Inc.  Acquired Co.  Combined
                            --------------  ------------  ----------

            Revenue            $1,643,966      $  6,490   $1,650,456
            Net income         $    4,495      $    250   $    4,745

                                       5
<PAGE>
NOTE B - OTHER EXPENSES - NET

Other expenses - net consists of the following (in thousands):


                                   Quarters ended      26 weeks ended
                                  ------------------  -----------------
                                   May 4,   Apr. 28,   May 4,   Apr. 28,
                                    1997      1996      1997      1996
                                  -------   -------   -------   -------
         Interest expense         $ 2,060   $   853   $ 2,534   $ 1,181

         Expenses from sales of
          accounts receivable       4,737     3,202     9,001     6,001
         Other                        369       364       391       480
                                  -------   -------   -------   -------
                                  $ 7,166   $ 4,419   $11,926   $ 7,662
                                  =======   =======   =======   =======


NOTE C - FINANCING ARRANGEMENTS

The  Company  maintains  three  financing  agreements  (the  "Agreements")  with
financing  facilities totaling $675 million.  The agreements were amended during
the quarter  ended May 4, 1997 to increase the  facilities  from $500 million to
$675 million and to extend the  expiration  date of the  Agreements  from August
1997 to  August  1998.  The line of  credit in the  accompanying  balance  sheet
represents borrowings under a line of credit option in the Agreements.

NOTE D - LITIGATION

On July 14 through July 19, 1994,  seven class action  complaints  were filed in
the  United  States  District  Court for the  District  of Arizona  against  the
Company,  certain of its officers and directors,  and, in three of the lawsuits,
one of the underwriters of the Company's June 16, 1994 public offering of common
stock.  On December 5, 1994,  the Court  consolidated  the seven  actions into a
single  action.  On February 16, 1995,  plaintiffs  filed and served an amended,
consolidated  complaint  against the Company,  certain officers and directors of
the Company, and three of the underwriters of the Company's June 16, 1994 public
offering of common stock ("the Complaint"). The Complaint purports to be brought
on behalf of a class of  purchasers  of the  Company's  common  stock during the
period April 13, 1994 through July 14, 1994. The Complaint alleges,  among other
things,  that the Company violated federal  securities laws by making misleading
public statements and omitting material facts regarding the Company's operations
and  financial  results,  which  the  plaintiffs  contend  to have  artificially
inflated  the price of the  Company's  common  stock  during the  alleged  class
period. The Complaint seeks unspecified compensatory damages as well as fees and
costs. On April 28, 1995, the Company filed a motion to dismiss the Complaint in
its  entirety.  On March 25,  1996,  the Court  dismissed  the  majority  of the
allegations contained in the Complaint. An agreement in principle has since been
reached to settle the  litigation,  subject to  obtaining  final court  approval
thereof.  On May 29, 1997,  the Court  granted its  preliminary  approval of the
proposed  settlement  and  notice  to  class  members.  A final  hearing  on the
settlement has been scheduled for August 1, 1997. The Company's  contribution to
the proposed settlement,  after the contributions of the Company's directors and
officers insurers,  constitutes  amounts  immaterial to the Company's  financial
statements.
                                       6
<PAGE>
Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations.


This Item  contains  forward-looking  statements,  which may  include  plans for
future operations,  financing needs or plans, the impact of inflation  and plans
relating to products or services of the Company, as well as assumptions relating
to the foregoing. Forward-looking statements are inherently subject to risks and
uncertainties,  some of which cannot be predicted or  quantified.  Future events
and actual results could differ materially from those set forth in, contemplated
by or  underlying the forward-looking statements.  Please refer to "Factors That
May Affect Future Results and Financial  Condition of the Company" below,  which
identifies some important  factors that could cause the Company's actual results
to differ materially from those projected in forward-looking  statements made by
the Company.

On January 15, 1997,  the Company  issued shares of its common stock in exchange
for all of the outstanding shares of a previously  franchised reseller location.
The merger has been  accounted for as a pooling of interests  and,  accordingly,
the Company's  consolidated  financial  statements have been restated to include
the accounts and operations of the acquired company for all periods presented.

Results of Operations

The following table sets forth, for the indicated  periods,  data as percentages
of total revenue:
<TABLE>
<CAPTION>
                                                                 Quarter ended
                                 ------------------------------------------------------------------------------
                                   May 4,          Feb. 2,        Nov. 3,        July 28,       April 28,
                                    1997            1997            1996           1996           1996
                                    ----            ----            ----           ----           ----
<S>                               <C>            <C>              <C>           <C>             <C>       
    Revenue (in thousands)        $1,035,719     $   860,319      $1,033,998    $  847,716      $  866,705
    Cost of sales                       93.5 %          93.5 %          94.3 %        94.4  %         94.6 %
                                 ------------    ------------   -------------   -----------    ------------
    Gross profit                         6.5             6.5             5.7           5.6             5.4

    Operating expenses                   4.8             5.0             4.4           4.5             4.2
                                 ------------    ------------   -------------   -----------    ------------
    Operating income                     1.7             1.5             1.2           1.1             1.1

    Other expenses - net                 0.7             0.6             0.3           0.3             0.5
                                 ------------    ------------   -------------   -----------    ------------
    Income  before income taxes          1.0             0.9             0.9           0.8             0.6

    Provision for income taxes           0.4             0.4             0.4           0.3             0.3
                                 ------------    ------------   -------------   -----------    ------------
    Net income                           0.6 %           0.5 %           0.5 %         0.5  %          0.4 %
                                 ============    ============   =============   ===========    ============
</TABLE>

Total Revenue. Total revenue of $1.0 billion increased $169 million, or 20%, for
the quarter  ended May 4, 1997 as compared to the quarter  ended April 28, 1996.
This revenue increase included a $170 million,  or 33%, increase in distribution
business  revenue  and a $5  million,  or 1%,  decrease  in systems  integration
business revenue.  Although systems integration business revenues for the second
quarter of fiscal 1997 were lower than the record levels  recorded in the second
quarter of fiscal 1996, they increased 7% over the first quarter of fiscal 1997.

Total revenue of $1.9 billion  increased  $246 million,  or 15% for the 26 weeks
ended May 4, 1997 as compared to the 26 weeks ended April 28, 1996. This revenue
increase  included a $233  million,  or 24%  increase in  distribution  business
revenue  and a $6  million,  or 1%  increase  in  systems  integration  business
revenue.
                                       7
<PAGE>
The revenue  increases were attributable to sales to resellers added since April
28, 1996, increased demand for the Company's major suppliers' products, improved
product availability and the growth of the microcomputer products industry.

Gross Profit Percentage.  The Company's gross profit percentage was 6.5% for the
quarter  ended May 4, 1997 and 5.4% for the quarter  ended April 28,  1996.  The
gross profit  percentage was 6.5% for the 26 weeks ended May 4, 1997 as compared
to 5.4% for the 26 weeks ended April 28, 1996.

The increase in the Company's gross profit  percentage  results primarily from a
higher  service  content  in  revenues,   which  generate  higher  margins,  the
increasing  profitability of the Company's  integration  business and increasing
supplier incentives in the Company's distribution business.

Operating Expenses. As a percentage of revenue, operating expenses were 4.8% for
the quarter  ended May 4, 1997  compared to 4.2% for the quarter ended April 28,
1996.  Operating  expenses  increased  $12.6  million to $49.3  million  for the
quarter  ended May 4, 1997,  as compared to $36.7  million for the quarter ended
April 28, 1996.  Operating  expenses  increased from $72.4  million,  or 4.4% of
revenue,  for the 26 weeks  ended April 28,  1996 to $92.4  million,  or 4.9% of
revenue, for the 26 weeks ended May 4, 1997. The increases in operating expenses
were primarily  attributable  to costs  associated  with  increased  revenue and
capacity expansion in personnel, systems and facilities.

Other  Expenses - Net.  Other  expenses - net  increased to $7.2 million for the
quarter  ended May 4, 1997 from $4.4  million  for the  quarter  ended April 28,
1996. Other expenses - net increased to $11.9 million for the 26 weeks ended May
4, 1997 from $7.7 million for the 26 weeks ended April 28, 1996. These increases
were  primarily  due to increases in net  financing  costs as a result of higher
inventory levels.

See  "Factors  That May Affect  Future  Results and  Financial  Condition of the
Company" for a discussion of potential risks and uncertainties that could affect
the Company's future operating results and financial condition.

Liquidity and Capital Resources

The Company has  financed  its growth and cash needs to date  primarily  through
working capital financing facilities,  bank credit lines, common stock offerings
and cash generated from  operations.  The primary uses of cash have been to fund
increases in inventory and accounts  receivable  resulting from increased sales.
If the Company is successful in achieving  continued revenue growth, its working
capital requirements are likely to increase.

In order to  establish  or  solidify  its  presence in  strategic  markets or in
response to  competitive  pressures,  the Company may make  acquisitions  of, or
investments in, certain companies. These acquisitions or investments may be made
utilizing cash, stock or a combination of cash and stock.

For the 26 weeks ended May 4, 1997,  $21.6 million of cash was used in operating
activities.  Net cash used in  operating  activities  included  an  increase  in
inventory of $135.4 million,  offset by an increase in accounts payable of $74.8
million,  a decrease in  accounts  receivable  of $10.4  million and net income,
before certain non-cash items, of $25.5 million.

The number of days cost of sales in ending  inventory  increased from 33 days at
November  3, 1996 to 43 days at May 4,  1997,  but was down from 52 days at the
end of the first fiscal  quarter.  Inventory is 
                                       8
<PAGE>
purchased  in  anticipation  of sales.  Revenue for the  Company's  first fiscal
quarter of 1997 was below the Company's  expectations,  resulting in higher than
anticipated  inventory levels at the end of the first fiscal quarter. The number
of days'  cost of sales in ending  accounts  payable  increased  from 47 days at
November 3, 1996 to 52 days at May 4, 1997.  The number of days' sales in ending
accounts receivable decreased from 24 days at November 3, 1996 to 21 days at May
4, 1997,  primarily due to accounts  receivable that were sold under a financing
facility  (see  discussion  below).  The  receivables  days  adjusted  for  sold
receivables were 43 days at May 4, 1997 and November 3, 1996.

For the 26  weeks  ended  May 4,  1997,  $17.5  million  was  used in  investing
activities,  of which $16.5  million was used for the  purchase of property  and
equipment,  and $1 million was used for purchases of businesses and  investments
in unconsolidated companies. Net cash of $48.4 million was provided by financing
activities  during the 26 weeks ended May 4, 1997, which consisted  primarily of
borrowings under the Company's financing facility.

The  Company  maintains  three  financing  agreements  (the  "Agreements")  with
financing  facilities totaling $675 million.  The Agreements were amended during
the quarter  ended May 4, 1997 to increase the  facilities  from $500 million to
$675 million and to extend the  expiration  date of the  Agreements  from August
1997 to August 1998. The Agreements include an accounts receivable facility (the
"A/R Facility") and inventory financing facilities (the "Inventory Facilities").

Under the A/R  Facility,  the  Company  has the right to sell  certain  accounts
receivable  from time to time, on a limited  recourse  basis, up to an aggregate
amount of $350 million sold at any given time. At May 4, 1997, the net amount of
sold accounts  receivable  was $250 million and the  effective  funding rate was
LIBOR plus 1.85%.

The Inventory  Facilities provide for borrowings up to $325 million.  Within the
Inventory  Facilities,  the  Company  has lines of credit  for the  purchase  of
inventory from selected product suppliers  ("Inventory Lines of Credit") of $175
million  and  a  line  of  credit  for  general  working  capital   requirements
("Supplemental Line of Credit") of $150 million. Payments for products purchased
under the Inventory  Lines of Credit vary depending  upon the product  supplier,
but  generally  are due between 45 and 60 days from the date of the advance.  No
interest  or finance  charges are  payable on the  Inventory  Lines of Credit if
payments  are made  when  due.  At May 4,  1997,  the  Company  had $70  million
outstanding under the Inventory Lines of Credit (included in accounts payable in
the  accompanying  Balance  Sheets),  and  $47  million  outstanding  under  the
Supplemental  Line  of  Credit.  As of May 4,  1997,  the  interest  rate on the
Supplemental Line of Credit was LIBOR plus 2%.

Of the $675 million of financing  capacity  represented by the Agreements,  $308
million  was unused as of May 4 , 1997.  Utilization  of the  unused  portion is
dependent upon the Company's collateral availability at the time the funds would
be needed.  There can be no  assurance  that the Company  will be able to borrow
adequate amounts on terms acceptable to the Company.

Borrowings  under  the  Agreements  are  secured  by  substantially  all  of the
Company's  assets,  and the Agreements  contain certain  restrictive  covenants,
including  working  capital and tangible net worth  requirements,  and ratios of
debt to tangible net worth and current assets to current liabilities.  At May 4,
1997, the Company was in compliance with these covenants.

The Company also  maintains  trade credit  arrangements  with its  suppliers and
other creditors to finance  product  purchases.  A few major suppliers  maintain
security interests in their products sold to the Company.
                                       9
<PAGE>
The  unavailability of a significant  portion of, or the loss of, the Agreements
or trade  credit  from  suppliers  would have a material  adverse  effect on the
Company.

Although the Company has no material capital commitments, the Company expects to
make  capital  expenditures  of  approximately  $15 to $20  million  during  the
remaining quarters of fiscal 1997.

Inflation

The Company  believes that inflation has generally not had a material  impact on
its operations.

Recent Accounting Pronouncements

In February 1997, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting  Standards No. 128 "Earnings Per Share" ("SFAS 128"). SFAS
128 is effective for financial  statements  for both interim and annual  periods
ending after December 15, 1997.  SFAS 128 replaces the current  presentation  of
earnings  per share with a dual  presentation  of Basic  Earnings  per Share and
Diluted Earnings per Share.

Factors That May Affect Future Results and Financial Condition of the Company

The Company's  future operating  results and financial  condition are subject to
certain risks. Potential risks and uncertainties that could affect the Company's
future operating results and financial  condition include,  without  limitation,
the factors discussed below.

Intense Competition
-------------------

The computer  reseller industry is characterized by intense  competition,  based
primarily  on  product   availability,   price,   speed  of   delivery,   credit
availability,  ability to tailor specific  solutions to customer needs,  quality
and breadth of product  lines,  service and  post-sale  support  and  quality of
customer training. In addition, the Company faces competition in the recruitment
and retention of franchised and non-franchised  resellers.  The  Company and its
reseller  locations  compete for sales with numerous other  computer  resellers,
including  (i)  master  resellers;  (ii)  direct  resellers;  (iii)  wholesalers
(resellers that do not sell to end-users);  (iv) suppliers that sell directly to
large  purchasers;  and (v) parties that implement other sales methods,  such as
direct mail,  computer  "superstores" and  mass  merchandisers.  There can be no
assurance  that the Company will not lose market  share,  or that it will not be
forced in the  future to reduce  its prices in  response  to the  actions of its
competitors and thereby experience a reduction in its gross margins.

Narrow Margins
--------------

The Company has  experienced  low operating and gross profit  margins  caused by
intense price competition within its industry.  The Company has partially offset
the  effect of the low  margins  by  achieving  increased  revenue  and  reduced
operating  expenses  as a  percentage  of  revenue;  however,  there  can  be no
assurance  that the Company will maintain or increase  revenue or further reduce
expenses (as a percentage of revenue) in the future.  Future operating and gross
profit margins may be adversely  affected by market pressures,  the introduction
of new Company initiatives, changes in revenue mix, the Company's utilization of
early  payment  discount  opportunities,  supplier  pricing  actions  and  other
competitive and economic pressures.
                                       10
<PAGE>
Dependence on Supplier Incentive Funds
--------------------------------------

The Company  receives  funds from  certain  suppliers  which are earned  through
marketing programs,  meeting established purchasing objectives or  meeting other
objectives  determined  by the  supplier.  There can be no assurance  that these
programs  will be continued by the  suppliers.  A  substantial  reduction in the
supplier  funds  available  to the Company  would have an adverse  effect on the
Company's results of operations.

Product Supply; Dependence on Key Suppliers
-------------------------------------------

The computer reseller industry  continues to experience product supply shortages
and customer  order  backlogs due to the inability of certain  manufacturers  to
supply  certain  products.  In addition,  certain  suppliers  have initiated new
channels of distribution  that increase  competition  for the available  product
supply.  There can be no assurance  that  suppliers  will be able to maintain an
adequate supply of products to fulfill all of the Company's customer orders on a
timely  basis.  Although  the  Company  has not  historically  encountered  such
conditions, the failure to obtain adequate product supplies, if competitors were
able to obtain  them,  could have a  material  adverse  effect on the  Company's
results of operations.

Three suppliers of the Company each  represented  more than 10% of total product
sales for the year ended November 3, 1996. They were COMPAQ Computer Corporation
("COMPAQ"),  Hewlett-Packard  Company  ("Hewlett-Packard"),   and  International
Business  Machines  Corporation  ("IBM").  During fiscal 1996, sales of products
from  COMPAQ,   Hewlett-Packard,   and  IBM  represented   22%,  20%,  and  14%,
respectively,  of the  Company's  total  product  sales.  Sales of  these  three
manufacturers'  products represented  approximately 56% of the Company's revenue
from product  sales during  fiscal 1995,  fiscal 1996 and the second  quarter of
fiscal 1997.

The Company's agreements with these suppliers generally are renewed periodically
and permit  termination by the supplier  without cause,  generally upon 30 to 90
days' notice,  depending on the supplier. In addition, the Company's business is
dependent upon price and related terms and product availability  provided by its
key suppliers.  Although the Company  considers its  relationships  with COMPAQ,
Hewlett-Packard,  and IBM to be  good,  there  can be no  assurance  that  these
relationships  will  continue as  presently  in effect or that changes by one or
more of  these  key  suppliers  in  their  volume  discount  schedules  or other
marketing  programs  would not  adversely  affect the  Company.  Termination  or
nonrenewal  of the Company's  agreements  with COMPAQ,  Hewlett-Packard,  or IBM
would have a material adverse effect on the Company's business.

Open Sourcing
-------------

In the past,  certain of the Company's  suppliers required resellers to purchase
their  products  and  services  exclusively  from  one  source.  Suppliers  have
generally  removed  this  requirement,  resulting  in "open  sourcing"  of their
products.  To date,  open sourcing has  significantly  contributed  to the rapid
growth of the Company's  sales to value-added  resellers.  However,  competitive
pricing pressures  throughout the industry have  intensified;  these competitive
pressures have been particularly evident in the Company's distribution business.
During  fiscal  1996,  61% of total  sales were  attributable  to the  Company's
distribution  business and 39% of total sales were  attributable  to its systems
integration business. While the Company believes that it can effectively compete
for sales of those  products  available  under  open  sourcing,  there can be no
assurance that open sourcing will not adversely affect the Company's business.
                                       11
<PAGE>
Potential Fluctuations in Quarterly Results
-------------------------------------------

The Company's  operating results may vary  significantly from quarter to quarter
depending  on certain  factors,  including,  but not limited to,  demand for the
Company's  information  technology products and services,  product availability,
competitive   conditions,   new  product   introductions  and  general  economic
conditions.  In  particular,  the Company's  operating  results are sensitive to
changes in the mix of product and service revenues,  product margins,  inventory
adjustments  and interest  rates.  Although the Company  attempts to control its
expense  levels,  these  levels are based,  in part,  on  anticipated  revenues.
Therefore, the Company may not be able to control spending in a timely manner to
compensate  for  any  unexpected  revenue  shortfall.  As  a  result,  quarterly
period-to-period   comparisons  of  the  Company's  financial  results  are  not
necessarily  meaningful and should not be relied upon as an indication of future
performance.  In addition,  although the Company's financial performance has not
exhibited  significant  seasonality  in the past,  the Company and the  computer
industry in general tend to follow a sales pattern with peaks occurring near the
end of the calendar  year,  due  primarily to special  supplier  promotions  and
year-end business purchases.

Risk of Declines in Inventory Value
-----------------------------------

The  Company's  business is subject to the risk that the value of its  inventory
will be adversely  affected by price reductions by suppliers or by technological
changes affecting the usefulness or desirability of the products  comprising the
inventory.  It is the policy of most  suppliers  of the  Company's  products  to
protect  distributors  such as the  Company,  who  purchase  directly  from such
suppliers,  from the loss in value of inventory due to  technological  change or
the  supplier's  price  reductions.  Under  the  terms of many of the  Company's
distribution agreements,  suppliers will credit the Company for inventory losses
resulting  from the  supplier's  price  reductions if the Company  complies with
certain conditions.  In addition,  under many of the Company's  agreements,  the
Company  has the right to return for  credit or  exchange  for other  products a
portion of the inventory items  purchased,  within a designated  period of time.
Since the Company can only return a portion of its inventory,  the Company could
be  forced  to  liquidate  nonreturnable  aged  inventory  at  prices  below the
Company's cost. A supplier who elects to terminate a distribution  agreement may
repurchase  from  the  distributor  the  supplier's   products  carried  in  the
distributor's  inventory.  The industry practices  discussed above are sometimes
not embodied in written  agreements  and do not protect the Company in all cases
from declines in inventory  value. No assurance can be given that such practices
will  continue,  that  unforeseen new product  developments  will not materially
adversely  affect the Company,  or that the Company will be able to successfully
manage its existing and future inventories. The Company establishes reserves for
estimated  losses due to obsolete  inventory  in the normal  course of business.
Historically,  the Company has not experienced  losses due to obsolete inventory
materially in excess of established  inventory  reserves.  However,  significant
declines in inventory  value in excess of established  inventory  reserves could
materially  adversely affect the Company's  business,  financial  condition,  or
results of operations.

No Assurance of Successful Acquisitions
---------------------------------------

In order to  establish  or  solidify  its  presence in  strategic  markets or in
response to competitive  pressures,  the Company has made, and in the future may
make,  acquisitions  of or investments  in additional  reseller  locations.  Any
acquisitions  by the Company may result in  potentially  dilutive  issuances  of
equity  securities,  the  incurrence  of  additional  debt and  amortization  of
expenses related to goodwill and intangible assets, all of which could adversely
effect the Company's profitability. Acquisitions involve numerous risks, such as
the diversion of the attention of the Company's  management  from other business
concerns,  the  entrance of the Company  into  markets in which it has had no or
only limited experience,  the integration of the acquired companies'  management
information  systems  with those of the  Company and the  potential  loss of key
employees of the acquired companies,  all of which could have a material adverse
effect on the Company's business, financial condition or results of operations.
                                       12
<PAGE>
Capital Intensive Nature of Business
------------------------------------

The  Company's  business  requires  significant  levels of  capital  to  finance
accounts  receivable  and  product  inventory  that  is not  financed  by  trade
creditors.  The Company has financed its growth and cash needs to date primarily
through working capital financing  facilities,  bank credit lines,  common stock
offerings,  and cash  generated from  operations.  The primary uses of cash have
been to fund  increases in  inventory  and accounts  receivable  resulting  from
increased  sales.  If the Company is successful in achieving  continued  revenue
growth, its working capital requirements will continue to increase.

The  Company  maintains  three  primary  financing   agreements,   as  discussed
previously in "Liquidity  and Capital  Resources",  with an aggregate  borrowing
capacity of $675 million.  The Agreements  expire in August 1998, but any of the
Agreements  may be  terminated  90 days after either party gives the other party
notice of  termination.  At May 4, 1997,  the  Company  had  approximately  $367
million  outstanding  under the  Agreements.  Of the $675  million of  borrowing
capacity  represented  by the  Agreements,  $308 million was unused as of May 4,
1997.  Utilization  of the unused $308  million is dependent  upon,  among other
things,  the Company's  collateral  availability  at the time the funds would be
needed.

The  unavailability  of a significant  portion of, or the loss of, the Financing
Agreements or trade credit from suppliers  would have a material  adverse effect
on the  Company.  There can be no  assurance  that the  Company  will be able to
borrow adequate amounts on terms acceptable to the Company.

Dependence on Information Systems.
----------------------------------

The Company  depends on a variety of  information  systems  for its  operations,
particularly its centralized information processing system which supports, among
other things, inventory management,  order processing,  shipping,  receiving and
accounting.  Although  the Company has not in the past  experienced  significant
failures or down time of its centralized information processing system or any of
its other information  systems,  any such failure or significant down time could
prevent the Company from taking customer orders,  printing  product  pick-lists,
and/or  shipping  product and could prevent  customers from accessing  price and
product  availability  information from the Company.  In such event, the Company
could be at a severe disadvantage in determining  appropriate product pricing or
the  adequacy of  inventory  levels or in reacting  to rapidly  changing  market
conditions.  A failure of the Company's information systems which impacts any of
these functions could have a material adverse effect on the Company's  business,
financial condition or results of operations.  In addition, the inability of the
Company  to  attract  and  retain  the  highly-skilled   personnel  required  to
implement,  maintain and operate its centralized  information  processing system
and the Company's other information systems could have a material adverse effect
on the Company's  business,  financial  condition or results of  operations.  In
order to react to changing  market  conditions,  the Company  must  continuously
expand and improve its centralized  information  processing system and its other
information  systems.  There can be no assurance that the Company's  information
systems  will not fail,  that the  Company  will be able to  attract  and retain
qualified  personnel  necessary  for the  operation  of such systems or that the
Company will be able to expand and improve its information systems.


Dependence on Independent Shipping Companies
--------------------------------------------

The Company relies almost entirely on  arrangements  with  independent  shipping
companies for the delivery of its products.  Products are shipped from suppliers
to the Company  through a variety of  independent  common  carriers.  Currently,
United Parcel Service ("UPS") delivers the substantial majority
                                       13
<PAGE>
of the Company's  products to its reseller  customers.  The  termination  of the
Company's arrangements with UPS or other independent shipping companies,  or the
failure or inability of one or more of these independent  shipping  companies to
deliver products from suppliers to the Company,  or products from the Company to
its reseller customers or their end-user customers could have a material adverse
effect on the Company's business,  financial condition or results of operations.
For  instance,  an employee  work  stoppage or slow-down at one or more of these
independent  shipping  companies could materially impair that shipping company's
ability  to  perform  the  services  required  by the  Company.  There can be no
assurance that the services of any of these independent  shipping companies will
continue to be available to the Company on terms as favorable as those currently
available  or that  these  companies  will  choose or be able to  perform  their
required shipping services for the Company.

Rapid Technological Change
--------------------------

The  Company's  industry  is  subject  to rapid  technological  change,  new and
enhanced product  specification  requirements and evolving  industry  standards.
These changes may cause inventory and stock to decline substantially in value or
to become  obsolete.  In addition,  suppliers may give the Company limited or no
access to new products being  introduced.  Although the Company believes that it
has adequate price protection and other arrangements with its suppliers to avoid
bearing the costs  associated with these changes,  no assurance can be made that
future technological or other changes will not have a material adverse effect on
the business,  financial condition or results of operations of the Company.  See
"Risk of Declines in Inventory Value."
                                       14
<PAGE>
PART II.          OTHER INFORMATION

Item 1.           Legal Proceedings

         See Note D of Notes to Consolidated  Financial  Statements  (Unaudited)
for  information  regarding a  consolidated  class  action  lawsuit  against the
Company, its directors,  certain of its officers,  and three of the underwriters
of the Company's June 16, 1994 public offering of Common Stock.

Item 4.           Submission of Matter to a Vote of Security Holders.

         (a)      The Annual Meeting of Stockholders was held on April 2, 1997.

         (b)(1)   The  following  individuals  were  elected  to  the  Board  of
                  Directors as Class II Directors for three-year  terms expiring
                  at the Company's Annual Meeting in 2000: Jeffrey D.
                  McKeever and Steven G. Mihaylo.

         (b)(2)   The following  individuals'  terms  continued after the Annual
                  Meeting as Class III Directors. Their terms will expire at the
                  Company's  Annual  Meeting  in 1998:  Fred  Israel  and Roy A.
                  Herberger, Jr.

         (b)(3)   The following  individuals'  terms  continued after the Annual
                  Meeting as Class I  Directors.  Their terms will expire at the
                  Company's  Annual  Meeting in 1999:  William H.  Mallender and
                  Lynda M. Applegate.

         (c)      The only matter  submitted for vote at the Annual  Meeting was
                  the election of two Class II Directors  for  three-year  terms
                  expiring at the  Company's  Annual  Meeting in 2000.  See Item
                  4(b)(1) above. The shares were voted as follows:

              Nominee                           No. of Shares

     Jeffrey D. McKeever               For                      13,235,240
                                       Against                      66,751
                                       Abstentions                       0
                                       Broker Non-votes                  0

     Steven G. Mihaylo                 For                      13,235,005
                                       Against                      66,817
                                       Abstentions                       0
                                       Broker Non-votes                  0

         (d)      None
<PAGE>
Item 6.           Exhibits and Reports on Form 8-K

         (a)      Exhibits

                  10.1     Amendment to Restated and Amended Purchase  Agreement
                           dated as of March 3, 1997,  by and  between  MicroAge
                           Computer Centers,  Inc. et al and Deutsche  Financial
                           Services Corporation

                  10.2     Amendment to Second Restated  Agreement for Wholesale
                           Financing  dated as of March 3, 1997,  by and between
                           MicroAge  Computer  Centers,  Inc. et al and Deutsche
                           Financial Services Corporation

                  11       EPS Detail Calculation

                  27       Financial Data Schedule

         (b)      The  Company  did not file any  Reports on Form 8-K during the
                  quarter ended May 4, 1997.
<PAGE>
                                  EXHIBIT INDEX

Exhibit No.                Description
-----------                -----------

10.1                       Amendment to Restated and Amended Purchase
                           Agreement dated as of March 3, 1997, by and between
                           MicroAge Computer Centers, Inc. et al and Deutsche
                           Financial Services Corporation

10.2                       Amendment to Second Restated Agreement for
                           Wholesale Financing dated as of March 3, 1997, by
                           and between MicroAge Computer Centers, Inc. et al
                           and Deutsche Financial Services Corporation

11                         EPS Detail Calculation

27                         Financial Data Schedule
<PAGE>
                                   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.

                                                       MICROAGE, INC.
                                                          (Registrant)



Date:    June 13, 1997                       By: /s/ Jeffrey D. McKeever
                                             -----------------------------------
                                                 Jeffrey D. McKeever
                                                 Chairman of the Board and
                                                 Chief Executive Officer




Date:    June 13, 1997                       By: /s/ James R. Daniel
                                             -----------------------------------
                                                 James R. Daniel
                                                 Senior Vice President, Chief
                                                 Financial Officer and Treasurer