<PAGE>
================================================================================

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

                                   FORM 10-QSB

(Mark One)

[x]         QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934
            For the quarterly period ended      June 30, 2002
                                           -----------------------


[ ]         TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
            For the transition period from              to
                                           ------------    ------------


               Commission file number           0-27675
                                      ---------------------------


                           NetMeasure Technology Inc.
       -----------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)


                  Nevada                                     86-0914695
     --------------------------------                    -------------------
      (State or other jurisdiction                         (IRS Employer
     of incorporation or organization)                   Identification No.)


              122 Howe Street, Victoria, British Columbia, V8V 4K4
              ----------------------------------------------------
                    (Address of principal executive offices)


                                  250-920-4833
                          ---------------------------
                          (Issuer's telephone number)


 ----------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Not Applicable

                      APPLICABLE ONLY TO CORPORATE ISSUERS

The number of shares outstanding of the issuer's common stock, as of June
30,2002 was 423,596, which includes 9,366 shares that will be returned to
treasury and cancelled.

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

<PAGE>
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [x]


                         PART I -- FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

CONTENTS

Consolidated Balance Sheet -- Unaudited

Consolidated Statement of Operations -- Unaudited

Consolidated Statement of Cash Flows -- Unaudited

Notes to the Unaudited Consolidated Financial Statements


<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED BALANCE SHEET
(expressed in U.S. dollars)

<TABLE>
<CAPTION>
                                                               JUNE 30      December 31
                                                                  2002             2001
---------------------------------------------------------------------------------------
                                                           (unaudited)
<S>                                                        <C>              <C>
ASSETS

Current
   Cash                                                    $     2,977      $     1,627
   Receivables                                                   3,340           13,119
                                                           -----------      -----------
                                                           $     6,317      $    14,746
                                                           ===========      ===========

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

LIABILITIES

Current
   Accounts payable and accruals                           $   377,202      $   350,176
   Promissory notes                                            110,636          110,636
   Convertible promissory notes (Note 3)                       102,369           73,716
                                                           -----------      -----------
                                                               590,207          534,528
                                                           -----------      -----------

SHAREHOLDERS' DEFICIENCY

Capital stock (Note 4)
   Authorized:
     100,000,000 common shares at $0.001 par value
   Issued:
     414,230 shares (2001: 407,696)                                414              408
Additional paid-in capital                                   1,762,006        1,760,378
Share subscriptions                                            601,250          601,250
Deficit accumulated during the development stage            (2,947,560)      (2,881,818)
                                                           -----------      -----------
                                                              (583,890)        (519,782)
                                                           -----------      -----------
                                                           $     6,317      $    14,746
                                                           ===========      ===========

---------------------------------------------------------------------------------------
</TABLE>

Continuance of Operations (Note 1)


   See accompanying notes to the unaudited consolidated financial statements.


<PAGE>


NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENT OF OPERATIONS -- UNAUDITED
(expressed in U.S. dollars)

<TABLE>
<CAPTION>
                                           For the        For the        For the        For the       For the
                                       Period from     Six Months     Six Months   Three Months  Three Months
                                      Inception to          Ended          Ended          Ended         Ended
                                           June 30        June 30        June 30        June 30       June 30
                                              2002           2002           2001           2002          2001
-------------------------------------------------------------------------------------------------------------
<S>                                    <C>               <C>           <C>            <C>           <C>
Revenue                                $     6,125       $     --      $   5,213      $     --      $      59
                                       -----------       --------      ---------      --------      ---------
Expenses
   Marketing
     Advertising                             5,862             --            246            --            246
     Computer and office                     3,479             --             --            --             --
     Consulting fees                        59,502             --          3,472            --             --
     Salaries and benefits                 272,765             --         45,528            --         11,486
     Travel                                 56,088             --          1,298            --            930
                                        ----------       --------      ---------      --------      ---------
                                           397,696             --         50,544            --         12,662
                                        ----------       --------      ---------      --------      ---------
   Product development
     Consulting fees                        74,667             --         30,038            --          8,772
     Salaries and benefits                 602,914             --         65,547            --         31,818
     Travel                                 25,888             --            866            --             --
                                        ----------       --------      ---------      --------      ---------
                                           703,469             --         96,451            --         40,590
                                        ----------       --------      ---------      --------      ---------
   General and administrative
     Advertising and promotion               2,196             --             --            --             --
     Bad debts                              25,681             --             --            --             --
     Bank charges and interest              37,433          6,545          8,024         3,279            612
     Communication                          45,717             --          4,827            --             --
     Computer and office supplies          109,816          1,823          8,507           264          5,814
     Consulting fees                       259,762             --             --            --             --
     Depreciation and amortization         252,483             --         44,808            --         15,396
     Employee relocation                     9,080             --             --            --             --
     Forgiveness of debt                   (66,500)       (66,500)                     (66,500)
     Loss on disposition of capital
       assets                               40,318             --             --            --             --
     Professional fees                     319,042         34,849         46,265        20,867          8,857
     Rent                                  107,165             --         20,841            --         10,736
     Salaries and benefits                 255,770         22,525         37,919         4,786         16,193
     Stock award compensation              237,501             --       (210,157)           --       (317,614)
     Technical advisory board                9,932             --          2,875            --             --
     Travel                                 21,873             --            586            --             --
     Write-down of capital assets
       and goodwill                        140,858             --             --            --             --
     Write-off of deferred
       acquisition costs (Note 5)           66,500         66,500             --        66,500             --
                                        ----------       --------      ---------      --------      ---------
                                         1,874,627         65,742        (35,505)       29,196       (260,006)
                                        ----------       --------      ---------      --------      ---------
   Interest income                         (22,107)            --             --            --             --
                                        ----------       --------      ---------      --------      ---------
   Total expenses                        2,953,685         65,742        111,490        29,196       (206,754)
                                        ----------       --------      ---------      --------      ---------
Net (loss) earnings                    $(2,947,560)      $(65,742)     $(106,277)     $(29,196)     $ 206,813
                                       ===========       ========      =========      ========      =========
Weighted average number of
   shares outstanding                                     414,230        333,663       414,230        359,344
                                                         ========      =========      ========      =========
(Loss) earnings per share -- basic
   and diluted                                          $   (0.16)     $   (0.32)     $  (0.07)     $   (0.58)
                                                         ========      =========      ========      =========

-------------------------------------------------------------------------------------------------------------
</TABLE>


   See accompanying notes to the unaudited consolidated financial statements.


<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENT OF CASH FLOWS -- UNAUDITED
(expressed in U.S. dollars)

<TABLE>
<CAPTION>
                                                                      For the        For the       For the
                                                                  Period from     Six Months    Six Months
                                                                 Inception to          Ended         Ended
                                                                      June 30        June 30       June 30
                                                                         2002           2002          2001
----------------------------------------------------------------------------------------------------------
<S>                                                               <C>               <C>          <C>
Cash derived from (applied to)

   OPERATING
     Net loss                                                     $(2,947,560)      $(65,742)    $(106,277)
     Write-off of amount due from company controlled
       by a shareholder                                                17,208             --            --
     Loss on disposition of capital assets                             40,318             --            --
     Write-down of capital assets and goodwill                        140,858             --            --
     Depreciation and amortization                                    252,483             --        44,808
     Interest on promissory notes                                       1,250             --            --
     Stock award compensation expense                                 239,135          1,634      (210,157)
     Shares issued for services rendered                              111,938             --            --
     Forgiveness of debt                                              (66,500)       (66,500)
     Write-off of deferred acquisition costs                           66,500         66,500            --
     Change in non-cash operating working capital                                         --            --
       Receivables                                                     14,969          9,779       (13,123)
       Prepaids                                                            --             --         2,866
       Accounts payable and accruals                                  339,311         27,026       220,737
                                                                  -----------       --------     ---------
                                                                   (1,790,090)       (27,303)      (61,146)
                                                                  -----------       --------     ---------
   FINANCING
     Bank indebtedness                                                     --             --       (19,610)
     Promissory notes                                                 279,505         95,153        21,008
     Shares issued for cash                                         1,258,691             --       125,000
     Share subscriptions received                                     600,000             --            --
     Cash assumed on acquisition of subsidiary                         34,113             --            --
     Payment of promissory notes payable by subsidiary
       Company                                                       (127,373)            --            --
                                                                  -----------       --------     ---------
                                                                    2,044,936         95,153       126,398
                                                                  -----------       --------     ---------
   INVESTING
     Deferred acquisition costs                                       (66,500)       (66,500)           --
     Acquisition of capital assets                                   (192,947)            --            --
     Proceeds on disposition of capital assets                         24,786             --         2,538
     Advances to company controlled by a shareholder                  (17,208)            --            --
                                                                  -----------       --------     ---------
                                                                     (251,869)       (66,500)        2,538
                                                                  -----------       --------     ---------
Net increase in cash                                                    2,977          1,350        67,790

Cash
   Beginning of period                                                     --          1,627            --
                                                                  -----------       --------     ---------
   End of period                                                  $     2,977       $  2,977     $  67,790
                                                                  ===========       ========     =========

----------------------------------------------------------------------------------------------------------
NON-CASH ITEMS NOT INCLUDED IN CASH FLOWS
   Stock award compensation expense                              $    239,135       $  1,634     $(210,157)
   Shares issued under stock awards plan                         $    237,501       $     --     $      --
   Shares issued for services                                    $    111,938       $     --     $      --
   Shares issued to acquire subsidiary                           $    152,656       $     --     $      --
----------------------------------------------------------------------------------------------------------
</TABLE>

   See accompanying notes to the unaudited consolidated financial statements.

<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(expressed in U.S. dollars)
June 30, 2002

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

1.   OPERATIONS AND GOING CONCERN

The company was incorporated as Powertech, Inc. under the laws of the State of
Nevada on May 4, 1998 to engage in the business of Internet software and
hardware development. On January 4, 2000, the company changed its name to
NetMeasure Technology Inc.

On February 12, 1999, the company acquired all the issued and outstanding common
shares of NetMeasure Technology (Canada) Inc. (formerly NETSentry Technology
Inc.), a Vancouver, Canada based company in business to develop and market
technologies that assist network administrators in improving the efficiency,
reliability and recoverability of Internet Protocol networks.

The company is a development stage company that has earned minimal revenues and
that requires additional financing to develop and market its technologies. It is
uncertain that the company will be able to continue as a going concern. As a
result of not having the funds to continue to develop its technologies, the
company has written off all goodwill.

At June 30, 2002, the company had minimal cash, no operations and only one
employee, the company's CEO. Previously, the company's efforts were devoted
primarily to product development of its first product, ProbeNET, which is a
distributed network measurement software product. During the three months ended
June 30, 2002, the company secured a minimal amount of funding, which has
provided it with additional time in which to find a merger partner. There can be
no assurance that any negotiations will be successfully concluded. During the
quarter ending June 30, 2002, the company restructured its outstanding common
stock to improve its attractiveness to potential acquisition and merger
candidates.

These financial statements have been prepared on the basis that the company is a
going concern. These financial statements do not include adjustments that would
be necessary should the company be unable to continue as a going concern.

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

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

These unaudited consolidated financial statements are presented in accordance
with accounting principles generally accepted in the United States and have been
prepared on the same basis as the annual audited consolidated financial
statements. In the opinion of management, these unaudited consolidated financial
statements reflect all adjustments (consisting of normal recurring adjustments)
necessary for a fair presentation for each of the periods presented. The results
of operations for interim periods are not necessarily indicative of results to
be achieved for full fiscal years.

As contemplated by the Securities and Exchange Commission (SEC) under Rule 10-01
of Regulation S-X, the accompanying consolidated financial statements and
related footnotes have been condensed and do not contain certain information
that will be included in the company's annual consolidated financial statements
and footnotes. For further information, refer to the consolidated financial
statements and related footnotes for the years ended December 31, 2001 and 2000
included in the company's Annual Report on Form 10-KSB.


<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(expressed in U.S. dollars)
June 30, 2002

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

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

DEFERRED ACQUISITION COSTS

Deposits paid in connection with potential acquisitions currently being
negotiated have been deferred. These costs will be treated as a cost of
acquisition and will be allocated to the net tangible assets acquired when the
acquisition(s) are recorded. Should the acquisition(s) not be successfully
concluded, these deposits will be written off.

CONSOLIDATION

These financial statements include the accounts of the company and its
wholly-owned subsidiary, NetMeasure Technology (Canada) Inc.

RECENT ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board ("FASB") has issued the following
pronouncements, none of which are expected to have a significant effect on the
financial statements.

SFAS No. 141, "Business Combinations". SFAS No. 141 requires that all business
combinations be accounted for under the purchase method of accounting. SFAS No.
141 also changes the criteria for the separate recognition of intangible assets
acquired in a business combination. SFAS No. 141 is effective for all business
combinations initiated after June 30, 2001.

SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 142 addresses
accounting and reporting for intangible assets acquired, except for those
acquired in a business combination. SFAS No. 142 presumes that goodwill and
certain intangible assets have indefinite useful lives. Accordingly, goodwill
and certain intangibles will not be amortized but rather will be tested at least
annually for impairment. SFAS No. 142 also addresses accounting and reporting
for goodwill and other intangible assets subsequent to their acquisition. SFAS
No. 142 is effective for fiscal years beginning after December 15, 2001.

SFAS No. 143, "Accounting for Asset Retirement Obligations." SFAS No. 143
addresses financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement
costs. SFAS No. 143 is effective for financial statements issued for fiscal
years beginning after June 15, 2002.

FASB issued SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets." This statement addresses financial accounting and reporting
for the impairment or disposal of long-lived assets. SFAS No. 144 is effective
for financial statements issued for fiscal years beginning after December 15,
2001, and interim periods within those fiscal years.

In April 2002, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard ("SFAS") No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections". This statement eliminates the current requirement that gains and
losses on debt extinguishment must be classified as extraordinary items in the
income statement. Instead, such gains and losses will be classified as
extraordinary items only if they are deemed to be unusual and infrequent, in
accordance with the current GAAP criteria for extraordinary classification. In
addition, SFAS 145 eliminates an inconsistency in lease accounting by


<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(expressed in U.S. dollars)
June 30, 2002

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

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

RECENT ACCOUNTING PRONOUNCEMENTS (continued)

requiring that modifications of capital leases that result in reclassification
as operating leases be accounted for consistent with sale-leaseback accounting
rules. The statement also contains other nonsubstantive corrections to
authoritative accounting literature. The rescission of SFAS 4 is effective in
fiscal years beginning after May 15, 2002. The amendment and technical
corrections to SFAS 13 are effective for transactions occurring after May 15,
2002. All other provisions of SFAS 145 are effective for financial statements
issued on or after May 15, 2002. Management believes that the adoption of SFAS
No. 145 will not have a material impact on its financial position or results of
operations.

In June 2002, the FASB issued SFAS No. 146, "Account for Costs Associated with
Exit or Disposal Activities", which addresses accounting for restructuring and
similar costs. SFAS No. 146 supersedes previous accounting guidance, principally
Emerging Issues Task Force Issue No. 94-3. SFAS No. 146 requires that the
liability for costs associated with an exit or disposal activity be recognized
when the liability is incurred. SFAS No. 146 also establishes that the liability
should initially be measured and recorded at fair value. Accordingly, SFAS No.
146 may affect the timing of recognizing future restructuring costs as well as
the amount recognized. SFAS No. 146 is effective for exit or disposal activities
that are initiated after December 31, 2002. Management believes that the
adoption of SFAS No. 146 will not have a material impact on its financial
position or results of operations.

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

3.   CONVERTIBLE PROMISSORY NOTES

During the six months ended June 30, 2002, the company obtained financing under
several promissory notes payable to companies with a director in common that are
convertible into the company's common shares at a price of $0.25 per share. The
promissory notes are unsecured, bear interest at 15% per annum, and are
repayable one year after their issuance. Of the total $95,153 received under
these convertible promissory notes, the creditors have agreed to forgive
$66,500.

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

4.   CAPITAL STOCK

SHARE CONSOLIDATION

On March 18, 2002, the Board of Directors authorized a 1 for 50 reverse stock
split. Effective April 8, 2002, one new share of common stock was issued for
each 50 shares of previously issued and outstanding common stock. All shares and
per-share amounts disclosed in these financial statements are expressed at the
post-consolidation amounts.

RESTRICTED SECURITIES

Of the issued and outstanding shares, 117,700 shares are restricted securities
as defined under the Securities Act of 1933 and in the future may be sold only
in compliance with Rule 144 of the Act, pursuant to a registration statement
filed under the Act, or other applicable exemptions from registration
thereunder.


<PAGE>
NETMEASURE TECHNOLOGY INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(expressed in U.S. dollars)
June 30, 2002

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

4.   CAPITAL STOCK (continued)

1999 STOCK INCENTIVE PLAN

The company had authorized 30,390 shares of common stock for issuance to
eligible employees. The Plan authorized the company to grant to eligible
participants of the company and its subsidiary, deferred stock awards.

During 1999, the company made stock awards to nine employees aggregating 19,700
shares at a weighted average price of $62.50. Compensation under the plan has
been charged to earnings over the vesting period. In the year ended December 31,
2001, all unissued restricted stock awards were cancelled and the share
certificates returned to the company.

SUBSEQUENT EVENT

Subsequent to June 30, 2002, the company received $11,844 in consideration for
118,440 common shares which have yet to be issued.

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

5.   WRITE-OFF OF DEFERRED ACQUISITION COSTS

During the three months ended June 30, 2002, the company wrote off its deferred
acquisition costs as management concluded that it was unlikely that these
acquisitions would be successfully concluded.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

The company has no established source of revenue and is dependent on its ability
to raise substantial amounts of equity funds or merge with another company. This
raises substantial doubt about its ability to continue as a going concern.


                                PLAN OF OPERATION

As a result of running out of funding, the company was forced to discontinue its
development and marketing activities at the end of August 31, 2001. As a result
of not having the funds to continue to develop its technologies, the company
tried for several months to find a buyer for its intellectual property. However,
it was unsuccessful in achieving this objective and wrote off goodwill
associated with the technology in 2001.

The company's Board of Directors plans to continue its search to find another
operating company with which to merge. In the three months ended June 30, 2002
the company secured a small amount of funding, which has provided it with
additional time and resources in which to find a merger partner. In addition,
the company restructured its outstanding common stock to improve its
attractiveness to potential acquisition and merger candidates. To date, the
company has not been able to successfully conclude any negotiations with
potential acquisition and merger candidates and there can be no assurance that
any negotiations will be successfully concluded.

<PAGE>
Subsequent to June 30, 2002, the company received $11,844 in consideration for
118,440 common shares, which have yet to be issued.


      COMPARISON OF FISCAL QUARTERS ENDING JUNE 30, 2002 and JUNE 30, 2001

During the fiscal quarter ending June 30, 2002 the Company had no revenues and a
net loss of $29,196. The company's primary activities during the quarter were
related to financing and merger discussions. For the six months ending June 30,
2002 the Company had no revenues and a net loss of $65,742.

During the fiscal quarter ending June 30, 2001 the Company had revenues of $59
and a net profit of $206,813, including a stock award compensation recovery of
$317,614, resulting from the cancellation of employee stock awards. The Company
sustained a loss of $110,801 excluding the stock award compensation recovery.
Also, during this quarter, the Company had total expenses of $110,860 excluding
the stock compensation recovery. For ease of comparison, contract fees paid to
former employees were recorded as salaries and benefits. Thus, most of the
expenses during the quarter were related to salaries and benefits ($59,497).
Other significant expenses included depreciation and amortization ($15,396) and
rent ($10,736).

For the six-month period ending June 30, 2001 the Company had revenues of $5,213
and a net loss of $106,277.


<PAGE>

                          PART II -- OTHER INFORMATION

All other items are inapplicable or the answer is negative.


                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


NETMEASURE TECHNOLOGY INC.


By                        /s/ RANDY VOLDENG
    --------------------------------------------------------------
    RANDY VOLDENG, PRESIDENT

Date   September 19, 2002


In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.


NETMEASURE TECHNOLOGY INC.


By                        /s/ RANDY VOLDENG
    --------------------------------------------------------------
    RANDY VOLDENG, DIRECTOR, PRESIDENT AND CHIEF EXECUTIVE OFFICER
    (Principal Executive Officer and Principal Financial Officer)

Date   September 19, 2002


By                         /s/ RYAN HENNING
    --------------------------------------------------------------
    RYAN HENNING, DIRECTOR AND VICE PRESIDENT

Date   September 19, 2002