<PAGE>
 
                   U.S. SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549


                                  FORM 10-Q

 X   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
---                                                                     
     EXCHANGE ACT OF 1934

For the quarterly period ended January 2, 1999

                                     OR

___  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

                      Commission file number 000-25071

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


               DELAWARE                               77-0494507
     (State or other jurisdiction of               (I.R.S. Employer
      incorporation or organization)            Identification Number)


                           1399 MOFFETT PARK DRIVE
                            SUNNYVALE, CA  94089
                  (Address of principal executive offices)


                                408-543-6000
            (Registrant's telephone number, including area code)


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

                               Yes   X     No
                                    ---       ---    

As of February 5, 1999 there were 61,170,296 shares of the registrant's
Common Stock outstanding.
<PAGE>
 
                              TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                               PAGE
                                                                                              NUMBER
                                                                                              ------
PART I      FINANCIAL INFORMATION

Item 1.     Financial Statements
<S>         <C>                                                                               <C>
            Condensed Consolidated Unaudited Interim Balance Sheets as of 
              January 2, 1999 and October 3, 1998...................................             3

            Condensed Consolidated Unaudited Interim Statements of Operations for
              the Three Months Ended January 2, 1999 and December 31, 1997..........             4

            Condensed Consolidated Unaudited Interim Statements of Cash Flows for
              the Three Months Ended January 2, 1999 and December 31, 1997..........             5

            Notes to Condensed Consolidated Unaudited Interim Financial Statements..             6

Item 2.     Management's Discussion and Analysis of Financial Condition and 
              Results of Operations.................................................            12

            Risk Factors............................................................            23

PART II     OTHER INFORMATION

Item 6.     Exhibits and Reports on Form 8-K........................................            38

            Signatures..............................................................            39
</TABLE>

                                       2
<PAGE>
 
                                    PART I
                             FINANCIAL INFORMATION

Item 1.       Financial Statements.

                              INFOSEEK CORPORATION
            CONDENSED CONSOLIDATED UNAUDITED INTERIM BALANCE SHEETS
                                 (In thousands)

<TABLE>
<CAPTION>
                                                          January 2, 1999    October 3, 1998
                                                          ---------------    ---------------
<S>                                                       <C>                <C>
Assets
Current assets:
   Cash and cash equivalents..........................     $    5,177          $    628
   Short-term investments.............................         88,903            51,240
   Accounts receivable, net...........................         15,111             6,942
   Prepaid to service providers.......................         14,419            20,338
   Other current assets...............................          2,901               998
                                                           ----------          --------
     Total current assets.............................        126,511            80,146
Property and equipment, net...........................         23,386            15,370
Direct acquisition costs..............................            642             2,825
Investment in Joint Ventures..........................          6,243                --
Intangibles and other assets..........................        872,949             3,315
                                                           ----------          --------
     Total assets.....................................     $1,029,731          $101,656
                                                           ==========          ========
Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable...................................     $   23,319          $  3,560
   Accrued payroll and related expenses...............          6,116             2,191
   Accrued liabilities to service providers...........          2,634            16,058
   Other accrued liabilities..........................          8,465             2,418
   Deferred revenue...................................          4,391             4,789
   Short-term obligations.............................          2,540             2,942
                                                           ----------          --------
     Total current liabilities........................         47,465            31,958

Long-term obligations.................................          2,543             2,981
Deferred tax liabilities..............................         41,601                --

Stockholders' equity:
   Preferred Stock....................................             --                --
   Common Stock.......................................      1,235,623           121,292
   Accumulated deficit................................       (157,772)          (53,724)
   Deferred compensation..............................           (621)             (717)
   Notes receivable from stockholders.................       (139,108)             (134)
                                                           ----------          --------
     Total stockholders' equity.......................        938,122            66,717
                                                           ----------          --------
     Total liabilities and stockholders' equity.......     $1,029,731          $101,656
                                                           ==========          ========
</TABLE>

  See notes to condensed consolidated unaudited interim financial statements.

                                       3
<PAGE>
 
                             INFOSEEK CORPORATION
       CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF OPERATIONS
                   (In thousands, except per share amounts)

<TABLE>
<CAPTION>
 
                                                                  Three Months Ended
                                                        January 2, 1999       December 31, 1997
                                                     --------------------   --------------------
<S>                                                  <C>                    <C>
Revenues                                                  $  30,175               $12,675
Costs and expenses:
    Hosting, content and website costs.............           8,910                 1,922
    Amortization of intangibles related 
      to hosting, content and website costs........           4,357                    --
                                                          ---------               -------
    Total hosting, content and website costs.......          13,267                 1,922

    Research and development.......................           4,481                 2,021
    Sales and marketing............................          29,443                11,800
    General and administrative.....................           6,930                 1,800
    Amortization of goodwill.......................           8,233                    --
    In-process research and development............          72,600                    --
                                                          ---------               -------
    Total costs and expenses.......................         134,954                17,543
                                                          ---------               -------
Operating loss.....................................        (104,779)              (4,868)
Loss from Joint Ventures...........................          (1,282)                  --
Interest income, net...............................           2,013                  220
                                                          ---------              -------
Net loss...........................................       $(104,048)             $(4,648)
                                                          =========              =======

Basic and diluted net loss per share...............          $(2.26)              $(0.17)
Shares used in computing basic and diluted net               
 loss per share....................................          46,136               27,341
         
</TABLE>

  See notes to condensed consolidated unaudited interim financial statements.

                                       4
<PAGE>
 
                             INFOSEEK CORPORATION
       CONDENSED CONSOLIDATED UNAUDITED INTERIM STATEMENTS OF CASH FLOWS
                                (In thousands)

<TABLE>
<CAPTION>
                                                                                      Three Months Ended
                                                                         -----------------------------------------------
                                                                            January 2, 1999           December 31, 1997
                                                                         ---------------------     ---------------------
<S>                                                                      <C>                       <C>
Cash flows from operating activities:
Net loss...........................................................           $(104,048)                 $ (4,648)
Adjustments to reconcile net loss to net cash provided by (used in)
  operating activities:
   Write-off in-process technology.................................              72,600                        --
   Depreciation and amortization...................................              16,278                     1,044
   Equity in losses from Joint Ventures............................               1,282                        --
   Writedown of restructure related assets.........................                  --                     2,080

   Changes in assets and liabilities:
      Accounts receivable, net.....................................              (7,649)                   (2,662)
      Prepaid to service providers.................................               5,919                        --
      Other current assets.........................................              (1,428)                      (25)
      Direct acquisition costs.....................................             (11,191)                       --
      Intangibles and other assets.................................                (675)                     (592)
      Accounts payable.............................................              17,709                     2,710
      Accrued payroll and related expenses.........................               1,572                       490
      Accrued liabilities to service providers.....................             (13,424)                    1,864
      Other accrued liabilities....................................               2,008                       963
      Deferred revenue.............................................                (398)                      950
      Accrued restructuring and other charges......................                  --                    (1,027)
                                                                              ---------                  --------
           Net cash provided by (used in) operating activities.....             (21,445)                    1,147

Cash flows from investing activities:
Investment in Joint Ventures.......................................              (1,949)                       --
Purchases of available-for-sale securities.........................            (108,170)                  (15,102)
Proceeds from sales and maturities of available-for-sale                         
    securities.....................................................              70,507                    15,092
Purchases of property and equipment................................              (6,088)                     (118)
Cash received from Starwave acquisition............................                 712                        --
Issuance of notes receivable.......................................                  --                      (950)
                                                                              ---------                  --------
           Net cash used in investing activities...................             (44,988)                   (1,078)
            
Cash flows from financing activities:
Proceeds from term loan............................................                  --                       265
Repayments of term loan............................................                (840)                     (267)
Proceeds from issuance of convertible debt.........................                  --                       305
Proceeds from issuance of common stock.............................              71,822                       410
                                                                              ---------                  --------
           Net cash provided by financing activities...............              70,982                       713
                                                                              ---------                  --------
Net increase in cash and cash equivalents..........................               4,549                       782
Cash and cash equivalents at beginning of period...................                 628                     2,541
                                                                              ---------                  --------
Cash and cash equivalents at end of period.........................           $   5,177                  $  3,323
                                                                              =========                  ========
---------
Cash paid for interest.............................................           $     125                  $    202
</TABLE>

  See notes to condensed consolidated unaudited interim financial statements.

                                       5
<PAGE>
 
                             INFOSEEK CORPORATION

    NOTES TO CONDENSED CONSOLIDATED UNAUDITED INTERIM FINANCIAL STATEMENTS

NOTE 1.      ORGANIZATION AND BASIS OF PRESENTATION

         In this Quarterly Report on Form 10-Q, references to "Infoseek" or "the
Company" on or after November 18, 1998 are references to Infoseek Corporation, a
Delaware corporation and its subsidiaries, and references to Infoseek prior to
November 18, 1998 are references to Infoseek Corporation, a California
corporation. When necessary for clarity, Infoseek Corporation, a California
corporation, is referred to as "Infoseek California" and Infoseek Corporation, a
Delaware corporation, is referred to as "Infoseek Delaware." References to
"Disney" refer to The Walt Disney Company and its affiliated companies.
References to the "ABCNews Joint Venture" and the "ESPN Joint Venture" refer to
the joint ventures Starwave maintains with affiliates of Disney and ESPN,
respectively. The ABCNews Joint Venture and the ESPN Joint Venture are together
referred to as the "Joint Ventures."

         Infoseek Corporation was incorporated in California in August 1993 to
develop and provide Internet and World Wide Web search and navigation services.
On November 18, 1998, Infoseek entered into a significant transaction with The
Walt Disney Company.  In this transaction, Infoseek acquired Starwave
Corporation from Disney and formed a holding company incorporated in Delaware on
June 12, 1998, for purposes of holding the capital stock of Infoseek
Corporation, a California corporation, and Starwave.

         Infoseek is a leading provider of Internet services and software
products. Infoseek produces GO Network (home page: go.com), and the Infoseek
Service (home page: infoseek.go.com), comprehensive Internet gateways that
combine branded content from media leaders, search and navigation with
directories of relevant information sources and content sites, community
applications for communicating shared interests such as chat and instant
messaging, and which facilitate the purchase of related goods and services. In
January 1999, Infoseek launched GO Network and an enhanced version of the
Infoseek Service. The Company conducts its business predominantly within one
industry segment.

         On January 28, 1999, the Company changed to a fiscal year with 52 or 53
week periods ending on the Saturday nearest September 30. This Quarterly Report
presents financial information for the first quarter of fiscal 1999, beginning
October 4, 1998 and ending January 2, 1999. The unaudited results of operations
and cash flows of the Company for the quarter ended January 2, 1999 contained 91
days and compare to 92 days for the unaudited results of operations and cash
flows for the quarter ended December 31, 1997.

         Because prior to November 18, 1998 Infoseek Delaware was a wholly
owned subsidiary of Infoseek California that was created for conducting the
transactions described above, Infoseek Delaware, the Registrant with the
Securities and Exchange Commission, did not conduct business activities prior to
November 18, 1998.  Since November 18, 1998, Infoseek Delaware's business has
primarily consisted of holding the capital stock of Infoseek California and
Starwave and, after January 15, 1999, Quando, Inc.  Accordingly, because the
transaction with Disney and acquisition of Starwave did not occur until November
18, 1998, this Quarterly Report on Form 10-Q presents financial information for
Infoseek through the entire period, and combined operations with Starwave, the
acquisition of which was accounted for under the purchase method of accounting,
for the portion of the period following November 18, 1998.  As a result,
information presented herein may not be comparable to results in previous
quarters.

                                       6
<PAGE>
 
         GO Network and the Infoseek Service are Internet portal sites that
combine search and directory services, including 18 easy to navigate "centers"
that integrate search results with relevant information, services, products and
communities on the Internet, and the content of ABC.com, ABCNEWS.com, ESPN.com,
Disney and others. Both services contain unique features like universal
navigation, follow-me tabs, universal registration, universal personalization,
and security. Infoseek has a strategic relationship with Disney concerning GO
Network, including its promotion and content. Infoseek also produces other
leading Internet sites, like ESPN.com and ABCNEWS.com, in partnership with 
Disney affiliates.

         The condensed consolidated financial information as of January 2, 1999
and for the three month periods ended January 2, 1999 and December 31, 1997
included herein is unaudited and has been prepared by the Company in accordance
with generally accepted accounting principles and reflects all adjustments,
consisting only of normal recurring adjustments, which in the opinion of
management are necessary to state fairly the Company's financial position,
results of operations, and cash flows for the periods presented. The October 3,
1998 balance sheet was derived from audited financial statements at that date.
All significant intercompany transactions and balances have been eliminated.

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements as well as the reported amounts of revenue and expenses during the
reporting period. These condensed consolidated financial statements should be
read in conjunction with the consolidated financial statements and notes thereto
included in Infoseek's Transition Report on Form 10-K for the nine months ended
October 3, 1998, filed with the Securities and Exchange Commission on February
16, 1999. The results of operations for the three months ended January 2, 1999
are not necessarily indicative of the results to be expected for any future
periods.

NOTE 2.  NET LOSS PER SHARE

         In 1997, the Financial Accounting Standards Board issued Statement No.
128 ("SFAS No. 128"), "Earnings per Share." SFAS No. 128 replaced the
calculation of primary and fully diluted earnings per share with basic and
diluted earnings per share. Unlike primary and fully diluted earnings per share,
outstanding nonvested shares are not included in the computations of basic and
diluted earnings per share until the time-based vesting restriction has lapsed.
Basic earnings per share also excludes any dilutive effects of options, warrants
and convertible securities.  Diluted net loss per share does not include
options, warrants or convertible securities, as they would be antidilutive for
all periods presented.  Diluted earnings per share is very similar to the
previously reported fully diluted earnings per share.

NOTE 3.  NEW ACCOUNTING PRONOUNCEMENTS

         During 1998, the Company adopted the Financial Accounting Standards
Board Statement No. 130 ("SFAS No. 130"), "Reporting Comprehensive Income."
SFAS No. 130 establishes rules for reporting and 

                                       7
<PAGE>
 
displaying comprehensive income or comprehensive loss. The Company's total
comprehensive net loss was the same as its net loss for the three months ended
January 2, 1999 and December 31, 1997.

         During 1998, the Company adopted the Financial Accounting Standards
Board Statement No. 131 ("SFAS No. 131"), "Disclosures about Segments of an
Enterprise and Related Information."   SFAS No. 131 requires the Company to use
the "management approach" in disclosing segment information.  The Company
conducts its business predominantly within one industry segment for all periods
presented.  Management assesses the Company's performance and measures the
Company's loss and assets on a single segment basis.  The single segment
generates revenue predominantly from the United States for all periods
presented.

         In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 133 ("SFAS No. 133") "Accounting for
Derivative Instruments and Hedging Activities."  SFAS No. 133 requires the
Company to recognize all derivatives on the balance sheet at fair value.
Derivatives that are not hedges must be adjusted to fair value through net
income.  If the derivative is designated as a hedge, depending on the nature of 
the hedge, changes in the fair value of the derivative are either offset against
the change in fair value of assets, liabilities, or firm commitments through
earnings or recognized in comprehensive income until the hedged item is
recognized in earnings. The ineffective portion of a derivative's change in fair
value will be immediately recognized in earnings. SFAS No. 133 is effective for
years beginning after June 15, 1999, but companies can early adopt as of the
beginning of any fiscal quarter that begins after June 1998. The Company is
evaluating the requirements of SFAS No. 133, but does not expect this
pronouncement to materially impact the Company's results of operations.

NOTE 4.  BUSINESS COMBINATION

         In June 1998, Infoseek entered into agreements with Starwave and Disney
relating to an acquisition by Infoseek of Starwave, of which Disney was the
principal shareholder, through a merger and exchange of shares.  The Starwave
merger and related transactions were completed on November 18, 1998.  In
accordance with the Starwave merger agreement, Infoseek issued 25,932,681 shares
of Infoseek common stock for all outstanding shares of Starwave capital stock.
Infoseek also reserved 2,205,316 shares of Infoseek Common Stock for Starwave
stock options assumed by Infoseek.  The fair value of Infoseek's shares and
options issued was approximately $897.8 million.  Infoseek incurred direct
acquisition costs of approximately $22.0 million, which were included in the
purchase price of Starwave.  In addition, Disney purchased 2,642,000
unregistered shares of Infoseek common stock and a warrant, subject to vesting,
to purchase an additional 15,720,000 unregistered shares of Infoseek common
stock at certain times, and subject to certain conditions, in exchange for
approximately $70.0 million in cash and a $139.0 million five-year promissory
note.  The warrant is intended to enable Disney to achieve a majority stake in
Infoseek over time.

         The acquisition was accounted for under the purchase method of
accounting. The purchase price was allocated to the assets acquired and
liabilities assumed based on a determination from an independent appraisal of
their respective fair values. The consolidation of the acquired assets and
liabilities significantly affected the Company's balance sheet at January 2,
1999, as depicted in the following tables:


         The approximate purchase price (in thousands):

Purchase price..........................   $897,834
Estimated transaction and other direct              
 acquisition costs......................     22,000 
                                           -------- 
                                           $919,834 
                                           ======== 

                                       8
<PAGE>
 
The allocation of the approximate purchase price was determined as follows (in 
thousands):

 
       Tangible assets acquired and 
         liabilities assumed:
         Tangible assets.................   $ 12,751
         Liabilities.....................     (6,163)
       Intangible assets acquired:
         Joint Ventures relationships       
          (ESPN and ABCNews).............    178,500
         Developed technology............     29,900
         Assembled workforce.............     15,300
         In-process research and             
          development....................     72,600
         Goodwill........................    658,547
         Deferred tax liability..........    (41,601)
                                            --------
                                            $919,834
                                            ========

         To determine the value of the developed technology and the investment
in the Joint Ventures, the expected future cash flow attributed to all existing
technology was discounted, taking into account risks related to the
characteristics and applications of the technology, existing and future markets,
and assessments of the life cycle stage of the technology.  The value of the
assembled workforce was derived by estimating the costs to replace the existing
employees, including recruiting and hiring costs and training costs for each
category of employee.  Based on a third-party appraisal, management determined
that $72.6 million of the purchase price represented acquired in-process
research and development that had not yet reached technological feasibility and
had no alternative future use.  This amount was expensed during the quarter
ended January 2, 1999 as a non-recurring charge upon consummation of the
acquisition.  Goodwill is determined based on the residual difference between
the amount paid and the values assigned to identified tangible and intangible
assets. In November 1998, the Company began amortizing the Joint Venture
relationships and goodwill over an estimated useful life of 10 years, and
developed technology and assembled workforce over an estimated useful life of 2
years.  Amortization expense of  intangibles assets purchased was 
approximately $13.3 million during the quarter ended January 2, 1999.

         In connection with the Starwave acquisition, Infoseek accrued
approximately $22.0 million in costs related to the acquisition, including
estimated transaction costs of approximately $13.4 and costs of approximately
$8.6 million associated with the elimination of redundant operations and closure
of duplicate facilities. These costs qualify as liabilities in connection with a
purchase business combination under EITF 95-3. Transaction costs consist of fees
for investment bankers, attorneys, accountants, financial printing and other
related charges. As of January 2, 1999, the Company made cash payments related
to transaction costs of approximately $13.4 million. The Company also incurred
non-cash transactions of approximately $5.7 million related to liabilities in
connection with a purchase business combination. The remaining accrued balance
of approximately $2.9 million is expected to be used during fiscal 1999.
Infoseek also expects to incur additional costs related to the Starwave
acquisition, due mainly to integration of operations and computer systems, of
approximately $7.0 million, of which approximately $3.3 million was expensed
as of January 2, 1999. Integration costs do not qualify as liabilities in
connection with a purchase business combination under EITF 95-3 and will be
charged to operations as incurred.

         Infoseek may be required to sell to Disney certain shares of common
stock and issue warrants at prices below fair market value at the time of
purchase which may result in future material charges adversely affecting
Infoseek's results of operations.

         Under certain representation agreements by and among Infoseek, Starwave
and each of the Joint Ventures, entered into in conjunction with the Starwave
merger, Starwave is engaged by the Joint Ventures on an exclusive basis in the
sale of advertising and other items as designated or approved by the Joint
Ventures and to provide additional services, if any, as the Joint Ventures may
request. Activities with respect to the sale of

                                       9
<PAGE>
 
advertising on the Internet services and other related items included the
negotiation, execution, renewal, amendment, modification or termination of
advertising and other related contracts. Starwave guarantees to the Joint
Ventures a minimum quarterly payment equal to the number of projected page
views, multiplied by 80%, multiplied by the minimum revenue rate. The minimum 
revenue rate is based on the average advertising revenue rate per page view of
publicly traded Internet companies involved in activities comparable to those 
of the Joint Ventures. If a mutually agreeable rate cannot be determined, then
the rate will be based on the Joint Ventures' 12 month trailing average.

         Starwave recognizes revenue on the sale of advertising and other
related items of the Joint Ventures due to its obligations under the
representation agreements.  Starwave bears the risk of loss if it fails to bill
and collect amounts sufficient to cover its contractual guaranteed minimum
payments.

         Under the representation agreements, Starwave pays the Joint Ventures 
for the right to render services the greater of (i) the guaranteed minimum 
payment or (ii) actual revenues billed to third parties for services, in each 
case less only Starwave's actual and reasonably allocated costs of providing the
services and a profit margin of 5% of such costs. The obligations of Starwave to
pay these representation rights fees are unconditional. Starwave is required to 
pay the Joint Ventures regardless of whether Starwave is able to collect the 
related outstanding receivables.

         Each of the Joint Ventures is accounted for under the equity method
since neither Infoseek nor Starwave have a majority voting interest. Under each
of the joint venture agreements, required funding and profits/losses under the
Joint Ventures are split 60/40 between Starwave and Disney entities in loss
years and 50/50 in years in which the respective Joint Ventures have net income.
The other partners of these Joint Ventures, subsidiaries of ESPN and ABC, are
subsidiaries of Disney.

         Under a license agreement entered into by and between Disney and
Infoseek, Disney granted to Infoseek a worldwide license to exploit
the trademarks and web addresses associated with GO Network and Infoseek has
agreed to pay Disney royalties.  Royalties are calculated as one percent (1%) of
Infoseek's revenues other than revenues derived from software sales and
services.  Royalties under the license agreement will not be earned nor paid
until the end of any Infoseek fiscal year in which Infoseek has positive
earnings before interest, taxes, and amortization ("EBITA") as defined and
royalty payments in any year will not exceed 15% of EBITA in such year as
defined.

         The EBITA calculation for the three months ended January 2, 1999 is as 
follows (in thousands):

                Net loss........................    $(104,048)
                Interest expense................          125
                Amortization of Intangibles:

                  Goodwill......................        8,233
                  Developed technology..........        1,868
                  Assembled workforce...........          956
                  Joint Venture relationships...        2,231
                                                    ---------
                EBITA...........................    $ (90,635)
                                                    =========

         Since the license agreement was not in effect for the quarter ended 
December 31, 1997, EBITA for this period is not presented.

                                      10
<PAGE>
 
NOTE 5.    INTANGIBLE ASSETS

Intangible and other assets are comprised of (in thousands):

 
                                  January 2, 1999    October 3, 1998
                                  ---------------    ---------------
Developed Technology                  $ 29,900           $  --
Assembled Workforce                     15,300              --
Goodwill                               658,547              --
Joint Venture Relationships            178,500              --
Other Assets                             3,990            3,315
Accumulated Amortization               (13,288)             --
                                      --------           ------
                                      $872,949           $3,315
                                      ========           ======

         The following selected unaudited pro forma combined results of
operations of Infoseek and Starwave for the three months ended January 2, 1999
and December 31, 1997 have been prepared assuming that the acquisition had
occurred at the beginning of the period presented. The following selected
unaudited pro forma information is not necessarily indicative of the results
that would have occurred had the acquisition been completed at the beginning of
the period indicated nor is it indicative of future operating results (in
thousands, except per share data):

<TABLE>
<CAPTION>
 
                                                  Three Months Ended
                                           January 2, 1999    December 31, 1997
                                         ------------------  -------------------
<S>                                      <C>               <C>
Net revenues..........................        $ 36,076             $ 21,036
Loss from operations(1)(2)............        $(50,342)            $(40,052)
Net loss(1)(2)(3).....................        $(51,701)            $(42,350)
Net loss per share(1)(2)(3)...........        $  (0.83)            $  (0.73)
Shares used in per share calculation..          62,372               58,121
</TABLE>
----------
(1) The loss from operations and net loss and net loss per share does not 
    include the $72.6 million in-process research and development charge.

(2) The pro forma adjustment for the representation rights fee is the Joint
    Venture's revenues less allocated costs of 15% of revenue, plus a 5% profit
    margin on allocated costs. In addition, a pro forma adjustment has been made
    for additional costs Starwave would have incurred that were historically
    incurred by the Joint Ventures.

(3) A pro forma adjustment has been made to Starwave's allocated (60%)
    losses from the Joint Ventures.

NOTE 6.  SIGNIFICANT AGREEMENTS

         On October 1, 1998, the Company entered into an agreement with
Microsoft to become one of five premier providers of search and navigation
services on Microsoft's network of Internet products and services. Under the
terms of the twelve month Microsoft agreement, the Company is obligated to
pay an aggregate of $10.7 million for a guaranteed minimum number of impressions
on both Microsoft's Internet Explorer search feature and Microsoft's website.
The Company will also pay, based on the number of impressions delivered, for
additional impressions on both Internet Explorer and Microsoft's website, up
to a maximum of $18.0 million. The obligated amount under the Microsoft
agreement is being amortized on a straight-line basis over the one-year term
of the agreement, beginning in the quarter ended January 2, 1999, the quarter
when the service was launched. In connection with the agreement, the Company
made a prepayment of $5.3 million as of October 3, 1998, which was included in
prepaid to service providers. For the three months ended January 2, 1999, the
Company amortized $2.6 million under this agreement leaving a prepaid balance
of $2.7 million.

         On August 28, 1998 Infoseek entered into an agreement with WebTV
Networks, Inc. ("WebTV") pursuant to which Infoseek will be the exclusive
provider of search and directory services to WebTV. Under this two year
agreement, Infoseek is responsible for managing advertising sales for all of
WebTV's search traffic and the substantial majority of WebTV's current non-
search traffic. Pursuant to the agreement, Infoseek is obligated to make cash
payments to WebTV totaling $26.0 million over a two year period, with $0.5
million paid upon the signing of the agreement, $14.5 million to be paid in
advance for the first five quarters upon mutual acceptance of the technology
by both parties, and the remaining $11.0 million to be paid ratably over the
last three quarters of the agreement term. On October 1, 1998, Infoseek and
WebTV agreed on the technology; however, cash was not paid until the quarter
ended January 2, 1999. The payments under the WebTV agreements are being
amortized ratably over the period covered by the payment, on a straight-line
basis. Such payments by Infoseek are subject to reimbursement depending on the
number of impressions delivered over the life of the agreement. Infoseek is to
receive all of the revenue generated from such advertising sales up to a pre-
determined amount that is in excess of Infoseek's total payment obligations to
WebTV under the agreement, with allocations of such revenue between Infoseek
and WebTV being made beyond this pre-determined amount. For the three months
ended January 2, 1999, the Company incurred approximately $3.2 million of
sales and marketing expenses under this agreement. There can be no assurance
that Infoseek will be able to sell the available advertising inventory of
WebTV under this agreement or be able to collect the receivables resulting
from such advertising sales which could have a material adverse effect on
Infoseek's business, results of operations and financial condition.

                                      11
<PAGE>
 
NOTE 7.  PROMISSORY NOTE

         In conjunction with the Starwave acquisition, Disney, a 43% shareholder
of Infoseek, delivered a promissory note of $139.0 million payable to Infoseek.
The promissory note bears interest on the principal amount outstanding at a rate
of 6.5% per annum.  The promissory note is payable in twenty quarterly principal
installments, beginning on February 18, 1999, of $6.9 million, with the final
payment due on November 18, 2003.  The promissory note, together with accrued
and unpaid interest, may be paid in whole or in part without premium or penalty
at any time.  The Company earned approximately $1.1 million of interest income
related to this promissory note in the quarter ended January 2, 1999.

NOTE 8.  SEGMENT INFORMATION

        The Company predominantly operates in one business segment--providing 
Internet search and navigation products and services for which the Company 
receives advertising revenues from its customers. Advertising revenues totaled 
approximately $28.0 million and $11.9 million for the three months ended 
January 2, 1999 and December 31, 1997, respectively.

        The Chief Executive Officer has been identified as the Chief Operating 
Decision Maker (CODM) because he has final authority over resource allocation 
decisions and performance assessment. The CODM does not receive discrete 
financial information about asset allocation, expense allocation, or 
profitability from the Company's Internet search navigation products and 
services or from its Ultraseek software license and support.

        Total revenues generated from U.S. customers totaled approximately $29.0
million and $12.5 million of total revenues for the three months ended January
2, 1999 and December 31, 1997, respectively. Total revenues generated from
foreign customers totaled approximately $1.1 million and $0.2 million,
respectively, of total revenues for the three months ended January 2, 1999 and
December 31, 1997.
 
NOTE 9.  SUBSEQUENT EVENTS

         On January 15, 1999, Infoseek completed the acquisition of Quando, Inc.
Quando creates constantly updated directories of information obtained from the
Internet for use to search the Web -- including shopping guides, event guides,
contact directories, audio clip libraries, review guides and website rating
guides. Infoseek issued approximately 396,591 shares of Infoseek common stock
and reserved approximately 26,000 shares of Infoseek common stock for Quando
options assumed by Infoseek. Infoseek will account for the Quando acquisition as
a purchase transaction and will incur a write-off related to in-process research
and development of approximately $4.3 million in the quarter ending April 3,
1999 in connection with this transaction. In addition, intangible assets related
to goodwill, developed technology and assembled workforce are approximately
$17.7 million and will be amortized over two years from the date of acquisition.
These are preliminary amounts. In connection with the acquisition of Quando, 
Infoseek incurred direct costs of approximately $1.5 million which will be
accounted for as part of the purchase price of the transaction. In addition,
Infoseek expects to incur additional integration costs of up to $0.5 million
in the quarter ending April 3, 1999.

                                      12
<PAGE>

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

         This Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 that are subject to risks and uncertainties. These forward-
looking statements are typically denoted in this Report by the phrases
"anticipates," "believes," "expects," "plans" and similar phrases. Actual
results could differ materially from those projected in the forward-looking
statements as a result of the factors set forth in "Risk Factors" beginning on
page 23 of this Quarterly Report on Form 10-Q, including, without limitation,
those entitled "-Accounting Charges From Acquisitions Will Delay and Reduce
Profitability," "-In Order to Continue to Grow, Infoseek Will Need More
Financing," "-Infoseek's Financial Results Will Vary," "-If Infoseek Cannot
Renew Existing or Enter Into New Agreements Which Result in User Traffic, or If
Sites That Provide Traffic to Infoseek are Not Successful, Infoseek's
Advertising Revenue Will Decrease," "-Infoseek Has Had Losses in the Past and
Has Difficulty Predicting Future Results But Expects Fluctuations and Losses in
the Future," "-If Infoseek Does Not Achieve Revenue Minimums Under
Representation Agreements, It May Incur Losses Under These Agreements," and "-If
Infoseek Advertising and Related Sponsorship of Infoseek Services Are Not
Accepted, Infoseek's Revenues Will Be Adversely Affected." The discussion of
those risk factors is incorporated herein by this reference as if said
discussion was fully set forth at this point.

Explanatory Note

         On January 28, 1999, Infoseek changed to a fiscal year with 52 or 53
week periods ending on the Saturday nearest September 30. This Quarterly Report
on Form 10-Q presents financial information for the first fiscal quarter of
1999, beginning October 4, 1998 and ending January 2, 1999. The unaudited
results of operations and cash flows of the Company for the quarter ended
January 2, 1999 contained 91 days and compare to 92 days for the unaudited
results of operations and cash flows for the quarter ended December 31, 1997.

         Because prior to November 18, 1998 Infoseek Delaware was a wholly owned
subsidiary of Infoseek California that was created for purposes of conducting
the transactions described above, Infoseek Delaware, the Registrant with the
Securities and Exchange Commission, did not conduct business activities prior to
November 18, 1998. Since November 18, 1998, Infoseek Delaware's business has
primarily consisted of holding the capital stock of Infoseek California and
Starwave and, after January 15, 1999, Quando, Inc. Accordingly, although the
transaction with Disney did not occur until November 18, 1998, this Quarterly
Report on Form 10-Q presents financial information for Infoseek through the
entire period, and combined operations with Starwave, the acquisition of which
was accounted for under the purchase method of accounting. As a result,
information presented herein may not be directly comparable to results in
previous quarters.

Infoseek Overview

         Infoseek was formed in August 1993 to develop and provide Internet and
World Wide Web search and navigational services.  From inception to March 31,
1995, Infoseek's operations were limited and consisted primarily of start-up
activities, including recruiting personnel, raising capital, research and
development, and the negotiation and execution of an agreement to license an
information retrieval search engine.

         Infoseek introduced its first products and services in 1995.  Through
September 1997, Infoseek's strategic focus was on developing its capabilities as
an Internet search and navigation service.  In response to rapid growth and a
change in the Internet search and navigation market, Infoseek's Board of
directors, in June 1997, hired a new Chief Executive Officer, Harry Motro, to
evolve the strategic vision of Infoseek while continuing to leverage Infoseek's
core strength in search and navigation.  Mr. Motro and founder Steven Kirsch
recruited a number of new members to the executive management team to execute
Infoseek's strategy of building Infoseek brand awareness; creating a richer
viewer experience; maximizing value for Infoseek's advertisers; providing
intranet search products; and enhancing Infoseek's search and navigation
service.  In June 1997, Infoseek took a restructuring charge of approximately
$7.4 million related to the discontinuance of certain non-strategic business
arrangements and management changes.

         Beginning in early 1997, Infoseek began to license its Ultraseek Server
product to corporate customers for use on their intranet and public web site
search applications.  Gross margins from licensing Ultraseek and advertising 
revenues are not materially different.

                                      13
<PAGE>
 
         In October 1997, Infoseek launched an enhanced version of the Infoseek
Service, with easy to navigate "channels" (now called "centers" and numbering
18) that integrate search results with relevant information, services, products
and communities on the Internet.  The Infoseek Service provides Infoseek with a
platform for creating content and marketing partnerships that enrich the
viewer's experience while enabling advertisers, sponsors and partners to more
effectively target viewers.

         Beginning with the October 1997 launch of the enhanced version of the
Infoseek Service, Infoseek began to sell channel sponsorships to advertisers,
sponsors and partners.  The duration of Infoseek's sponsorship and partnership 
agreements range from two months to three years and revenues are generally 
recognized ratably over the term of the agreements, provided that minimum 
impressions are met, and are included in advertising revenues.  Most of
Infoseek's contracts with advertising customers have terms of three months or
less, with options to cancel at any time.

         Infoseek's significant growth and limited operating history in a
rapidly evolving industry make it difficult to manage operations and predict
future operating results.  Infoseek has incurred significant net losses since
inception and expects to incur substantial additional losses.  As of January 2,
1999, Infoseek had an accumulated deficit of approximately $157.8 million.
Infoseek and its prospects must be considered in light of the risks, costs and
difficulties frequently encountered by companies in their early stage of
development, particularly companies in the new and rapidly evolving Internet
market.  In addition, because the acquisitions of Starwave and Quando are large
and complex, Infoseek may be required to reorganize its operations in order to
operate more effectively.  For example, in January 1999, Infoseek reorganized
all of its product and engineering related efforts into a single department to
become more functional and efficient.  Due to the complexity and scale
of Infoseek's recent acquisitions, Infoseek's operating plans and forecasts,
including its projected business outlook, and Infoseek's operating objectives,
are subject to frequent revision. Although Infoseek has recently begun a new 
multi-year planning cycle, future events and plans may cause Infoseek to 
dramatically revise its business objectives and estimates of profitability.  
Infoseek cannot assure you it will be able to adequately address the challenges 
of the Internet market and the complexity of its recent acquisitions.  Although 
Infoseek has experienced significant revenue growth from 1997 to 1999, there 
can be no assurance that this growth rate will be sustained, that revenues will 
continue to grow or that Infoseek will achieve profitability.  In the quarter 
ending April 3, 1999, the Company expects revenues to increase modestly from 
the quarter ended January 2, 1999 and expenses to increase at least $10.0 
million during such period.  Infoseek's estimates of revenue and expense levels 
for the quarter ending April 3, 1999 are forward-looking statements subject to 
risks and uncertainties.  Actual results may vary as a result of a number of 
factors, including those set forth below and including "Risk Factors - If GO 
Network is Not Successful, Infoseek's Business Would Be Seriously Harmed," 
"- If Infoseek Encounters Difficulties in Integrating Starwave and Quando, 
Infoseek Will Not Experience All of the Expected Benefits of these Acquisitions,
" and "- Infoseek's Financial Results Will Vary."  From 1997 to 1999, Infoseek
significantly increased its operating expenses as a result of a substantial
increase in its sales and marketing operations, development of new distribution
channels, broadening of its customer support capabilities and funding of 

                                      14
<PAGE>
 
greater levels of research and development. Further increases in operating
expenses are planned in the future. To the extent that any such expenses are not
timely followed by increased revenues, Infoseek's business, results of
operations, financial condition and prospects would be materially adversely
affected.

         As a result of Infoseek's limited operating history as well as the
recent emergence and rapid pace of change and development of both the Internet
and intranet markets addressed by Infoseek, Infoseek has neither internal nor
industry-based historical financial data for any significant period of time upon
which to project revenues or base planned operating expenses.  Infoseek expects
that its results of operations may also fluctuate significantly in the future as
a result of a variety of factors, including: the Starwave Acquisition (described
below); development of GO Network; the continued rate of growth; usage and
acceptance of the Internet and intranets as information media; the rate of
acceptance of the Internet as an advertising medium and a channel of commerce;
demand for Infoseek's products and services; the advertising budgeting cycles of
individual advertisers; the introduction and acceptance of new, enhanced or
alternative products or services by Infoseek or by its competitors; Infoseek's
ability to anticipate and effectively adapt to a developing market and to
rapidly changing technologies; Infoseek's ability to attract, retain and
motivate qualified personnel; initiation, implementation, renewal or expiration
of significant contracts with Borders Online, Inc., AT&T, N2K, Microsoft,
Netscape and others; pricing changes by Infoseek or its competitors; specific
economic conditions in the Internet and intranet markets; general economic
conditions; and other factors.  Substantially all of Infoseek's revenues have
been generated from the sale of advertising and sponsorships, and Infoseek
expects to continue to derive substantially all of its revenues from selling
advertising and related products for the foreseeable future.  Moreover, many of
Infoseek's contracts with advertising customers have terms of three months or
less.  Advertising revenues are tightly related to the amount of traffic on
Infoseek's services, which is seasonal and inherently unpredictable.
Accordingly, future sales and operating results are difficult to forecast.  In
addition, Infoseek has in the past relied on the purchase of traffic from
Netscape, Microsoft and others as a significant portion of Infoseek's total
traffic.  Infoseek originally entered into an agreement with Netscape in June
1998.  Under the June agreement, Infoseek purchased 15% of Netscape's available
search traffic, which traffic had decreased from 30% in the year earlier period.
In November 1998, Infoseek and Netscape renegotiated the terms of the June
agreement to provide for the purchase of 5% of Netscape's available search
traffic from January 11, 1999 and through the duration of the agreement which
terminates May 31, 1999. Daily page views for Infoseek, go.com and the Joint
Ventures in the month of December 1998 averaged approximately 33.0 million, 
down from approximately 38.0 million in the month of September 1998. The 
decline in page views was primarily due to decreased traffic on the Joint 
Ventures' websites (including as a result of the NBA lockout), and seasonality 
in sports and news events. Average daily page views on the Infoseek Service 
were approximately 21.5 million in the month of December 1998, up 69% from 
approximately 12.7 million in December 1997, but similar to the approximately 
21.4 million average daily page views in September 1998. Daily traffic on the 
Infoseek Service, excluding chat traffic, increased 6% in the month of December
1998 compared to the daily traffic in September 1998. Infoseek's chat traffic
for the month of December 1988 was down 19% from September 1998. This decline
was due in part to Infoseek's concerted effort to eliminate pornographic or
sexually explicit chat. Chat pages typically provide lower revenues than
Infoseek's other services. Purchased traffic, including trafic from Microsoft
and Netscape, accounted for 20% of total daily page views in the quarter ended
January 2, 1999. If total traffic, whether purchased or not, declines or does
not continue growing, Infoseek's business, results of operations and financial
condition and prospects could be materially adversely affected.

         Infoseek's expense levels are based, in part, on its expectations as to
future revenues and, to a significant extent, are relatively fixed, at least in
the short term.  Infoseek may not be able to adjust spending in a timely manner
to compensate for any future revenue shortfall.  Accordingly, any significant
shortfall in relation to Infoseek's expectations would have an immediate
material adverse impact on Infoseek's business, results of operations, financial
condition and prospects.

         In addition, Infoseek may elect from time to time to make certain
pricing, service or marketing decisions or acquisitions that could have a short-
term material adverse effect on Infoseek's business, results of operations,
financial condition and prospects and which may not generate the long-term
benefits intended.  From time to time, Infoseek has entered into and may
continue to enter into strategic relationships with companies for cross service
advertising, such as Infoseek's relationship with Borders Online, Inc.
Infoseek's revenues have in the past been, and may in the future continue to be,
partially 

                                      15
<PAGE>
 
dependent on its relationship with its strategic partners. Such strategic
relationships have and may continue to include substantial one-time or up front
payments from Infoseek's partners. Accordingly, Infoseek believes that its
quarterly revenues are likely to vary significantly in the future, that period-
to-period comparisons are not necessarily meaningful and that such comparisons
should not necessarily be relied upon as an indication of Infoseek's future
performance. Due to the foregoing factors, it is likely that in future periods,
Infoseek's operating results may be below the expectations of public market
analysts and investors. In such event, the price of Infoseek's common stock
would likely be materially adversely affected. See "Risk Factors -Infoseek Has
Had Losses in the Past and Has Difficulty Predicting Future Results But Expects
Fluctuations and Losses in the Future," "- Infoseek's Stock Price Will
Fluctuate," "Infoseek's Financial Results Will Vary," "- If Infoseek Cannot
Renew Existing or Enter Into New Agreements Which Result In User Traffic, or If
Sites That Provide Traffic to Infoseek Are Not Successful, Infoseek's
Advertising Revenue Will Decrease," "- Infoseek's Future Success Depends on the
Continuation and Integration of Joint Venture Relationships and on Entering Into
New Third Party Relationships," and "- If the Internet and Electronic Commerce
Do Not Continue to Grow, Infoseek's Business Will Suffer."

         Disney Transaction.  In June 1998, Infoseek entered into agreements
with Starwave and Disney relating to an acquisition of Starwave, of which Disney
was the principal shareholder, by Infoseek through a merger and exchange of
shares (the "Starwave Acquisition") pursuant to an Agreement and Plan of
Reorganization (the "Starwave Merger Agreement").  The transactions contemplated
by the Starwave Merger Agreement were completed on  November 18, 1998.  In
accordance with the Starwave Merger Agreement, Infoseek issued 25,932,681 shares
of Infoseek common stock for all outstanding Starwave shares.  Infoseek also
reserved 2,205,316 shares of Infoseek common stock for Starwave stock options
assumed by Infoseek.  The fair value of Infoseek's shares and options issued was
approximately $897.8 million.  In addition, Infoseek incurred direct
acquisition costs of approximately $22.0 million, which were included in the
purchase price of Starwave.  The total purchase price of Starwave was therefore
approximately $919.8 million.  The Starwave Acquisition is being accounted for
as a purchase transaction.  In addition, Disney purchased an additional
2,642,000 unregistered shares of Infoseek common stock and a warrant, subject to
vesting, to purchase an additional 15,720,000 unregistered shares of Infoseek
common stock in exchange for approximately $70.0 million in cash and a $139.0
million five-year promissory note.  The warrant is intended to enable Disney to 
achieve a majority stake in Infoseek over time.

         Infoseek and Disney have established a strategic relationship
concerning the development, launch and promotion of GO Network. In connection
with GO Network, a subsidiary of Disney has agreed to provide, and Infoseek has
agreed to purchase, $165.0 million in promotional support and activities over
five years.
 
         Disney also has certain contractual rights to maintain its initial
percentage stock and warrant ownership through direct purchases from Infoseek
in the event of dilutive issuances, including issuances pursuant to financings, 
acquisitions and employee benefit plans. Infoseek may be required to
sell to Disney certain shares of common stock and issue warrants at prices
below fair market value at the time of purchase which may result in future
material charges adversely affecting Infoseek's results of operations.

         Because the acquisition of Starwave is being accounted for under the
purchase method of accounting, the purchase price is being allocated to the
acquired assets and liabilities of Starwave. An in-process research and
development charge of approximately $72.6 million was recorded in the quarter
ending January 2, 1999. In addition, intangible assets related to developed
technology and assembled workforce of approximately $45.2 million are being
amortized over two years.

                                      16
<PAGE>
 
Intangible assets relating to goodwill and the Joint Ventures of approximately
$658.5 million and $178.5 million, respectively, will be amortized over ten
years. Infoseek began the amortization of each of these intangible assets in the
quarter ended January 2, 1999. In addition, Infoseek expects to incur increased
operating expenditures associated with the expanded operations resulting from
the transaction, as well as the development, launch and promotion of GO Network.
In this regard, Infoseek has agreed to use commercially reasonable efforts to
meet certain spending requirements for GO Network pursuant to the terms of a
license agreement between Infoseek and Disney related to GO Network (the
"License Agreement"). Subject to adjustment by unanimous vote of the two member
advisory committee established pursuant to a product management agreement
between Infoseek and Disney (the "Product Management Agreement"), these spending
requirements for GO Network for the first three years are $40.5 million, $58.3
million and $64.8 million, respectively. In addition, pursuant to a promotional
services agreement (the "Promotional Services Agreement"), Infoseek has agreed
to purchase $165.0 million in promotional services over a five-year period for
GO Network. The amounts spent on the purchase of promotional services under the
Promotional Services Agreement apply towards the spending requirements under the
License Agreement. As a result, Infoseek's profitability is expected to be
delayed beyond the time when Infoseek, prior to consummating the Disney
Transaction, may have otherwise achieved profitability. In addition, the size
and complexity of the Disney Transaction, the launch of GO Network and the rapid
pace of change and development in the Internet market make it difficult to
predict the future results. See "Risk Factors - Infoseek Has Had Losses in the
Past and Has Difficulty Predicting Future Results But Expects Fluctuations and
Losses in the Future."

         In connection with the acquisition of Starwave, Infoseek acquired 
Starwave's interests in the ABCNews Joint Venture and ESPN Joint Venture with 
affiliates of Disney and ESPN, respectively. Under each of the joint venture 
agreements, required funding and profits/losses under the Joint Ventures are 
split 60/40 between the Starwave and Disney entities in loss years and 50/50 in 
years in which the respective Joint Ventures each net income.

         Infoseek (through Starwave) has also agreed to act as a representative
of the Joint Ventures for the sale of advertising and related services for the
Joint Ventures.
 
         Under representation agreements by and among Infoseek, Starwave and
each of the Joint Ventures, each entered into in conjunction with the
acquisition of Starwave, Starwave is engaged by the Joint Ventures on an
exclusive basis in the sale of advertising and other items as designated or
approved by the Joint Ventures and to provide additional services, if any, as
the Joint Ventures may request. Activities with respect to the sale of
advertising on the Internet and other related items include the negotiation,
execution, renewal, amendment, modification or termination of advertising and
other related contracts. Starwave guarantees to the Joint Ventures a minimum
quarterly payment equal to the number of projected page views, multiplied by 
the minimum revenue rate. The minimum revenue rate is based on the average 
advertising revenue rate per page view of the publicly traded internet 
companies involved in activities comparable to those of the Joint Ventures.

        Starwave recognizes revenue on the sale of advertising and other
related items of the Joint Ventures due to its obligations under the
representation agreements. Starwave bears the risk of loss if it fails to bill
and collect amounts sufficient to cover its contractual guaranteed minimum
payments. Under the representation agreements, Starwave pays the Joint 
Ventures for the right to render services the greater of (i) the guaranteed 
minimum payment or (ii) actual revenues billed to third parties for services, 
in each case less only Starwave's actual and reasonably allocated costs of 
providing the services and a profit margin of 5% of such costs. The 
obligations of Starwave to pay these representation rights fees are 
unconditional. Starwave is required to pay the Joint Ventures regardless of 
whether Starwave is able to collect the related outstanding receivables.

        Each of the Joint Ventures is accounted for under the equity method
since neither Infoseek nor Starwave have a majority voting interest.

         Quando Acquisition.  On July 24, 1998, the Company entered into an
agreement to acquire Quando for shares of Infoseek's common stock.  On
January 15, 1999 Infoseek completed its acquisition of Quando in a tax-free
reorganization in which a wholly-owned subsidiary of Infoseek was merged
directly into Quando.  Infoseek issued 396,591 shares of Infoseek common stock
and reserved approximately 26,000 shares of Infoseek common stock for Quando
options assumed by Infoseek. The acquisition of Quando will be accounted for
using the purchase method of accounting. Infoseek will incur an in-process
research and development charge of approximately $4.3 million in the quarter
ending April 3, 1999 in connection with this transaction. In addition,
intangible assets related to goodwill, developed technology and assembled
workforce are approximately $17.7 million and will be amortized over two
years. In connection with the acquisition of Quando, Infoseek incurred direct
costs of approximately $1.5 million which will be accounted for as part of the
purchase price of the transaction. In addition, Infoseek expects to incur
additional integration costs of up to $0.5 million in the quarter ending April
3, 1999.

         WebTV Transaction.  On August 28, 1998 Infoseek entered into an
agreement with WebTV pursuant to which Infoseek will be the exclusive provider
of search and directory services to WebTV.  Under this two year agreement,
Infoseek is responsible for managing advertising sales for all of WebTV's search
traffic and the substantial majority of WebTV's current non-search traffic.
Pursuant to the agreement, Infoseek  is obligated to make cash payments to WebTV
totaling approximately $26.0 million over a two year period, with $0.5 million
paid upon the signing of the agreement, $14.5 million to be paid in advance
for the first five quarters upon mutual acceptance of the technology by both
parties and the remaining $11.0 million to be paid ratably over the last three
quarters of the agreement term. On October 1, 1998, Infoseek and WebTV agreed
on the technology; however, cash was not paid until the quarter ending January
2, 1999. The payments under the WebTV agreements are being amortized ratably
over the period covered by the payments, on a straight-line basis. Such
payments by Infoseek are subject to reimbursement depending on the number of
impressions delivered over the life of the agreement. Infoseek is to receive
all of the revenue generated from such advertising sales up to a pre-
determined amount that is in excess of Infoseek's total payment obligations to
WebTV under the agreement, with allocations of such revenue between Infoseek
and WebTV being made beyond this pre-determined amount. There can be no
assurance that Infoseek will be able to sell the available advertising
inventory of WebTV under this agreement or be able to collect the receivables
resulting from such advertising sales, which could have a material adverse
effect on Infoseek's business, results of operations and financial condition.

        Microsoft Agreement.  On October 1, 1998, the Company entered into an
agreement with Microsoft to become one of five premier providers of search and
navigation services on Microsoft's network of Internet products and services.
Under the terms of the twelve month Microsoft agreement, the Company is
obligated to pay an aggregate of $10.7 million for a guaranteed minimum number
of impressions on both Microsoft's Internet Explorer search feature and
Microsoft's website. The Company will also pay, based on the number of
impressions delivered, for additional impressions on both Internet Explorer
and Microsoft's website, up to a maximum of $18.0 million. The obligated
amount under the Microsoft agreement is being amortized on a straight-line
basis over the one-year term of the agreement, beginning in the quarter ended
January 2, 1999, the quarter when the service was launched. In connection with
the agreement, the Company made a prepayment of $5.3 million as of October 3,
1998, which was included in prepaid to service providers. For the three months
ended January 2, 1999, the Company amortized $2.6 million under this agreement
leaving a prepaid balance of $2.7 million.


                                      17
<PAGE>
 
         GO Network and Enhanced Infoseek Service.  In December 1998, Infoseek
launched a beta version of GO Network and in January 1999, Infoseek launched the
premier version of GO Network and an enhanced interest version of the Infoseek
Service, with a similar user interface to GO Network.  GO Network and the
enhanced Infoseek Service are comprehensive Internet gateways that combine
branded content from media leaders, search and navigation with directories of
relevant information and content sites, community applications for communicating
shared interests such as chat and instant messaging, and which facilitate the
purchase of related good and services. GO Network and the enhanced Infoseek
Service have several unique features, such universal registration and
navigation, universal personalization, and GO Guardian and security, and also
offer content from Disney and its affiliates, including ABC News and ESPN.
Infoseek expects to transition users from the Infoseek Service to GO Network and
may in the future redirect Infoseek Service users to the GO Network home page.
As a result of the launch of GO Network and the enhanced Infoseek Service,
Infoseek expects to have significantly increased costs and operating expenses in
future periods.

RESULTS OF OPERATIONS

For the Three Months Ended January 2, 1999 and December 31, 1997

Total Revenues

         Infoseek's total revenues for the three months ended January 2, 1999
were approximately $30.2 million, which represents a 138% increase over revenues
for the three months ended December 31, 1997 of approximately $12.7 million.
Revenues consist primarily of advertising derived from banner and sponsorship
sales and revenues Starwave recognizes on the sale of advertising and other 
services for the Joint Ventures due to its obligations under the representation
agreements. Infoseek also earned revenue from licensing the Ultraseek server
product. The revenue growth is primarily attributable to increased advertising
revenue due to increased use of the Internet for information publication, the
development and acceptance of the Internet as an advertising and commerce
medium, increased viewer traffic on the Infoseek Service and the inclusion of
Starwave revenues from November 18, 1998, which accounted for approximately
$6.2 million of revenues. Infoseek's current business model is to generate
revenues through the sale of advertising on the Internet. There can be no
assurance that current advertisers will continue to purchase advertising
space, sponsorships and services from Infoseek or that Infoseek will be able
to successfully attract additional advertisers.

                                      18
<PAGE>
 
         For the three months ended January 2, 1999 and the three months ended
December 31, 1997, the average daily page views were approximately 36.7 million
and 12.5 million, respectively. Historically, Infoseek has purchased traffic
from companies such as Microsoft and Netscape. For the three months ended
January 2, 1999, purchased traffic accounted for 20% of total daily page views
compared to 51% of average daily page views for the three months ended December
31, 1997. The decrease in the percentage of traffic purchased is primarily the
result of increased traffic on the Infoseek Service and the Joint Ventures and a
decrease in the overall percentage volume of traffic purchased from Netscape.
Due to the GO Network launch, continued operations of the Joint Ventures and
amendments to traffic purchase agreements, Infoseek believes that purchased
traffic as a percentage of average daily page views will continue to decrease.

Hosting, Content and Website Costs

         Hosting, content and website costs were approximately $13.3 million for
the three months ended January 2, 1999, or 44% of revenues, compared to 
approximately $1.9 million, or 15% of revenues for the three months ended
December 31, 1997. Hosting, content and website costs consist primarily of
representation rights fees paid to the Joint Ventures (approximately $5.2
million since the acquisition of Starwave), amortization of intangibles
relating to hosting, content and website costs (approximately $4.4 million
since the acquisition of Starwave) and the costs associated with the
enhancement, maintenance and support of Infoseek's websites and the Joint
Ventures' websites, including telecommunications costs, equipment depreciation
and related support services. Hosting, content and website costs also include
costs associated with the licensing of certain third-party technologies and
content. The increase was primarily due to the representation agreements, the
addition of equipment and personnel to support the Joint Ventures' websites
and increases in royalties due to additional traffic. Management expects its
hosting, content and website costs will continue to increase in dollars and as
a percentage of revenues because of the representation agreements and as it
upgrades equipment and maintenance and support personnel, adds content
partners to meet the growing demands for web services and provides additional
services for the Joint Ventures.

Research and Development

         Research and development costs were approximately $4.5 million for the
three months ended January 2, 1999, or 15% of revenues, compared to
approximately $2.0 million, or 16% of revenues for the three months ended
December 31, 1997. Research and development expenses primarily consist of
personnel costs, consulting and equipment depreciation. The increase in dollars
is attributable to the development and launch of GO Network, on-going
enhancements to the Infoseek Service, enhancements related to the Joint

                                      19
<PAGE>
 
Ventures' websites and the development and implementation of new technology and
products.  Management believes that a significant level of research and
development expenses is required to continue to remain competitive in its
industry. Accordingly, management anticipates that it will continue to devote
substantial resources to product development, especially related to GO Network,
and that these costs are expected to continue to increase in dollar amount in
future periods.

Sales and Marketing

         Sales and marketing costs were approximately $29.4 million for the
three months ended January 2, 1999, or 98% of revenues, compared to
approximately $11.8 million, or 93% of revenues, for the three months ended
December 31, 1997. Sales and marketing expenses primarily consist of
compensation of sales and marketing personnel, advertising, promotional expenses
and other marketing related costs. The increase in dollars is primarily the
result of expenses related to the WebTV transaction, promotional spending on the
GO Network, cost of purchased traffic, hiring additional sales and marketing
personnel and an increase in promotional and advertising activity including
television and other media advertising campaigns. Management expects to increase
the amount of promotional and advertising expenses, especially related to GO
Network, and anticipates hiring additional sales representatives in future
periods.

General and Administrative

         General and administrative costs were approximately $6.9 million for
the three months ended January 2, 1999, or 23% of revenues, compared to
approximately $1.8 million, or 14% of revenues, for the three months ended
December 31, 1997. General and administrative expenses consist primarily of
compensation of administrative and executive personnel, facility costs and fees
for professional services. The increase in dollars is the result of the
integration costs associated with the Starwave acquisition, hiring additional
administrative and executive staff and adding infrastructure to manage the
expansion of the business. Management anticipates that its general and
administrative expenses will continue to increase as Infoseek continues to
expand its administrative and executive staff.

Amortization of Intangibles

         The Starwave merger and related transactions were completed on November
18, 1998. The Starwave acquisition is being accounted for as a purchase
transaction. The fair value of Infoseek's shares and options issued was
approximately $897.8 million. In addition, Infoseek incurred direct acquisition
costs of approximately $22.0 million, which were included in the purchase price
of Starwave.  The total purchase price of Starwave was therefore approximately
$919.8 million. Accordingly, intangible assets of approximately $45.2 million
related to developed technology and assembled workforce were recorded and will
be amortized over two years.  Intangible assets related to goodwill and the
Joint Ventures of approximately $658.5 million and $178.5 million, respectively,
were recorded and will be amortized over ten years.  For the three months ended
January 2, 1999, Infoseek incurred approximately $13.3 million in amortization
expense related to intangibles. Of the approximately $13.3 million of
intangibles amortization, approximately $4.4 million is related to hosting,
content and website costs, approximately $0.4 million related to sales and
marketing expenses, approximately $0.2 million related to general and
administrative expenses, approximately $0.1 million related to research and
development expenses and approximately $8.2 million for goodwill. Management
anticipates that amortization of intangibles will increase in future periods.

In-Process Research and Development

         For the three months ended January 2, 1999, Infoseek incurred charges
for in-process research and development of approximately $72.6 million. Because
the acquisition of Starwave was accounted for under the purchase method of
accounting, the purchase price was allocated to the acquired assets and
liabilities of Starwave.

                                      20
<PAGE>
 
Loss from Joint Ventures

         For the three months ended January 2, 1999, Infoseek incurred losses of
approximately $1.3 million from the Joint Ventures related to the Starwave
acquisition which represents 60% of the Joint Venture losses.

Interest Income, Net

         For the three months ended January 2, 1999 and December 31, 1997,
Infoseek earned net interest income of approximately $2.0 million and $0.2
million, respectively.  The increase in interest income, net is primarily the
result of an increase in available cash from increased revenues and proceeds
from the Disney transaction and Infoseek's follow-on public offering in February
1998.

Income Taxes

         Due to Infoseek's loss position, there was no provision for income
taxes for any of the periods presented. At October 3, 1998, Infoseek had federal
and state net operating loss carry forwards of approximately $40.0 million and
$17.0 million, respectively. The federal net operating loss carry forwards will
expire beginning in 2009 through 2013, if not utilized, and the state net
operating loss carry forwards will expire in the years 1999 through 2013.
Certain future changes in the share ownership of Infoseek, as defined in the Tax
Reform Act of 1986 and similar state provisions, may restrict the utilization of
carry forwards. A valuation allowance has been recorded for the entire deferred
tax asset as a result of uncertainties regarding the realization of the asset
due to the lack of earnings history of Infoseek.  As a result of the Starwave
acquisition, the Company recorded a deferred tax liability of $41.6 million.

Year 2000 Compliance

         Infoseek is aware of the issues associated with the programming code in
existing computer systems as the year 2000 approaches.  Virtually every computer
operation will be affected by the "year 2000 problem."  Many computer systems
only provide for a two digit date and therefore will not properly recognize
dates when the year changes from 1999 ("99" in most systems) to 2000, since the
system may recognize the year as 1900 instead of 2000.  Computer systems that do
not properly recognize the year 2000 could generate incorrect data or cause a
system to fail.

         Infoseek management has conducted a review of Infoseek's exposure to
the year 2000 problem.  Infoseek is working with its major computer system,
data feed and software vendors to determine if they are prepared for
the year 2000.  Based on Infoseek's internal review and discussions with these
vendors, Infoseek currently believes that its internal systems are year 2000
compliant or will be made so with only minor modifications.  However, Infoseek
does plan to replace several internal systems as part of a conversion to
improved financial and business systems in connection with upgrade programs in
late 1999. Infoseek does not expect to incur significant expenses or to have to
purchase additional computer systems to avoid the year 2000 problem, for either
Infoseek's internal information technology systems or Infoseek's products and
services.

         Despite Infoseek's review, the effects of the year 2000 problem are
still very uncertain.  Infoseek cannot assure you that its vendors'
representations are accurate.  Infoseek has also not investigated year 2000
compliance by third parties who are not vendors of Infoseek.  Infoseek has no
control over these third parties' compliance.  For example, if a link on GO
Network or the Infoseek search service points to a website which is not year
2000 compliant, that link may not be available to users and therefore the
Infoseek

                                      21
<PAGE>
 
services will offer fewer features. If many linked sites do not work, the
value of user traffic and advertising on Infoseek's websites could materially
decrease. In addition, if Infoseek's review of its year 2000 readiness did not
uncover all year 2000 problems, Infoseek does not have a contingency plan to
address this risk and could suffer serious harm or be required to expend
resources to resolve those problems. If Infoseek's systems are not year 2000
compliant, although Infoseek does not expect any of the following to occur, it
may not be able to input financial data or generate reports and could lose
data in its management information and advertising management systems. In
addition, users of its services could experience reduced functionality and
potentially lose stored user data.

         If Infoseek or any of its viewers, customers, linked sites,
advertisers, vendors or other third parties are not year 2000 compliant,
Infoseek's business, results of operations, financial condition and prospects
could be seriously harmed.

LIQUIDITY AND CAPITAL RESOURCES

         At January 2, 1999, Infoseek had approximately $5.2 million in cash and
cash equivalents, an increase of approximately $4.5 million from October 3,
1998.

         For the three months ended January 2, 1999, operating activities used
cash of approximately $21.4 million due primarily to Infoseek's net loss,
partially offset by increases in non-cash charges including depreciation and
amortization and the write-off of in-process technology. For the three months
ended December 31, 1997, operating activities provided cash of approximately
$1.1 million due primarily to increases in accounts payables and accrued
liabilities to service providers partially offset by Infoseek's net loss. For
the three months ended January 2, 1999, investing activities used cash of
approximately $45.0 million primarily related to the net purchases of short-term
investments and equipment purchases. For the three months ended December 31,
1997, investing activities used cash of approximately $1.1 million primarily
related to the issuance of notes receivable. Financing activities generated cash
of approximately $71.0 million in the three months ended January 2, 1999
primarily from the issuance of common stock. Financing activities generated cash
of approximately $0.7 million in the three months ended December 31, 1999
primarily from the issuance of convertible debt and common stock.

         Infoseek has cash commitments to Netscape, Microsoft and WebTV in
connection with certain agreements. Infoseek also has commitments to purchase
promotion for GO Network from ABC pursuant to a promotional services
agreement, make guaranteed minimum payments under representation agreements
with the Joint Ventures, minimum funding commitments for GO Network pursuant
to a product management agreement with Disney and, when it obtains positive
EBITA, license royalty commitments to Disney. In addition, Infoseek has
funding commitments under operating lease agreements and expects to continue to
incur significant capital expenditures to support expansion of Infoseek's
business. Furthermore, from time to time Infoseek expects to evaluate the
acquisition of products, businesses and technologies that complement Infoseek's
business. Infoseek currently anticipates that its cash, cash equivalents, short-
term investments, and cash flows generated from advertising revenues will be
sufficient to meet its anticipated needs for working capital and other cash
requirements through at least September 30, 1999. However, Infoseek may need to
raise additional funds sooner in order to fund more rapid expansion, to develop
new or enhance existing services or products, to respond to competitive
pressures or to acquire complementary products, businesses or technologies.

         Infoseek had cash, cash equivalents and short-term investments of 
approximately $94.1 million as of January 2, 1999. If additional funds are
raised through the issuance of equity or convertible debt securities, the
percentage ownership of the stockholders of Infoseek will be reduced, such
stockholders may experience additional dilution and such securities may have
rights, preferences or privileges senior to those of the holders of Infoseek's
common stock. There can be no assurance that additional financing will be
available on terms favorable to Infoseek, or at all. If adequate funds are not
available or are not available on acceptable terms, Infoseek's ability to fund
expansion, take advantage of acquisition opportunities, develop or enhance
services or products or respond to competitive pressures would be significantly
limited. Such limitation could have a material adverse effect on Infoseek's
business, results of operations, financial condition and prospects. The estimate
of the period for which Infoseek expects its available funds to be sufficient to
meet its capital requirements is a forward-looking statement that involves risks
and uncertainties. There can be no assurance that Infoseek will be able to meet
its working capital and other cash requirements for this period as a result of a
number of factors including but not limited to those described under "Risk
Factors--In Order to Continue to Grow, Infoseek Will Need More Financing."

                                      22
<PAGE>
 
                                 RISK FACTORS
 
  You should carefully consider the risks described below before making your
decision to invest in Infoseek. The risks and uncertainties described below
are not the only ones facing Infoseek. Additional risks and uncertainties not
presently known to us or that we do not currently believe are important to an
investor may also harm Infoseek's business operations.
 
  If any of the events, contingencies, circumstances or conditions described
in the following risks actually occur, Infoseek's business, financial
condition or results of operations could be seriously harmed. If that occurs,
the trading price of Infoseek common stock could decline, and you may lose
part or all of your investment.
 
IF GO NETWORK IS NOT SUCCESSFUL, INFOSEEK'S BUSINESS WOULD BE SERIOUSLY HARMED
 
  Infoseek believes that its new Internet service, GO Network, is critical to
its business. If Infoseek does not further enhance GO Network, develop more
functions and services for GO Network, integrate more content into GO Network
or successfully promote GO Network, Infoseek's business, financial condition
and operating results would be seriously harmed.
 
  In addition, particularly given the growing number of new Internet sites and
low barriers to entering the Internet market, Infoseek also cannot assure you
that users and advertisers will accept GO Network. If users and advertisers do
not accept GO Network or do not find it to be of high quality, Infoseek will
experience decreased revenues and may be required to incur additional expenses
to promote GO Network.
 
  Further, Infoseek is transitioning users from the Infoseek Service to GO
Network. Infoseek cannot assure you this transition will occur effectively and
without disruption to its users, advertisers and partners. Current Infoseek
advertisers and content providers may not continue to advertise or provide
content to either the Infoseek Service or GO Network. The promotion of GO
Network may result in potential confusion or a decline in loyalty among users
or customers of the Infoseek Service or the ABCNEWS.com or ESPN.com services,
which are now part of GO Network.
 
  Finally, in order to attract users and build strong brand recognition and
loyalty for GO Network, Infoseek will be required to significantly increase
spending to promote GO Network, including the purchase of promotion from
Disney affiliate ABC. Infoseek may also be required to spend additional money
to purchase and produce new content. Such additional spending will result in
continued operating losses and delays to Infoseek's achievement of
profitability.
 
  As a result of these risks, Infoseek cannot assure you that GO Network will
be successful or result in greater revenues, cash flows or any profits to
Infoseek.
 
GO NETWORK MAY NOT SUCCEED WITHOUT DISNEY'S COOPERATION
 
  Infoseek and Disney plan to jointly promote GO Network. If Disney does not
effectively promote GO Network, GO Network may not be a success and Infoseek's
business may suffer.
 
  Infoseek licenses the GO Network trademark from Disney. This license may be
terminated by Disney under certain circumstances. If Disney terminates the
license, GO Network would be severely harmed. Further, if Disney does not
protect the GO Network trademark against infringement or if this trademark
infringes the rights of others, the value of the trademark would be diminished
and GO Network would be harmed. See "--Third Parties May Prevent Infoseek From
Developing Its Intellectual Property."
 
  Although Disney has generally agreed to not compete with Infoseek in certain
limited geographic and product areas, Disney may enter into transactions with
any of Infoseek's competitors or provide Disney content to Infoseek's
competitors. Disney currently provides some of its content to competitors of
Infoseek and maintains
 
                                      23
<PAGE>
 
a number of websites which are not expected to be linked to GO Network.
Infoseek cannot assure you that Disney will not compete with GO Network or the
Infoseek Service.
 
If Infoseek Encounters Difficulties in Integrating Starwave and Quando,
Infoseek Will Not Experience All of the Expected Benefits of these
Acquisitions
 
  To achieve benefits from Infoseek's recent acquisitions of Starwave and
Quando, Infoseek must quickly and smoothly integrate its operations with the
respective operations of Starwave, Starwave's joint ventures with ESPN and
ABC, and Quando. Infoseek will be required to coordinate Infoseek's,
Starwave's and Quando's respective product and service offerings. Infoseek
will also be required to combine Infoseek's, Starwave's and Quando's sales,
marketing and research and development efforts. Infoseek cannot assure you
that the integration will occur quickly and successfully or that it will be
able to take full advantage of the combined company's sales force, marketing
and research and development efforts. If Infoseek does not successfully
integrate its operations, Infoseek's business, results of operations,
financial condition and prospects could be seriously harmed.
 
  Since Infoseek's principal office (Sunnyvale, California), Starwave's
headquarters (Bellevue, Washington), the ABC News Joint Venture (principally
located in New York City), the ESPN Joint Venture (principally located in
Bristol, Connecticut and New York City), and Quando's headquarters (Portland,
Oregon), are geographically dispersed, integrating these organizations and
operating these businesses will be more difficult. In addition, Infoseek has
approximately 410 more employees now than prior to these acquisitions. Infoseek
management will be required to spend a significant amount of time on
integration issues, which may distract their attention from the day-to-day
operations of Infoseek.
 
ACCOUNTING CHARGES FROM ACQUISITIONS WILL DELAY AND REDUCE PROFITABILITY
 
  Infoseek's acquisitions of Starwave and Quando were accounted for under the
purchase method of accounting. As a result, Infoseek will have reduced
profitability for at least several years due to accounting charges relating
to:
 
  .  amortization of intangible assets:
 
    1. developed technology and assembled workforce of Starwave: $45.2
       million amortized over a two year period
 
    2. developed technology and assembled workforce of Quando: $8.7 million
       amortized over a two year period
 
    3. goodwill of Starwave: $658.5 million amortized over a ten year
       period
 
    4. goodwill of Quando: $9.1 million amortized over a two year period
 
    5. joint venture relationships: $178.5 million amortized over a ten year
       period
 
  .  in-process research and development of Starwave and Quando: $72.6
     million expensed in the quarter ended January 2, 1999 and $4.3 million
     to be expensed in the quarter ended April 3, 1999
 
  .  remaining integration costs: up to $4.2 million
 
  .  significant future charges relating to sales of shares and warrants which
     Infoseek may be required to make to Disney below fair market value at the
     time of purchase in connection with Disney's exercise of its rights to
     maintain its ownership interest in Infoseek
 
  .  increased operating expenses due to Infoseek's expanded business,
     including GO Network
 
  .  other costs not currently known
 
  If these expenses are not timely followed by increased revenues, Infoseek's
business, results of operations, financial condition and prospects would be
seriously harmed.
 
IN ORDER TO CONTINUE TO GROW, INFOSEEK WILL NEED MORE FINANCING
 
  Infoseek currently anticipates that its cash and other available sources of
funds will last through at least September 30, 1999. After that time, Infoseek
may need to raise additional funds. Additional financing may not
 
                                      24
<PAGE>
 
be available on satisfactory terms, if at all. Infoseek's estimate of the time
period through which its cash and other sources of funds will be sufficient to
fund its operations is a forward-looking statement subject to risks and
uncertainties. The actual time period may vary as a result of a number of
factors including those set forth below in this risk factor.
 
  Infoseek expects to use its funds to, among other things, continue expanding,
develop new and enhance existing services and products, promote GO Network and
acquire other businesses, products or technologies. Infoseek may decide to
spend more money than currently forecasted on any of these activities, and
therefore may be required to raise additional funds sooner than currently
anticipated. If Infoseek does not raise enough additional funds, Infoseek may
not be able to continue to do any or all of these activities and Infoseek's
business, financial condition and prospects could be seriously harmed. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Infoseek Liquidity and Capital Resources."
 
  If any additional funds are raised through the sale of stock or convertible
debt, the percentage ownership of Infoseek's current stockholders will be
reduced. Such stock or convertible debt also may have rights, preferences or
privileges greater than Infoseek's common stock.
 
INFOSEEK'S FINANCIAL RESULTS WILL VARY
 
  Infoseek and its subsidiaries have limited operating histories. The Internet
and intranet markets addressed by Infoseek are new. Infoseek therefore does not
have internal or industry-based historical financial data for any significant
period of time upon which to base projections for revenues or to help budget
operating expenses. As a result, Infoseek cannot assure you it will have
profits in any given period or in the long term.
 
  Infoseek expects that its results will vary significantly in the future due
to a number of reasons, including:
 
  .  the rate of growth, usage and acceptance of the Internet, intranets and
     online services,
 
  .  the rate of acceptance of the Internet as an advertising medium and the
     demand for advertising,
 
  .  acceptance of the Internet for commerce,
 
  .  demand for Infoseek's products and services,
 
  .  the advertising budgeting cycles of individual advertisers,
 
  .  costs related to expansion and capital investments,
 
  .  results of acquisitions and strategic agreements, including amortization of
     intangible assets,
 
  .  charges relating to the issuance of stock or warrants below market price in
     connection with Disney's right to maintain its ownership interest,

  .  the introduction, marketing and acceptance of new, enhanced or
     alternative products or services by Infoseek or by its competitors,
 
  .  Infoseek's ability to anticipate and effectively adapt to and expand in
     a developing market,
 
  .  Infoseek's ability to adapt to rapidly changing technologies and develop
     new technologies,
 
  .  technical difficulties or system outages,
 
  .  Infoseek's ability to integrate operations and manage expansion,
 
  .  Infoseek's ability to attract, retain and motivate qualified personnel,
 
  .  initiation, implementation, amendment, renewal or expiration of
     significant contracts with partners,
 
  .  performance of its partners such as Disney, ABC and ESPN in developing
     their own brands,
 
  .  short and long term pricing changes by Infoseek or its competitors,
 
  .  specific economic conditions in the Internet, intranet and digital media
     markets,
 
  .  strikes or other work disruptions,
 
  .  seasonal fluctuations in Internet use and the markets for news and
     sports events,
 
  .  general economic conditions, and
 
  .  other factors.
 
                                      25
<PAGE>
 
  In addition, almost all of Infoseek's revenues come from advertising
contracts and related sponsorship agreements, many of which are for three
months or less. Advertising prices are closely related to the number of
viewers on Infoseek's services, and Infoseek cannot accurately predict the
number of viewers on its sites for any given time. As a result, Infoseek has
difficulty forecasting future sales and operating results.
 
  Infoseek cannot assure you that it will be able to adjust spending quickly
to compensate for any reduction in future revenues. Accordingly, if revenues
do not meet Infoseek's expectations, there would be an immediate and serious
impact on Infoseek's business, results of operations, financial condition and
prospects.
 
DISNEY OWNS A SUBSTANTIAL AMOUNT OF INFOSEEK STOCK AND IS ABLE TO
SIGNIFICANTLY INFLUENCE INFOSEEK'S AFFAIRS
 
  Disney is the principal stockholder of Infoseek, owning approximately 43% of
Infoseek's outstanding stock. Disney also owns warrants which generally become
exercisable over three years from November 1998 that will allow Disney to own
a total of 50.1% or more of Infoseek's outstanding common stock. Infoseek and
its stockholders face several specific risks as a result of Disney's ownership
of Infoseek's common stock, including the following:
 
Disney Has Certain Control Over Infoseek's Governance.
 
  Through its substantial ownership of and its agreements with Infoseek,
Disney may exercise significant control over Infoseek. Specifically:
 
  .  Disney may be able to exercise effective control over certain matters
     requiring stockholder approval.
 
  .  Disney has the right to have its nominees for director submitted to a
     vote of stockholders of Infoseek. Disney currently is entitled to a
     number of nominees sufficient to require the approval of the Disney
     nominees for those transactions requiring supermajority board approval,
     described below.
 
  .  Supermajority board approval is required for certain Infoseek
     transactions, including:
 
    .  amendment of Infoseek's certificate of incorporation or bylaws,
 
    .  a transaction in which the ownership control of Infoseek changes,
 
    .  sale of 15% or more of Infoseek's assets,
 
    .  issuance of securities representing 15% or more of Infoseek's
       outstanding shares or for $200 million or more,
 
    .  certain debt or cash transactions by Infoseek of $200 million or
       more, and
 
    .  any appointment of a new Chief Executive Officer of Infoseek.
 
Disney May Be Able to Obtain Majority Control of Infoseek in the Future.
 
  Although Disney has agreed for a three-year period to not acquire voting
power over more than 49.9% of Infoseek's stock, this "standstill" obligation
may be terminated earlier in certain limited circumstances. If the standstill
obligation terminates, Disney could quickly obtain majority control over
Infoseek.
 
Disney Has a Right to Purchase Additional Shares in Future Infoseek Offerings
Which Could Further Dilute Other Shareholders' Ownership.
 
  Disney has a right to purchase additional shares and warrants of Infoseek in
order to maintain its ownership level if Infoseek issues additional shares or
options. Disney's purchase of additional shares will dilute other Infoseek
stockholders' ownership and could reduce Infoseek's earnings per share, if
any. Disney's purchase of additional shares and warrants could also result in
material charges if the purchase of shares or warrants, or the price of the
warrants, to Disney are below fair market value at the time of purchase; these
charges may materially adversely affect Infoseek's results of operations.
 
Disney's Ownership Reduces Opportunity for an Acquisition of Infoseek by a
Third Party.
 
  Disney's substantial ownership position in Infoseek, as well as the terms of
the GO Network trademark license agreement between Infoseek and Disney, may
prevent or discourage tender offers for Infoseek's common stock
 
                                      26
<PAGE>
 
or other changes in the control of Infoseek unless the terms are approved by
Disney. Therefore, it is difficult for a person other than Disney to acquire
all or a large portion of Infoseek stock. See "Business--Relationship with
Disney."
 
IF INFOSEEK CANNOT RENEW EXISTING OR ENTER INTO NEW AGREEMENTS WHICH RESULT IN
USER TRAFFIC, OR IF SITES THAT PROVIDE TRAFFIC TO INFOSEEK ARE NOT SUCCESSFUL,
INFOSEEK'S ADVERTISING REVENUE WILL DECREASE
 
  Infoseek's success depends in great part on strategic relationships with
third parties as sources of traffic and as providers of content to its
Web site. Infoseek's traffic agreements generally have terms of one year or
less. A significant portion of the aggregate page views on the Infoseek
Service is generated by traffic derived from third party sources, principally
Microsoft, WebTV and Netscape. Infoseek's agreement with Netscape was
renegotiated on November 25, 1998, resulting in Infoseek receiving less
traffic from Netscape.
 
  When existing traffic agreements terminate, Infoseek may not be able or
willing to renew them. Infoseek may not be able to enter into other agreements
on good terms or at all. If Infoseek does not renew these agreements or enter
into similar agreements on good terms or does not develop significant traffic
to make up for the loss of these agreements, Infoseek's advertising revenues
will be reduced. Reduced advertising revenues would likely seriously harm
Infoseek's business, results of operations, financial condition and prospects.
 
  In addition, the products or services of those companies that provide access
or links to Infoseek's products or services, such as other website operators,
may not achieve market acceptance or commercial success, which would likely
seriously harm Infoseek's business, results of operations, financial condition
and prospects.
 
INFOSEEK'S FUTURE SUCCESS DEPENDS ON THE CONTINUATION AND INTEGRATION OF JOINT
VENTURE RELATIONSHIPS AND ON ENTERING INTO NEW THIRD PARTY RELATIONSHIPS
 
  Infoseek's success also depends in great part on the continuation and
integration of its joint ventures and third party relationships, especially
the joint ventures with ESPN and ABC. Under certain representation agreements,
Starwave contracted for, and has exclusive rights to sell, all advertising and
other related items of the Joint Ventures. Starwave guarantees its performance
through minimum revenue commitments and is at risk if its subsequent
collection of the related receivables is insufficient to cover such
commitments. These representation agreements will result in Starwave
recognizing revenue for the sale of the advertising and of related items and a
corresponding representation fee for amounts due to the Joint Ventures. If
Infoseek is unable to continue its joint ventures with its joint venture
partners, integrate these joint ventures into its business or enter into new
joint ventures, Infoseek may not be able to keep or create interactive
services and products that are attractive to users and advertisers. This in
turn could seriously harm Infoseek's business, financial results and financial
condition.
 
INFOSEEK HAS HAD LOSSES IN THE PAST AND HAS DIFFICULTY PREDICTING FUTURE
RESULTS BUT EXPECTS FLUCTUATIONS AND LOSSES IN THE FUTURE
 
  Infoseek has not yet been profitable and expects to have consolidated net
losses for a number of years. The limited operating histories of Infoseek and
its subsidiaries make it difficult to budget or predict future results.
Although Infoseek has experienced significant revenue growth in 1997 and 1998,
Infoseek cannot assure you that revenues will continue to grow or that
Infoseek will achieve profitability.
 
  Infoseek and its prospects must be considered in light of the risks, costs
and difficulties frequently encountered by companies in their early stage of
development, particularly companies in the new and rapidly evolving Internet
market. In addition, because the acquisitions of Starwave and Quando are large
and complex, Infoseek may be required to reorganize its operations in order to
operate more effectively. For example, in January 1999, Infoseek reorganized
all of its product and engineering related efforts into a single department to
become more functional and efficient. Due to the complexity and scale of
Infoseek's recent acquisitions and the rapid pace of change and development of
the Internet market, Infoseek's operating plans and forecasts, including its
projected business outlook, and Infoseek's operating objectives, are subject
to frequent revision. Although Infoseek has recently begun a new multi-year
planning cycle, future events and plans

 
                                      27
<PAGE>
 
may cause Infoseek to dramatically revise its business objectives and
estimates of profitability. Infoseek cannot assure you it will be able to
adequately address the challenges of the Internet market and the complexity of
its recent acquisitions.
 
  As of January 2, 1999, Infoseek had an accumulated deficit of $157.8 million, 
excluding the accumulated deficit of Quando, which will appear in the quarter 
ending April 3, 1998.
 
  In addition, Infoseek may elect from time to time to make certain pricing,
service or marketing decisions or acquisitions that could seriously harm
Infoseek's business, results of operations, financial condition and prospects
in the short-term or long-term. Infoseek's agreements with its strategic
partners have included and may in the future include substantial one-time or
up-front payments from these partners. Accordingly, Infoseek believes that its
quarterly revenues are likely to vary significantly in the future, that
period-to-period comparisons are not necessarily meaningful and that such
comparisons should not necessarily be relied upon as an indication of
Infoseek's future performance.
 
INFOSEEK'S STOCK PRICE WILL FLUCTUATE
 
  The market price of Infoseek's common stock has fluctuated and may continue
to fluctuate widely. Such changes are in response to a number of events and
factors such as:
 
  .  quarterly changes in results of operations,
 
  .  announcements of new technological innovations or new products and media
     properties by Infoseek or its competitors,
 
  .  changes in financial estimates and recommendations by securities
     analysts,
 
  .  the operating and stock price performance of other companies that
     investors may deem comparable to Infoseek, and
 
  .  news relating to trends in Infoseek's markets or the economy generally.
 
  In addition, the stock market and specifically the stock of Internet
companies have been very volatile. This volatility is often not related to the
operating performance of the companies. This broad market volatility and
industry volatility may reduce the price of Infoseek's common stock, without
regard to Infoseek's operating performance. In addition, Infoseek's operating
results may be below the expectations of public market analysts and investors.
In such event, the market price of Infoseek's common stock would likely
significantly decrease.
 
IF INFOSEEK DOES NOT DEVELOP STRONG BRANDS, ITS BUSINESS COULD SUFFER
 
  Infoseek believes that establishing and maintaining the GO Network and
related brands is crucial to its business. Infoseek believes that brand
recognition will be even more important as the number of Internet sites grows,
due to the relative ease of entering the Internet market. If Infoseek does not
promote and maintain its brands, its business, results of operations,
financial condition and prospects would be seriously harmed.
 
  In order to promote and enhance its brands, Infoseek believes it must create
loyalty among consumers. This will require Infoseek to spend a large amount of
resources on developing high quality products and services and to design and
use effective media promotions. If Infoseek does not develop high quality
products and services or have effective promotions, it will not develop a
strong brand.
 
INFOSEEK FACES INTENSE COMPETITION AND MAY NOT BE ABLE TO COMPETE EFFECTIVELY
 
  The market for Internet and intranet products is very competitive and
Infoseek expects these markets to become more competitive in the future.
Infoseek believes it faces competition in numerous areas, including:
 
  .  consolidated Internet ("Portal") products,
 
  .  search and navigation services,
 
  .  search software,
 
                                      28
<PAGE>
 
  .  Internet media,
 
  .  advertising media, and
 
  .  electronic commerce.
 
  If Infoseek is unable to compete effectively in these areas, it could
suffer serious harm to its business.
 
  The market for these services is new and developing. As a result, Infoseek
cannot predict how competition will affect Infoseek, its competitors or its
customers. Since, developing new Internet technology is relatively inexpensive,
it is easy for new competitors to enter the Internet and intranet markets, and
these markets are changing quickly. There is a large number of competitors
currently in these markets and new competitors are entering these markets
everyday. In addition, some of Infoseek's competitors have engaged in business
combinations or other strategic relationships in order to increase their power
and market share.
 
  Many of Infoseek's competitors have greater resources, including financial,
marketing and technical resources, than Infoseek. These companies may be able
to offer greater content and services than Infoseek, including greater
multimedia content, search and directory services, on-line "communities" with
chat, e-mail and games, electronic commerce and high speed home Internet
access. Infoseek may be unable to develop these and other new services in
advance of competitors.
 
IF INFOSEEK DOES NOT ACHIEVE REVENUE MINIMUMS UNDER REPRESENTATION AGREEMENTS,
IT MAY INCUR LOSSES UNDER THESE AGREEMENTS
 
  Under certain representation agreements with ESPN and ABC, Infoseek (through
Starwave) has agreed to act as the representative of the ESPN and ABCNews
Joint Ventures. As such representative, Infoseek will sell advertising and
related services for these Joint Ventures, and has agreed to make quarterly
payments to the Joint Ventures. These payments will be the greater of a
predetermined minimum amount or revenues actually billed to third parties
(even if not collected) in the performance of such advertising and related
services, less the costs of providing the services and a predetermined profit
margin.
 
  Infoseek may not be able to sell the guaranteed minimum amount in any
quarterly period or be able to collect the money due from these sales and
services. Failure to sell the predetermined minimum amount or collect enough
money from these sales services could result in losses, and seriously harm
Infoseek's business, results of operations and financial condition.
 
IF THE INTERNET AND ELECTRONIC COMMERCE DO NOT CONTINUE TO GROW, INFOSEEK'S
BUSINESS WILL SUFFER
 
  To grow revenues, Infoseek depends on increased acceptance and use of the
Internet, intranets and other interactive online platforms as sources of
information, entertainment and sales of goods and services. If the Internet
grows more slowly than expected, or does not grow at all, Infoseek's business,
financial condition and operating results would be seriously harmed. If access
to the Internet or Infoseek's services is restricted, Infoseek's business,
financial condition and operating results would also be seriously harmed.
 
  The Internet has grown very rapidly in recent years. Infoseek cannot assure
you that the Internet will continue to be accepted and widely used. In
particular, Infoseek cannot assure you that consumers will continue to use the
Internet for purchasing or selling goods and services or that advertisers will
continue to use it for advertising goods and services. Infoseek also cannot
assure you that a large base of users will support Infoseek's business.
Significant structural problems remain in using the Internet and conducting
electronic commerce, including:
 
  .  security
 
  .  reliability
 
  .  cost
 
  .  ease of use and access
 
  .  quality of service
 
                                      29
<PAGE>
 
  .  lack of network infrastructure to support increased use
 
  .  speed of Internet service
 
  .  limitations on access by corporations and schools
 
  .  privacy
 
  These problems may slow the growth of Internet use or the attractiveness of
the Internet for advertising and online transactions. In addition, the use of
the Internet could be reduced due to delays in the development or adoption of
new standards and protocols required to handle increased levels of Internet
activity or as the result of increased government regulation.
 
  The Internet industry is young. The business model of Infoseek and its
competitors changes frequently and very few products and services have become
established in the market. The Internet market might not continue developing
or develop more slowly than expected. Infoseek may be unable to modify its
business model rapidly enough to remain competitive. The Internet market might
become filled with competitors. Infoseek's products may not become accepted by
Internet users or advertisers. If any of these events occurs, Infoseek's
business, results of operations, financial condition and prospects would be
seriously harmed.
 
IF INTERNET ADVERTISING AND RELATED SPONSORSHIP OF INFOSEEK'S SERVICES ARE NOT
ACCEPTED, INFOSEEK'S REVENUES WILL BE ADVERSELY AFFECTED
 
  Infoseek depends heavily on the sale of advertisements and related
sponsorships of GO Network and the Infoseek Service as a source of revenue.
Therefore, Infoseek depends on the acceptance and success of advertising on
the Internet. Infoseek cannot assure you that Internet advertising will be
widely accepted. The Internet market is changing quickly. Infoseek believes
that the number of companies selling advertising on the Web and the amount of
advertising space on the Internet have greatly increased recently. Infoseek
may therefore face a market which demands lower prices for the purchase of
advertisements and this could result in a decline in Infoseek's revenues. Many
of the advertisers on Infoseek's services are relatively new to Internet
advertising and have not devoted significant amounts of their advertising
budgets to Internet advertising. Advertisers may determine that traditional
sources of advertising, like television, radio and newspapers are less costly
or better at reaching customers than the Internet. There are no widely
accepted standards to measure the effectiveness of Internet advertising.
 
  Infoseek believes that advertising sales are generally lower in the winter
and summer of each year as compared with the fall and spring. Infoseek also
believes that advertising usage changes with the economy. Seasonal and
economic changes could more seriously affect Internet advertising sales. Any
seasonal or economic-based changes in advertising sales could seriously harm
Infoseek's business, financial condition and operating results.
 
IF INFOSEEK'S FUTURE ACQUISITIONS AND STRATEGIC TRANSACTIONS ARE NOT
SUCCESSFUL, INFOSEEK'S BUSINESS MAY SUFFER
 
  Infoseek believes it may be necessary to acquire complementary products,
technologies or businesses to remain competitive. There are several risks of
acquisitions or other strategic transactions, including the Quando and
Starwave acquisitions, such as:
 
  .  difficulties integrating people and operations,
 
  .  difficulties integrating acquired technology or content into existing
     businesses,
 
  .  potential disruption of Infoseek's ongoing businesses,
 
  .  expenses and other charges associated with transactions,
 
  .  the necessity of establishing and implementing uniform standards,
     controls, procedures and policies for acquired companies,
 
                                      30
<PAGE>
 
  .  impairment of relationships with employees, vendors and customers as a
     result of any integration of new management personnel, technologies,
     products and services,
 
  .  potential unknown liabilities associated with acquired businesses,
 
  .  use of limited cash resources,
 
  .  dilutive issuances of stock, and
 
  .  loss of key personnel.
 
  There can be no assurance that Infoseek will be successful in overcoming
these risks. Infoseek may also encounter other problems in connection with
acquisition transactions.
 
  Infoseek cannot assure you that any acquisition or strategic transaction
will be worth the time, effort and expense required to complete any
acquisition or transaction.
 
INFOSEEK MAY NOT BE ABLE TO USE POOLING ACCOUNTING FOR FUTURE ACQUISITIONS
WHICH MAY REDUCE ITS FUTURE PROFITABILITY
 
  Because of Infoseek's acquisition of Starwave and its transactions with
Disney, Infoseek may not be able to account for future acquisitions as
pooling-of-interests transactions for a period of time. Also, if Disney
chooses to obtain control when its warrant vests, Infoseek will not be able to
use pooling-of-interests accounting. Charges for the amortization of goodwill
incurred in acquisitions will reduce Infoseek's profits, if any, in the
periods over which it is amortized. Infoseek may also take charges for
acquired in-process research and technology when acquisitions occur. Such
charges for acquired in-process research and technology would reduce
Infoseek's profits in such period.
 
IF INFOSEEK DOES NOT IMPROVE ITS PRODUCTS TO KEEP PACE WITH CHANGING
TECHNOLOGY, IT WILL LOSE USERS
 
  Infoseek may not be able to respond to changing Internet technologies,
customers needs and industry standards. Infoseek may not be able to introduce
new products and services before competitors or improve existing products to
match competitors products and services. If it does not continue to timely and
continually improve its products and services and introduce new ones, Infoseek
could suffer serious harm to its business, results of operations and
prospects.
 
  One key element of Infoseek's strategy is to continue to develop new
technological innovations in order to enhance the user's experience and
strengthen relationships with advertisers. The success of GO Network and its
component sites will depend in part on how easy-to-use, functional and
feature-filled such services are.
 
  Because Infoseek needs to continue to provide technological improvements to
its services, including GO Network and the Infoseek Service, Infoseek faces
many risks. Infoseek cannot assure you:
 
  .  Any of its new or proposed products or services will be accepted by the
     market or will continue to meet the market's changing needs.
 
  .  It will successfully design, develop, test, market and introduce new and
     enhanced technologies and services.
 
  .  It will successfully improve its existing and planned products and
     services.
 
  .  It will not experience difficulties that delay or prevent the successful
     development, introduction or marketing of new or enhanced technologies,
     products and services.
 
  .  It will bring its technological innovations to the market quickly and in
     advance of its competitors.
 
  .  It will not have large expenses in order to develop, improve or acquire
     new technologies.
 
  .  Its new or enhanced products and services will be free of errors and
     will not require significant design changes once introduced.
 
                                      31 
<PAGE>
 
  If any of these risks occur, customers may become dissatisfied with
Infoseek's products and services. In turn, Infoseek could lose viewers and
could experience delayed or lost advertising revenues.
 
COMPUTER INTRUSIONS OR ELECTRONIC COMMERCE LIABILITIES MIGHT RESULT IN LOSSES
TO INFOSEEK
 
  Consumers' lack of faith in and lapses in the privacy and security of the
Internet and online transactions may also prevent the growth of the Internet
and electronic commerce generally. Infoseek's business, which depends on this
growth, may be harmed as a result.
 
  Despite Infoseek's efforts to prevent intruders from breaking into
Infoseek's systems and stealing information or interrupting service, Infoseek
cannot assure you that it will be able to protect itself from computer
security intrusions. Infoseek and its contractors store and transmit
confidential information, such as computer software or credit card numbers. If
data is lost or stolen, Infoseek may be sued by the owners of the lost or
stolen data or by other entities who rely on the data.
 
  Although Infoseek has agreements which are designed to limit Infoseek's
liability for losses, these agreements may not be enforceable. Even if they
are, the agreements may not be successful in limiting Infoseek's liability.
Also, Infoseek may not be able to negotiate these agreements with all parties.
 
  Infoseek does not have insurance against these security risks, although it
does have standard business interruption and crime insurance which might cover
certain losses. If Infoseek's revenue from electronic commerce increases
substantially, Infoseek will consider buying additional insurance. However, if
Infoseek does not or cannot obtain adequate insurance at that time, large or
repeated security breaches into Infoseek's systems could seriously harm
Infoseek's business, results of operations and financial condition.
 
  Infoseek has agreements and expects to enter into other agreements with
third parties where Infoseek is entitled to receive part of the revenues
received by these third parties from the purchase of goods and services by
users referred from Infoseek's products and services. Infoseek may also
directly sell goods and services on the Internet. These arrangements may
expose Infoseek to additional risks and uncertainties, including potential
liabilities to consumers of such products and services.
 
INFOSEEK MAY EXPERIENCE YEAR 2000 COMPUTER PROBLEMS THAT HARM ITS BUSINESS
 
  Certain computer systems may not correctly recognize dates when the year
changes from 1999 to 2000. Infoseek management has reviewed Infoseek's
exposure to this problem and does not believe that it will incur significant
expenses as a result of the effect of this problem on its products, services
or information technology. However, Infoseek does plan to replace several
systems as part of a conversion to improved financial and business systems in
connection with regular upgrade programs in late 1999 and will make minor
software alterations to certain of its systems to ensure full year 2000
readiness. Infoseek may not be able to implement these upgrades successfully,
and its belief that it will not incur significant expenses may be incorrect
due to unknown defects in its systems. If any of these were to occur, Infoseek
could suffer serious harm to its business, results of operations, financial
condition and prospects due to year 2000 computer system problems.
 
  Infoseek is relying on assurances from vendors that they and their products
are prepared for the year 2000. Infoseek cannot assure you the assurances it
receives from vendors are reliable, since Infoseek has not independently
investigated its vendor's assertions about their products. In addition,
Infoseek has also not investigated year 2000 compliance by third parties who
are not vendors of Infoseek. Infoseek has no control over these third parties'
compliance. For example, if a link on GO Network or the Infoseek Search
service points to a website which is not year 2000 compliant, that link may
not be available to users and therefore the Infoseek services will offer fewer
features. If many linked sites do not work, the value of user traffic and
advertising on Infoseek's websites could materially decrease. In addition, if
Infoseek's review of its year 2000 readiness did not uncover all year 2000
problems, Infoseek does not have a contingency plan to address this risk and
could suffer serious harm or be required to expend resources to resolve those
problems. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Year 2000 Compliance."
 
                                      32
<PAGE>
 
IN ORDER TO ACCOMMODATE FUTURE GROWTH, INFOSEEK MUST MAKE IMPROVEMENTS TO ITS
OPERATIONS
 
  Infoseek may not be able to manage its rapid growth effectively. In order to
take advantage of market opportunities, Infoseek may be required to expand.
Infoseek's growth has placed, and could continue to place, a significant
strain on Infoseek's limited personnel and other resources. Competition for
engineering, sales and marketing personnel is intense. Infoseek cannot assure
you that it will be successful in attracting and retaining such personnel.
 
  In order to succeed, Infoseek must continue to:
 
  .  Invest in and improve operational, financial and management information
     systems which affect planning, advertising sales, management, finance
     and accounting.
 
  .  Enhance its advertising inventory management analysis system discussed
     further under "--If Infoseek's Advertising Management Systems Fail,
     Infoseek Could Lose Advertising Sales Opportunities."
 
  .  Hire, train, motivate and manage its employees.
 
  .  Maintain relationships with various partners, advertising customers,
     advertising agencies, Internet sites and services, Internet service
     providers and other third parties.
 
  .  Retain control by management over the operations and strategic direction
     of Infoseek in a rapidly changing environment and locate new business
     activities.
 
  .  Develop expanded electronic commerce capabilities, including an
     infrastructure for security, order processing and financial reporting.
 
  If Infoseek fails to do any of these or experiences problems, delays or
unanticipated additional costs in addressing these concerns, Infoseek's
business, results of operations, financial condition and prospects could be
seriously harmed.
 
FAILURES OR LACK OF CAPACITY IN INFOSEEK'S COMPUTER SYSTEMS COULD RESULT IN
LOSS OF USERS
 
  If Infoseek's systems, the majority of which are located in Sunnyvale,
California, and Bellevue and Seattle, Washington, fail or function poorly for
any reason, these interruptions would result in less traffic to the Infoseek
services. If the interruptions continue, they could reduce the number of users
of and advertisers on Infoseek's products and services. A reduction in the
number of users of and advertisers on Infoseek's products and services could
seriously harm Infoseek's business, results of operations, financial condition
and prospects.
 
  Infoseek relies on computer, network and telecommunications systems to
provide its products and services. Such systems:
 
  .  May fail to operate correctly
 
  .  May be strained by too many users or demands
 
  .  May be damaged by earthquakes, fires, floods, wind storms, power loss,
     lightning, electrical and telecommunication failures or similar events
 
  .  May be damaged through physical or electronic break-ins or computer
     viruses
 
  Infoseek does not maintain a comprehensive disaster recovery plan and does
not have redundant systems for each of its services. Although Infoseek has
insurance for fires, floods, earthquakes (and, for the systems in Washington,
wind storms) and general business interruptions, the amount of coverage may
not be adequate to cover all losses which could occur. If losses occur from
failures of Infoseek systems and insurance does not fully cover such losses,
they could seriously harm Infoseek's business, results of operations,
financial condition and prospects.
 
  Infoseek also depends on Web browser makers and Internet and online service
providers. Infoseek's viewers have experienced and may in the future
experience difficulties due to incompatibilities or other problems.
 
                                      33
<PAGE>
 
Infoseek cannot control these Web browser makers and online services providers
and cannot predict when these incompatibilities or problems will occur.
Infoseek also depends on computer hardware suppliers to promptly deliver,
install and service its servers and other equipment and services used to
provide Infoseek's products and services. If Infoseek's access to the Internet
or computer systems fail, it could result in serious harm to Infoseek's
business, results of operations, financial condition and prospects.
 
IF INFOSEEK'S ADVERTISING MANAGEMENT SYSTEMS FAIL, INFOSEEK COULD LOSE
ADVERTISING SALES OPPORTUNITIES
 
  In order to generate revenues, Infoseek must manage the advertising on its
large, high traffic websites. Infoseek relies on internal advertising
inventory management and analysis systems to provide internal reporting and
customer feedback on advertising. If Infoseek has serious difficulties in
utilizing these systems, Infoseek will need to devote more resources to
enhance these systems.
 
  If Infoseek fails to properly display advertising because of problems with
its advertising management systems or other technical problems, Infoseek would
be required to deliver additional advertising displays which otherwise could
have been sold to other advertisers. Significant amounts of these "make good"
obligations could result in serious harm to Infoseek's business, results of
operations, financial condition and prospects.
 
IF INFOSEEK IS NOT SUCCESSFUL IN EXPANDING INTERNATIONALLY, ITS BUSINESS MAY
SUFFER
 
  As part of its business strategy, Infoseek has begun to expand its products
and services into international markets and is exploring further opportunities
to expand internationally. If Infoseek fails to be successful in international
markets, Infoseek's business could suffer.
 
  Infoseek may not be successful in creating localized versions of its
products and services or marketing or distributing its products abroad. Even
if Infoseek is successful, its international revenues may not be adequate to
offset the expense of establishing and maintaining international operations.
Further, in addition to the uncertainty of Infoseek's ability to establish an
international presence, there are difficulties and risks inherent in doing
business internationally, such as:
 
  .  compliance with regulatory requirements and changes in these
     requirements
 
  .  export restrictions
 
  .  export controls relating to technology
 
  .  tariffs and other trade barriers
 
  .  difficulty in protection of intellectual property rights
 
  .  difficulties in staffing and managing international operations
 
  .  longer payment cycles
 
  .  problems in collecting accounts receivable
 
  .  political instability
 
  .  fluctuations in currency exchange rates
 
  .  potentially adverse tax consequences
 
  .  increased competition
 
  Any one or more of these factors could prevent Infoseek from being
successful in international markets.
 
INFOSEEK MAY NOT BE ABLE TO ATTRACT OR RETAIN THE KEY PERSONNEL IT NEEDS TO
SUCCEED
 
  If Infoseek is unable to attract and retain key and other skilled employees,
its business, results of operations, financial condition and prospects would
be seriously harmed. Infoseek's ability to generate revenues and profits
 
                                      34
<PAGE>
 
depends upon its senior management team. Infoseek depends upon its Chairman of
the Board, Steven Kirsch, who is very involved in Infoseek's research and
development efforts, Harry Motro, its President and Chief Executive Officer,
Les Wright, its Senior Vice President, Chief Administrative Officer and Chief
Financial Officer, and Patrick Naughton, its Executive Vice President of
Products. Infoseek also depends on many other employees, such as employees
with writing, editing, sales, management, marketing or technical ability.
Employees with these skills are difficult to find, and competition for these
employees is intense. Most of Infoseek's key employees do not have employment
contracts. Infoseek may also require even more skilled employees because of
the launch of GO Network and acquisition of Starwave.
 
IF INFOSEEK IS UNABLE TO PROTECT ITS INTELLECTUAL PROPERTY, ITS BUSINESS COULD
SUFFER
 
  Infoseek's success depends heavily upon its exclusive technology, brand
names and Internet locations ("domain names"). Infoseek cannot assure you that
it can adequately protect this intellectual property. If Infoseek fails to
protect its intellectual property, its business could suffer.
 
  To protect its rights to its software, systems, documentation and product
features, Infoseek currently relies on a combination of:
 
  .  patent, copyright and trademark and service mark laws,
 
  .  trade secret laws,
 
  .  confidentiality procedures, and
 
  .  contractual provisions.
 
  These methods of protection may not be adequate to protect against others
using Infoseek's technology, brand names and content. Accordingly, Infoseek
cannot assure you that it will be able to maintain the goodwill associated
with its products and services or competitive features.
 
  Despite Infoseek's efforts to patent and trademark its intellectual property
and keep information confidential, Infoseek may not be able to protect its
intellectual property. Infoseek may not be able to protect its technology
because:
 
  .  Pending and new patent applications and trademark registrations may not
     be approved.
 
  .  Even if issued, new patents and trademark registration may be
     challenged, invalidated or designed around.
 
  .  Infoseek's new products or technologies may not be patentable.
 
  .  Time-consuming and costly litigation may be necessary to protect
     Infoseek's proprietary technologies.
 
  .  Policing unauthorized use of Infoseek's intellectual property is
     difficult and expensive.
 
  .  The laws of some foreign countries do not protect proprietary rights to
     as great an extent as do the laws of the United States.
 
  .  Infoseek's competitors may independently develop similar technology or
     design around Infoseek intellectual property.
 
  .  The application of copyright and trademark laws to the Internet and
     other digital media is very uncertain.
 
THIRD PARTIES MAY PREVENT INFOSEEK FROM DEVELOPING ITS INTELLECTUAL PROPERTY
 
  Infoseek may not be able to use its intellectual property or further develop
its business because of third parties. Infoseek cannot assure you that third
parties will not in the future claim infringement by Infoseek with
 
                                      35
<PAGE>
 
respect to Infoseek's current or future products. These claims of
infringement, whether successful or not, could seriously harm Infoseek's
business, results of operations or prospects.
 
  Third parties:
 
  .  may bring claims of patent, copyright or trademark infringement against
     Infoseek,
 
  .  may obtain patents or other intellectual property rights which may limit
     Infoseek's ability to do business or require Infoseek to license or
     cross-license technology, or
 
  .  may bring costly, time consuming lawsuits.
 
  Infoseek is aware of a number of issued patents which cover interactive
programming, Internet programming and techniques, and electronic commerce. For
example, Infoseek is aware of a U.S. patent recently issued to Carnegie Mellon
and licensed to Lycos related to Web spider technology. While Infoseek
currently believes, based on a preliminary review of such issued patent and
consultation with its patent counsel, that its products and services do not
infringe the Carnegie Mellon patent, Infoseek cannot assure you it would
prevail if Lycos or Carnegie Mellon claimed Infoseek infringed such patent.
Infoseek expects patent infringement regarding Internet technologies to
increase as the number of products and competitors in this market grows and as
new patents are issued. Infoseek expects that patents, particularly in the
areas of real-time or "streaming" audio and video, online commerce and
"digital cash," and other technologies may issue in the future. Some of these
technologies may be considered to be critical to long-term success in the
Internet marketplace.
 
  Infoseek has also from time to time received informal notices from copyright
and trademark holders regarding use of music, images and websites in its
services. Disney, who licenses the GO Network name to Infoseek has received
informal notices from certain parties regarding the use of the GO Network
name. Infoseek is also aware of other companies and/or services that employ
"Go" as a part of their names. Infoseek cannot assure you that Infoseek's use
of GO Network will be free from challenge or liability and Infoseek cannot
assure you it will always be able to operate GO Network under such name. Disney
does not indemnify Infoseek against claims of infringement by third parties for
use of GO Network.

CHANGES IN LAWS GOVERNING THE INTERNET COULD DECREASE THE DEMAND FOR
INFOSEEK'S SERVICES
 
  If new laws or regulations are adopted or if courts apply or expand existing
laws in Internet cases, Internet use may decrease. This could in turn decrease
the demand for Infoseek's products and services or increase Infoseek's cost of
doing business. These effects or other effects of new laws and regulations
could seriously harm Infoseek's business, results of operations, financial
condition and prospects.
 
  No government entity currently directly regulates Infoseek. Infoseek is,
however, subject to those general laws and regulations that apply to all
businesses. At present, there are few laws or regulations that apply to access
to or commerce on the Internet. However, proposals for regulation are
presented to federal, state, and foreign governments frequently. Laws or
regulations may be passed regarding the Internet on such issues as:
 
  .  user privacy (including sending of unsolicited e-mail, or "spamming"),
 
  .  consumer protection for products and services,
 
  .  media regulation, such as libel and obscenity,
 
  .  intellectual property, and
 
  .  liability of Internet service providers.
 
  In addition, courts are still determining how existing laws regarding
property, copyrights, trade secrets, libel and defamation, and privacy apply
to the Internet.
 
  Infoseek may also face claims because materials may be downloaded through
its online or Internet services and then distributed to others. Some of
Infoseek's products and services, such as chat rooms, messaging, and hosted
Web pages, contain content provided by users. Infoseek has little control over
these users' content. Claims might be made against Infoseek under a variety of
media and intellectual property laws for the nature, content,
 
                                      36
<PAGE>
 
publication and distribution of its materials or its users' materials. For
example, Infoseek might be subject to claims of copyright or trademark
infringement, obscenity, or libel brought against it for content that appears
on its site. These types of claims have been brought against online service
providers in the past, some of which have been successful.
 
  Infoseek provides a variety of third-party information through its services.
For example, Infoseek's service provides news, stock quotes, analyst estimates
or other stock trading information. If this information contains errors,
Infoseek could be sued for losses suffered by users who relied on the
information. Infoseek expects to offer Web-based e-mail services in the near
future. E-mail may further expose Infoseek to potential risks. For example,
Infoseek may be subject to claims or liabilities from spamming, lost or
incorrectly delivered messages, use of e-mail for illegal purposes or fraud,
harassment or interruptions or delays in e-mail service.
 
  Although Infoseek carries general liability insurance, such insurance may
not cover all claims or may not be sufficient to reimburse Infoseek for all
liabilities that may occur.
 
                                      37
<PAGE>
 
                                    PART II
                               OTHER INFORMATION

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

a)       Exhibit

         27.1 Financial Data Schedule

b)       Reports on Form 8-K

         1.  Infoseek filed a current report on Form 8-K dated November 18, 1998
         on December 2, 1998, reporting: (i) Disney's acquisition of
         approximately 43% of Infoseek with the right to acquire 50.1% over
         time, (ii) Infoseek's acquisition of Starwave Corporation from Disney
         and others, and (iii) the declaration of a dividend of one Right
         pursuant to and as defined in that certain Preferred Shares Rights
         Agreement dated October 2, 1998 by and between Infoseek Delaware and
         BankBoston, N.A. for each share of Infoseek Delaware common stock
         outstanding as of 5:00 p.m. New York time on November 18, 1998. Such
         current report was amended in its entirety on December 9, 1998 to
         further include (i) the financial statements of Infoseek California,
         Starwave, the ESPN Joint Venture and the ABCNews Joint Venture; (ii)
         pro forma financial information reflecting the purchase combination of
         Infoseek and Starwave; (iii) certain risk factors investors should
         consider before investing in Infoseek.

         2.  Infoseek filed a current report on Form 8-K dated January 15, 1999
         on January 29, 1999, reporting Infoseek's acquisition of Quando, Inc.
         Such current report was amended on February 12, 1999 to further include
         (i) the financial statements of Quando and (ii) pro forma financial
         information reflecting the purchase combinations of Infoseek, Starwave,
         and Quando.

         3.  Infoseek filed a current report on Form 8-K dated January 28, 1999
         on February 4, 1999 reporting that Infoseek had changed to a 52/53 week
         fiscal year ending on the Saturday closest to September 30 and
         indicated Infoseek would file a report on Form 10-K for the nine-month
         fiscal period ended October 3, 1998.

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<PAGE>
 
                                   SIGNATURES

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



                                             INFOSEEK CORPORATION
 
 

Dated:  February 16, 1999                    By:  /s/ Leslie E. Wright
                                             -----------------------------
                                             Leslie E. Wright
                                             Senior Vice President, Chief
                                             Administrative Officer and Chief
                                             Financial Officer





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