UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q/A
                                  AMENDMENT NO. 1


(Mark  One)

[X] Quarterly Report pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934 For the quarterly period ended April 4, 1998, 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: 0-13459

                       Axiohm Transaction Solutions, Inc.
             (Exact name of registrant as specified in its charter)


California                                                            94-2917470
(State or other jurisdiction of                                 (I.R.S. Employer
incorporation or organization)                               Identification No.)



              15070 Avenue of Science, San Diego, California 92128
                     (Address of principal executive office)

       Registrant's telephone number, including area code: (619) 451-3485




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 XXX No____

As of April 4, 1998,  there were  6,517,426  shares of the  registrant's  Common
Stock outstanding.


<PAGE>

<TABLE>
<CAPTION>

                                             PART 1 - FINANCIAL INFORMATION
                                                ITEM 1 - Financial Statements
                                   AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                          Condensed Consolidated Balance Sheets
                                                     (In thousands)
<S>                                                                             <C>                    <C>

                                                                                    April 4,              December 31,
                                                                                -----------------      -------------------
                                                                                      1998                    1997
                                                                                -----------------      -------------------
                                                                                  (Unaudited)

ASSETS

Current assets:
     Cash and cash equivalents                                                           $ 3,158                  $ 3,877
     Restricted cash                                                                           -                    8,594
     Accounts receivable, net                                                             34,825                   30,515
     Inventories                                                                          33,904                   30,103
     Prepaid expenses and other current assets                                            10,429                   11,015
                                                                                -----------------      -------------------
         Total current assets                                                             82,316                   84,104
     Fixed assets, net of accumulated depreciation                                        21,161                   21,535
     Intangible assets                                                                    86,848                   92,371
     Other assets                                                                          5,826                    6,034
                                                                                =================      ===================
        Total assets                                                                   $ 196,151                $ 204,044
                                                                                =================      ===================

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

Current liabilities:
     Accounts payable                                                                   $ 19,181                 $ 17,351
     Current portion of long-term debt                                                     5,487                    5,948
     Current portion of government grant obligations                                         700                      649
     Accrued payroll, payroll taxes and benefits                                           5,314                    6,194
     Accrued expenses                                                                      3,527                    4,645
     Income taxes payable                                                                      -                    1,937
     Deferred revenue                                                                      1,952                    2,056
     Rabbi Trust                                                                               -                    8,594
     Other current liabilities                                                             1,448                    4,481
                                                                                -----------------      -------------------
        Total current liabilities                                                         37,609                   51,855
Non-current liabilities:
     Long-term debt                                                                      178,486                  165,564
     Government grant obligations                                                          1,462                    1,569
     Other long-term liabilities                                                           3,120                    3,137
                                                                                -----------------      -------------------
        Total liabilities                                                              $ 220,677                $ 222,125
                                                                                -----------------      -------------------
Shareholders' equity (deficit):
     Preferred shares, no par value
        Authorized: 1,000,000 shares, none issued                                            $ -                      $ -
     Common shares:
        Common stock, authorized: 28,500,000
        shares; issued and outstanding: 6,517,426
        in 1998 and 6,512,926 shares in 1997                                              23,898                   23,852
     Foreign currency translation adjustment                                                (413)                    (658)
     Retained earnings (accumluated deficit)                                             (48,011)                 (41,275)
                                                                                -----------------      -------------------
        Total shareholders' equity (deficit)                                             (24,526)                 (18,081)
                                                                                -----------------      -------------------
        Total liabilities and shareholders' equity                                     $ 196,151                $ 204,044
                                                                                =================      ===================


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

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                              AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                Condensed Consolidated Statements of Operations
                                     (In thousands, except per share data)


<S>                                                                            <C>                 <C>

                                                                                          Period Ended
                                                                                   April 4,           March 31,
                                                                               -----------------   -----------------
                                                                                     1998                1997
                                                                               -----------------   -----------------
                                                                                 (Unaudited)         (Unaudited)

Net sales                                                                              $ 57,069            $ 24,891
Cost of net sales                                                                        36,995              17,324
                                                                               -----------------   -----------------
Gross margin                                                                             20,074               7,567

Operating expenses:
    Selling, general and administrative                                                   8,804               2,926
    Research and development                                                              4,090               1,740
    Acquisition related amortization                                                      8,462                  51
                                                                               -----------------   -----------------
Total operating expenses                                                                 21,356               4,717
                                                                               -----------------   -----------------

Income (loss) from operations                                                            (1,282)              2,850

Interest and other income                                                                    88                  49
Interest and other expense                                                                4,367                 175
                                                                               -----------------   -----------------

Income (loss) before income taxes                                                        (5,561)              2,724

Income taxes                                                                              1,175               1,099
                                                                               -----------------   -----------------

Net income (loss)                                                                      $ (6,736)            $ 1,625
                                                                               =================   =================

Basic:
    Net income (loss) per share                                                         $ (1.03)             $ 0.25
    Shares used in per share calculation                                                  6,517               6,513

Diluted:
    Net income (loss) per share                                                         $ (1.03)             $ 0.25
    Shares used in per share calculation                                                  6,517               6,513


                            The accompanying notes are an integral part of these
                                condensed consolidated financial statements.
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
 
                                   AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                     Condensed Consolidated Statements of Cash Flows
                                                      (In thousands)

<S>                                                                                 <C>                  <C>
                                                                                                 Period Ended
                                                                                        April 4,             March 31,
                                                                                    ------------------   ------------------
                                                                                          1998                 1997
                                                                                    ------------------   ------------------
                                                                                       (Unaudited)          (Unaudited)


Cashflows from operating activities:
   Net income (loss)                                                                         $ (6,736)             $ 1,625
   Adjustments to reconcile net income (loss) to net cash provided by operations:
     Depreciation and amortization                                                             10,209                  779
     Other                                                                                     (1,961)               1,055
   Changes in assets and liabilities, net of effects of acquisition of business:
     Accounts receivable                                                                       (4,310)              (2,762)
     Inventories                                                                               (3,801)              (1,668)
     Accounts payable and accrued expenses                                                       (272)                 569
     Other current assets                                                                         586                 (338)
     Other current liabilities                                                                 (3,033)              (1,205)
                                                                                    ------------------   ------------------

          Net cash used in operating activities                                              $ (9,318)            $ (1,945)

Cashflows from investing activities:
   Payment for acquisition of business and other intangibles                                 $ (3,207)                 $ -
   Capital expenditures and other                                                                (890)              (1,680)
                                                                                    ------------------   ------------------

          Net cash used in investing activities                                              $ (4,097)            $ (1,680)

Cashflows from financing activities:
   Net borrowings under line of credit                                                       $ 13,205              $ 1,543
   Principal repayments under long term debt                                                     (800)                 (33)
   Payments of dividends                                                                            -                  (98)
   Exercise of stock options                                                                       46                    -
   Net loans to related parties                                                                     -                1,608
                                                                                                         
                                                                                    ------------------   ------------------

          Net cash provided by financing activities                                          $ 12,451              $ 3,020

Effect of exchange rate changes on cash                                                           245                 (393)
                                                                                    ------------------   ------------------

Net increase in cash and cash equivalents                                                      $ (719)              $ (998)

Cash and cash equivalents at beginning of period                                                3,877                1,839
                                                                                    ------------------   ------------------

          Cash and cash equivalents at end of period                                          $ 3,158                $ 841
                                                                                    ==================   ==================

Supplemental Cashflow Disclosures:
Cash paid during the year for:
   Interest                                                                                   $ 7,252                $ 203
   Income taxes                                                                                 3,112                   64


Other transactions:
   Capital lease obligation                                                                       $ -                 $ 20
   Payment of restricted cash to former officers                                               (8,594)                   -
   Reduction of liability to former officers                                                  $ 8,594                  $ -
                                                                                    ==================   ==================


                                   The accompanying notes are an integral part of these
                                       condensed consolidated financial statements

</TABLE>
<PAGE>



      
               AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                           (April 4, 1998 - Unaudited)


Note 1:  Unaudited Interim Financial Statements


The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions to Form 10-Q and Article 10 of
Regulation  S-X.  Accordingly,  they 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 only normal recurring accruals)  considered necessary for a fair presentation
have been  included.  Operating  results for the quarter ended April 4, 1998 are
not  necessarily  indicative  of the results  which may be expected for the year
ended  December  31,  1998  or  any  other  period.  Reference  is  made  to the
Consolidated  Financial  Statements and Notes thereto  included in the Company's
Annual Report on Form 10-K filed on March 31, 1998 as amended on April 15, 1998.

In May, 1998, Axiohm  Transaction  Solutions,  Inc. (the "Company")  changed its
fiscal year from the twelve month period ended  December 31 to the 52 or 53-week
period that ends on the Saturday  nearest December 31, effective for fiscal year
1998.  As  a  result,  the  Company's  first  quarter  of  1998  represents  the
thirteen-week  period ended on April 4, 1998, and the Company's 1998 fiscal year
will end on January 2, 1999.  Fiscal year 1998 will have fifty-three  weeks. The
quarter ended March 31, 1997, contained 12 weeks and six days and the difference
between  the two  comparable  periods  is  immaterial  in terms of sales and net
income.

Note 2:  Basis of Presentation

The  financial  statements  of Axiohm  include the  accounts of its wholly owned
subsidiaries  in  the  United  States,   France,  Mexico,  the  United  Kingdom,
Australia,  Hong Kong and Japan. All intercompany accounts and transactions have
been eliminated.

On August 21, 1997, pursuant to an Agreement and Plan of Merger dated as of July
14, 1997 (the "Agreement of Merger"),  AX Acquisition  Corporation  ("AX" or the
"Purchaser"),  an indirect  wholly-owned  subsidiary  of Axiohm  S.A.,  acquired
approximately  88%, or 7,000,000 shares,  of the outstanding  Common Stock of DH
Technology,  Inc. ("DH") through a public tender offer to the shareholders of DH
at a price of $25 per share (the "Tender Offer").
<PAGE>

On October 2, 1997,  pursuant to the Agreement of Merger, AX acquired,  directly
or indirectly,  100% of the outstanding  Common Stock of Axiohm S.A. in exchange
for  5,518,524  shares of DH Common Stock and $12.2  million in cash (the "Share
Exchange Offer"). Simultaneously with the Share Exchange Offer, DH purchased all
of the outstanding  shares of AX in exchange for the assumption of approximately
$190 million of debt (the "Acquisition Financing") incurred by AX to finance the
Tender  Offer.  As part of the  Acquisition  Financing  the Company  completed a
private  placement  (the "Senior  Notes  Offering") of $120 million of its 9.75%
Senior  Subordinated  Notes due 2007 (the "Notes").  The Notes were exchanged in
March 1998 for new,  substantially  identical  Notes which have been  registered
under the Securities Act of 1933, as amended.  The Company's payment  obligation
under the  Senior  Notes is  jointly  and  severally  fully and  unconditionally
guaranteed  on  a  senior   subordinated  basis  by  certain  of  the  Company's
subsidiaries  (the  "Guarantor  Subsidiaries"),  all of which  are  directly  or
indirectly  wholly owned by the Company.  Immediately  after the Share  Exchange
Offer,  AX was  merged  with and into DH (the  "Merger"),  the  surviving  legal
entity,  and the company changed its name from "DH Technology,  Inc." to "Axiohm
Transaction  Solutions,  Inc." (the  "Company").  In connection with the Merger,
Axiohm  S.A.  changed  its tax filing  status and was  renamed  Axiohm  S.A.R.L.
Immediately after the Merger, approximately 85% of DH's outstanding Common Stock
was held by the former  shareholders of Axiohm S.A.R.L.  and 15% was held by the
former public shareholders of DH.

The Tender Offer,  the Share  Exchange  Offer and the Merger  (collectively  the
"Acquisition")  have  been  accounted  for  in a  manner  similar  to a  reverse
acquisition, in which Axiohm S.A.R.L. was treated as the acquiror for accounting
purposes. Accordingly, the historical financial information for periods prior to
August 31, 1997 is that of Axiohm S.A.R.L. The effective date of the Acquisition
and Merger of DH for accounting purposes was August 31, 1997, and,  accordingly,
the capital structure of the Company has been retroactively  restated to reflect
the number of shares and options outstanding as a result of the Acquisition.
<PAGE>


Note 3:  Inventories

The  composition  of  inventories  at April 4, 1998 and December 31, 1997 was as
follows:

                                            April 4, 1998     December 31, 1997

         Raw materials                       $24,929,000         $20,014,000
         Work in process                      $2,733,000           2,328,000
         Finished goods                       $6,242,000           7,761,000
                                              -----------        -----------
         Totals                              $33,904,000         $30,103,000
                                              ===========        ===========

Note 4:  Guarantors and Financial Information

The following  consolidating  financial information is presented for purposes of
complying  with  the  reporting  requirements  of  the  Guarantor  Subsidiaries.
Separate  financial  statements  and  other  disclosures  with  respect  to  the
Guarantor  Subsidiaries are not presented because the Company believes that such
financial   statements  and  other  information  would  not  provide  additional
information that is material to investors.

There are no contractual  restrictions,  under the Notes or otherwise,  upon the
ability of the Guarantor  Subsidiaries to make distributions or pay dividends to
their respective equityholders.  Directly or indirectly, the Company is the sole
equityholder of all of the Guarantor Subsidiaries.

The condensed  consolidating  financial information presents condensed financial
statements  as of April 4, 1998 and December 31, 1997 and for the quarter  ended
April 4, 1998 of:

          a)   the Company on a parent company only basis  ("Parent")  (carrying
               its investments in the subsidiaries under the equity method),

          b)   the  Guarantor  Subsidiaries  separated  as to French  Guarantors
               (Axiohm   S.A.R.L.,    Dardel   Technologies   E.U.R.L.,   Axiohm
               Investissements S.A.R.L.), and U.S. Guarantors (Axiohm IPB, Inc.,
               Cognitive L.L.C., Cognitive Solutions,  Inc., and Stadia Colorado
               Corp.),

          c)   the Non-Guarantor  Subsidiaries (DH Technology Plc, DH Technology
               Pty, DH  Technologia,  Axiohm Ltd. (Hong Kong),  and Axiohm Japan
               Inc.),

          d)   elimination  entries  necessary to consolidate the Parent Company
               and its subsidiaries, and

          e)    the Company on a consolidated basis.
<PAGE>

The  condensed  consolidating  financial  information  also  presents  condensed
financial statements for the quarter ended March 31, 1997 of:

          a)   the  Guarantor  Subsidiaries  which  were in  existence  and were
               within the Company's  consolidated  structure  during the quarter
               ended March 31, 1997  separated as to French  Guarantors  (Axiohm
               S.A.R.L., but excluding Dardel Technologies  E.U.R.L.),  and U.S.
               Guarantors (Axiohm IPB, Inc.),
          b)   The Non-Guarantor  Subsidiaries  which were in existence and were
               within the Company's  consolidated  structure  during the quarter
               ended March 31, 1997  (Axiohm  Ltd.  (Hong Kong) and Axiohm Japan
               Inc.),

          c)   elimination  entries  necessary to consolidate such Guarantor and
               Non-Guarantor Subsidiaries, and

          d)   such Guarantor and  Non-Guarantor  Subsidiaries on a consolidated
               basis.

<PAGE>
<TABLE>
<CAPTION>
                                       AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                   NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                             Condensed Consolidating Balance Sheets
                                                         (In thousands)
<S>                                               <C>           <C>         <C>           <C>          <C>           <C>

                                                                             April 4, 1998 (Unaudited)
                                                  --------------------------------------------------------------------------------
                                                                 Guarantor Subsidiaries  Non-Guarantor
                                                                -----------------------
                                                      Parent        French          US    Subsidiaries Eliminations  Consolidated
                                                  --------------------------------------------------------------------------------
ASSETS
Current assets:
    Cash and cash equivalents                          $ 15,506        $ 333    $ (13,627)       $ 946           $ -      $ 3,158
    Restricted cash                                           -            -            -            -             -            -
    Accounts receivable, net                             10,433        3,264       18,231        2,897             -       34,825
    Inventories                                           5,498        7,875       17,390        4,575        (1,434)      33,904
    Prepaid expenses and other current assets             7,256        1,817          644          181           531       10,429
    Intercompany                                        (16,532)         827       11,790       (3,240)        7,155            -
                                                  --------------------------------------------------------------------------------
    Total current assets                                 22,161       14,116       34,428        5,359         6,252       82,316

    Fixed assets, net of accumulated depreciation         3,775        3,838       11,863        1,685             -       21,161
    Intangible assets                                    83,307           93        3,440            8             -       86,848
    Other assets                                          5,491        8,948           76           51        (8,740)       5,826
    Investment in Subsidiaries                           45,030                                              (45,030)           -
                                                  ================================================================================
    Total assets                                      $ 159,764     $ 26,995     $ 49,807      $ 7,103     $ (47,518)   $ 196,151
                                                  ================================================================================

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities :                                                                                                           -
    Accounts payable                                    $ 4,990      $ 5,887      $ 6,809      $ 1,495           $ -     $ 19,181
    Current portion of long-term debt                     4,824          575           32           56             -        5,487
    Current portion of government grant obligations           -          700            -            -             -          700
    Accrued payroll, payroll taxes and benefits           2,041        1,856        1,362           55             -        5,314
    Accrued expenses                                      2,381          256          824           66             -        3,527
    Income taxes payable                                 (4,608)       3,053          476           73         1,006            -
    Deferred revenue                                        324        1,061          567            -             -        1,952
    Rabbi Trust                                               -            -            -            -             -            -
    Other current liabilities                              (832)       2,713          790           69        (1,292)       1,448
                                                  --------------------------------------------------------------------------------
    Total current liabilities                             9,120       16,101       10,860        1,814          (286)      37,609
Non-current liabilities:
    Long-term debt                                      176,860        1,548           40           38             -      178,486
    Government grant obligations                              -          912          550            -             -        1,462
    Other long-term liabilities                          (2,168)       3,391        1,897            -             -        3,120

                                                  --------------------------------------------------------------------------------
    Total liabilities                                   183,812       21,952       13,347        1,852          (286)     220,677
                                                  --------------------------------------------------------------------------------

Shareholders equity :
    Preferred shares, no par value
     Authorized: 1,000,000 shares, none issued
    Common shares:
     Common stock, authorized: 25,500,000
     shares; issued and outstanding:
     6,517,426 in 1998 and 6,512,926 in 1997             23,898        4,167            -          360        (4,527)      23,898
    Capital in excess of par value                            -            -            -            -             -            -
    Foreign currency translation adjustment                  65         (494)           -          129          (113)        (413)
    Retained earnings (accumluated deficit)             (48,011)       1,370       36,460        4,762       (42,592)     (48,011)


                                                  --------------------------------------------------------------------------------
       Total shareholders' equity (deficit)             (24,048)       5,043       36,460        5,251       (47,232)     (24,526)
                                                  --------------------------------------------------------------------------------

                                                  ================================================================================
       Total liabilities and shareholders' equity     $ 159,764     $ 26,995     $ 49,807      $ 7,103     $ (47,518)   $ 196,151
                                                  ================================================================================

</TABLE>
<PAGE>



<TABLE>
<CAPTION>

                                        AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                     NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                          Condensed Consolidating Statements of Operations
                                                           (In thousands)

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

                                                                              April 4, 1998 (Unaudited)
                                               -------------------------------------------------------------------------------------
                                                            Guarantor Subsidiaries   Non-Guarantor
                                                            ----------------------
                                                Parent        French       US        Subsidiaries   Eliminations    Consolidated
                                               -----------  ---------  -----------  -------------  --------------  ---------------


 Net Sales                                      $15,812      $ 9,677    $ 34,003     $ 4,992       $ (7,415)        $ 57,069
 Cost of net sales                               10,280        6,222      24,909       3,794         (8,210)          36,995
                                               -------------------------------------------------------------------------------------
 Gross margin                                     5,532        3,455       9,094       1,198            795           20,074
 Operating expenses
      Selling, general, and administrative        2,640          915       4,159       1,090              -            8,804
      Research & development                      1,183          921       1,829         157              -            4,090
      Acquisition related amortization            8,462            -           -           -              -            8,462 
                                              --------------------------------------------------------------------------------------
 Total operating expenses                        12,285        1,836       5,988       1,247              -           21,356
                                              --------------------------------------------------------------------------------------

 Income (loss) from operations                   (6,753)       1,619       3,106         (49)           795           (1,282)       
                        
 Interest and other income                        1,262           34          15          20         (1,243)              88 
 Interest and other expense                       4,312        1,294           3           1         (1,243)           4,367      
 Equity earnings in subsidiaries                  1,998                                              (1,998)               -
                                              --------------------------------------------------------------------------------------

 Income (loss) before income taxes               (7,805)         359       3,118         (30)        (1,203)          (5,561)   
                                              --------------------------------------------------------------------------------------

 Income taxes                                    (1,069)         669       1,254         (12)           333            1,175 
                                              --------------------------------------------------------------------------------------

 Net income (loss)                               (6,736)        (310)      1,864         (18)        (1,536)          (6,736)
                                             =======================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                     AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                       Condensed Consolidating Statements of Cash Flows
                                                        (In thousands)
<S>                                                   <C>         <C>         <C>         <C>          <C>          <C>

                                                                    Period Ending April 4, 1998 (Unaudited)
                                                      -------------------------------------------------------------------------
                                                                  Guarantor Subsidiaries  Non-Guarantor
                                                                  ----------------------
                                                         Parent      French         US    Subsidiaries Eliminations Consolidated 
                                                       -------------------------------------------------------------------------

Cashflows from operating activities:
          Net cash provided by (used in) operating
          activities                                     $ (7,761)    $ 9,479    $ (1,553)    $ (1,021)   $ (8,462)   $ (9,318)
                                                      -------------------------------------------------------------------------

Cashflows from investing activities:
   Payment for acquisition of business and other         $ (3,207)        $ -         $ -          $ -         $ -    $ (3,207)
   Intangibles
   Capital expenditures and other                            (549)     (8,623)       (398)         248       8,432        (890)
                                                      -------------------------------------------------------------------------

          Net cash provided by (used in) investing
          activities                                     $ (3,756)   $ (8,623)     $ (398)       $ 248     $ 8,432    $ (4,097)
                                                      -------------------------------------------------------------------------

Cashflows from financing activities:
   Net borrowings under line of credit                   $ 13,892      $ (724)      $ (10)        $ 47         $ -    $ 13,205
   Principal repayments under long term debt                 (800)          -           -            -           -        (800)
   Payments of dividends                                        -           -           -            -           -           -
   Exercise of stock options                                   46           -           -            -           -          46
   Net loans to related parties                                 -           -           -            -           -           -
                                                      -------------------------------------------------------------------------

          Net cash provided by (used in)
               financing activities                      $ 13,138      $ (724)      $ (10)        $ 47         $ -    $ 12,451

Effect of exchange rate changes on cash                        25          63           -          127          30         245
                                                      -------------------------------------------------------------------------

Net increase in cash and cash equivalents                 $ 1,646       $ 195    $ (1,961)      $ (599)        $ -      $ (719)
                                                      -------------------------------------------------------------------------

Cash and cash equivalents at beginning of period           13,860         138     (11,666)       1,545           -       3,877
                                                      -------------------------------------------------------------------------

         Cash and cash equivalents at end of period      $ 15,506       $ 333   $ (13,627)       $ 946         $ -     $ 3,158
                                                      =========================================================================



</TABLE>





<PAGE>
<TABLE>
<CAPTION>

                                     AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                           Condensed Consolidating Balance Sheets
                                                       (In thousands)
<S>                                               <C>          <C>          <C>         <C>         <C>          <C>

                                                                           December 31, 1997
                                                  ----------------------------------------------------------------------------
                                                                Guarantor Subsidiaries  Non-Guarantor
                                                               ------------------------
                                                      Parent       French         US    Subsidiaries Eliminations Consolidated
                                                  -----------------------------------------------------------------------------
ASSETS
Current assets:
    Cash and cash equivalents                         $ 13,860        $ 138   $ (11,666)     $ 1,545         $ -      $ 3,877
    Restricted cash                                      8,594            -           -            -           -        8,594
    Accounts receivable, net                            10,388        3,760      15,209        3,099      (1,941)      30,515
    Inventories                                          3,611        4,995      17,140        4,600        (243)      30,103
    Prepaid expenses and other current assets            4,235        9,759         437       (3,316)       (100)      11,015
    Intercompany                                       (14,259)       2,612      11,514       (1,761)      1,894            -
                                                  ----------------------------------------------------------------------------
    Total current assets                                26,429       21,264      32,634        4,167        (390)      84,104

    Fixed assets, net of accumulated depreciation        3,847        4,052      11,679        1,957           -       21,535
    Intangible assets                                   88,555           93       3,521          202           -       92,371
    Other assets                                         5,428          413         418           83        (308)       6,034
    Investment in Subsidiaries                          45,030            -           -            -     (45,030)           -
                                                  ============================================================================
    Total assets                                     $ 169,289     $ 25,822    $ 48,252      $ 6,409   $ (45,728)   $ 204,044
                                                  ============================================================================

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities :                                                                                                      
    Accounts payable                                   $ 2,510      $ 6,570     $ 6,767      $ 1,504         $ -     $ 17,351
    Current portion of long-term debt                    5,689          227          32            -           -        5,948
    Current portion of government grant obligations          -          649           -            -           -          649
    Accrued payroll, payroll taxes and benefits            690        3,557       1,947            -           -        6,194
    Accrued expenses                                     1,620        1,196       2,113         (284)          -        4,645
    Income taxes payable                                 1,937          174        (174)           -           -        1,937
    Deferred revenue                                       416        1,121         519            -           -        2,056
    Rabbi Trust                                          8,594            -           -            -           -        8,594
    Other current liabilities                            4,481            -           -            -           -        4,481
                                                  ----------------------------------------------------------------------------
    Total current liabilities                           25,937       13,494      11,204        1,220           -       51,855
Non-current liabilities:
    Long-term debt                                     162,903        2,014         600           47           -      165,564
    Government grant obligations                             -        1,569           -            -           -        1,569
    Other long-term liabilities                         (2,168)       3,455       1,850            -           -        3,137

                                                  ----------------------------------------------------------------------------
    Total liabilities                                  186,672       20,532      13,654        1,267           -      222,125
                                                  ----------------------------------------------------------------------------

Shareholders equity
     Common stock, authorized: 25,500,000
     shares; issued and outstanding:
     6,512,926 shares in 1998 and 1997                  23,852        4,167           -          360      (4,527)      23,852
    Capital in excess of par value                           -            -           -            -           -            -
    Foreign currency translation adjustment                 40         (557)          -            2        (143)        (658)
    Retained earnings (accumluated deficit)            (41,275)       1,680      34,598        4,780     (41,058)     (41,275)


                                                  ----------------------------------------------------------------------------
       Total shareholders' equity (deficit)            (17,383)       5,290      34,598        5,142     (45,728)     (18,081)
                                                  ----------------------------------------------------------------------------

                                                  ============================================================================
       Total liabilities and shareholders' equity    $ 169,289     $ 25,822    $ 48,252      $ 6,409   $ (45,728)   $ 204,044
                                                  ============================================================================

</TABLE>
<PAGE>


<TABLE>
<CAPTION>

                                        AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                                     NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                          Condensed Consolidating Statements of Operations
                                                           (In thousands)

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

                                                                               March 31, 1997 (Unaudited)
                                                     -------------------------------------------------------------------------------
                                                             Guarantor Subsidiaries   Non-Guarantor
                                                       -----------------------------
                                                          French            US         Subsidiaries   Eliminations    Consolidated
                                                       -------------   -------------  -------------  --------------  ---------------


 Net Sales                                                 $ 30,133           $ 455       $ (5,697)       $ (5,697)        $ 24,891
 Cost of net sales                                           22,311             401         (5,701)         (5,388)          17,324
                                                     -------------------------------------------------------------------------------
 Gross margin                                                 7,822              54              4            (309)           7,567

 Operating expenses
      Selling, general, and administrative                    2,787             191             (1)             (1)           2,977
      Research & development                                  1,735               -              5               5            1,740
       Acquisition related amortization                           -               -                              -                -
                                                     -------------------------------------------------------------------------------
 Total operating expenses                                     4,522             191              4               4            4,717
                                                     -------------------------------------------------------------------------------

 Income (loss) from operations                                3,300            (137)             -            (313)           2,850

 Interest and other income                                       49               -                              -               49
 Interest and other expense                                     174               1                              -              175
 Equity earnings in subsidiaries                               (336)                                           336                -
                                                     -------------------------------------------------------------------------------

 Income (loss) before income taxes                            2,839            (138)             -              23            2,724
                                                     -------------------------------------------------------------------------------

 Income taxes                                                 1,214               -                           (115)           1,099
                                                     -------------------------------------------------------------------------------

 Net income (loss)                                          $ 1,625          $ (138)           $ -          $  138          $ 1,625
                                                     ===============================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                  AXIOHM TRANSACTION SOLUTIONS, INC. AND SUBSIDIARIES
                               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                                    Condensed Consolidating Statements of Cash Flows
                                                     (In thousands)

<S>                                                  <C>             <C>        <C>            <C>           <C>
                                                                                     March 31, 1997 (Unaudited)
                                                     --------------------------------------------------------------------
                                                        Guarantor Subsidiaries  Non-Guarantor
                                                     ---------------------------
                                                          French          US    Subsidiaries   Eliminations   Consolidated
                                                     --------------------------------------------------------------------


Cashflows from operating activities:
          Net cash provided by (used in) operating
          activities                                          $ 46     $ (2,326)         $ (1)         $336     $ (1,945)
                                                     --------------------------------------------------------------------

Cashflows from investing activities:
   Payment for acquisition of business and other
   intangibles                                                 $ -          $ -           $ -           $ -          $ -
   Capital expenditures and other                             (471)      (1,193)          (16)            -       (1,680)
                                                     --------------------------------------------------------------------

          Net cash used in investing activities             $ (471)    $ (1,193)        $ (16)          $ -     $ (1,680)
                                                     --------------------------------------------------------------------

Cashflows from financing activities:
   Net borrowings under line of credit                         $ -      $ 1,552          $ (9)          $ -      $ 1,543
   Principal repayments under long term debt                   (25)          (8)            -             -          (33)
   Payments of dividends                                       (52)         (46)            -             -          (98)
   Exercise of stock options                                     -            -             -             -            -
   Net loans to related parties                              1,180          300           128             -        1,608
                                                     --------------------------------------------------------------------

          Net cash provided by (used in)
          financing activities                             $ 1,103      $ 1,798         $ 119           $ -      $ 3,020

Effect of exchange rate changes on cash                       (419)          26             -             -         (393)
                                                     --------------------------------------------------------------------

Net increase in cash and cash equivalents                    $ 259     $ (1,695)        $ 102          $336       $ (998)
                                                     --------------------------------------------------------------------

Cash and cash equivalents at beginning of period             1,494          230           115             -        1,839
                                                     --------------------------------------------------------------------

         Cash and cash equivalents at end of period        $ 1,753     $ (1,465)        $ 217          $336        $ 841
                                                      ===================================================================

</TABLE>
<PAGE>





<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.


Axiohm Transaction Solutions, Inc. by:


    May 19, 1998                            /s/Janet W. Shanks
--------------------                -----------------------------------------
         Date                       Janet W. Shanks, Chief Accounting Officer
                                           (Chief Accounting Officer)