---

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

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FORM 10-Q

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

For the quarterly period ended March 31, 2004

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    000-27743



Pac-West Telecomm, Inc.



|California                                                     | 68-0383568                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

1776 W. March Lane, Suite 250
Stockton, California     95207

(209) 926-3300







Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.  Yes [X]      NO [   ]

Indicate by check mark whether the registrant is an
accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes [    ]   No
[X]

As of April 30, 2004, the Company had an aggregate of
36,636,181 shares of common stock issued and outstanding.







Pac-West Telecomm, Inc.

            Report on  Form 10-Q for the Quarterly Period Ended March 31, 2004
                                   Table Of Contents



|PART I.    FINANCIAL INFORMATION                                                                                                                                 
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                 
|Item 1.   Financial Statements (Unaudited)                                                                                                                       
|                                                                                                                                                                 
|Condensed Consolidated Balance Sheets as of March 31, 2004
         and December 31, 2003                                                                        
|                                                                                                                                                                 
|Consolidated Statements of Operations and Comprehensive
          
         Income (Loss) - Three month periods
          
         ended March 31, 2004 and 2003
|                                                                                                                                                                 
|Condensed Consolidated Statements of Cash Flows
          
         for the three month periods ended March 31, 2004 and 2003                                    
|                                                                                                                                                                 
|Notes to Unaudited Condensed Consolidated Financial Statements                                                                                                   
|                                                                                                                                                                 
|Item 2.   Management's Discussion and Analysis of Financial
                      Condition and Results of Operations                                            
|                                                                                                                                                                 
|Item 3.   Quantitative and Qualitative Disclosures About Market Risk                                                                                             
|                                                                                                                                                                 
|Item 4.   Controls and Procedures                                                                                                                                
|                                                                                                                                                                 
|PART II.  OTHER INFORMATION                                                                                                                                      
|                                                                                                                                                                 
|Item 1.   Legal Proceedings                                                                                                                                      
|                                                                                                                                                                 
|Item 6.   Exhibits and Reports on Form 8-K                                                                                                                       
|                                                                                                                                                                 
|Signatures                                                                                                                                                       



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PART I
      ITEM 1. FINANCIAL STATEMENTS

PAC-WEST TELECOMM, INC.

                     Condensed Consolidated Balance Sheets

              (Unaudited in thousands except share and per share data)

`March 31,     December 31,
                                                               2004             2003
                                                           -------------  -------------

                           ASSETS
Current Assets:
   Cash and cash equivalents............................. $      31,971  $      34,657
   Trade accounts receivable, net of allowances of
      $1,510 and $1,560 respectively ....................         9,356          7,713
   Prepaid expenses and other current assets.............         3,549          4,576
   Deferred tax assets...................................            --          3,467
                                                           -------------  -------------
       Total current assets..............................        44,876         50,413
Property and equipment, net..............................       114,949        121,211
Other assets, net........................................         2,888          2,578
                                                           -------------  -------------
         Total assets.................................... $     162,713  $     174,202
                                                           =============  =============

            LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
   Accounts payable...................................... $       7,759  $       5,854
   Current obligations under capital leases..............         1,173          2,589
   Accrued interest......................................           836          2,096
   Other accrued liabilities ............................        10,571         11,957
   Deferred revenues.....................................           598            594
                                                           -------------  -------------
       Total current liabilities.........................        20,937         23,090
                                                           -------------  -------------
Senior Notes.............................................        36,102         36,102
Notes payable............................................        19,824         18,421
Capital leases, less current portion.....................            93            191
Deferred revenues, less current portion..................           401            467
Deferred income taxes....................................            --          3,467
                                                           -------------  -------------
       Total liabilities.................................        77,357         81,738
                                                           -------------  -------------
Commitments and Contingencies (Note 8)
Stockholders' Equity:
   Common stock, $.001 par value; 100,000,000 shares
       authorized 36,614,306 and 36,590,532 shares issued
       and outstanding, respectively.....................            37             37
   Additional paid-in capital............................       204,471        204,461
   Accumulated deficit...................................      (118,441)      (111,276)
   Deferred stock compensation...........................          (711)          (758)
                                                           -------------  -------------
       Total stockholders' equity........................        85,356         92,464
                                                           -------------  -------------
         Total liabilities and stockholders' equity...... $     162,713  $     174,202
                                                           =============  =============`

See accompanying notes to unaudited condensed consolidated financial statements.

---



PAC-WEST TELECOMM, INC.

               Condensed Consolidated Statements of Operations

                      and Comprehensive Loss

               (Unaudited in thousands except per share data)

`Three Month Period Ended
                                                                      March 31,
                                                            --------------------------
                                                                2004          2003
                                                            ------------  ------------
Revenues.................................................. $     29,423  $     30,515

Costs and Expenses:
    Network expenses......................................       10,492        10,698
    Selling, general and administrative...................       14,231        15,204
    Depreciation and amortization.........................        9,085        13,866
                                                            ------------  ------------
      Total operating expenses............................       33,808        39,768
                                                            ------------  ------------
        Loss from operations..............................       (4,385)       (9,253)
                                                            ------------  ------------
Other Expense (Income):
    Interest expense, net.................................        2,781         2,990
    Other (income) expense................................           (4)            9
                                                            ------------  ------------
      Total other expense, net............................        2,777         2,999
                                                            ------------  ------------
      Loss before provision (benefit) from income taxes ..       (7,162)      (12,252)
Income tax expense (benefit)..............................            3        (1,928)
                                                            ------------  ------------
        Net loss.......................................... $     (7,165) $    (10,324)
                                                            ============  ============

Basic and diluted loss per share.......................... $      (0.20) $      (0.28)

Basic and diluted weighted average shares outstanding.....       36,608        36,449

Comprehensive loss:
    Net loss.............................................. $     (7,165) $    (10,324)
      Other comprehensive loss............................           --           (92)
                                                            ------------  ------------
      Comprehensive loss.................................. $     (7,165) $    (10,416)
                                                            ============  ============`

See accompanying notes to unaudited condensed consolidated financial statements.

---



PAC-WEST TELECOMM, INC.

          Condensed Consolidated Statements of Cash Flows

               (Unaudited in thousands)

`Three Month Period Ended
                                                                                      March 31,
                                                                            ----------------------------
                                                                               2004           2003
                                                                            -------------  -------------
Operating activities:
    Net loss.............................................................. $      (7,165) $     (10,324)
    Adjustments to reconcile net income loss to net cash
      provided by (used in) operating activities:
        Depreciation and amortization.....................................         9,085         13,866
        Amortization of deferred financing costs..........................           168            105
        Amortization of discount on notes payable.........................         1,255             --
        Amortization of deferred stock compensation.......................            46             --
        Provision for doubtful accounts...................................            48            (11)
        Deferred income taxes.............................................            --         (2,008)
        Net (gain) loss on disposal of property...........................            (4)             9
        (Increase) decrease  in other assets..............................           (19)           202
        Changes in operating assets and liabilities:
          (Increase) decrease in accounts receivable......................        (1,585)           798
          Decrease (increase) in prepaid expenses and other current assets         1,029           (760)
          Increase (decrease) in accounts payable.........................         2,432         (1,075)
          Decrease in accrued interest....................................        (1,093)        (3,144)
          (Decrease) increase in accrued payroll and related
            expenses and other liabilities................................        (4,150)           140
                                                                            -------------  -------------
           Net cash provided by (used in) operating activities............            47         (2,202)
                                                                            -------------  -------------
Investing activities:
    Purchase of property and equipment....................................          (689)        (1,482)
    Proceeds from disposal of property and equipment......................           103             20
    Redemptions of short-term investments, net............................            --         25,113
    Acquisitions..........................................................          (576)            --
                                                                            -------------  -------------
          Net cash (used in) provided by investing activities.............        (1,162)        23,651
                                                                            -------------  -------------
Financing activities:
    Net proceeds from borrowings under notes payable......................            --             45
    Repayments of notes payable...........................................            (3)            --
    Proceeds from the issuance of common stock............................            10             19
    Principal payments on capital leases..................................        (1,514)        (1,683)
    Payments for deferred financing costs.................................           (64)            --
                                                                            -------------  -------------
           Net cash used in financing activities..........................        (1,571)        (1,619)
                                                                            -------------  -------------
           Net (decrease) increase in cash and cash equivalents...........        (2,686)        19,830
Cash and cash equivalents:
    Beginning of period...................................................        34,657         28,050
                                                                            -------------  -------------
    End of period......................................................... $      31,971  $      47,880
                                                                            =============  =============
Supplemental Disclosure of Cash Flow Information:
    Cash paid for interest................................................ $       2,492  $       6,463
    Non cash investing activities:
    Deferred payments on equipment acquisitions........................... $       2,167  $          --`

See accompanying notes to unaudited condensed consolidated financial statements.

---



PAC-WEST TELECOMM, INC.
                  NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                  AS OF AND FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2004

The terms "the Company," "Pac-West," "we," "our," "us," and similar terms
used in this Form 10-Q, refer to Pac-West Telecomm, Inc.

1. Organization and Basis of Presentation:
2. Stock Based Compensation:
3. Concentration of Customers and Suppliers:
4. Restructuring Charges:
5. Income Taxes:
6. Comprehensive Loss:
7. Property and Equipment:
8. Commitments and Contingencies:
9. Related Party Transactions:
10. Debt and interest expense, net:
11. Acquisition of Sentient Group, Inc.:
12. Subsequent Events:

ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Except for the historical information contained herein,
this report contains forward-looking statements, subject to uncertainties and
risks. In this Quarterly Report on Form 10-Q, our use of the words "outlook,"
"expect," "anticipate," "estimate," "forecast," "project," "likely,"
"objective," "plan," "designed," "goal," "target," and similar expressions is
intended to identify forward-looking statements. While these statements
represent our current judgment on what the future may hold, and we believe these
judgments are reasonable, actual results may differ materially due to numerous
important risk factors that are described in our Annual Report on Form 10-K for
the period ended December 31, 2003, as filed with the SEC on March 30, 2004,
which may be revised or supplemented in subsequent reports filed by us with the
SEC.  Such risk factors include, but are not limited to: our substantial
indebtedness; an inability to generate sufficient cash to service our
indebtedness; regulatory and legal uncertainty with respect to intercarrier
compensation payments received by us; the declining rate at which intercarrier
compensation payments are determined; the inability to expand our business as a
result of the unavailability of funds to do so; adverse affects on our
operations as a result of covenants in agreements related to our borrowings; the
loss of key executive officers could negatively impact our business prospects;
and our principal competitors for local services and potential additional
competitors have advantages that may adversely affect our ability to compete
with them.

Introduction

We are a high-value, independent broadband provider of
integrated communications services within our target markets. Our customers
include Internet service providers and enhanced communications service
providers, collectively referred to as service providers, or SPs, and the
business enterprise market (enterprise), many of which are communications-
intensive users.

We built our facilities-based network to capitalize on the
significant growth in Internet usage and in the related demand for local
telephone service by SPs, as well as the increasing demand of enterprises for
customized and integrated voice and data communications services. We believe the
statewide footprint of our network, which encompasses all of the major
metropolitan areas of California, provides us with a competitive advantage over
incumbent local exchange carriers (ILECs), and other competitive local exchange
carriers (CLECs), particularly for SPs. Our ubiquitous network in California
enables SPs to provide their business and residential customers with access to
Internet, paging and other data and voice services from almost any point in the
state through a local call. We believe the breadth of our product offerings and
the structure of our network enable us to generate high network utilization and
strong gross profit margins.

For the quarters ended March 31, 2004 and 2003, we had net
revenues of approximately $29.4million and $30.5 million, respectively.
Operating expenses for the quarters ended March 31, 2004 and 2003 were $33.8
million and $39.8 million, respectively. Net loss for the quarters ended March
31, 2004 and 2003 was $(7.2) million and $(10.3) million, respectively.

Earnings before interest, net, income taxes, depreciation and
amortization (EBITDA) for the quarters ended March 31, 2004 and 2003 was $4.7
million and $4.6 million, respectively. Although EBITDA is not a measure of
financial performance under generally accepted accounting principles, we believe
EBITDA is a common measure used by analysts and investors to evaluate our
capacity to meet our obligations. We also use EBITDA as an internal measurement
tool and accordingly, we believe that the presentation of EBITDA provides useful
and relevant information. The tables below reconcile EBITDA to net cash provided
by (used in) operating activities for the quarters ended March 31, 2004 and 2003
(in thousands):

`2004          2003
                                                              ------------  ------------
                                                              (unaudited)   (unaudited)
    EBITDA                                                   $      4,704  $      4,604
    Change in operating assets and liabilities..............       (1,970)       (3,827)
    Interest expense, net...................................       (2,781)       (2,990)
    Allowance for doubtful accounts receivable..............           48            11
    Amortization of deferred stock compensation.............           46            --
                                                              ------------  ------------
      Net cash provided by (used in) operating activities... $         47  $     (2,202)
                                                              ============  ============`

In December 2003, we successfully completed an important
financing transaction which permitted us to reduce our debt level and cash
interest expense. In particular, on December 19, 2003, we sold to Deutsche Bank
AG - New York, acting through DB Advisors, LLC, as investment advisor, (Deutsche
Bank), a Senior Secured Note in the principal amount of $40.0 million, which we
refer to as the Senior Secured Note, and warrants to purchase up to 26,666,667
shares of our common stock at an exercise price of $1.50 per share. Under the
terms of the guaranty and security agreement related to the Senior Secured Note,
we granted Deutsche Bank a security interest in substantially all of our assets
and agreed to certain covenants including limitations on our ability to incur
additional indebtedness, incur liens, sell assets and pay dividends.

We derive our revenues from monthly recurring charges, usage
charges and amortization of initial non-recurring charges. We provide services
to both retail and wholesale customers. Monthly recurring charges include the
fees paid by customers for lines in service and additional features on those
lines, as well as equipment collocation services. Usage charges consist of fees
paid by end users for each call made, fees paid by our customers as intercarrier
compensation for completion of their customers' calls through our network, and
access charges paid by carriers for long distance traffic terminated on our
network. Initial non-recurring charges consist of fees paid by end users for the
installation of our service. These payments and related costs up to the amount
of revenues are recognized as revenue and expense ratably over the term of the
service contracts, which is generally 24 to 36 months. We recognize revenue when
there is persuasive evidence of an arrangement, delivery of the product or
performance of the service has occurred, the selling price is fixed or
determinable and collectibility is reasonably assured.

We have carrier customers who pay us to terminate their
originating call traffic on our network. These carrier customers are renting the
use of our network to complete calls for their own customers. These payments
consist of transit traffic and other intercarrier compensation payments,
collectively referred to as intercarrier compensation and meet point, which we
refer to as switched access. Intercarrier compensation payments are a function
of the number of calls we terminate, the minutes of use associated with such
calls and the rates we are compensated at by the ILECs. Intercarrier
compensation payments have historically been a significant portion of our
revenues, as they are for most other local carriers. In particular, intercarrier
compensation payments accounted for 27.2%, and 30.8% of our total revenues for
the quarters ended March 31, 2004 and 2003, respectively.  As a result, the
failure, for any reason, of one or more ILECs from which we ordinarily receive
intercarrier compensation payments to make all or a significant portion of such
payments would adversely affect our financial results.

Our right to receive intercarrier compensation payments from
ILECs, as well as the right of other CLECs to receive such payments is the
subject of numerous regulatory and legal challenges.  For example, in 2003,
Verizon and SBC attempted to adopt the Federal Communications Commission's, or
FCC's, Intercarrier ISP Compensation Order.  The FCC ISP order introduced a
series of declining intercarrier compensation pricing tiers for certain locally-
dialed minutes of use, at rates starting below the rates previously negotiated
in our interconnection agreements (ICAs) with both carriers.  The lowest pricing
tier specified by the FCC ISP order was reached on June 15, 2003, will remain in
effect until such time that a replacement FCC order may become effective.
Additionally, the FCC ISP order introduced arbitrary annual growth limits on
compensable minutes of use subject to the FCC's plan based on the composition
and balance of traffic between carriers. During the later months of 2003,
Verizon and SBC commenced withholding of intercarrier compensation payments
based on their interpretation of the growth cap formula. We expect that SBC and
Verizon may also withhold intercarrier compensation payments in 2004 and beyond
once we have exceeded their calculation of the growth cap. We do not believe
that there will be any direct impact on us in the foreseeable future from a
March 2004 U.S. Court of Appeals ruling overturning portions of an FCC Order
relating to the telephone competition policy rules on UNE-P.

As technology continues to evolve with the corresponding
development of new products and services, there is no guarantee we will retain
our customers with our existing product and service offerings or with any new
products or services we may develop in the future. While the demand for Internet
access in our target markets continues to grow, the demand for dial-up Internet
access has slowed in recent years and may decline in the future.  The
introduction of broadband and Voice over Internet Protocol (VoIP) could further
affect the growth of our existing dial-up access to the Internet and our
switched local and long-distance voice products. VoIP utilizes high-speed data
networks rather than traditional phone lines to complete calls, offering
customers enhanced functionality and potential cost savings over traditional
carrier networks. VoIP services are rapidly gaining momentum in the enterprise
market as the quality and reliability continue to improve and broadband becomes
more affordable. In this regard, in the fourth quarter of 2003, we entered into
a joint operating agreement with Sentient Group, Inc. (Sentient) to jointly
develop opportunities for the application of VoIP services to the enterprise
market, and in the first quarter of 2004 we acquired substantially all of the
assets, and assumed certain specified liabilities of Sentient.  We also
announced in May 2004, a partnership with Level 3 Communications, Inc. We are
hopeful that this partnership may further accelerate our ability to deliver VoIP
services to customers both within and outside of our western U.S. footprint. Our
VoIP solution, called VoIPpro, offers a complete suite of Internet applications
and enhanced functionality with circuit-switched technology. We believe that
VoIPpro enables geographically dispersed companies to cost-effectively connect
multiple locations and teleworkers.

Regulatory uncertainty and competition in the communication
services market has resulted in the consolidation of CLECs, a trend we expect to
continue. In order to grow our business and better serve our customers, we
continue to consider new business models and strategies, including potential
acquisitions or new business lines. We believe that our ubiquitous network will
enable us to successfully compete in the future, but we cannot guarantee that we
will be able to sustain continued growth.

Results of Operations

Quarter Ended March 31, 2004 Compared to the Quarter Ended March 31,
2003

The following tables summarize the unaudited results of
operations as a percentage of revenues for the quarters ended March 31, 2004 and
2003. The following data should be read in conjunction with the unaudited
condensed consolidated financial statements and notes thereto included elsewhere
in this report:

`2004          2003
                                                    ------------  ------------
                                                    (unaudited)   (unaudited)
Consolidated Statements of Operations Data:

Revenue...........................................        100.0 %       100.0 %
Network expenses..................................         35.7 %        35.1 %
Selling, general and administrative expenses......         48.4 %        49.8 %
Depreciation and amortization expenses............         30.9 %        45.4 %
Loss from operations..............................        (14.9)%       (30.3)%
Net loss..........................................        (24.4)%       (33.8)%`

Our significant revenue components and operational metrics
for the quarters ended March 31, 2004 and 2003 are as follows:

`Revenues (millions):                                    2004          2003        % Change
                                                    ------------  ------------  ------------
                                                    (unaudited)   (unaudited)

Intercarrier compensation......................... $        8.0  $        9.4         (14.9)%
Direct billings to SP customers...................         11.1          10.3           7.8
Direct billings to enterprise customers...........          4.7           3.6          30.6
Outbound local and long distance..................          2.9           3.2          (9.4)
Dedicated transport...............................          1.0           1.8         (44.4)
Switched access...................................          1.5           1.7         (11.8)
Other.............................................          0.2           0.5         (60.0)
                                                    ------------  ------------
Total revenues.................................... $       29.4  $       30.5          (3.6)%
                                                    ============  ============

Operational metrics:
DS-0 equivalent lines in service .................      407,394       337,294          20.8 %
Minutes of use (in billions) .....................         11.3           9.4          20.2 %`

Consolidated revenues decreased 3.6% to $29.4 million in
the quarter ended March 31, 2004 from $30.5 million during the same period in
2003. This decrease in revenues is primarily the result of a decrease of $1.4
million in intercarrier compensation revenue and a decrease of $0.8 million in
dedicated transport revenues, partially offset by increases in direct billings
to enterprise and SP customers.

The total lines in service increased by 70,100 or 20.8% to
407,394 at March 31, 2004 from 337,294 lines as of March 31, 2003. Billable
minutes of use increased 20.2% to 11.3 billion in the quarter ended March 31,
2004 from 9.4 billion during the same period in 2003.

The following table describes the main components of our
intercarrier compensation revenue for the quarters ended March 31. 2004 and 2003
(in thousands except minutes of use):

`2004        2003    % change
                                                                         ---------   --------- ---------
                                                                         (unaudited) (unaudited)

Minutes of use subject to intercarrier compensation revenue (billions)       11.0         9.2      19.6 %
Average intercarrier compensation per minute of use................... $   0.0007  $   0.0010     (28.8)
                                                                         ---------   --------- ---------
Intercarrier compensation revenue..................................... $    8,009  $    9,402     (14.8)%
                                                                         =========   ========= =========`

Direct billings to SP customers increased 7.8% to $11.1
million in the quarter ended March 31, 2004 from $10.3 million during the same
period in 2003. While lines in service to this market increased to 340,765 lines
at March 31, 2004 from 278,405 at March 31, 2003, an increase in lines of
62,360, or 22.4%, revenue per line decreased in response to on-going competitive
pressure on pricing.

Direct billings to enterprise customers increased 30.6% to
$4.7 million in the quarter ended March 31, 2004 from $3.6 million during the
same period in 2003. This increase was primarily due to a change in the mix of
products sold combined with an increase in lines in service to 66,629 lines at
March 31, 2004 from 58,889 at March 31, 2003, an increase of 7,740, or
13.1%.

Outbound local and long distance revenues, including 800,
888, and 877 numbers and travel card calls, decreased 9.4% to $2.9 million in
the quarter ended March 31, 2004 from $3.2 million during the same period in
2003. This decline in revenue was principally due to a 19.6% rate per minute
decreases resulting from the highly competitive nature of this market.

Dedicated transport revenues decreased 44.4% to $1.0 million
in the quarter ended March 31, 2004 from $1.8 during the same period in 2003
primarily because of reduced service levels. Switched access revenues decreased
11.8% to $1.5 million in the quarter ended March 31, 2004 from $1.7 million
during the same period in 2003 primarily due to lower rates per minute of
use.

The significant costs and expenses for the quarters ended March 31, 2004 and
2003 are as follows:

`Costs and expenses (in millions):                       2004          2003        % Change
                                                    ------------  ------------  ------------
                                                    (unaudited)   (unaudited)

Network expenses.................................. $       10.5  $       10.7          (1.9)%
Selling, general and administrative...............         14.2          15.2          (6.6)
Depreciation and amortization.....................          9.1          13.9         (34.5)
                                                    ------------  ------------
Total costs and expenses.......................... $       33.8  $       39.8         (15.1)%
                                                    ============  ============`

Consolidated network expenses remained relatively constant
with a decrease of 1.9% to $10.5 million in the quarter ended March 31, 2004
from $10.7 million during the same period in 2003. This decrease was achieved in
spite of a 20.2% increase in minutes of use largely due to increased network
efficiency. Although we continue to look for ways to optimize our network, we
cannot guarantee that our network expenses will continue to decline in the
future as we experience growth in network operations associated with a higher
level of telecommunications activity.

Consolidated selling, general and administrative expenses
decreased 6.6% to $14.2 million in the quarter ended March 31, 2004 from $15.2
million during the same period in 2003. The decrease is primarily the result of
decreases in maintenance expenses incurred on our network equipment and
personnel costs incurred in the quarter ended March 31, 2003 that were not
repeated in 2004.  Selling, general and administrative expenses were 48.4% and
49.8% of revenues for the quarters ended March 31, 2004 and 2003, respectively.

Estimates and assumptions are used in setting depreciable
lives. Assumptions are based on internal studies of use, industry data on
average asset lives, recognition of technological advancements and understanding
of business strategy. Consolidated depreciation and amortization expense
decreased 34.5% to $9.1 million in the quarter ended March 31, 2004 from $13.9
million during the same period in 2003. The decrease in depreciation and
amortization expense is primarily due to the change in estimated useful lives of
certain assets, which we made in January 2003. This adjustment resulted in
additional depreciation expense of approximately $2.5 million in the quarter
ended March 31, 2003.

Consolidated loss from operations improved 52.7% to $(4.4)
million in the quarter ended March 31, 2004 from $(9.3) million during the same
period in 2003 primarily due to the factors discussed in the preceding
paragraphs.

Consolidated interest expense, net decreased 6.7% to $2.8
million in the quarter ended March 31, 2004 from $3.0 million during the same
period in 2003. In December 2003, we successfully completed a financing
transaction, which permitted us to reduce our debt level. The resulting decrease
in interest expense of $0.6 million in the quarter ended March 31, 2004 compared
to the same period in 2003 was partially offset by decreased interest income. We
incurred interest expense of approximately $1.3 million related to the accretion
of the discount on our Senior Secured Note during the quarter ended March 31,
2004. Amortization of deferred financing costs included in interest expense was
$0.2 million and $0.1 million in the quarters ended March 31, 2004 and 2003,
respectively.

For the quarters ended March 31, 2004 and 2003, our
effective income tax rate was 0.0% and 15.7%, respectively.

Consolidated net loss improved 30.1% to $(7.2) million in the
quarter ended March 31, 2004 from $(10.3) million during the same period in 2003
primarily due to the factors discussed in the preceding paragraphs.

Quarterly Operating and Statistical Data:

The following table sets forth unaudited statistical data for
each of the specified quarters of 2004 and 2003. The operating and statistical
data for any quarter are not necessarily indicative of results for any future
period.

`Quarter Ended
                                     -----------------------------------------------------
                                       2004                         2003
                                     -----------------------------------------------------
                                     March 31,   Dec 31,   Sept. 30,  June 30,   March 31,
                                     ---------  ---------  ---------  ---------  ---------
                                                           (unaudited)
Ports equipped.....................   998,400    998,400    998,400    998,400    940,800
Lines in service to date...........   407,394    428,192    425,070    403,751    337,294
Quarterly minutes of use
 switched (in millions)............    11,263     11,077     11,189     10,030      9,394
Capital expenditures
 (in thousands).................... $     689  $   1,046  $   1,504  $   1,713  $   1,482
Employees..........................       389        372        371        402        402`

Liquidity and Capital Resources:

Sources and use of cash. At March 31, 2004 cash
and short term investments decreased $2.7 million to $32.0 million from  $34.7
million at December 31, 2003. The decrease was primarily due to the payment of
the semi-annual interest payments on our 13.5% Senior Notes and the acquisition
of the assets and certain of the liabilities of Sentient.

Net cash used in operating activities was $0.0 million for
the quarter ended March 31, 2004 as compared to $2.2 million for the same period
ended in 2003. This improvement was primarily because of the improvements in
loss from operations in 2004 as described in "Results of Operations"
above.

Net cash used in investing activities was $1.2 million for
the quarter ended March 31, 2004 compared to net cash provided by investing
activities of $23.7 million during the same period in 2003. We did not redeem
any short-term investments in the quarter ended March 31, 2004 whereas we
redeemed $25.2 million of short-term investments in the same period in 2003.
Purchases of property and equipment decreased to $0.7 million during the quarter
ended March 31, 2004 as compared to $1.5 million during the same period in 2003.

Net cash used in financing activities was $1.6 million in
both the quarters ended March 31, 2004 and 2003. The primary financing activity
was capital lease payments of $1.5 million and $1.7 million in the quarters
ended March 31, 2004 and 2003, respectively.

Cash requirements. The telecommunications service
business is capital intensive. Our operations have required substantial capital
investment for the design, acquisition, construction and implementation of our
network. With the recent advancements in switch technology, we are currently
investigating our options for the deployment of our first next generation
network switch, which represents the latest technological improvements in switch
capacity and configuration, sometime during 2004. In April 2004, we announced
that we had selected Tekelec, a leading developer of telecommunications products
for next-generation fixed, mobile, and packet networks, as our switching and
signaling supplier. In addition we completed a modem replacement program in the
first quarter of 2004, which we expect will provide us with increased
operational efficiencies. We continue to seek further ways to enhance our
infrastructure in 2004 and beyond. These projects and our business plan, as
currently contemplated, anticipates capital expenditures, excluding
acquisitions, of approximately $12 million in 2004. However, the actual cost of
capital expenditures during 2004 will depend on a variety of factors.
Accordingly, our actual capital requirements may exceed, or fall below, the
amount described above.

During the normal course of business, we may enter into
agreements with some suppliers, which allow these suppliers to have equipment or
inventory available for purchase based upon criteria as defined by us.   As of
March 31, 2004, we did not have any material future purchase commitments to
purchase equipment from any of our vendors.

Debt outstanding. At March 31, 2004 and December 31,
2003 long-term debt and capital lease obligations consist of the following (in
thousands):

`2004        2003
                                               ---------   ---------
Senior Notes..................................$  36,102  $   36,102
Senior Secured Note............................  19,791      18,369
Capital lease obligation.......................   1,266       2,780
Notes Payable..................................      33          52
Less current portion of capital lease..........  (1,173)     (2,589)
                                               ---------   ---------
                                              $  56,019  $   54,714
                                               =========   =========`

The Senior Notes of which there is $36.1
million in principal amount outstanding at March 31, 2004 of bear interest at
13.5% per annum payable in semiannual installments, with all principal due in
full on February 1, 2009.

The Senior Secured Note, which was initially issued in the
principal amount of $40.0 million accrues interest at a rate of LIBOR plus 0.5%
(1.6% at March 31, 2004), and matures in December 2006. Accrued interest on the
Senior Secured Note is payable quarterly in cash, or at the Company's option,
may be capitalized and added to outstanding principal. The maturity date of the
Senior Secured Note will be automatically extended to coincide with any
extension of the expiration date of the warrants, which is extendable for up to
an additional 18 months at the option of Deutsche Bank. Under the terms of
the guaranty and security agreement related to the Senior Secured Note, the
Company granted Deutsche Bank a security interest in substantially all of its
assets and agreed to certain covenants including limitations on its ability to
incur additional indebtedness, incur liens, sell assets and pay dividends. In
accordance with the terms of the Senior Secured Note, during the quarter ended
March 31, 2004 the Company elected to capitalize and add to principal interest
of approximately $0.2 million.

Future uses and sources of cash. Our principal sources
of funds for 2004 are anticipated to be current cash and short-term investment
balances and cash flows from operating activities. We may also obtain one or
more lease or lines of credit in 2004. However there can be no assurance that we
will obtain these additional lines of credit or leases or that such lines of
credit or leases will be entered into at favorable interest rates

- interest payments of approximately $5 million assuming an interest rate of
2% on our Senior Secured Note and our expected election to defer quarterly interest payments;
- anticipated capital expenditures of approximately $12
million; and
- capital lease payments (including interest) of
approximately $1 million.

The foregoing statements do not take into account (i)
acquisitions, which, if made, are expected to be funded through a combination of
cash and equity (ii) the repurchase of any of our remaining outstanding Senior
Notes or (iii) changes in interest rates.  Depending upon our rate of growth and
profitability, among other things, we may require additional equity or debt
financing to meet our working capital requirements or capital needs. There can
be no assurance that additional financing will be available when required, or,
if available, will be on terms satisfactory to us. Key factors which could
affect our liquidity include:

- future demand of our services;
- financial stability of our customers;
- outcomes of regulatory proceedings involving intercarrier
compensation;
- capital expenditures;
- debt payments;
- capital lease repayments; and
- interest expense on debt.

The guaranty and security agreement related to the Senior
Secured Note contains various covenants, which among other things restrict our
ability to borrow future amounts, early repay future borrowings and restrict our
ability to pay dividends or repurchase our common stock.

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISKS

The SEC's rule related to market risk disclosure requires
that we describe and quantify our potential losses from market risk sensitive
instruments attributable to reasonably possible market changes. Market risk
sensitive instruments include all financial or commodity instruments and other
financial instruments that are sensitive to future changes in interest rates,
currency exchange rates, commodity prices or other market factors. We are not
exposed to market risks from changes in foreign currency exchange rates or
commodity prices. We do not hold derivative financial instruments nor do we hold
securities for trading or speculative purposes. At March 31, 2004, we had an
outstanding $40.0 million principal amount of Senior Secured Notes payable.
These notes are at a rate of LIBOR plus 0.5%, which was 1.6% at March 31, 2004.
A hypothetical 1% point increase in short-term interest rates would reduce the
annualized income before tax by approximately $0.4 million as a result of higher
interest expense.

Additionally, we are exposed to changes in interest rates on
our investments in cash equivalents and short-term investments.  Substantially
all of our investments are in cash equivalents with original maturities of less
than three months. Currently this reduces our exposure to long-term interest
rate changes. A hypothetical 1% decrease in short-term interest rates would
reduce the annualized pretax interest income on our $32.0 million cash and cash
equivalents at March 31, 2004 by approximately $0.3 million.

ITEM 4.	CONTROLS AND PROCEDURES

Within 90 days prior to the filing of this Report, the
Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
the Company's "disclosure controls and procedures" (as defined in Rule
13a-14(c) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), in accordance with Rule 13a-15 of the Exchange Act. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer, together
with the other members of management participating in the evaluation, concluded
that the Company is in compliance with the requirements of Rule 13a-15(a) of the
Exchange Act and that the Company's disclosure controls and procedures are
effective.

There have been no significant changes in the Company's
internal controls or in other factors that could significantly affect internal
controls subsequent to the date of the Company's evaluation of its disclosure
controls and procedures. It should be recognized that the design of any system
of controls is based upon certain assumptions about the scope of the tasks to be
performed and the environment in which the tasks are to be performed. As such,
the Company's internal controls provide the Company with a reasonable assurance
of achieving their intended effect.

PART II

OTHER INFORMATION

ITEM 1. Legal Proceedings

See Note 8 to the Unaudited Condensed Consolidated
Financial Statements included elsewhere in this Form 10-Q and "Management's
Discussion and Analysis of Financial Condition and Results of Operations-Factors
Affecting Operations-Revenues" for a description of certain legal
proceedings involving the Company.

ITEM 6. Exhibits and Reports on Form 8-K

(a)    Exhibits

10.79    Network interconnection agreement, dated February 9,
2004 between us and Cox Arizona Telcom, LLC.

31.1 Certification by Henry R. Carabelli, Chief Executive Officer
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2Certification by H. Ravi Brar, Chief Financial Officer
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1Certification by Henry R. Carabelli, Chief Executive Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2
Certification by H. Ravi Brar, Chief Financial Officer pursuant to Section
906 of the
Sarbanes-Oxley Act of 2002.

(b)    Reports on Form 8-K

On February 19, 2004, we filed pursuant to Item 5 of Form 8-K
a copy of our press release issued on February 19, 2004, announcing the
acquisition of Sentient Group, Inc.

On February 19, 2004, we furnished pursuant to Item 12
of Form 8-K a copy of our press release issued on February 19, 2004,
announcing our financial results for the periods ended December 31, 2003.

Note:  ITEMS 2, 3, 4 and 5 are not applicable and have been omitted.

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SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized on May 12, 2004.

PAC-WEST TELECOMM, INC.

/s/ Henry R. Carabelli
   Henry R. Carabelli
   President and Chief Executive Officer



/s/ H. Ravi Brar
                           H. Ravi Brar	
   Chief Financial Officer

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