U. S. Securities and Exchange Commission
                    Washington, D. C.  20549

                           FORM 10-QSB

[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the quarter ended March 31, 2004
                           --------------

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     For the transition period from               to
                                    -------------    -------------

                 Commission File No.   000-33381
                                       ---------

                   WIZZARD SOFTWARE CORPORATION
                   ----------------------------
          (Name of Small Business Issuer in its Charter)

      COLORADO                                             87-0575577
      --------                                             ----------
(State or Other Jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                        Identification No.)

                          424 Gold Way
                 Pittsburgh, Pennsylvania 15213
                 ------------------------------
             (Address of Principal Executive Offices)

            Issuer's Telephone Number:  (412) 621-0902


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

                                  N/A
                                  ---

                     (APPLICABLE ONLY TO CORPORATE ISSUERS)

          State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:

                               May 11, 2004

                       Common - 24,195,976 shares

Transitional Small Business Issuer Format   Yes  X   No
                                                ---     ---
<PAGE>
                  PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements.
          ---------------------

          The Consolidated Financial Statements of the Company required
to be filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes.  In the opinion
of management, the Consolidated Financial Statements fairly present the
financial condition of the Company.

<PAGE>


                 WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

             UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                MARCH 31, 2004



<PAGE>



                 WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY



                                   CONTENTS

                                                                 PAGE


- Unaudited Condensed Consolidated Balance Sheet,
    March 31, 2004                                                2

- Unaudited Condensed Consolidated Statements of
    Operations, for the three months ended
    March 31, 2004 and 2003                                       3

- Unaudited Condensed Consolidated Statements of Cash
    Flows, for the three months ended March 31, 2004
    and 2003                                                      4

- Notes to Unaudited Condensed Consolidated Financial
    Statements                                               5 - 10



<PAGE>

<TABLE>
<CAPTION>

                 WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

                UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET

                                    ASSETS

                                                                March 31,
                                                                  2004
<S>                                                          <C>

CURRENT ASSETS:
     Cash                                                    $    970,868
     Restricted cash                                              104,591
     Accounts receivable                                           30,688
     Inventory                                                     22,602
     Prepaid Expenses                                              24,628
                                                             ------------
      Total Current Assets                                      1,153,377
                                                             ------------
PROPERTY & EQUIPMENT, net                                          88,715
                                                             ------------
OTHER ASSETS:
     Definite-life Intangible assets, net                         251,294
     Deposits                                                       6,452
                                                             ------------
      Total Other Assets                                          257,746
                                                             ------------
                                                             $  1,499,838
                                                             ============
                LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

     Accounts payable                                        $    238,147
     Accrued expenses                                             115,432
     Customer deposits                                              7,000
     Notes payable - related party                                 35,092
                                                             ------------
      Total current liabilities                                   395,671
                                                             ------------
CONVERTIBLE NOTE PAYABLE                                          235,000
                                                             ------------
      Total liabilities                                           630,671
                                                             ------------
NON-CONTROLLING INTEREST IN SUBSIDIARY                                  -
                                                             ------------
STOCKHOLDERS' EQUITY:

     Preferred stock, $.001 par value, 10,000,000 shares
      authorized, no shares issued and outstanding                      -
     Common stock, $.001 par value, 100,000,000 shares
      authorized, 23,928,718 shares issued and outstanding         23,929
     Capital in excess of par value                            10,107,207
     Retained Deficit                                          (9,261,969)
                                                             ------------
      Total Stockholders' Equity                                  869,167
                                                             ------------
                                                             $  1,499,838
                                                             ============
</TABLE>
The accompanying notes are an integral part of this unaudited condensed
consolidated financial statements.
                                2
<PAGE>
<TABLE>
<CAPTION>

                 WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

          UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                                        For the Three
                                                        Months Ended
                                                          March 31,
                                                      2004        2003

<S>                                               <C>         <C>
SALES, net of returns and allowances            $   97,064       $ 104,146

COST OF GOOD SOLD                                   78,612          65,765
                                                ----------       ---------
GROSS PROFIT                                        18,452          38,381
                                                ----------       ---------
OPERATING EXPENSES:
Selling expenses                                    69,481           8,261
General and administrative                       1,055,333         156,873
Compensation for re-pricing of warrants            160,420         210,000
                                                ----------       ---------
 Total Operating Expenses                        1,285,234         375,134
                                                ----------       ---------
LOSS BEFORE OTHER EXPENSE                        1,266,782        (336,753)

OTHER EXPENSE:
  Interest expense                                 (10,158)        (11,311)
                                                ----------       ---------
     Total Other Expense                           (10,158)        (11,311)
                                                ----------       ---------
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME
TAXES                                           (1,276,940)       (348,064)

CURRENT TAX EXPENSE                                      -               -

DEFERRED TAX EXPENSE                                     -               -
                                                ----------       ---------
NET LOSS                                       $(1,276,940)      $(348,064)
                                                ----------       ---------
LOSS PER COMMON SHARE                           $     (.06)      $    (.02)
                                                ----------       ---------
</TABLE>

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

                                3
<PAGE>
<TABLE>
<CAPTION>

                 WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

          UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                      For the Three
                                                      Months Ended
                                                        March 31,
                                                   2004           2003
<S>                                             <C>            <C>
Cash Flows from Operating Activities:
 Net loss                                      $(1,276,940)    $    (348,064)
 Adjustments to reconcile net loss
 to net cash used by operating activities:
  Depreciation and amortization expense             35,301            36,508
  Non-cash expenses                                985,420           219,412
  Change in assets and liabilities:
    (Increase) in restricted cash                  (69,820)                -
    (Increase) decrease in accounts receivable      (1,324)            5,285
    Decrease in Inventory                              659             1,519
    (Increase) decrease in prepaid expenses         (4,460)              924
    Decrease in accounts payable and accrued
     expense                                         1,991            (5,304)
    Increase in customer deposits                    7,000                 -
                                                ----------     -------------
      Net Cash (Used) by Operating
      Activities                                  (322,173)          (89,720)
                                                ----------     -------------
Cash Flows from Investing Activities:
     Purchase of property & equipment               (6,222)                -
                                                ----------     -------------
       Net Cash (Used) by Investing Activities      (6,222)                -
                                                ----------     -------------
Cash Flows from Financing Activities:
     Proceeds from Issuance of common stock      1,336,972            37,019
     Payment of stock offering cost                (91,253)                -
     Proceeds from notes payable
      - related party                                    -            22,000
                                                ----------     -------------
       Net Cash Provided by Financing Activities 1,245,719            59,019
                                                ----------     -------------
Net (Decrease) in Cash                             917,324           (30,701)
Cash at Beginning of Period                         53,544            50,956
                                                ----------     -------------
Cash at End of Period                           $  970,868     $      20,255
                                                ==========     =============
Supplemental Disclosures of
 Cash Flow Information:
     Cash paid during the periods for:
       Interest                                 $        -      $          -
       Income taxes                             $        -      $          -
</TABLE>
Supplemental Schedule of Noncash Investing and Financing Activities:

For the three months ended March 31, 2004:

The Company recorded $160,420 in compensation for the re-pricing of 408,076
warrants from $1.50 to $1.00 per share and extending the expiration date from
January 1, 2004 to February 29, 2004.

The Company issued 250,000 shares of common stock for consulting services
valued at $825,000.

For the three months ended March 31, 2003:

The Company recorded $210,000 in compensation for the re-pricing of warrants
from $2.00 to $.50 per share.

The Company issued 6,098 shares of common stock to purchase certain intangible
assets valued at $6,092.

The Company issued 901,778 shares of common stock in payment of $374,183 in
related party notes payable and $13,902 in related accrued interest.

The Company issued 11,246 shares of common stock upon the exercise of options
for legal services valued at $9,400.

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

                                4

<PAGE>
           WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Organization   Wizzard Software Corporation ["Parent"] a Colorado
     corporation, was organized on July 1, 1998. The Company has, at the
     present time, not paid any dividends and any dividends that may be paid
     in the future will depend upon the financial requirements of the Company
     and other relevant factors. Wizzard Software Corp. ["Subsidiary"], was
     incorporated on February 29, 1996 under the laws of the State of
     Delaware.  The Company engages primarily in the development, sale, and
     service of custom and packaged computer software products. On February
     7, 2001, the Company completed the Plan of Reorganization and Stock
     Exchange agreement, wherein, Parent acquired 96% of the common stock of
     Subsidiary.   The merger was accounted for as a recapitalization of
     Subsidiary, wherein Subsidiary became a 96% owned subsidiary of the
     Parent.  On May 22, 2001 the Company purchased all of the issued and
     outstanding shares of Speech Systems, Inc. in a transaction accounted
     for as a purchase.

     Consolidation   The financial statements presented reflect the accounts
     of Wizzard Software Corporation, Wizzard Software Corp., and Speech
     Systems, Inc. as of March 31, 2004.  At March 31, 2004 the Company held
     a 96% ownership interest in Wizzard Software Corp.  The Company recorded
     no liability for the 4% non-controlling interest as Wizzard Software
     Corp. had a stockholders deficit at the time of merger.  Further the net
     loss for Wizzard Software Corp. for the period ended March  31, 2004
     applicable to the 4% non-controlling interest was not allocated to the
     non controlling interest as there is no obligation of the non-
     controlling interest to share in such losses.  All significant inter-
     company transactions between the Parent and Subsidiary have been
     eliminated in consolidation.

     Unaudited Condensed Financial Statements   The accompanying financial
     statements have been prepared by the Company without audit.  In the
     opinion of management, all adjustments (which include only normal
     recurring adjustments) necessary to present fairly the financial
     position, results of operations and cash flows at March 31, 2004 and
     2003 and for all the periods presented have been made.

     Certain information and footnote disclosures normally included in
     financial statements prepared in accordance with generally accepted
     accounting principles in the United States of America have been
     condensed or omitted.  These condensed financial statements should be
     read in conjunction with the financial statements and notes thereto
     included in the Company's December 31, 2003 audited financial
     statements.  The results of operations for the periods ended March 31,
     2004 and 2003 are not necessarily indicative of the operating results
     for the full year.

     Cash and Cash Equivalents   For purposes of the financial statements,
     the Company considers all highly liquid debt investments purchased with
     a maturity of three months or less to be cash equivalents. The Company
     maintains its cash balance at one financial institution located in
     Pittsburgh, Pennsylvania. At March 31, 2004, the Company had $870,868 in
     excess of federally insured amounts.

     Accounts Receivable - Accounts receivable consist of trade receivables
     arising in the normal course of business. At March 31, 2004, the Company
     has not established an allowance for doubtful accounts which reflects
     the Company's best estimate of probable losses inherent in the accounts
     receivable balance.  The Company determines the allowance based on known
     troubled accounts, historical experience, and other currently available
     evidence. Amounts written off for the periods presented are
     insignificant for disclosure.

     Inventory   Inventory consists of $22,602 in raw materials at March 31,
     2004 and is carried at the lower of cost or market as determined on the
     first-in first-out method.
                                5
<PAGE>
           WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Depreciation   Depreciation of property and equipment is provided on the
     straight-line method over the estimated useful lives of the assets of
     five years to thirty nine years.

     Intangible assets   Intangible assets consist of the rights, interest,
     title patents, trademarks, a purchased website and trade secrets of the
     speech recognition software ActiveX Voice Tools, purchased in the
     acquisition of Speech Systems, Inc., purchased rights to a Merchant
     Operating Understanding for the distribution of the Company's products
     and domain name registration and are being amortized over two to five
     years on a straight-line basis.

     Software Development Costs - Statement of Financial Accounting Standards
     ("SFAS") No. 86 "Accounting for the Costs of Computer Software to be
     Sold, Leased or Otherwise Marketed" requires software development costs
     to be capitalized upon the establishment of technological feasibility.
     The establishment of technological feasibility and the ongoing
     assessment of the recoverability of these costs requires considerable
     judgment by management with respect to certain external factors such as
     anticipated future revenue, estimated economic life, and changes in
     software and hardware technologies. Capitalizable software development
     costs have not been significant and accordingly no amounts are shown as
     capitalized at March 31, 2004.

     Income Taxes   The Company accounts for income taxes in accordance with
     Statement of Financial Accounting Standards No. 109, "Accounting for
     Income Taxes."  This statement requires an asset and liability approach
     for accounting for income taxes.

     Revenue Recognition   Revenue is recognized when earned. The Company's
     revenue recognition policies are in compliance with the American
     Institute of Certified Public Accountants Statement of Position ("SOP")
     97-2 (as amended by SOP 98-4 and SOP 98-9) and related interpretations,
     "Software Revenue Recognition" and the Securities and Exchange
     Commission Staff Accounting Bulletin No. 101, "Revenue Recognition in
     Financial Statements" (SAB 101). The Company sells packaged and custom
     software products and related voice recognition product development
     consulting.  Software product revenues are recognized upon shipment of
     the software product only if no significant Company obligations remain,
     the fee is fixed or determinable, and collection is received or the
     resulting receivable is deemed probable. Revenue from package software
     products is recorded when the payment has been received and the software
     has been shipped.   Revenue is recognized, net of discount and
     allowances, at the time of product shipment.  For packaged software
     products the Company offers a 30 day right of return.  Provisions are
     recorded for returns, concessions, and bad debts and at March 31, 2004
     amounted to $0. Revenue related to obligations, which include telephone
     support for certain packaged products, are based on the relative fair
     value of each of the deliverables determined based on vendor-specific
     objective evidence ("VSOE") when significant. The Company VSOE is
     determined by the price charged when each element is sold separately.
     Revenue from packaged software product sales to and through distributors
     and resellers is recorded when payment is received and the related
     products are shipped.  The Company's distributors or resellers do not
     carry packaged software product inventory and thus the Company does not
     offer any price protections or stock balancing rights. Revenue from non-
     recurring programming, engineering fees, consulting service, support
     arrangements and training programs is recognized when the services are
     provided. Such items are included in net revenues and amounted to
     $11,850 and $4,980 for the three months ended  March 31, 2004 and 2003,
     respectively.

                                6
<PAGE>
           WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY
  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Loss Per Share   The Company computes loss per share in accordance with
     (SFAS) No. 128 "Earnings Per Share," which requires the Company to
     present basic earnings per share and dilutive earnings per share when
     the effect is dilutive [See Note 6].

     Accounting Estimates   The preparation of financial statements in
     conformity with generally accepted accounting principles in the United
     States of America requires management to make estimates and assumptions
     that affect the reported amounts of assets and liabilities, the
     disclosures of contingent assets and liabilities at the date of the
     financial statements, and the reported amounts of revenues and expenses
     during the reporting period.  Actual results could differ from those
     estimated by management.

     Recently Enacted Accounting Standards - Statement of Financial
     Accounting Standards SFAS No. 149, "Amendment of Statement 133 on
     Derivative Instruments and Hedging Activities", SFAS No. 150,
     "Accounting for Certain Financial Instruments with Characteristics of
     both Liabilities and Equity", were recently issued.  SFAS No, 149, and
     150 have no current applicability to the Company or their effect on the
     financial statements would not have been significant. The FASB has
     issued an exposure draft proposing to expense the fair value of share-
     based payments to employees beginning in 2005.  We are currently
     evaluating the impact of this proposed standard on our financial
     statements.

NOTE 2   INTANGIBLES

     The Company has classified its intangible assets as definite-life
     intangible asset and is amortizing them on a straight-line basis over
     two to five years.  During the three months ended March 31, 2002, the
     Company completed its initial test of intangible assets for impairment
     in accordance with SFAS No. 142. The Company used the estimated future
     cash flows to test the remaining intangible assets for impairment and
     determined that the Company's intangible assets were not impaired.
     Amortization expense of $29,030 and $28,744, respectively, was recorded
     for the periods ended March 31, 2004 and 2003 and has been included in
     cost of goods sold. The following is a summary of definite-life
     intangible:
                                                  Life March 31, 2004
          _____     ____________
          Active X Voice Tools Software      5 years   $    500,000
          Trademarks, patents, website       2 to 5 years    23,043
          Memorandum of Understanding        5 years         66,227
                                                       ____________
                                                       589,270
               Accumulated amortization                (337,976)
                                                            ____________
               Definite-life intangibles, net               $251,294
                                                       ____________

     The remaining estimated aggregate amortization expense at March 31, 2004
     for next five years is as follows:
          2004      $    87,089
          2005           115,391
          2006            47,302
          2007             1,220
          2008               292
                    ____________
                    $    251,294
                    ____________

                                7
<PAGE>
           WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3   PROPERTY & EQUIPMENT

     The following is a summary of property and equipment:
                                                  March 31, 2004
                                                  ____________

          Furniture, fixtures and equipment       $    234,856
          Leasehold improvements                        36,482
          Software                                      39,472
                                                        ------
                                                       310,810
               Accumulated Deprecation                (222,095)
                                                       -------

               Property & Equipment, net          $     88,715
                                                        ------


     Depreciation expense for the three months ended March 31, 2004 and 2003
     was $6,272 and $7,764, respectively.

NOTE 4   NOTES PAYABLE

     Convertible Note Payable - On September 14, 2001, the Company sold a
     Series 2001-A 8% convertible note payable of the Company in the amount
     of $250,000, with a maturity date of August 1, 2011.  The Note is
     convertible in to the Company's common stock at the lessor of $.50 per
     share or 75% of the closing bid price. During the year ended December
     31, 2001, $15,000 of the note with related accrued interest of $208 was
     converted into 30,416 shares of common stock. As the conversion price
     was below the fair value of the common stock on the date issued the
     Company has recorded the beneficial conversion feature of the note in
     accordance with the provisions found in EITF 98-5 by recording a
     $250,000 discount on the note.  The discount was recorded as interest
     expense on September 14, 2001 as the note is immediately convertible.
     The note further calls for the Company to register the underlying shares
     into which the note can be converted and if said share are not
     registered as of March 15, 2003 the Company will owe a penalty of $7,500
     and $10,000 for every month thereafter, accordingly the Company has
     included $67,500 in accounts payable for penalties on the Note at March
     31, 2004.   The penalties were subsequently paid on May 3, 2004 through
   the issuance of 19,286 common shares.  As of March 31, 2004, the balance
  of the note is $235,000 with related accrued interest payable of $47,837.

     Related Party Notes Payable   During the year ended December 31, 2001, a
     shareholder loaned the Company $46,076.  The demand note is unsecured
     and accrues interest at 5% per annum.  As of March 31, 2004, a balance
     of $25,076 remained outstanding on the note with related accrued
     interest of $4,522.

     During the year ended December 31, 2002, the Company borrowed from five
     shareholders of the Company's a total of $402,183.  During the quarter
     ended March 31, 2003, the Company borrowed an additional $22,000.  These
     notes are payable on demand and accrue interest at a rate of prime plus
     1% or approximately 5.75%.  During the Quarter ended March 31, 2003 the
     Company issued 901,778 shares of common stock in payment of $374,183
     related party notes payable and $13,323 in related accrued interest. The
     remaining $50,000 note payable with accrued interest of $2,386 was
     repaid in April 2003.

                                8
<PAGE>

            WIZZARD SOFTWARE CORPORATIONAND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4   NOTES PAYABLE (Continued)

     During April, 2003, the Company borrowed from a shareholder of the
     Company a total of $10,165.  The note is payable on demand and accrues
     interest at a rate of prime plus 1% or approximately 5.75% and amounted
     to $536 at March 31, 2004.

     On January 8, 2004, a shareholder loaned an additional $50,000 to the
     Company.  The note was repaid with interest of $5,000 on January 24,
     2004.

NOTE 5   CAPITAL STOCK

     Preferred Stock - The Company has authorized 10,000,000 shares of
     preferred stock, $.001 par value. As of March 31, 2004, no shares were
     issued and outstanding.

     Common Stock   During the quarter ended March 31, 2004, the Company
     issued 588,076 common shares upon the exercise of warrants outstanding
     to purchase common stock of the Company at $.25 to $1.25 per share. The
     Company further issued 90,210 common shares upon exercise of 90,210
     options issued for $162,846 in salaries during 2004.

     On January 23, 2004, the Company entered into a subscription agreement
     and issued 824,174 of 1,648,352 common shares and 412,086 of 824,174
     warrants to purchase common shares at $1.55 per share, expiring January
     23, 2007. The first $600,000 of the Share subscription was payable
     immediately upon closing, and the Company received this sum on January
     23, 2004.  The second $600,000 will become payable five days after the
     effective date of the Company's registration statement on Form SB-2 (or
     other suitable registration statement) by which the Company is to
     register the Shares and all of the shares of common stock underlying the
     Warrants (the "Warrant Shares"). Similarly, the Company was to issue the
     Warrants to purchase the first 412,087 Warrant Shares immediately, with
     the remaining Warrants to be issued five days after the registration
     statement is declared effective. The Company is required to register the
     underlying shares under a registrations statement being filed on or
     before March 8, 2004 and effective on or before May 2, 2004.  If the
     Company delinquent in meeting  these deadlines for the registrations
     statement they have agreed to pay a 1% penalty for each 30 day period or
     part thereof.

     On March 25, 2004, the Company issued 250,000 common shares for $825,000
     in investor relations/consulting services.

     During the Quarter ended March 31, 2003 the Company issued 901,778
     shares of common stock in payment of $374,183 related party notes
     payable and $13,902 in related accrued interest.  The Company also
     issued 6,098 shares of common stock to purchase certain intangible
     assets valued at $6,092 and 58,532 shares of common stock upon the
     exercise of options for $9,400 in legal services and $36,971 salaries.

     In connection with the private placement of 671,500 shares of common
     stock issued during 2001, the Company recorded a 1% penalty per
     month, beginning November 2001 through September 2002, for the delay in
     the effectiveness of registering said shares.   As of March 31, 2004 the
     Company has included $73,865 in accounts payable said penalties.

                                9

<PAGE>
            WIZZARD SOFTWARE CORPORATIONAND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5   CAPITAL STOCK

     2003 Stock Option Plan - During 2003, the Board of Directors adopted a
     Stock Option Plan (the Plan). Under the terms and conditions of the
     Plan, the board is empowered to grant stock options to employees,
     officers, directors and consultants of the Company.  Additionally, the
     Board will determine at the time of granting the vesting provisions and
     whether the options will qualify as Incentive Stock Options under
     Section 422 of the Internal Revenue Code (Section 422 provides certain
     tax advantages to the employee recipients).   The total number of shares
     of common stock available under the Plan may not exceed 1,000,000.  At
     March 31, 2004, total options available to be granted under the Plan
     amounted to 14,259.   During the Quarter ended March 31, 2004 the
     Company issued 90,210 options to purchase common stock at $1.38 to $2.09
     per share that were immediately exercised for $162,846 in salaries.
     During the Quarter ended March 31, 2003 the Company issued 58,532
     options to purchase common stock at $.76 to $.86 per share that were
     immediately exercised for $9,400 in legal services and $36,971 in
     salaries.

     Warrants   As of March 31, 2004, the Company had 432,086 warrants
     outstanding to purchase shares of common stock at $.25 to $1.55 per
     share expiring at various times through January 23, 2007.

     On January, 23, 2004, the Company issued 412,086 warrants to purchase
     common stock at $1.55 per share expiring on January 23, 2007 in
     connection with a subscription agreement.  The Company has committed to
     issue an additional 412,086 warrants to purchase common stock upon the
     completion of the subscription agreement.

     On January 1, 2004, the Company recorded a $160,420 expense for the re-
     pricing of 408,076 warrants to purchase common stock from $1.50 per
     share to $1.00 per share and extending the expiration date of the
     warrants from January 1, 2004 to February 29, 2004.

     On March 28, 2003, the Company recorded a $210,000 expense for the re-
     pricing of 600,000 warrants to purchase common stock from $2.00 per
     share to $.50 per share.

                                10
<PAGE>
            WIZZARD SOFTWARE CORPORATION AND SUBSIDIARY

  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6   LOSS PER SHARE

     The following data show the amounts used in computing loss per share and
     the weighted average number of shares of common stock outstanding for
     the periods presented:
                                            For the Three Months Ended
                                                      March 31,
                                                      ---------
                                                2004             2003
                                                ----             ----

     Loss from continuing operations available
       to common shareholders (numerator)       $ (1,276,940)   $  (348,064)
                                                  -----------      ---------
     Weighted average number of common shares
       outstanding during the period used in
       per share calculations (denominator)       23,158,789     18,926,695
                                                  ----------     ----------

     At March 31, 2004, the Company had 432,086 warrants outstanding to
     purchase common stock of the Company at $.25 to $1.55 per share and a
     convertible note payable wherein the holder could convert the note into
     a minimum of 470,000 shares of common stock, [See Note 4], which were
     not included in the loss per share computation because their effect
     would be anti-dilutive.  Subsequent to the quarter ended March 31, 2004,
     the Company agreed to issue 150,037 shares upon the purchase all of
     issued and outstanding shares and settlement of certain outstanding debt
     of MedivoxRx Technologies, Inc. (See Note 9).

     At March 31, 2003, the Company had 1,788,076 warrants outstanding to
     purchase common stock of the Company at $.25 to $1.50 per share and a
     convertible note payable wherein the holder could convert the note into
     a minimum of 470,000 shares of common stock, [See Note 4], which were
     not included in the loss per share computation because their effect
     would be anti-dilutive.  Subsequent to the quarter ended March 31, 2003,
     the Company issued 600,000 shares upon the exercise of 600,000 warrants
     to purchase common stock at $.50 per share.  The Company further issued
     184,167 common shares for services rendered, 35,806 common shares for
     interest on notes payable, 27,999 for the repayment of notes payable and
     19,286 for penalties for the delay in registering stock underlying the
     Company's convertible debt.

                                11
<PAGE>
            WIZZARD SOFTWARE CORPORATIONAND SUBSIDIARY
  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7   INCOME TAXES

     The Company accounts for income taxes in accordance with Statement of
     Financial Accounting Standards No. 109 "Accounting for Income Taxes".
     SFAS No. 109 requires the Company to provide a net deferred tax
     asset/liability equal to the expected future tax benefit/expense of
     temporary reporting differences between book and tax accounting methods
     and any available operating loss or tax credit carryforwards.  The
     Company has available at March 31, 2004 operating loss
     carryforwards of approximately $9,000,000 which may be applied against
     future taxable income and which expires in various years through 2024.

     The amount of and ultimate realization of the benefits from the
     operating loss carryforward for income tax purposes is dependent, in
     part, upon the tax laws in effect, the future earnings of the Company,
     and other future events, the effects of which cannot be determined.
     Because of the uncertainty surrounding the realization of the loss
     carryforward and significant changes in the ownership of the Company, a
     valuation allowance has been established equal to the tax effect of the
     loss carryforward and, therefore, no deferred tax asset has been
     recorded for the loss carryforward.  The net deferred tax assets are
     approximately $3,060,000 as of March 31, 2004, with an offsetting
     valuation allowance of the same amount. The change in the valuation
     allowance for the period ended March 31, 2004 is approximately $77,000.

NOTE 8   GOING CONCERN

     The accompanying consolidated financial statements have been prepared in
     conformity with generally accepted accounting principles of the United
     States of America, which contemplate continuation of the Company as a
     going concern.  However, the Company has incurred significant losses
     from inception, and has not yet been successful in establishing
profitable operations.  These factors raise substantial doubt about the
ability of the Company to continue as a going concern.  In this regard,
management plans to mitigate this doubt by raising additional funds
through debt and/or equity offerings and by substantially increasing
sales.  There is no assurance that the Company will be successful in
achieving profitable operations.  The consolidated financial statements
do not include any adjustments that might result from the outcome of
these uncertainties.

NOTE 9   SUBSEQUENT EVENTS

     On May 13, 2004, the Company entered into an agreement to issue 150,035
     shares of common stock for all of the issued and outstanding common
     shares of MedivoxRx Technologies, Inc. and approximately $150,000 in
     MedivoxRx Technologies, Inc. outstanding debt.  The Company further
     agreed to issue up to 1,550,000 additional common shares to the
     MedivoxRx Technologies, Inc. shareholders if certain profit, revenue and
     product acceptance milestones are reached.

     On May 3, 2004, the Company issued a total of 184,167 restricted common
     shares for services valued at $585,651.

     On May 3, 2004, the Company issued 19,286 restricted common shares issued
     for payment of $67,500 in penalties for the delay in registering shares
     underlying the 8% Convertible Note payable, and 17,689 common shares fro
     interest payment of $47,837 on the 8% Convertible Note payable.

     On May 3, 2004, the Company issued 18,117 restricted common shares for
     $63,408 in outstanding interest payable.

     On May 3, 2004, the Company issued 27,999 common shares in payment of a
     $10,165 note payable and related accrued interest of $616.  The $78,256
     difference between the fair value of the stock issued and note and
     related interest will be recorded as interest expense.

                                  12
<PAGE>

Item 2.   Management's Discussion and Analysis or Plan of Operation.
          ----------------------------------------------------------

Results of Operations.
----------------------

     During the quarterly period ended March 31, 2004, Wizzard recorded
revenues of $97,064, a 6.8% decrease from revenues of $104,146 in the first
quarter of 2003.  The decrease in the first quarter 2004 was due to lower
sales of IBM ViaVoice products, which management attributes to inadvertent,
temporarily lost web links in the IBM-Wizzard referral process, which have
since been corrected.  For approximately 21 days, almost no leads were being
referred to Wizzard; this is how Wizzard generates approximately 95% of its
IBM sales.  Because third parties were involved in the maintenance of the web
sits, it took several weeks to correct after the discovery was made.  While
there can be no guarantees, management has put additional safeguards in place
to reduce the risk of this reoccurring.

     Cost of goods sold totaled $78,612 in the first quarter of 2004, versus
$65,765 in the first quarter of 2003.  This increase of approximately 19.5% is
attributed primarily to the increased royalty payments to third party
technology suppliers.

     In the quarter ended March 31, 2004, operating expenses totaled
$1,285,234, which was a 243% increase over operating expenses of $375,134 in
the first quarter of 2003.  This increase was largely caused by the non-cash
expenses of $825,000 due to the issuance of 250,000 shares of common stock to
Arthur Douglas & Associates for investor relations/consulting services.
Issuance of the Company's common stock to pay such obligations has extended
our liquidity for operational purposes.  The Company further recorded non-cash
consideration of $160,420 for the extension and repricing of certain warrants
for which Wizzard received approximately $407,000 in proceeds.  In the first
quarter of 2003, non-cash expenses were $219,412, resulting from similar
repricing of certain warrants and the issuance of common stock to pay for
legal services.  Selling expense increased to $69,481 in the first quarter of
2004, as compared to $8,261 in the first quarter of 2003, due to the
additional sales personnel employed by the Company.

     Wizzard's net loss was $1,276,940, or $0.06 per share, in the quarter
ended March 31, 2004.  This represents a 267% increase from our net loss of
$348,064, or $0.02 per share, in the first quarter of 2003.

     Management believes that Wizzard's revenues will increase with
anticipated additional sales from the planned acquisition of MedivoxRx
Technologies, Inc., the planned launch of a new set of programming tools, sale
of additional text-to-speech runtime licenses for the telephony market, and
the planned launch of three additional "talking products" in 2004.  Prior to
and in connection with these product releases, management believes that
expenses will increase accordingly as we add staff and undertake the necessary
marketing efforts.

Liquidity and Capital Resources.
--------------------------------

     Cash on hand was $970,868 at March 31, 2004, an increase of $917,324 over
the $53,544 on hand at December 31, 2003.  This change was due to cash
provided by financing activities.  For the three months ended March
31, 2004, we received $1,336,972 in proceeds from issuances of common stock,
and paid $91,253 in offering costs.  Cash used in operations for the three
months ended March 31, 2004 was $322,173, an increase of approximately 259%
over the $89,720 cash used in operations for the three months ended March 31,
2003.  Cash used in investing activities for the three months ended March 31,
2004 consisted of $6,222 for the purchase of needed office equipment updates.

     The Company used common stock to pay $825,000 in consulting services
during the three months ended March 31, 2004.  In so doing, we believe we
have conserved Wizzard's cash liquidity for operational purposes.

     The Company's operations are principally being sustained through
financing activities until sufficient sales levels can be achieved to
establish profitable operations.  We believe that the cash on hand at March
31, 2004, should be sufficient to meet our operating expenses through the end
of 2004.  During May 2004, we expect to receive an additional $600,000 from
financing activities through the sale of 824,176 additional common shares and
the issuance of 412,088 warrants, which management estimates will allow us to
meet our operating expenses through May of 2005.

Safe Harbor Statement.
----------------------

     Statements made in this Form 10-QSB which are not purely historical are
forward-looking statements with respect to the goals, plan objectives,
intentions, expectations, financial condition, results of operations, future
performance and business of the Company, including, without limitation, (i)
our ability to gain a larger share of the speech recognition software
industry, our ability to continue to develop products acceptable to that
industry, our ability to retain our business relationships, and our ability to
raise capital and the growth of the speech recognition software industry, and
(ii) statements preceded by, followed by or that include the words "may",
"would", "could", "should", "expects", "projects", "anticipates", "believes",
"estimates", "plans", "intends", "targets", "tend" or similar expressions.

     Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond the Company's control) that could
cause actual results to differ materially from those set forth in the forward-
looking statements, including the following, in addition to those contained in
the Company's reports on file with the SEC: general economic or industry
conditions, nationally and/or in the communities in which the Company conducts
business, changes in the interest rate environment, legislation or regulatory
requirements, conditions of the securities markets, changes in the software
industry, intellectual property matters, the development of products that may
be superior to the products offered by the Company, demand for financial
services, competition, changes in the quality or composition of the Company's
products, our ability to develop new products, our ability to raise capital,
changes in accounting principles, policies or guidelines, financial or
political instability, acts of war or terrorism, other economic, competitive,
governmental, regulatory and technical factors affecting the Company's
operations, products, services and prices.

     Accordingly, results actually achieved may differ materially from
expected results in these statements.  Forward-looking statements speak only
as of the date they are made.  The Company does not undertake, and
specifically disclaims, any obligation to update any forward-looking
statements to reflect events or circumstances occurring after the date of such
statements.

Item 3.  Controls and Procedures.
         ------------------------

     Within 90 days prior to the date of this Report, we carried out an
evaluation, under the supervision and with the participation of our President
/Treasurer, of the effectiveness of the design and operation of our disclosure
controls and procedures.  Based on this evaluation, our President/Treasurer
concluded that our disclosure controls and procedures are effective in timely
alerting him to material information required to be included in our periodic
Securities and Exchange Commission reports.  It should be noted that the
design of any system of controls is based in part upon certain assumptions
about the likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all potential future
conditions, regardless of how remote.  In addition, we reviewed our internal
controls, and there have been no significant changes in our internal controls
or in other factors that could significantly affect those controls subsequent
to the date of our last evaluation.

                   PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.
          ------------------

     None; not applicable.

Item 2.   Changes in Securities and Small Business Issuer Purchases of Equity
Securities.
-----------

     The following table provides information about all "unregistered" and
"restricted" securities that Wizzard has sold during the quarterly period
ended March 31, 2004, which were not registered under the Securities Act of
1933, as amended:

<TABLE>
<CAPTION>

                      Date            Number of       Aggregate
Name of Owner         Acquired        Shares          Consideration
-------------         --------        ------          -------------

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

Three institutional   1-23-04         (1)             (1)
investors

Arthur Douglas        3-25-04         250,000         Consulting services
& Associates                                          valued at $825,000

</TABLE>

     (1)  On January 23, 2004, we closed a Subscription Agreement by which
three institutional investors (collectively, the "Subscribers") agreed to
purchase:

     a total of 1,648,352 shares of our common stock for a total of
$1,200,000, or $0.728 per share (the "Shares"); and

     warrants to purchase an additional 824,174 shares of common stock at a
     price of $1.55 per share (the "Warrants").

The first $600,000 of the Share subscription was payable immediately upon
closing, and the Company received this sum on January 23, 2004.  The second
$600,000 will become payable five days after the effective date of the
Company's registration statement on Form SB-2 by which the Company registered
the Shares and all of the shares of common stock underlying the Warrants (the
"Warrant Shares").   Similarly, the Company was to issue the Warrants to
purchase the first 412,087 Warrant Shares immediately, with the remaining
Warrants to be issued five days after the effective date of the registration
statement.  The registration statement was declared effective on May 12, 2004.
For additional information about this transaction, see the Company's Current
Report on Form 8-K, dated January 23, 2004, which was filed with the
Securities and Exchange Commission on January 28, 2004.  See the Exhibit
Index, Part II, Item 6 of this Report.

Item 3.   Defaults Upon Senior Securities.
          --------------------------------

     None; not applicable.

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

     None; not applicable.

Item 5.   Other Information.
          ------------------

     None; not applicable.

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

     (a)  Exhibits.

          31 - 302 Certification of Christopher J. Spencer

          32 - 906 Certification.

     (b)  Reports on Form 8-K.

          8-K Current Report dated January 22, 2004, regarding change in
accountants.

          8-K Current Report dated January 23, 2004, regarding Subscription
Agreement with three institutional investors.

          8-K Current Report dated February 6, 2004, regarding the proposed
acquisition of MedivoxRx Technologies, Inc.

          8-K Current Report dated April 28, 2004, regarding the completion of
the acquisition of MedivoxRx Technologies, Inc.
<PAGE>
                            SIGNATURES

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

                                         WIZZARD SOFTWARE CORPORATION

Date: 5/14/04                               /s/Christopher J. Spencer
      --------                             --------------------------
                                           Christopher J. Spencer, Director,
                                           CEO, President and Treasurer

Date: 5/14/04                               /s/Armen Geronian
      --------                             ------------------
                                           Armen Geronian, Director
                                           Secretary

Date: 5/14/04                               /s/Gordon Berry
      --------                             ----------------
                                           Gordon Berry, Director

Date: 5/14/04                               /s/ Alan Costilo
      --------                             -----------------
                                           Alan Costilo, Director