UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

    X    Quarterly Report under Section 13 or 15(d) of the Securities Exchange 
-------
          Act of 1934

                For the quarterly period ended December 31, 1998

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: 000-16014


                             ADELPHIA COMMUNICATIONS
                                   CORPORATION
             (Exact name of registrant as specified in its charter)



                 Delaware                                 23-2417713
       (State or other jurisdiction of                 (I.R.S. Employer
        incorporation or organization)                Identification No.)


                      Main at Water Street
                        Coudersport, PA                 16915-1141
               (Address of principal executive offices) (Zip code)


                                  814-274-9830
               (Registrant's telephone number including area code)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                Yes   X                              No ______

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:

     At February 12, 1999, 41,328,343 shares of Class A Common Stock, par value
$.01 per share, and 10,834,476 shares of Class B Common Stock, par value $.01
per share, of the registrant were outstanding.



<PAGE>


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              ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

                                      INDEX




                                                                                                           Page Number
PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements
<S>                                                                                                     <C>
       Condensed Consolidated Balance Sheets - March 31, 1998 and
        December 31, 1998..............................................................................             3

       Condensed Consolidated Statements of Operations - Three and Nine Months Ended
        December 31, 1997 and 1998.....................................................................             4

       Condensed Consolidated Statements of Cash Flows - Nine Months Ended
        December 31, 1997 and 1998.....................................................................             5

       Notes to Condensed Consolidated Financial Statements............................................             6

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
          of Operations..................................................................................          13

Item 3.  Quantitative and Qualitative Disclosures about Market Risk....................................            24

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.............................................................................            25

Item 2.  Changes in Securities and Use of Proceeds.....................................................            25

Item 3.  Defaults Upon Senior Securities..............................................................             25

Item 4.  Submission of Matters to a Vote of Security Holders..........................................             25

Item 5.  Other Information............................................................................             25

Item 6.  Exhibits and Reports on Form 8-K..............................................................            25


SIGNATURES.............................................................................................            27



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<TABLE>
<CAPTION>

                         PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements

                       ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                        CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
                          (Dollars in thousands, except share amounts)

                                                                                  March 31,    December 31,
                                                                                    1998           1998
                                                                                ------------   ------------
ASSETS:
<S>                                                                             <C>            <C>        
Property, plant and equipment - net                                             $   918,637    $ 1,207,655
Intangible assets - net                                                             695,104      1,029,159
Cash and cash equivalents                                                           276,895        398,644
U.S. government securities - pledged                                                 70,535         58,054
Investments                                                                         127,827        196,893
Preferred equity investment in Managed Partnership                                   18,338           --
Subscriber receivables - net                                                         30,551         53,911
Prepaid expenses and other assets - net                                             114,526        114,625
Investment in and amounts due from Olympus                                             --          191,408
Related party receivables - net                                                      52,258         44,108
                                                                                -----------    -----------
Total                                                                           $ 2,304,671    $ 3,294,457
                                                                                ===========    ===========

LIABILITIES, PREFERRED STOCK, COMMON STOCK AND
OTHER STOCKHOLDERS' EQUITY (DEFICIENCY):
Subsidiary debt                                                                 $ 1,329,471    $ 1,717,240
Parent debt                                                                       1,580,274      1,810,212
Accounts payable                                                                     65,019         96,985
Subscriber advance payments and deposits                                             17,129         19,377
Accrued interest and other liabilities                                               98,087        137,131
Deferred income taxes                                                               116,351        109,609
                                                                                -----------    -----------
Total liabilities                                                                 3,206,331      3,890,554
                                                                                -----------    -----------

Minority interests                                                                   27,737         48,784
                                                                                -----------    -----------

Cumulative equity in loss in excess of investment in and amounts
due from Olympus                                                                     31,202           --
                                                                                -----------    -----------

Hyperion Redeemable Exchangeable Preferred Stock                                    207,204        228,674
                                                                                -----------    -----------

Series A Cumulative Redeemable Exchangeable Preferred Stock                         148,062        148,191
                                                                                -----------    -----------

Commitments and contingencies (Note 8)

Convertible preferred stock, common stock and other stockholders' equity
(deficiency):
8 1/8% Series C Convertible Preferred Stock ($100,000 liquidation preference)             1              1
Class A Common Stock, $.01 par value, 200,000,000 shares authorized,
20,043,528 and 31,258,843 shares outstanding, respectively                              200            313
Class B Common Stock, $.01 par value, 25,000,000 shares authorized,
10,944,476 and 10,834,476 shares outstanding, respectively                              109            108
Additional paid-in capital                                                          331,263        738,102
Accumulated deficit                                                              (1,647,438)    (1,760,270)
                                                                                -----------    -----------
Convertible preferred stock, common stock and
other stockholders' equity (deficiency)                                          (1,315,865)    (1,021,746)
                                                                                ===========    ===========
Total                                                                           $ 2,304,671    $ 3,294,457
                                                                                ===========    ===========

                        See notes to condensed consolidated financial statements.
</TABLE>


<PAGE>



<TABLE>
<CAPTION>


                          ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
                            (Dollars in thousands, except per share amounts)

                                                          Three Months Ended        Nine Months Ended
                                                               December 31,             December 31,
                                                        ------------------------  -----------------------
                                                           1997         1998         1997         1998
                                                        ----------   ----------   ----------   ----------

<S>                                                     <C>          <C>          <C>          <C>      
Revenues                                                $ 138,271    $ 193,012    $ 389,905    $ 507,155
                                                        ---------    ---------    ---------    ---------

Operating expenses:
Direct operating and programming                           43,711       62,630      121,924      167,963
Selling, general and administrative                        24,354       45,095       70,085      107,249
Depreciation and amortization                              37,251       56,181      104,570      140,823
                                                        ---------    ---------    ---------    ---------
Total                                                     105,316      163,906      296,579      416,035
                                                        ---------    ---------    ---------    ---------


Operating income                                           32,955       29,106       93,326       91,120
                                                        ---------    ---------    ---------    ---------

Other income (expense):
Priority investment income from Olympus                    12,000       12,000       35,765       36,000
Other income                                                 --           --           --          1,113
Interest expense - net                                    (63,172)     (65,531)    (187,341)    (191,593)
Equity in loss of Olympus and other joint ventures        (16,012)     (15,772)     (50,050)     (48,891)
Equity in loss of Hyperion joint ventures                  (2,858)      (3,776)      (9,284)      (9,580)
Minority interest in net losses of subsidiaries              --         11,769         --         25,772
Hyperion preferred stock dividends                         (5,988)      (7,424)      (5,988)     (21,536)
Gain on sale of investment                                    408         --          1,018         --
                                                        ---------    ---------    ---------    ---------

Total                                                     (75,622)     (68,734)    (215,880)    (208,715)
                                                        ---------    ---------    ---------    ---------

Loss before income taxes and extraordinary loss           (42,667)     (39,628)    (122,554)    (117,595)
Income tax (expense) benefit                                 (264)       2,040         (559)       6,802
                                                        ---------    ---------    ---------    ---------

Loss before extraordinary loss                            (42,931)     (37,588)    (123,113)    (110,793)
Extraordinary loss on early retirement of debt            (13,625)        --        (11,325)      (4,337)
                                                        ---------    ---------    ---------    ---------

Net loss                                                  (56,556)     (37,588)    (134,438)    (115,130)
Dividend requirements applicable to preferred stock        (7,448)      (6,906)     (11,998)     (20,718)
                                                        ---------    ---------    ---------    ---------

Net loss applicable to common stockholders              $ (64,004)   $ (44,494)   $(146,436)   $(135,848)
                                                        =========    =========    =========    =========

Basic and diluted loss per weighted average share of
common stock before extraordinary loss                  $   (1.64)   $   (1.06)   $   (4.57)   $   (3.63)
Basic and diluted extraordinary loss per
weighted average share on early retirement of debt          (0.45)        --          (0.38)       (0.12)
                                                        ---------    ---------    ---------    ---------
Basic and diluted net loss per weighted average share
of common stock                                         $   (2.09)   $   (1.06)   $   (4.95)   $   (3.75)
                                                        =========    =========    =========    =========

Weighted average shares of common stock
outstanding (in thousands)                                 30,647       42,093       29,595       36,226
                                                        =========    =========    =========    =========





                             See notes to condensed consolidated financial statements.

</TABLE>



<PAGE>


<TABLE>
<CAPTION>

                    ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                                   (Dollars in thousands)

                                                                 Nine Months Ended December 31,
                                                                  -----------------------------
                                                                        1997          1998
                                                                   -------------  ------------
Cash flows from operating activities:
<S>                                                                <C>            <C>         
Net loss                                                           $  (134,438)   $  (115,130)
Adjustments to reconcile net loss to net cash 
provided by operating activities:
Depreciation and amortization                                          104,570        140,823
Noncash interest expense                                                29,981         23,663
Noncash dividends                                                        5,988         21,536
Equity in loss of Olympus and other joint ventures                      50,050         48,891
Equity in loss of Hyperion joint ventures                                9,284          9,580
Gain on sale of investments                                               (408)          --
Minority interest in losses of subsidiaries                               --          (25,772)
Extraordinary loss on early retirement of debt                          11,325          4,337
Decrease in deferred income taxes, net of effect of acquisitions           (84)        (6,510)
Changes in operating assets and liabilities,
 net of effect of acquisitions:
Subscriber receivables                                                  (7,500)       (19,874)
Prepaid expenses and other assets                                       (3,764)        (6,942)
Accounts payable                                                         1,027         31,029
Subscriber advance payments and deposits                                 1,124          1,678
Accrued interest and other liabilities                                  (5,117)        31,051
                                                                   -----------    -----------
Net cash provided by operating activities                               62,038        138,360
                                                                   -----------    -----------

Cash flows used for investing activities:
Acquisitions                                                           (88,217)      (403,851)
Expenditures for property, plant and equipment                        (117,560)      (255,797)
Investments in Hyperion nonconsolidated joint ventures                 (48,574)       (69,018)
Investments in other joint ventures                                    (13,616)       (12,540)
Purchase of minority interest in Hyperion                                 --          (15,580)
Investments in U.S. government securities - pledged                    (83,400)          --
Sale of U.S. Government securities - pledged                              --           15,312
Amounts invested in and advanced to
 Olympus and related parties                                           (82,211)      (274,216)
Proceeds from sale of investment                                         9,613           --
                                                                   -----------    -----------
Net cash used for investing activities                                (423,965)    (1,015,690)
                                                                   -----------    -----------

Cash flows provided by financing activities:
Proceeds from debt                                                   1,138,295        836,176
Repayments of debt                                                    (862,786)      (269,778)
Costs associated with debt financings                                  (18,701)        (7,125)
Issuance of redeemable exchangeable preferred stock                    147,976           --
Issuance of convertible preferred stock                                 97,000           --
Issuance of Hyperion redeemable exchangeable preferred stock           194,733           --
Premium paid on early retirement of debt                               (12,153)        (3,634)
Issuance of Hyperion Class A common stock                                 --          205,599
Issuance of Class A common stock                                          --          275,880
Costs associated with issuances of common stock                           --          (22,196)
Preferred stock dividends paid                                          (2,573)       (15,843)
                                                                   -----------    -----------
Net cash provided by financing activities                              681,791        999,079
                                                                   -----------    -----------

Increase in cash and cash equivalents                                  319,864        121,749

Cash and cash equivalents, beginning of period                          61,539        276,895
                                                                   -----------    -----------

Cash and cash equivalents, end of period                           $   381,403    $   398,644
                                                                   ===========    ===========



                     See notes to condensed consolidated financial statements.
</TABLE>


<PAGE>


              ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                (Dollars in thousands, except per share amounts)


         The accompanying unaudited condensed consolidated financial statements
of Adelphia Communications Corporation and its majority owned subsidiaries
("Adelphia" or the "Company") have been prepared in accordance with the rules
and regulations of the Securities and Exchange Commission.

         In the opinion of management, all adjustments, consisting of only
normal recurring accruals necessary for a fair presentation of the financial
position of Adelphia at December 31, 1998, and the results of operations for the
three and nine months ended December 31, 1997 and 1998, have been included.
These condensed consolidated financial statements should be read in conjunction
with Adelphia's consolidated financial statements included in its Annual Report
on Form 10-K for the fiscal year ended March 31, 1998 ("Annual Report"). The
results of operations for the three and nine months ended December 31, 1998 are
not necessarily indicative of the results to be expected for the year ending
March 31, 1999.

1. Significant Events Subsequent to the Annual Report:

         On April 1, 1998, the Company completed an exchange of cable systems
with Time Warner Entertainment ("Time Warner"). The Company exchanged its
interests in Mansfield, Ohio area systems, which served approximately 64,400
subscribers, and approximately $11,000 cash for interests in systems adjacent to
systems owned or managed by Adelphia in Virginia, New England and New York,
which served approximately 70,200 subscribers. No gain or loss was recognized in
connection with this transaction.

         On May 8, 1998, Hyperion Telecommunications, Inc. ("Hyperion")
completed an initial public offering ("IPO") of its Class A Common Stock
("Hyperion Stock"). As part of the offering, Adelphia purchased an incremental
3,324,001 shares of Hyperion Stock for $49,900 and converted indebtedness owed
to the Company by Hyperion into 3,642,666 shares of Hyperion Stock. In addition,
Adelphia purchased warrants issued by Hyperion to MCI Metro Access Transmission
Services, Inc., and purchased shares of Hyperion Class B common stock from
certain executive officers of Hyperion for a total purchase price of
approximately $12,580 and $3,000, respectively. Adelphia owns approximately 66%
of the Hyperion common stock on a fully diluted basis and 86% of the total
voting power. Additional net proceeds of $191,411 to Hyperion were received as a
result of the sale of Hyperion Stock to the public. In a related transaction on
June 5, 1998, Hyperion issued and sold 350,000 shares of its Class A Common
Stock at the $16.00 IPO price pursuant to the underwriters' over allotment
option in the IPO. As a result of the IPO, Adelphia's additional paid-in capital
increased approximately $147,000 and minority interests increased approximately
$45,000.

         On June 5, 1998, Adelphia acquired cable systems from Cablevision
Systems. These systems served approximately 11,250 subscribers at the date of
acquisition in southern New York and were purchased for an aggregate price of
$11,500. The acquisition was accounted for under the purchase method of
accounting. Accordingly, the financial results of the acquired systems are
included in the consolidated results of Adelphia effective with the date
acquired.

         Since April 1, 1998, Hyperion entered into a series of agreements,
totaling $126,000 with several local and long-haul fiber optic network
providers. These agreements will provide Hyperion with ownership or an
indefeasible right of use ("IRU") to over 9,000 route miles of local and
long-haul fiber optic cable, which will significantly increase its presence in
the eastern half of the United States. Through December 31, 1998, Hyperion has
paid $42,604 of the total due under these agreements, which is included in
property, plant and equipment.

<PAGE>

         On July 2, 1998, Adelphia issued $150,000 of 8 1/8% Senior Notes due
2003 (the "8 1/8% Senior Notes"). Net proceeds of approximately $147,300, after
payment of transaction costs, were used to repay debt of subsidiaries. The terms
of the 8 1/8% Senior Notes are similar to those of Adelphia's existing publicly
held senior debt.

         On July 31, 1998, Adelphia consummated its transaction with
Tele-Communications, Inc. ("TCI") to form a joint venture limited partnership in
the Western New York region (the "Western New York Partnership"). Pursuant to
this agreement, Adelphia contributed its Western New York and Lorain, Ohio
systems totaling approximately 298,000 subscribers and certain programming
assets and $440,000 in debt. Subsidiaries of TCI contributed their cable systems
in Buffalo, New York; Erie, Pennsylvania; and Ashtabula and Lake County, Ohio,
totaling approximately 171,000 subscribers and $228,000 in debt. Adelphia and
TCI hold a 66.7% and 33.3% interest, respectively, in the partnership. Adelphia
manages the partnership and consolidates the partnership's results of operations
for financial reporting purposes beginning on the acquisition date.

         On August 18, 1998, Adelphia issued 8,190,315 shares of Class A Common
Stock to the public and to the Rigas Family (principal shareholders and officers
of Adelphia). Of this total, 4,100,000 shares were sold to the public at a price
of $32.00 per share, with an underwriting discount of $1.44 per share. The
remaining 4,090,315 shares were sold to entities controlled by the Rigas Family
at the public offering price less the underwriting discount. In a related
transaction on September 14, 1998, the Company issued and sold 615,000 shares of
Class A Common Stock at the offering price of $32.00, with an underwriting
discount of $1.44 per share, pursuant to the underwriters' over-allotment
option. Adelphia realized aggregate net proceeds of $268,038 after deducting
underwriter and other fees.

         On September 1, 1998, a majority owned subsidiary of Adelphia acquired
cable systems from Marcus Cable. These systems served approximately 62,000
subscribers at the date of acquisition in Connecticut and Virginia and were
purchased for an aggregate price of $150,126. The acquisition was accounted for
under the purchase method of accounting. Accordingly, the financial results of
the acquired systems are included in the consolidated results of Adelphia
effective from the date acquired.

         On September 30, 1998, Adelphia merged a subsidiary of the Company with
the subsidiary of TCI that held an interest in Syracuse Hilton Head Holdings,
L.P. ("SHHH, L.P."), an Adelphia managed partnership controlled by the Rigas
Family. Pursuant to the merger agreement, TCI received 2,250,000 newly issued
shares of the Company's Class A Common Stock, $.01 par value. Simultaneously,
SHHH, L.P. distributed certain SHHH, L.P. cable systems, which serve
approximately 34,100 subscribers, in Virginia and North Carolina (the "Virginia
and North Carolina Systems") to Adelphia, in exchange for the interest acquired
by Adelphia from TCI as described above, Adelphia's Preferred equity investment
in Managed Partnership and certain affiliate receivables owed to Adelphia. The
Virginia and North Carolina Systems were distributed to Adelphia without
indebtedness.

         On November 4, 1998, Hyperion entered into purchase agreements with
subsidiaries of MediaOne of Colorado, Inc. ("MediaOne"), its local partner in
the Jacksonville, FL and Richmond, VA networks, whereby MediaOne will be paid
approximately $82,751 in cash for MediaOne's ownership interest in these
networks. In addition, Hyperion will be responsible for the payment of fiber
lease liabilities due to MediaOne in the amount of approximately $14,500, which
are generally payable over the next ten years. Upon consummation of this
transaction, which is subject to normal closing conditions and receipt of
regulatory approvals, Hyperion's ownership interest in each of these networks
will increase to 100%.

<PAGE>

         On November 10, 1998, Hyperion and Telergy, Inc. ("Telergy") entered
into a binding letter agreement that modified certain provisions of the Senior
Secured Note agreement with Telergy and extended the note's maturity from
January 20, 1999 to January 20, 2000 in exchange for an IRU or long term lease
of certain fiber segments in New York City and along certain of Telergy's long
haul fiber segments in the northeastern United States and southeastern Canada.
Telergy must deliver such fiber segments within certain agreed upon timelines or
be subject to prescribed liquidated damages.

         On November 12, 1998, Adelphia issued $150,000 of 8 3/8% Senior Notes
due 2008 (the "8 3/8% Senior Notes"). Net proceeds of the offering, after
deducting offering expenses, were approximately $151,500, including
approximately $3,500 in accrued interest. The proceeds from the offering were
used to repay borrowings under revolving credit facilities of subsidiaries. The
terms of the 8 3/8% Senior Notes are similar to those of Adelphia's existing
publicly held senior debt.

         On December 30, 1998, the Western New York Partnership closed on a
$700,000, 8.5 year credit facility. The credit facility consists of a $350,000
reducing revolving credit portion and a $350,000 term loan portion. Proceeds
from initial borrowings were used to repay existing indebtedness.

         On January 13, 1999, Adelphia completed offerings of $100,000 of 7 1/2%
Senior Notes due 2004 and $300,000 of 7 3/4% Senior Notes due 2009. Net proceeds
from these offerings, after deducting offering expenses, were approximately
$393,700. Of this amount, Adelphia used approximately $160,000 to retire a
portion of its 9 1/2% Senior Pay-In-Kind Notes due 2004. Adelphia used the
remainder to repay borrowings under revolving credit facilities of its
subsidiaries which may be reborrowed and used for general corporate purposes.
The terms of these notes are similar to those of Adelphia's existing publicly
held senior debt.

         On January 14, 1999, Adelphia completed offerings totaling 8,600,000
shares of its Class A common stock. In those offerings, Adelphia sold 4,600,000
newly issued shares of Class A common stock to Goldman, Sachs & Co. at $43.25
per share and it also sold 4,000,000 shares of its Class A common stock at
$43.25 per share to entities controlled by the Rigas Family. Adelphia used the
proceeds of approximately $372,000 from these offerings to repay subsidiary bank
debt, which may be reborrowed and used for general corporate purposes.

         On January 15, 1999, Adelphia acquired cable systems from Lake
Champlain Cable Television and Richmond Cable Television Corporation. These
systems served approximately 10,000 subscribers at the date of acquisition in
Vermont and were purchased for an aggregate price of $18,000. The acquisition
was accounted for under the purchase method of accounting. Accordingly, the
financial results of the acquired systems will be included in the consolidated
results of Adelphia effective from the date acquired.

         On January 21, 1999, Adelphia acquired Verto Communications, Inc.
("Verto") pursuant to a merger agreement between Adelphia, Verto and Verto's
shareholders. These systems served approximately 56,000 subscribers in the
greater Scranton, Pennsylvania area at the date of acquisition. In connection
with the Verto acquisition, Adelphia issued 2,561,024 shares of its Class A
common stock to the former owners of Verto and assumed approximately $35,000 of
net liabilities of Verto. The acquisition was accounted for under the purchase
method of accounting. Accordingly, the financial results of the acquired systems
will be included in the consolidated results of Adelphia effective from the date
acquired.

         On January 25, 1999, Hyperion entered into a purchase agreement with
Multimedia, Inc. ("Multimedia"), the parent of its local partner in the Wichita,
KS market, whereby Multimedia will receive approximately $8,500 in cash for
Multimedia's ownership interest in this network. In addition, Hyperion will
be responsible for the payment of fiber lease liabilities due to Multimedia in

<PAGE>

the amount of approximately $2,800 which are payable over the next six years.
Upon consummation of the transaction, which is subject to normal closing
conditions and receipt of regulatory approvals, Hyperion ownership in
Wichita will increase to 100%.

         On January 29, 1999, Adelphia purchased from Telesat Cablevision, Inc.,
a subsidiary of FPL Group, Inc. shares of Adelphia's stock owned by Telesat. In
the transaction, Adelphia purchased 1,091,524 shares of Class A common stock and
20,000 shares of Series C Cumulative Convertible preferred stock which are
convertible into an additional 2,358,490 shares of Class A common stock. These
shares represent 3,450,014 shares of common stock on a fully converted basis.
Adelphia and Telesat also agreed to a redemption of Telesat's interests in
Olympus by July 11, 1999. The redemption transaction is subject to applicable
approvals of third parties or governmental authorities.
The aggregate purchase price for these transactions will be approximately
$257,200.


2.       Debt:
         Debt is summarized as follows:
<TABLE>
<CAPTION>

           Subsidiary Debt:
                                                       March 31,    December 31,
                                                          1998         1998
                                                      -----------  -----------
<S>                                                   <C>          <C>       
Notes to banks and institutions                       $  827,725   $1,200,970
13% Senior Discount Notes of Hyperion due 2003           215,213      220,784
12 1/4% Senior Secured Notes of Hyperion due 2004        250,000      250,000
Other subsidiary debt                                     36,533       45,486
                                                      ----------   ----------

Total Subsidiary debt                                 $1,329,471   $1,717,240
                                                      ==========   ==========
</TABLE>


         The following information updates to December 31, 1998, unless
otherwise noted, certain disclosures included in Note 3 to Adelphia's
consolidated financial statements contained in the Annual Report:

<TABLE>
<CAPTION>

<S>                                                           <C>
Commitments for additional borrowings,
  as of February 12, 1999                                       $     816,400

Weighted average interest rate payable by subsidiaries
 under credit agreements with banks and institutions                     7.89%

Percentage of subsidiary notes to banks and institutions that
 bear interest at fixed rates for at least one year                     35.90%
</TABLE>





<PAGE>


<TABLE>
<CAPTION>

         Parent Debt:

                                       March 31,  December 31,
                                         1998         1998
                                     -----------  -----------

<S>                               <C>            <C>
12 1/2% Senior Notes due 2002        $   69,838   $     --
10 1/4% Senior Notes due 2000            99,504       99,653
 9 7/8% Senior Notes due 2007           347,446      347,586
 9 1/4% Senior Notes due 2002           325,000      325,000
10 1/2% Senior Notes due 2004           150,000      150,000
 8 3/8% Senior Notes due 2008           149,153      299,197
 8 1/8% Senior Notes due 2003              --        149,285
11 7/8% Senior Debentures due 2004      124,579      124,613
 9 7/8% Senior Debentures due 2005      128,407      128,531
 9 1/2% Pay-In-Kind Notes due 2004      186,347      186,347
                                     ----------   ----------

Total Parent debt                    $1,580,274   $1,810,212
                                     ==========   ==========
</TABLE>


<TABLE>
<CAPTION>


3.  Investments:

       Adelphia's nonconsolidated investments are as follows:

                                                            March 31,   December 31,
                                                              1998          1998
                                                           ----------   ----------
Investments accounted for using the equity method:
Gross investment:
<S>                                                        <C>          <C>      
Hyperion investments in joint ventures                     $  69,596    $ 138,614
Page Call, Inc.\Benbow PCS Ventures, Inc.                     15,539       17,170
Mobile communications                                         15,387       18,249
Other                                                          1,757        2,308
                                                           ---------    ---------
Total                                                        102,279      176,341
                                                           ---------    ---------

Investments accounted for using the cost method:
Niagara Frontier Hockey, L.P.                                 40,497       44,897
SuperCable ALK International                                   3,190        3,190
Programming ventures                                           1,427        1,469
Mobile communications                                          2,582        2,925
Other                                                            812          672
                                                           ---------    ---------
Total                                                         48,508       53,153
                                                           ---------    ---------

Total investments before cumulative equity in net losses     150,787      229,494
Cumulative equity in net losses                              (22,960)     (32,601)
                                                           ---------    ---------
Total investments                                          $ 127,827    $ 196,893
                                                           =========    =========

</TABLE>




<PAGE>



4.  Related Party Investments and Receivables:

         Related party receivables - net represent advances to managed
partnerships, the Rigas Family and Rigas Family controlled entities. No related
party advances are collateralized.
<TABLE>
<CAPTION>

         Investment in and amounts due from Olympus is comprised of the
following:



                                                        March 31,   December 31,
                                                          1998         1998
                                                       ----------   ----------

<S>                                                    <C>          <C>       
Cumulative equity in loss over investment in Olympus   $ (94,833)   $(102,888)
Amounts due from Olympus                                  63,631      294,296
                                                       ---------    ---------
                                                       $ (31,202)   $ 191,408
                                                       =========    =========

</TABLE>



<TABLE>
<CAPTION>

         The investment in Olympus represents a 50% voting interest in such
partnership and is being accounted for using the equity method. Summarized
unaudited results of operations of Olympus are as follows:

                                                          Nine Months Ended
                                                             September 30,
                                                       -----------------------
                                                          1997         1998
                                                       ----------   ----------
<S>                                                    <C>          <C>      
Revenues                                               $ 126,818    $ 156,497
Net loss                                                 (15,020)     (15,265)
Net loss of general partners after priority return       (70,783)     (80,855)

</TABLE>


5. Net Loss Per Weighted Average Share of Common Stock:

         Basic net loss per weighted average share of common stock is computed
based on the weighted average number of common shares outstanding after giving
effect to dividend requirements on the Company's preferred stock. Diluted net
loss per common share is equal to basic net loss per common share because the
Company's Convertible Preferred Stock had an antidilutive effect for the periods
presented; however, the Convertible Preferred Stock could have a dilutive effect
on earnings per share in future periods.

6.  Supplemental Financial Information:

         Cash payments for interest were $142,429 and $162,113 for the nine
months ended December 31, 1997 and 1998, respectively. Accumulated depreciation
of property, plant and equipment amounted to $649,527 and $729,873 at March 31
and December 31, 1998, respectively. Accumulated amortization of intangible
assets amounted to $211,967 and $249,618 at March 31 and December 31, 1998,
respectively. Interest expense - net includes interest income of $11,193 and
$4,964 for the three months ended December 31, 1997 and 1998 and $15,295 and
$20,952 for the nine months ended December 31, 1997 and 1998, respectively.
Interest income includes interest income from affiliates on long-term loans and
for reimbursement of interest expense on revolving credit agreements related to
short-term borrowings by such affiliates.

<PAGE>

7.  Income Taxes:

         Income tax benefit for the three and nine months ended December 31,
1998 was $2,040 and $6,802,  respectively, which was substantially comprised of
deferred tax.

8.  Commitments and Contingencies:

         Reference is made to Management's Discussion and Analysis of Financial
Condition and Results of Operations for a discussion of material commitments and
contingencies.

9.  Reclassifications:

         Certain prior period amounts have been reclassified to conform with the
current period presentation.

<PAGE>


              ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                             (Dollars in thousands)


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

Results of Operations

         The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain information included in this
Form 10-Q, including Management's Discussion and Analysis of Financial Condition
and Results of Operations, is forward-looking, such as information relating to
the effect of future regulation, future capital commitments and the effects of
competition. Such forward-looking information involves important risks and
uncertainties that could significantly affect expected results in the future
from those expressed in any forward-looking statements made by, or on behalf of,
the Company. These risks and uncertainties include, but are not limited to,
uncertainties relating to economic conditions, acquisitions and divestitures,
government and regulatory policies, the pricing and availability of equipment,
materials, inventories and programming, product acceptance, technological
developments, year 2000 issues and changes in the competitive environment in
which the Company operates.

         Adelphia Communications Corporation and its subsidiaries ("Adelphia" or
the "Company") operates primarily in two lines of business within the
telecommunications industry: cable television and related investments
("Adelphia, excluding Hyperion") and competitive local exchange carrier ("CLEC")
telephony ("Hyperion"). The balance sheet data as of March 31, 1998 and December
31, 1998 and the other data for the three and nine months ended December 31,
1997 and 1998 of Hyperion presented below have been derived from the
consolidated financial statements of Hyperion not included herein.

         A majority owned subsidiary of the Company, Hyperion, together with its
subsidiaries owns CLEC networks and investments in CLEC joint ventures and
manages those networks and joint ventures. Hyperion is an unrestricted
subsidiary for purposes of the Company's indentures. For further information
regarding Hyperion, which also files reports pursuant to the Securities Exchange
Act of 1934, see Hyperion's Form 10-Q for the quarterly period ended December
31, 1998.

         Summarized unaudited financial information of Adelphia, Hyperion and
Adelphia, excluding Hyperion is as follows:
<TABLE>
<CAPTION>

Balance Sheet Data:
                                                         March 31,  December 31,
                                                            1998        1998
                                                        -----------  -----------
<S>                                                     <C>          <C>              
Adelphia Consolidated   
Total assets                                            $2,304,671   $3,294,457
Total debt                                               2,909,745    3,527,452
Cash                                                       276,895      398,644
Investments (a)                                            150,787      229,494
Redeemable preferred stock                                 355,266      376,865
Convertible preferred stock (liquidation preference)       100,000      100,000

Hyperion
Total assets                                            $  639,992   $  836,342
Total debt                                                 528,776      494,109
Cash                                                       230,750      242,570
Investments (a)                                             69,596      138,614
Redeemable preferred stock                                 207,204      228,674

Adelphia, excluding Hyperion
Total assets                                            $1,664,679   $2,458,115
Total debt                                               2,380,969    3,033,343
Cash                                                        46,145      156,074
Investments (a)                                             81,191       90,880
Redeemable preferred stock                                 148,062      148,191
Convertible preferred stock (liquidation preference)       100,000      100,000
</TABLE>

<PAGE>


<TABLE>
<CAPTION>


Other Data:                                Three Months Ended        Nine Months Ended
                                              December 31,               December 31,
                                        -----------------------   --------------------------
                                           1997         1998         1997         1998
                                        ----------   ----------   ---------    ----------

Adelphia Consolidated
<S>                                     <C>          <C>          <C>          <C>      
Revenues                                $ 138,271    $ 193,012    $ 389,905    $ 507,155
Priority income                            12,000       12,000       35,765       36,000
Operating expenses (b)                     68,065      107,725      192,009      275,212
Depreciation and amortization expense      37,251       56,181      104,570      140,823
Operating income                           32,955       29,106       93,326       91,120
Interest expense - net                    (63,172)     (65,531)    (187,341)    (191,593)
Preferred stock dividends                 (13,436)     (14,330)     (17,986)     (42,254)
Capital expenditures                       36,945       76,945      117,560      255,797
Cash paid for acquisitions                 51,070         --         88,217      403,851
Cash used for investments                  24,411       56,570       62,190       81,558

Hyperion
Revenues                                $   4,983    $  15,043    $   8,690    $  34,776
Operating expenses (b)                      6,497       23,182       14,362       54,050
Depreciation and amortization expense       3,344       10,708        7,027       26,671
Operating loss                             (4,858)     (18,847)     (12,699)     (45,945)
Interest expense - net                    (11,045)      (6,994)     (27,983)     (20,010)
Preferred stock dividends                  (5,988)      (7,424)      (5,988)     (21,536)
Capital expenditures                        8,603       35,057       34,834      146,752
Cash paid for acquisitions                   --           --          7,638         --
Cash used for investments                  21,934       54,258       48,574       69,018

Adelphia, excluding Hyperion
Revenues                                $ 133,288    $ 177,969    $ 381,215    $ 472,379
Priority income                            12,000       12,000       35,765       36,000
Operating expenses (b)                     61,568       84,543      177,647      221,162
Depreciation and amortization expense      33,907       45,473       97,543      114,152
Operating income                           37,813       47,953      106,025      137,065
Interest expense - net                    (52,127)     (58,537)    (159,358)    (171,583)
Preferred stock dividends                  (7,448)      (6,906)     (11,998)     (20,718)
Capital expenditures                       28,342       41,888       82,726      109,045
Cash paid for acquisitions                 51,070         --         80,579      403,851
Cash used for investments                   2,477        2,312       13,616       12,540

<FN>

a)       Represents total investments before cumulative equity in net losses.
b)       Amount excludes depreciation and amortization.
</FN>
</TABLE>


<PAGE>




         Adelphia earned substantially all of its revenues in the three and nine
months ended December 31, 1997 and 1998 from monthly subscriber fees for basic,
satellite, premium and ancillary services (such as installations and equipment
rentals), local and national advertising sales, pay-per-view programming, high
speed data services and CLEC telecommunications services.

         The changes in Adelphia's operating results for the three and nine
months ended December 31, 1998 compared to the same period of the prior year,
were primarily the result of acquisitions, rate increases and expansion of
existing operations.

         The high level of depreciation and amortization associated with the
significant number of acquisitions in recent years, the continued upgrade and
expansion of systems and interest costs associated with financing activities
will continue to have a negative impact on the reported results of operations.
Also, significant charges for depreciation, amortization and interest are
expected to be incurred in the future by Olympus, which will adversely impact
Adelphia's future results of operations. Adelphia expects to report net losses
for the next several years.

         The following tables set forth certain cable television system data at
the dates indicated for Company Owned, Olympus and Managed Systems. The "Olympus
Systems" are systems currently owned by Olympus. The "Managed Systems" are
affiliated systems managed by Adelphia.

<TABLE>
<CAPTION>


                                 December 31,       Percent         
                            ---------------------   Increase
                               1997        1998    (Decrease)
                            ---------   ---------   -------
Homes Passed by Cable
<S>                         <C>         <C>           <C>  
Company Owned Systems       1,663,505   2,131,978     28.2%
Olympus Systems               749,884     943,602     25.8%
Managed Systems               346,157     177,250    (48.8%)
                            ---------   ---------   -------
Total Systems               2,759,546   3,252,830     17.9%
                            =========   =========   =======

Basic Subscribers
Company Owned Systems       1,213,400   1,528,307     26.0%
Olympus Systems               497,972     641,575     28.8%
Managed Systems               257,614     134,443    (47.8%)
                            ---------   ---------   -------
Total Systems               1,968,986   2,304,325     17.0%
                            =========   =========   =======         
</TABLE>




         Managed Systems' data, as of December 31, 1998, reflect the sales of
systems consisting of approximately 47,100 and 75,900 homes passed and
approximately 34,100 and 62,100 basic subscribers to Adelphia and Olympus,
respectively.



<PAGE>



         The following table is derived from Adelphia's Condensed Consolidated
Statements of Operations that are included in this Form 10-Q and sets forth the
historical percentage relationship to revenues of the components of operating
income contained in such financial statements for the periods indicated.

<TABLE>
<CAPTION>

                                       Three Months Ended  Nine Months Ended
                                           December 31,       December 31,
                                       ------------------ ------------------
                                          1997     1998      1997     1998
                                        -------  -------   -------  -------
<S>                                      <C>      <C>       <C>      <C>   
Revenues                                 100.0%   100.0%    100.0%   100.0%

Operating expenses:
Direct operating and programming          31.6%    32.4%     31.3%    33.1%
Selling, general and administrative       17.6%    23.4%     18.0%    21.1%
Depreciation and amortization             26.9%    29.1%     26.8%    27.8%
                                         ------   ------    ------   ------

Operating income                          23.9%    15.1%     23.9%    18.0%
                                         ======   ======    ======   ======
</TABLE>



         Revenues. The primary revenue sources reflected as a percentage of
total revenues were as follows:

<TABLE>
<CAPTION>

                                               Three Months Ended
                                                   December 31,
                                               ------------------
                                                 1997     1998
                                               -------- --------
<S>                                               <C>      <C>
Regulated service and equipment                   74%      71%
Premium programming                                9%       8%
Advertising sales and other services              14%      13%
Competitive local exchange carrier services        3%       8%

</TABLE>


         Revenues increased approximately 39.6% and 30.1%, respectively, for the
three and nine month periods ended December 31, 1998 compared with the same
periods of the prior year. The increases are attributable to the following:

<TABLE>
<CAPTION>

                                             Three Months   Nine Months
                                                 Ended         Ended
                                               December 31, December 31,
                                                  1998          1998
                                               ----------    ----------
<S>                                             <C>          <C>
Acquisitions                                       59%          58%
Basic subscriber growth                             3%           4%
Rate increases                                     17%          21%
Premium programming                                (4%)         (5%)
Competitive local exchange carrier services        19%          14%
Advertising sales and other services                6%           8%

</TABLE>
<PAGE>


         Effective August 1, 1998, certain rate increases related to regulated
cable services were implemented in substantially all of the Company's systems.
Advertising revenues and revenues derived from other strategic service offerings
such as paging, high-speed data services, long distance and CLEC services also
had a positive impact on revenues for the quarter ended December 31, 1998. The
Company expects to implement rate increases related to certain regulated cable
services in substantially all of the Company's systems during the next fiscal
year.

         Direct Operating and Programming Expenses. Direct operating and
programming expenses, which are mainly basic and premium programming costs and
technical expenses, increased 43.3% and 37.8% for the three and nine month
periods ended December 31, 1998 compared with the same periods of the prior
year. Hyperion expenses increased due to expansion of operations at its network
control center, as well as an increase in the number and size of its networks,
which resulted in increased employee related costs and equipment maintenance
costs. The consolidation of the Buffalo, Syracuse, New Jersey, Louisville,
Lexington and Harrisburg networks also increased Hyperion's costs related to
operations. The increases in Adelphia excluding Hyperion were primarily due to
increased operating expenses from acquired systems, increased programming costs,
incremental costs associated with increased subscribers and new services.

         Selling, General and Administrative Expenses. These expenses, which are
mainly comprised of costs related to system offices, customer service
representatives and sales and administrative employees, increased 85.2% and
53.0% for the three and nine month periods ended December 31, 1998 compared with
the same periods of the prior year. Hyperion expenses increased due to increased
expenses associated with the network expansion plan, an increase in the sales
force in the Existing Networks and an increase in corporate overhead costs to
accommodate the growth in the number, size and operations of operating companies
managed and monitored by the Company, as well as the consolidation of the
networks mentioned in direct operating and programming expenses. The increases
in Adelphia excluding Hyperion were primarily due to incremental costs
associated with acquisitions, subscriber growth and new services.

         Depreciation and Amortization. Depreciation and amortization, excluding
Hyperion, increased 34.1% and 17.0% for the three and nine month periods ended
December 31, 1998, respectively, compared with the same periods of the prior
year primarily due to increased depreciation and amortization related to
acquisitions, as well as increased capital expenditures made during the past
several years. Depreciation and amortization for Hyperion increased 220.2% and
279.6% for the three and nine month periods ended December 31, 1998,
respectively. These increases were primarily a result of increased depreciation
resulting from the higher depreciable asset bases of the Hyperion network
operations control center, its wholly owned networks and the consolidation of
several of its networks and increased amortization of deferred financing costs.

         Priority Investment Income. Priority investment income is comprised of
payments received from Olympus of accrued priority return on the Company's
investment in 16.5% preferred limited partner ("PLP") interests in Olympus.

         Interest Expense - Net. Interest expense - net, excluding Hyperion,
increased 12.3% and 7.7% for the three and nine month periods ended December 31,
1998 compared with the same periods of the prior year. Interest expense net,
including Hyperion, increased 3.7% and 2.3% for the three and nine month periods
ended December 31, 1998, as compared with the same periods of the prior year.
Interest expense increased primarily due to incremental debt related to
acquisitions and other new debt issuances. These increases were partially offset
by Hyperion's interest income on cash balances. Interest expense includes
noncash accretion of original issue discount on the Hyperion 13% Senior Discount
Notes and other noncash interest expense totaling $7,860 and $23,663 for the
three and nine month periods ended December 31, 1998 compared with $7,352 and
$29,981 the same periods of the prior year.

<PAGE>

         Equity in Loss of Joint Ventures. The equity in loss of joint ventures
represents primarily (i) the Company's pro-rata share of Olympus' losses and the
accretion requirements of Olympus' PLP interests, and (ii) Hyperion's pro-rata
share of its less than majority owned partnerships' operating losses.

         Minority Interest in Net Losses of Subsidiaries. As a result of
Hyperion's IPO which occurred on May 8, 1998, a portion of Hyperion's net loss
applicable to common stockholders is attributable to minority interests.

         Extraordinary Loss on Early Retirement of Debt. During the nine months
ended December 31, 1998, $69,838 of 12 1/2% Senior Notes due 2002 were redeemed
at 103% of principal and subsidiary debt in the amount of $52,000 was repaid
prior to its maturity, at a premium. Additionally, Hyperion retired $25,160 face
value of its 13% Senior Discount Notes, resulting in a gain. As a result of
these transactions, Adelphia recognized a net extraordinary loss on early
retirement of debt of $4,337.

         Income Tax Benefit. Income tax benefit for the three and nine months
ended December 31, 1998 is primarily due to the impact of a change in tax law
which extends the number of years the Company can utilize its net operating loss
carryforward generated in the current fiscal year.



<PAGE>




Liquidity and Capital Resources

         The cable television and other telecommunication businesses are capital
intensive and typically require continual financing for the construction,
modernization, maintenance, expansion and acquisition of cable and other
telecommunication systems. The Company historically has committed significant
capital resources for these purposes and for investments in Olympus and other
affiliates and entities. These expenditures were funded through long-term
borrowings and, to a lesser extent, internally generated funds. The Company's
ability to generate cash to meet its future needs will depend generally on its
results of operations and the continued availability of external financing.

         The Company has made a substantial commitment to the technological
development of its systems and is aggressively investing in the upgrade of the
technical capabilities of its cable plant in a cost efficient manner. Over 50%
of Adelphia's networks have bandwidth capacity of 550 Mhz or greater. The
Company continues to deploy fiber optic cable and to upgrade the technical
capabilities of its broadband networks in order to increase network capacity,
digital capability, two-way communication and network reliability.

         The design of the current system upgrade, when completed, will deploy
on average one fiber optic node for every two system plant miles or
approximately one fiber node for every 180 homes passed compared to the industry
norm of 500 to 1,000 homes passed per fiber optic node. Approximately 75% of the
system will be upgraded to 750 Mhz. Approximately 25% of the plant will remain
at 550 Mhz. The upgraded system will be completely addressable and provide
two-way communication capability. The additional bandwidth will enable the
Company to offer additional video programming services. A portion of the
bandwidth will be allocated to new service offerings such as two-way data,
telephony and video-on-demand. By the end of fiscal 1999, approximately 50% of
customers will be served by two-way cable plant.

         Capital expenditures for Adelphia, excluding Hyperion for the nine
months ended December 31, 1997 and 1998 were $82,726 and $109,045, respectively.
Capital expenditures, including Hyperion, for the nine months ended December 31,
1997 and 1998 were $117,560 and $255,797, respectively. Capital expenditures for
Hyperion for the nine months ended December 31, 1998 compared with the nine
months ended December 31, 1997, increased primarily due to the upgrade of plant
in markets in which Hyperion purchased its local partners' interests, payments
for indefeasible right of use agreements for fiber optic networks and the
commencement of switching services. The Company expects that capital
expenditures excluding Hyperion for fiscal 1999 will be in the range of
approximately $150,000 to $170,000. Hyperion estimates that it will require
approximately $60,000 to fund anticipated capital expenditures, working capital
requirements, operating losses and investments in its existing and its planned
new networks through the remaining three months of fiscal 1999.

         The Company generally has funded its working capital requirements,
capital expenditures and investments in Olympus and other affiliates and
entities through long-term borrowings, primarily from banks and insurance
companies, short-term borrowings, internally generated funds and the issuance of
parent company public debt and equity and Hyperion public debt and equity. The
Company generally has funded the principal and interest obligations on its
long-term borrowings from banks and insurance companies by refinancing the
principal with new loans or through the issuance of parent company debt or
equity securities, and by paying the interest out of internally generated funds.
Adelphia has funded the interest obligations on its public borrowings from
internally generated funds.

         The Company's financing strategy has generally been to maintain its
public long-term debt at the parent holding company level while the Company's
consolidated subsidiaries have their own senior and subordinated credit

<PAGE>

arrangements with banks and insurance companies or, for Hyperion, its own public
debt and equity. The Company's public indentures and subsidiary credit
agreements contain covenants that, among other things, require the maintenance
of certain financial ratios (including compliance with certain debt to cash flow
ratios in order to incur additional indebtedness); place limitations on
borrowings, investments, affiliate transactions, dividends and distributions;
and contain certain cross default provisions relating to Adelphia or its
subsidiaries.

         At December 31, 1998, the Company's total outstanding debt aggregated
$3,527,452, which included $1,810,212 of parent debt, $494,109 of Hyperion debt
and $1,223,131 of other subsidiary debt.  At December 31, 1998, Adelphia's 
subsidiaries had an aggregate of $758,644 in unused credit lines and cash and 
cash equivalents.


         The Company's weighted average interest rate on notes payable to banks
and institutions was approximately 7.88% at December 31, 1997 compared to 7.89%
at December 31, 1998. At December 31, 1998, approximately 35.90% of such debt
was subject to fixed interest rates for at least one year under the terms of
such debt or applicable interest rate swap agreements.

         The following table sets forth the mandatory reductions in principal
under all debt agreements for each of the next four years and three months based
on amounts outstanding at December 31, 1998:
<TABLE>
<CAPTION>


<S>                                   <C>
Three months ending March 31, 1999      $ 38,387
Year ending March 31, 2000               100,069
Year ending March 31, 2001               240,742
Year ending March 31, 2002               198,930
Year ending March 31, 2003               548,041
</TABLE>

         Reference is made to Note 1 of the condensed consolidated financial
statements included elsewhere in this Form 10-Q for discussion of significant
events and financings subsequent to March 31, 1998, which is incorporated by
reference herein.

         The Company plans to continue to explore and consider new commitments,
arrangements or transactions to refinance existing debt, increase the Company's
liquidity or decrease the Company's leverage. These could include, among other
things, the future issuance by Adelphia, or its subsidiaries, of public or
private equity or debt and the negotiation of new or amended credit facilities.
These could also include entering into acquisitions, joint ventures or other
investment or financing activities, although no assurance can be given that any
such transactions will be consummated. The Company's ability to borrow under
current credit facilities and to enter into refinancings and new financings is
limited by covenants contained in Adelphia's indentures and its subsidiaries'
credit agreements, including covenants under which the ability to incur
indebtedness is, in part, a function of applicable ratios of total debt to cash
flow.

         The Company believes that cash and cash equivalents, internally
generated funds, borrowings under the existing credit facilities, and future
financing sources will be sufficient to meet its short-term and long-term
liquidity and capital requirements. Although in the past the Company has been
able to refinance its indebtedness or obtain new financing, there can be no
assurance that the Company will be able to do so in the future or that the terms
of such financings would be favorable.
<PAGE>

         Management believes that the telecommunications industry, including the
cable television and telephone industries, continues to be in a period of
consolidation characterized by mergers, joint ventures, acquisitions, sales of
all or part of cable or telephone companies or their assets, and other
partnering and investment transactions of various structures and sizes involving
cable or other telecommunications companies. The Company continues to evaluate
new opportunities that allow for the expansion of its business through the
acquisition of additional cable television systems in geographic proximity to
its existing regional markets or in locations that can serve as a basis for new
market areas. The Company, like other cable television companies, has
participated from time to time and is participating in preliminary discussions
with third parties regarding a variety of potential transactions, and the
Company has considered and expects to continue to consider and explore potential
transactions of various types with other cable and telecommunications companies.
However, no assurances can be given as to whether any such transaction may be
consummated or, if so, when, or that additional competition from this industry
consolidation will not have an adverse effect on the Company..

Regulatory and Competitive Matters

         The cable television operations of the Company may be adversely
affected by changes and developments in governmental regulation, competitive
forces and technology. The cable television industry and the Company are subject
to extensive regulation at the federal, state and local levels. The 1992 Cable
Act significantly expanded the scope of regulation of certain subscriber rates
and a number of other matters in the cable industry, such as mandatory carriage
of local broadcast stations and retransmission consent, and increased the
administrative costs of complying with such regulations. The FCC has adopted
rate regulations that establish, on a system-by-system basis, maximum allowable
rates for (i) basic and cable programming services (other than programming
offered on a per-channel or per-program basis), based upon a benchmark
methodology, and (ii) associated equipment and installation services based upon
cost plus a reasonable profit. Under the FCC rules, franchising authorities are
authorized to regulate rates for basic services and associated equipment and
installation services, and the FCC will regulate rates for regulated cable
programming services in response to complaints filed with the agency. The
Telecommunications Act of 1996 (the "1996 Act") ends FCC regulation of cable
programming service tier rates on March 31, 1999.

         Rates for basic and cable programming services are set pursuant to a
benchmark formula. Alternatively, a cable operator may elect to use a
cost-of-service methodology to show that rates for basic and cable programming
services are reasonable. Refunds with interest will be required to be paid by
cable operators who are required to reduce regulated rates. The FCC has reserved
the right to reduce or increase the benchmarks it has established. The rate
regulations also limit increases in regulated rates to an inflation indexed
amount plus increases in certain costs such as taxes, franchise fees, costs
associated with specific franchise requirements and increased programming costs.
Cost-based adjustments to these capped rates can also be made in the event a
cable operator adds or deletes channels or completes a significant system
rebuild or upgrade. Because of the limitation on rate increases for regulated
services, future revenue growth from cable services will rely to a much greater
extent than has been true in the past on increased revenues from unregulated
services and new subscribers than from increases in previously unregulated
rates.

         The FCC has adopted regulations implementing all of the requirements of
the 1992 Cable Act. The FCC is also likely to continue to modify, clarify or
refine the rate regulations. Adelphia cannot predict the effect of the 1996 Act
or future legislative or rulemaking proceedings or changes to the rate
regulations. No assurance can be given as to what other future actions Congress,
the FCC or other regulatory authorities may take or the effects thereof on
Adelphia.

<PAGE>

         Cable television companies operate under franchises granted by local
authorities which are subject to renewal and renegotiation from time to time.
Because such franchises are generally non-exclusive, there is a potential for
competition with the systems from other operators of cable television systems,
including public systems operated by municipal franchising authorities
themselves, and from other distribution systems capable of delivering television
programming to homes. The 1992 Cable Act and the 1996 Act contain provisions
which encourage competition from such other sources. The Company cannot predict
the extent to which competition will materialize from other cable television
operators, local telephone companies, other distribution systems for delivering
television programming to the home, or other potential competitors, or, if such
competition materializes, the extent of its effect on the Company.

         The 1996 Act repealed the prohibition on CLECs from providing video
programming directly to customers within their local exchange areas other than
in rural areas or by specific waiver of FCC rules. The 1996 Act also authorized
CLECs to operate "open video systems" ("OVS") without obtaining a local cable
franchise, although CLECs operating such a system can be required to make
payments to local governmental bodies in lieu of cable franchise fees. Where
demand exceeds capacity, up to two-thirds of the channels on an OVS must be
available to programmers unaffiliated with the CLEC. The statute states that the
OVS scheme supplants the FCC's "video dialtone" rules. The FCC has promulgated
rules to implement the OVS concept, and New Jersey Bell Telephone Company has
been granted permission to convert its video dialtone authorization in Dover
Township, New Jersey to an OVS authorization. New Jersey Bell Telephone Company
shut down its OVS operation in Dover Township, New Jersey at the end of 1998.
Recently, RCN has been granted permission to convert its video dialtone
authorization in the Philadelphia Region to an OVS authorization.

         The Company believes that the provision of video programming or other
services by telephone companies in competition with the Company's existing
operations could have an adverse effect on the Company's financial condition and
results of operations. At this time, the impact of any such effect is not known
or estimable.

         The Company also competes with DBS service providers. DBS has been
available to consumers since 1994. A single DBS satellite can provide more than
100 channels of programming. DBS service can be received virtually anywhere in
the United States through the installation of a small outdoor antenna. DBS
service is being heavily marketed on a nationwide basis by several service
providers. Although the impact to date has not been material, any future impact
of DBS competition on the Company's future results is not known or estimable.

Year 2000 Issue

         The year 2000 issue refers to the inability of computerized systems and
technologies to recognize and process dates beyond December 31, 1999. This could
present risk to the operation of our business in several ways. The Company is
evaluating the impact of the year 2000 issue on its business applications and
its products and services. The evaluation includes a review of the Company's
information technology systems, cable network equipment and other embedded
technologies. A significant portion of the Company's computerized systems and
technologies have been developed, installed or upgraded in recent years and are
generally more likely to be year 2000 ready. The Company is also evaluating the
potential impact as a result of its reliance on third-party systems that may
have year 2000 issues.



<PAGE>



         Computerized business applications that could be adversely affected by 
the year 2000 issue include:

-        information processing and financial reporting systems,
-        customer billing systems,
-        customer service systems,
-        telecommunication transmission and reception systems, and
-        facility systems.

         System failure or miscalculation could result in an inability to
process transactions, send invoices, accept customer orders or provide customers
with products and services. Customers could also experience a temporary
inability to receive or use the Company's products and services.

         The Company has developed a program to assess and address the year 
2000 issue.  This program consists of the following phases:

-        inventorying and assessing the impact on affected technology and 
          systems,
-        developing solutions for affected technology and systems,
-        modifying or replacing affected technology and systems,
-        testing and verifying solutions,
-        implementing solutions, and
-        developing contingency plans.

         The Company has substantially completed inventorying and assessing the
affected computerized systems and technologies. The Company is in various stages
of its year 2000 compliance program with respect to the remaining phases as it
relates to the affected systems and technologies.

         The Company has engaged a consulting firm familiar with its financial
reporting systems. This firm has developed and tested year 2000 solutions that
the Company is in the process of implementing. The Company expects its financial
reporting systems to be year 2000 compliant by June 1999.

         A third-party billing vendor currently facilitates customer billing.
The Company is currently in the process of testing an in-house service ordering,
provisioning, maintenance and billing system that would replace the third-party
billing vendor. The Company expects to have this new system implemented by June
1999. On a contingency basis, the third-party vendor has provided a written
statement that it will certify it is fully year 2000 compliant by June 1999.

         Telecommunication plant rebuilds and upgrades in recent years have
minimized the potential impact of the year 2000 issue on the Company's
facilities, customer service, telecommunication transmission and reception
systems. The Company is engaged in a comprehensive internal inventory and
assessment of all hardware components and component controlling software
throughout its telecommunication networks. The Company expects to implement any
hardware and software modifications, upgrades or replacements resulting from the
internal review by June 1999.

         Costs incurred to date directly related to addressing the year 2000
issue are approximately $700. The Company has also redeployed internal resources
to meet the goals of its year 2000 program. The Company currently estimates the
total cost of its year 2000 remediation program to be approximately $3,500.
Although the Company will continue to incur substantial capital expenditures in
the ordinary course of meeting its telecommunications system upgrade goals
through the year 2000, it will not specifically accelerate its expenditures to
facilitate year 2000 readiness, and accordingly such expenditures are not
included in the above estimate.

<PAGE>

         The Company has been communicating with others with whom it does
significant business to determine their year 2000 readiness and to determine the
extent to which the Company is vulnerable to the year 2000 issue related to
those third parties. The Company purchases much of its technology from third
parties. There can be no assurance that the systems of other companies on which
the Company's systems rely will be year 2000 ready or timely converted into
systems compatible with the Company's systems. The Company's failure or a
third-party's failure to become year 2000 ready or the Company's inability to
become compatible with third parties with which the Company has a material
relationship, may have a material adverse effect on the Company, including
significant service interruption or outages; however, the Company cannot
currently estimate the extent of any such adverse effects.

         The Company is in the process of identifying secondary sources to
supply its systems or services in the event it becomes probable that any of its
systems will not be year 2000 ready prior to the end of 1999. The Company is
also in the process of identifying secondary vendors and service providers to
replace those vendors and service providers whose failure to be year 2000 ready
could lead to a significant delay in the Company's ability to provide its
service to its customers.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

         Not applicable.



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<PAGE>


              ADELPHIA COMMUNICATIONS CORPORATION AND SUBSIDIARIES


                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

          None

Item 2.  Changes in Securities and Use of Proceeds

           None

Item 3.  Defaults Upon Senior Securities

          None

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

           Incorporated by reference herein from the Registrant's Form 10-Q for
             the period ended September 30, 1998

Item 5.  Other Information

          None

Item 6. Exhibits and Reports on Form 8-K

(a)      Exhibits:


Exhibit No.  Description


4.01         First Supplemental Indenture, dated as of November 12, 1998, to
             January 1998 Indenture with respect to the Registrant's 8 3/8%
             Senior Notes due 2008, between the Registrant and the Bank of
             Montreal Trust Company (Incorporated by reference herein is
             Exhibit 4.01 from the Registrant's Current Report on Form 8-K,
             filed January 28, 1999.) (File No. 0-16014)

4.02         Registration Rights Agreement between Adelphia Communications
             Corporation and the Initial Purchaser, dated November 12, 1998,
             regarding the Registrant" 8 3/8% Senior Notes due 2008
             (Incorporated by reference herein is Exhibit 4.02 from the
             Registrant's Current Report on Form 8-K, filed January 28, 1999.)
             (File No. 0-16014)

4.03         Indenture, dated as of January 13, 1999, with respect to the
             Registrant's 7 1/2% Senior Notes due 2004 and 7 3/4% Senior Notes
             due 2009, between the Registrant and the Bank of Montreal Trust
             Company (Incorporated by reference herein is Exhibit 4.03 from the
             Registrant's Current Report on Form 8-K, filed January 28, 1999.)
             (File No. 0-16014)

4.04         Registration Rights Agreement between Adelphia Communications
             Corporation and the Initial Purchaser, dated January 13, 1999,
             regarding the Registrant's 7 1/2% Senior Notes due 2004 and 7 3/4%
             Senior Notes due 2009 (Incorporated by reference herein is Exhibit
             4.04 from the Registrant's Current Report on Form 8-K, filed
             January 28, 1999.) (File No. 0-16014)

4.05         Form on 7 1/2% Senior Note due 2004 (Incorporated by reference
             herein is Exhibit 4.05 from the Registrant's Current Report on Form
             8-K, filed January 28, 1999.) (File No. 0-16014)

<PAGE>

4.06         Form of 7 3/4% Senior Notes due 2009 (Incorporated by reference 
             herein is Exhibit 4.06 from the Registrant's Current Report on Form
             8-K, filed January 28, 1999.) (File No. 0-16014)

10.01        Purchase Agreement among Adelphia Communications Corporation and
             Barclays Capital, Inc. (the "Initial Purchaser") dated November 6,
             1998. (Incorporated by reference herein is Exhibit 10.01 from the
             Registrant's Current Report on Form 8-K, filed January 28, 1999)

10.02        Purchase Agreement among Adelphia Communications Corporation and
             Salomon Smith Barney, Inc., Credit Suisse First Boston Corporation,
             Goldman Sachs & Co., Lehman Brothers, Inc. and NationsBank
             Montgomery Securities LLC (the "Initial Purchasers") dated January
             6, 1999. (Incorporated by reference herein is Exhibit 10.02 from
             the Registrant's Current Report on Form 8-K, filed January 28,
             1999)

10.03        Credit Agreement, dated as of December 30, 1998, among Parnassos,
             L.P. as the Borrower, various financial institutions as the
             Lenders, the Bank of Nova Scotia as the Administrative Agent,
             Nationsbank, N.A. as the Documentation Agent, and TD Securities
             (USA) Inc. as the Syndication Agent. (Incorporated by reference
             herein is Exhibit 10.03 from the Registrant's Current Report on
             Form 8-K, filed January 28, 1999)

10.04        Registration Rights Agreement among Adelphia Communications
             Corporation, Doris Holdings, L.P. and Highland Holdings II dated
             January 14, 1999. (Incorporated by reference herein is Exhibit
             10.04 from the Registrant's Current Report on Form 8-K, filed
             January 28, 1999)

10.05        Underwriting Agreement dated January 11, 1999 between the
             Registrant and Goldman, Sachs & Co. (Incorporated by reference
             herein is Exhibit 10.05 from the Registrant's Current Report on
             Form 8-K, filed January 13, 1999)

10.06        Purchase Agreement between the Registrant and Highland Holdings II
             dated January 11, 1999. (Incorporated by reference herein is
             Exhibit 10.06 from the Registrant's Current Report on Form 8-K,
             filed January 13, 1999)

27.01        Financial Data Schedule (supplied for the information of the 
             Commission).

(b)  Reports on Form 8-K:

         Form 8-Ks were filed for events dated November 9, 1998, November 12,
1998, December 23, 1998 and January 11, 1999, which reported information under
items 5 and 7 thereof. No financial statements were filed with such Form 8-Ks.


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





<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.

                       ADELPHIA COMMUNICATIONS CORPORATION
                                  (Registrant)



Date:  February 16, 1999                         By:   /s/ Timothy J. Rigas
                                                     ----------------------
                                                       Timothy J. Rigas
                                                       Executive Vice President
                                                       (authorized officer), 
                                                       Chief Financial Officer,
                                                       Chief Accounting Officer 
                                                       and Treasurer