<PAGE>   1

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                    FORM 10-Q

(Mark One)

[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
      Act of 1934

                 For the quarterly period ended June 30, 1997 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 NO. 0-13836


                          SILICON VALLEY RESEARCH, INC.
                      -------------------------------------
             (Exact name of registrant as specified in its charter)


             California                                          94-2743735
--------------------------------------------------------------------------------
    (State or other jurisdiction of                            (IRS Employer
    incorporation or organization)                          Identification No.)


    6360 San Ignacio Avenue         San Jose, CA                  95119-1231
--------------------------------------------------------------------------------
    (Address of principal executive offices)                      (Zip Code)

                                 (408) 361-0333
--------------------------------------------------------------------------------
               Registrant's telephone number, including area code



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

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

                     YES  X                      NO
                        ----                       ----

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

             Common Shares Outstanding at June 30, 1997: 16,764,624


<PAGE>   2


                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES

                                      INDEX

<TABLE>
<CAPTION>

                                                                                         Pages
                                                                                         -----
<S>            <C>                                                                          <C>

Part I.        FINANCIAL INFORMATION

               Item 1.    Financial Statements

                  Consolidated Balance Sheets -
                     March 31, 1997 and June 30, 1997 (unaudited)                           3

                  Consolidated Statements of Operations -
                     Three Months Ended June 30, 1996 and 1997 (unaudited)                  4

                  Consolidated Condensed Statements of Cash Flows -
                     Three Months Ended June 30, 1996 and 1997 (unaudited)                  5

                  Notes to Consolidated Financial Statements                              6-7

               Item 2.    Management's Discussion and Analysis of
                          Financial Condition and Results of
                          Operations                                                     8-12

Part II.       OTHER INFORMATION                                                        13-15

               Item 1     Legal Proceedings
               Item 2     Changes in Securities
               Item 3     Defaults Upon Senior Securities
               Item 4     Submission of Matters to a Vote of
                          Securities Holders
               Item 5     Other Information
               Item 6     Exhibits and Reports on Form 8-K

               Signatures                                                                  16

Exhibit 27.    Financial Data Schedule                                                     17

</TABLE>



<PAGE>   3

                                PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>

Assets                                                    March 31, 1997       June 30, 1997
------                                                    --------------       -------------
                                                                               (Unaudited)
<S>                                                           <C>                 <C>     
Current Assets:
Cash and cash equivalents                                     $   2,064           $  3,623
Accounts receivable, net of allowances of
     $150 in each period                                          1,129              1,188
Prepaid expenses and other current assets                           453                301
                                                              ---------           --------
                                                                  3,646              5,112

Fixed assets, net                                                   879                814
Other assets, net                                                 3,952              2,033
                                                              ---------           --------
                                                              $   8,477           $  7,959
                                                               ========            =======

Liabilities and Shareholders' Equity

Current Liabilities:
Accounts payable                                              $     515           $    582
Accrued expenses                                                  1,443              1,043
Deferred revenue                                                  1,018              1,030
Current portion of long-term debt                                   189                216
                                                              ---------           --------
                                                                  3,165              2,871

Long-term debt                                                      254                244
                                                              ---------           --------

                                                                  3,419              3,115
                                                              ---------           --------
Contingencies (Note 7)

Shareholders' Equity:
Preferred stock, no par value:
    Authorized: 1,000 shares
    Issued and outstanding: none                                     --                 --
Common stock, no par value:
    Authorized: 25,000 shares
    Issued and outstanding:
        12,227 shares at March 31, 1997
        and 16,765 shares at June 30, 1997 (Note 6)              32,375             36,253
Accumulated deficit                                             (27,308)           (31,303)
Cumulative translation adjustment                                    (9)              (106)
                                                              ---------           --------
                                                                  5,058              4,844
                                                              ---------           --------

                                                              $   8,477           $  7,959
                                                               ========            =======
</TABLE>


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


<PAGE>   4

                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
                                                        Three Months Ended
                                                             June 30,
                                                      1996                 1997
                                                    ----------        ---------
<S>                                                  <C>                <C>    
Revenue:
License fees and other                               $ 1,569            $   242
Maintenance fees                                         653                471
                                                     -------            -------
        Total revenue                                  2,222                713
                                                     -------            -------

Cost of revenue:
License fees and other                                   119              1,318
Maintenance fees                                          99                106
                                                     -------            -------
        Total cost of revenue                            218              1,424
                                                     -------            -------

Gross profit                                           2,004               (711)
                                                     -------            -------

Operating expenses:
Engineering, research and development                    668                625
Selling and marketing                                  1,568              1,341
General and administrative                               408                303
Impairment loss on prepaid royalty (Note 7)              ---              1,217
                                                     -------            -------
        Total operating expenses                       2,644              3,486
                                                     -------            -------

Operating loss                                          (640)            (4,197)
                                                     -------            -------

Other income (expense):
Interest income                                          112                 71
Interest expense                                          (8)                (4)
Other, net                                                 1                136
                                                     -------            -------
        Total other income                               105                203
                                                     -------            -------

Loss before provision for
        income taxes                                    (535)            (3,994)

Provision for income taxes                               ---                ---
                                                     -------            -------

Net loss                                             $  (535)           $(3,994)
                                                     =======            =======


Net loss per share                                   $ (0.05)            $(0.25)
                                                     =======             ======

Shares used in per share calculation                  11,378             15,964
                                                      ======             ======

</TABLE>


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


<PAGE>   5

                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                Three  Months Ended
                                                                     June 30,
                                                             1996                1997
                                                          ---------           ---------
<S>                                                       <C>                 <C>       

Cash Flows from Operating Activities:
Net loss                                                  $    (535)          $  (3,994)
Adjustments to reconcile net loss to net
cash used in operating activities:
        Provision for impairment of prepaid marketing royalty   ---               1,217
        Amortization of software development costs              136               1,204
        Depreciation and amortization                           120                  11
Changes in assets and liabilities, net:
        Accounts receivable                                   1,863                 (57)
        Prepaid expenses and other current assets              (530)                154
        Accounts payable                                        460                  66
        Accrued expenses                                       (337)               (414)
        Deferred revenue                                       (119)                (27)
        Other, net                                           (1,284)                204
                                                          ---------           ---------

Net cash used in operating activities                          (226)             (1,636)
                                                          ---------           ---------

Cash Flows from Investing Activities:
Acquisition of fixed assets                                    (137)                 (3)
Capitalization of software development costs and
   purchase of software licenses                             (1,758)               (567)
                                                          ---------           ---------

Net cash used in investing activities                        (1,895)               (570)
                                                          ---------           ---------

Cash Flows from Financing Activities:
Principal payments of long-term debt                            (34)                (45)
Proceeds from issuance of common stock                          129               3,878
                                                          ---------           ---------

Net cash provided by financing activities                        95               3,833
                                                          ---------           ---------

Effect of exchange rate changes on cash                          (3)                (68)
                                                          ---------           ---------

Net increase (decrease)  in cash and
   cash equivalents                                          (2,029)              1,559
Cash and cash equivalents at beginning
   of  period                                                10,238               2,064
                                                          ---------           ---------

Cash and cash equivalents at end
   of period                                         $        8,209        $      3,623
                                                     ==============        ============

</TABLE>

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


<PAGE>   6


                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JUNE 30, 1997- UNAUDITED
                                 (IN THOUSANDS)

NOTE 1:    BASIS OF PRESENTATION AND FINANCIAL STATEMENT INFORMATION

       The accompanying consolidated financial statements have been prepared by
the Company, pursuant to the rules and regulations of the Securities and
Exchange Commission for interim financial statements. Therefore, they do not
include all the disclosures which were presented in the Company's annual report
on Form 10-K. These financial statements do not include all disclosures required
by generally accepted accounting principles and accordingly, should be read in
conjunction with the consolidated financial statements and notes included as
part of the Company's latest annual report on Form 10-K.

        In the opinion of management, the consolidated financial statements
include all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the consolidated financial position, results of
operations and cash flows for the interim period. The results of operations
presented are not necessarily indicative of the results to be expected for the
full year or for any other period.

        In February 1997, the Company restated its unaudited consolidated
financial statements for the quarters ended June 30, 1996 and September 30, 1996
to reverse certain transactions and related expenses which were recognized other
that in accordance with the Company's accounting policies. The financial
statements for the three months ended June 30, 1996 include the effect of the
restatement referred to above.

NOTE 2:    EARNINGS PER SHARE

        The calculation of net loss per share is based upon the weighted average
number of shares outstanding during the period. During the three month period
ended June 30, 1997 and 1996, the common equivalent shares were antidilutive due
to losses and, accordingly, were excluded from the computation of net loss per
share.

        In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings per Share". This
Statement is effective for the Company's fiscal year ending March 31, 1998. The
Statement redefines earnings per share under generally accepted accounting
principles. Under the new standard, primary earnings per share is replaced by
basic earnings per share and fully diluted earnings per share is replaced by
diluted earnings per share. The Company does not expect the adoption of this
Statement to have a significant impact on the previously reported loss per
share.

NOTE 3:    STATEMENT OF CASH FLOWS INFORMATION

<TABLE>
<CAPTION>
                                                     Three Months Ended
                                                          June 30,
                                                   1996               1997
                                                   ----               ----
<S>                                             <C>                   <C> 
Supplemental Cash Flow Information:
Cash paid during the period for:
              Interest                          $    8                $  4
              Income Taxes                          13                 ---

</TABLE>


<PAGE>   7


                 SILICON VALLEY RESEARCH, INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
                            JUNE 30, 1997- UNAUDITED
                                 (IN THOUSANDS)

NOTE 4:      BALANCE SHEET COMPONENTS

<TABLE>
<CAPTION>
                                                               March 31,            June 30,
                                                                   1997               1997
                                                                   ----               ----
<S>                                                            <C>                 <C>      
Other Assets:
Software development costs                                     $    2,163          $   1,685
Software licenses                                                   2,388              2,421
                                                               ----------          ---------
                                                                    4,551              4,106
Less accumulated amortization                                      (2,425)            (2,754)
                                                               ----------          ---------
                                                                    2,126              1,352
Prepaid royalties, net                                              1,592                417
Other                                                                 234                264
                                                               ----------          ---------
                                                               $    3,952          $   2,033
                                                               ==========          =========

Accrued Expenses:
Payroll and related costs                                      $      434          $     362
Taxes payable                                                         108                106
Other                                                                 901                575
                                                               ----------          ---------
                                                                  $ 1,443            $ 1,043
                                                               ==========          =========

</TABLE>

NOTE 5:      BANK LINE OF CREDIT

        In June 1997, the Company entered into an additional line of credit with
its bank. The revolving line of credit will provide for borrowings up to $2,000
with available borrowings limited to certain percentages of eligible accounts
receivable. Interest at prime plus one percent will be due monthly with
principal due in one year. As of June 30, 1997, no amounts had been borrowed
under the line of credit.


NOTE 6:      CAPITAL STOCK

        On April 16, 1997, the Company completed a private placement of units
comprising 4,517 shares of Common Stock and warrants to purchase an additional
4,517 shares of Common Stock at an exercise price of $1.31 per share, with
proceeds to the Company of approximately $4,000. The shares of Common Stock are
unregistered. The Company will file a registration statement with the Securities
and Exchange Commission to become effective on or before October 14, 1997 as
part of the private placement agreement. One director, one officer/director and
two officers participated in the private placement.


NOTE 7:      CONTINGENCIES

        The Company is subject to various types of litigation during its normal
course of business. In January 1997, Gambit Automated Design, Inc. ("Gambit"), a
competitor of the Company, filed a complaint alleging misappropriation of trade
secrets, breach of contract, inducing breach of contract, breach of fiduciary
duty, unfair competition and unjust enrichment against the Company and a former
employee of Gambit who is a current employee of the Company. Gambit seeks
injunctive relief, compensation and punitive damages, restitution and attorneys'
fees and costs. The parties are currently engaged in discovery. The Company
believes the lawsuit is without merit and intends to defend itself vigorously.

        In June 1996, the Company entered into an agreement whereby the Company
was granted the exclusive marketing rights to Bell Labs' CLOVER line of deep
submicron verification products worldwide, with the exception of Japan and
Taiwan, where the Company would co-market with Bell Labs' existing distributors.
Pursuant to the four year agreement, the Company made prepaid royalty payments
of $1,750. The agreement also provides for future prepaid royalty payments of:
$1,250 in fiscal 1998 and $1,000 in fiscal 1999.  Despite active marketing
efforts, the product had limited success due to product issues and to strong
competitive factors.  Accordingly, the Company recognized an impairment loss on
the balance of unamortized prepaid royalties totalling $1,217 during the three
months ended June 30, 1997.  In July and August 1997, both parties sent notices
of termination, alleging breach of the agreement by the other 


<PAGE>   8

party. The agreement provides that any dispute, controversy or claim arising out
of the agreement shall be resolved through good faith consultation. If the
dispute is not resolved by consultation, it shall be referred to and finally
resolved by arbitration. Consultations between the parties continues.
Arbitrators have not been appointed. The disputes are in the very early stages
and the ultimate outcome cannot presently be determined. Accordingly, no
provision for any recovery or any liability that may result upon resolution has
been made in the consolidated financial statements.


ITEM 2.             MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                                 (IN THOUSANDS)

This Management's Discussion and Analysis of Financial Condition and Results of
Operations includes a number of forward-looking statements which reflect the
Company's current view with respect to future events and financial performance.
These forward-looking statements are subject to certain risks and uncertainties,
including those discussed in the Other Factors section of this Item 2, elsewhere
in this Form 10-Q and as set forth in the Company's form 10-K on file with the
SEC that could cause actual results to differ materially from historical results
or those anticipated. In this report, the words "anticipates," "believes,"
"expects," "intends," "future," and similar expressions identify forward-looking
statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.

RESULTS OF OPERATIONS

REVENUE

        Revenue for the first quarter of fiscal year 1998, which ended June 30,
1997, was $713, a decrease from $2,222 in the first quarter a year ago. The 68%
decrease in revenues was due to lower license and maintenance revenue during the
quarter ended June 30, 1997, primarily resulting from a reduction in capital
investment and increased competition. International sales, primarily Japan and
the Far East accounted for 28% of total revenue in the first quarter of fiscal
1998 compared to 12% in the first quarter a year ago.

        The Company's expense levels are based, in part, on its expectations as
to future revenue levels, which are difficult to predict. A substantial portion
of the Company's revenues in each quarter results from shipments during the last
month of that quarter, and for that reason among others, the Company's revenues
are subject to significant quarterly fluctuations. If revenue levels are below
expectations, as in the quarter ended June 30, 1997, operating results may be
materially and adversely affected. In addition, the Company's quarterly and
annual results may fluctuate as a result of many factors, including the size and
timing of software license fees, timing of co-development projects with
customers, timing of operating expenditures, increased competition, new product
announcements and releases by the Company and its competitors, gain or loss of
significant customers or distributors, expense levels, renewal of maintenance
contracts, pricing changes by the Company or its competitors, personnel changes,
foreign currency exchange rates, and economic conditions generally and in the
electronics industry specifically.

COST OF REVENUE

        Cost of license fees and other revenue for the first quarter of fiscal
year 1998 was $1,318, compared to $119 in the first quarter of fiscal 1997. Cost
of sales of license fees is primarily the amortization of software development
costs and amortization of prepaid royalty payments to third parties.  As a
result of the significant reduction in revenue and due to the Company's
expanded product development program, the Company wrote-off $1,036 of
unamortized software development costs in the three months ended June 30, 1997.

        Cost of maintenance fees for the first quarter of fiscal year 1998 was
$106 compared to $99 in the first quarter of fiscal 1997. Cost of maintenance
fees is primarily the cost of providing technical support and technical
documentation.



<PAGE>   9

ENGINEERING, RESEARCH AND DEVELOPMENT EXPENSES

        Engineering, research and development expenses for the first quarter of
fiscal year 1998 were $625 compared to $668 in the first quarter a year ago.
Comparing the first quarter of fiscal 1998 and the first quarter of fiscal 1997,
engineering, research and development expenses were 88% and 30% of total
revenue, respectively. 

SELLING AND MARKETING EXPENSES

        Selling and marketing expenses for the first quarter of fiscal year 1998
decreased to $1,341 from $1,568 in the first quarter a year ago. In the first
quarter of fiscal 1998 and the first quarter of fiscal 1997, selling and
marketing expenses were 188% and 71% of total revenue, respectively. The dollar
decrease is due to lower sales commissions resulting from reduced revenue in the
first quarter of fiscal 1998. The percentage increase is also due to lower
revenues levels.

GENERAL AND ADMINISTRATIVE EXPENSES

        General and administrative expenses decreased to $303 for the first
quarter of fiscal year 1998 from $408 in the first quarter a year ago. In the
first quarter of fiscal 1998 and the first quarter of fiscal 1997, general and
administrative expenses were 42% and 18% of total revenue, respectively. The 
percentage increase is due to reduced revenues.

IMPAIRMENT LOSS ON PREPAID ROYALTY

        In June 1996, the Company entered into an agreement whereby the Company
was granted the exclusive marketing rights to Bell Labs' CLOVER line of deep
submicron verification products worldwide, with the exception of Japan and
Taiwan. Pursuant to the four year agreement, the Company has made prepaid
royalty payments of $1,750. Despite active marketing efforts, the product had
limited success due to product issues and to strong competitive factors.
Accordingly, the Company recently ceased sales of the product line. Provision
was made in the accompanying financial statements to expense the full amount of
unamortized prepaid royalty of $1,217, the future value of which was considered
impaired.

LIQUIDITY AND CAPITAL RESOURCES

        Since inception, the Company has financed its operations primarily
through sales of equity securities and to a lesser extent, cash generated from
operations. To date in fiscal 1998, the Company has received net cash of $3,878
from the private placement of equity securities and the exercise of warrants and
options to purchase Common Stock ("financing activities"). During the three
months ended June 30, 1997, cash and cash equivalents increased $1,559 from
$2,064 to $3,623. This increase resulted from cash provided by the financing
activities of $3,833 less cash used by operations of $1,636 and $570 of cash
used for investing activities.

        The Company incurred a significant loss in the first quarter of fiscal
1998 and expects operating losses to continue, at least in the near term, as it
expands its product development and marketing capabilities. The achievement of
profitability is primarily dependent upon the continued development and
commercial acceptance of the Company's products, the successful management of
the business and management's ability to strategically focus the Company. There
can be no assurance as to whether or when achievement of profitable operations
will occur. In addition, the Company is experiencing negative cash flow from
operations and it is expected that it will continue to experience negative cash
flow at least through mid-fiscal 1998 and potentially thereafter.


<PAGE>   10

        The Company's primary unused sources of funds at June 30, 1997 consisted
of cash and cash equivalents of $3,623 and an unused line of credit of $2,000
from its bank. The Company believes its cash and cash generated from operations
and available borrowings will be sufficient to finance its operations at least
through its 1998 fiscal year.

        Nevertheless, the Company may require additional financing. Management
is exploring financing alternatives to supplement the Company's cash position.
Potential sources of additional financing include private equity financings,
mergers, strategic investments, strategic partnerships or various forms of debt
financings. The Company may be prevented or restricted from raising additional
funds by issuing equity securities or securities convertible into Common Stock
unless the Company amends its Articles of Incorporation to increase the number
of authorized shares of Common Stock. The Company is seeking shareholder
approval to increase the Company's authorized shares of Common Stock at its next
annual shareholder meeting. However, no assurance can be given as to whether
such shareholder approval will be obtained in a timely manner, if at all. The
Company has no commitments or arrangements to obtain any additional funding and
there can be no assurance that the required financing of the Company will be
available on acceptable terms, if at all. The unavailability or timing of any
financing could prevent or delay the continued development and marketing of the
products of the Company and could require substantial curtailment of operations
of the Company.

OTHER FACTORS AFFECTING FUTURE RESULTS

DEPENDENCE ON SINGLE PRODUCT LINE. Revenues from sales of the SVR GARDS family
of products have historically represented a substantial majority of the
Company's revenues. Although the Company has introduced its SVR SonIC family of
products, the Company expects that revenues from the sale of SVR GARDS products
will continue to account for at least a significant portion of the Company's
revenues for the foreseeable future. The life cycles of the Company's products
are difficult to predict due to the effect of new product introductions or
product enhancements by the Company or its competitors, market acceptance of new
and enhanced versions of the Company's products and competition in the Company's
marketplace. Declines in the demand for the SVR GARDS family of products,
whether as a result of competition, technological change, price reductions or
otherwise, could have a material adverse effect on the Company's business,
operating results and financial condition.

NEW PRODUCTS AND RAPID TECHNOLOGICAL CHANGE; RISK OF PRODUCT DEFECTS. The EDA
industry is characterized by extremely rapid technological change, frequent new
product introductions and enhancements, evolving industry standards and rapidly
changing customer requirements. The development of more complex ICs embodying
new technologies will require increasingly sophisticated design tools. The
Company's future results of operations will depend, in part, upon its ability to
enhance its current products and to develop and introduce new products on a
timely and cost-effective basis that will keep pace with technological
developments and evolving industry standards and methodologies, as well as
address the increasingly sophisticated needs of the Company's customers. The
Company has in the past, and may in the future, experience delays in new product
development and product enhancements.

        The Company has recently released significant upgrades to GARDS to
provide a new Power Router, to SonIC to provide a new placer and new routing
capabilities, and to SC to provide a rewritten Global Router and fast new
placement. There can be no assurance that these new products will gain market
acceptance or that the Company will be successful in developing and marketing
product enhancements or other new products that respond to technological change,
evolving industry standards and changing customer requirements, that the Company
will not experience difficulties that could delay or prevent the successful
development, introduction and marketing of these products or product
enhancements, or that its new products and product enhancements will adequately
meet the requirements of the marketplace and achieve any significant degree of
market acceptance.

        In addition, all of the Company's current products operate in, and
planned future products will operate in, the Unix operating system. In the event
that another operating system, such as Windows NT, were to achieve broad
acceptance in the EDA industry, the Company would be required to port its
products to such an operating system, which would be costly and time consuming
and could have a material adverse effect on the Company's business, operating
results or financial condition. Failure of the Company, for technological or


<PAGE>   11

other reasons, to develop and introduce new products and product enhancements in
a timely and cost-effective manner would have a material and adverse effect on
the Company's business, operating results and financial condition. In addition,
the introduction, or even announcement of products by the Company or one or more
of its competitors embodying new technologies or changes in industry standards
or customer requirements could render the Company's existing products obsolete
or unmarketable. There can be no assurance that the introduction or announcement
of new product offerings by the Company, or one or more of its competitors, will
not cause customers to defer purchases of existing Company products. Such
deferment of purchases could have a material adverse effect on the Company's
business, operating results or financial condition.

        Software products as complex as those offered by the Company may contain
defects or failures when introduced or when new versions are released. The
Company has in the past discovered software defects in certain of its products
and may experience delays or lost revenue to correct such defects in the future.
Although the Company has not experienced material adverse effects resulting from
any such defects to date, there can be no assurance that, despite testing by the
Company, errors will not be found in new products or releases after commencement
of commercial shipments, resulting in loss of market share or failure to achieve
market acceptance. Any such occurrence could have a material effect upon the
Company's business, operating results or financial condition.

DEPENDENCE ON CERTAIN CUSTOMERS AND RESELLERS. A small number of customers
account for a significant percentage of the Company's total revenue. In fiscal
1995, HAL Computer Systems, Inc., a subsidiary of Fujitsu Ltd ("HAL"), accounted
for 12% and Sony Corporation and Yamaha Corporation ("Yamaha") each accounted
for 10% of the Company's total revenue. In fiscal 1996, HAL accounted for 16%
and Motorola and Yamaha each accounted for 11% of the Company's total revenue.
In fiscal 1997, HAL accounted for 14%, Lucent Technologies accounted for 19% and
Motorola, Inc. accounted for 13% of the Company's total revenue. There can be no
assurance that sales to these entities, individually or as a group, will reach
or exceed historical levels in any future period. Any substantial decrease in
sales to one or more of these customers could have a material adverse effect on
the Company's business, operating results or financial condition. The Company
currently sells and markets its products overseas, other than in Japan and
Taiwan, through a limited number of distributors. The Company has a limited
history of performance by its distributors. In addition, there can be no
assurance that the new distributors will be able to successfully distribute and
support the Company's products on a timely basis or that such distributors will
not reduce their efforts devoted to selling the Company's products or terminate
their relationship with the Company as a result of competition with other
suppliers' products. The loss of, or changes in, the relationship with, or
performance by, one or more of the Company's international distributors could
have an adverse effect on the Company's business.



<PAGE>   12

POTENTIAL FLUCTUATIONS IN QUARTERLY OPERATING RESULTS. Numerous factors may
materially and unpredictably affect operating results of the Company, including
the uncertainties of the size and timing of software license fees, timing of
co-development projects with customers, timing of operating expenditures,
increased competition, new product announcements and releases by the Company and
its competitors, gain or loss of significant customers or distributors, expense
levels, renewal of maintenance contracts, pricing changes by the Company or its
competitors, personnel changes, foreign currency exchange rates, and economic
conditions generally and in the electronics industry specifically. Any
unfavorable change in these or other factors could have a material adverse
effect on the Company's operating results for a particular quarter. Many of the
Company's customers order on an as-needed basis and often delay delivery of firm
purchase orders until their project commencement dates are determined, and, as a
result, the Company operates with no significant backlog. Quarterly revenue and
operating results will therefore depend on the volume and timing of orders
received during the quarter, which are difficult to forecast accurately.
Historically, the Company has often recognized a substantial portion of its
license revenues in the last month of the quarter, with these revenues
frequently concentrated in the last two weeks of the quarter. Operating results
would be disproportionately affected by a reduction in revenue because only a
small portion of the Company's expenses vary with its revenue. Operating results
in any period should not be considered indicative of the results to be expected
for any future period, and there can be no assurance that the Company's revenues
will increase or that the Company will achieve profitability.

LENGTHY SALES CYCLE. The licensing and sales of the Company's software products
generally involves a significant commitment of capital by prospective customers,
with the attendant delays frequently associated with large capital expenditures
and lengthy acceptance procedures. For these and other reasons, the sales cycle
associated with the licensing of the Company's products is typically lengthy and
subject to a number of significant risks over which the Company has little or no
control. Because the timing of customer orders is hard to predict, the Company
believes that its quarterly operating results are likely to vary significantly
in the future. Actual results of the Company could vary materially as a result
of a variety of factors, including, without limitation, the high average selling
price and long sales cycle for the Company's products, the relatively small
number of orders per quarter, dependence on sales to a limited number of large
customers, timing of receipt of orders, successful product introduction and
acceptance of the Company's products and increased competition.

DEPENDENCE UPON SEMICONDUCTOR AND ELECTRONICS INDUSTRIES; GENERAL ECONOMIC AND
MARKET Conditions. The Company is dependent upon the semiconductor and more
generally, the electronics industries. Each of these industries is characterized
by rapid technological change, short product life cycles, fluctuations in
manufacturing capacity and pricing and gross margin pressures. Each of these
industries is highly cyclical and has periodically experienced significant
downturns, often in connection with, or in anticipation of, declines in general
economic conditions during which the number of new IC design projects often
decreases. Purchases of new licenses from the Company are largely dependent upon
the commencement of new design projects, and factors negatively affecting any of
these industries could have a material adverse effect on the Company's business,
operating results or financial condition. The Company's business, operating
results and financial condition may in the future reflect substantial
fluctuations from period to period as a consequence of patterns and general
economic conditions in either the semiconductor or electronics industry.

COMPLIANCE WITH NASDAQ LISTING REQUIREMENTS; DISCLOSURE RELATING TO LOW-PRICED
STOCK The Company's Common Stock is quoted on the Nasdaq National Market ("The
National Market"). However, in order to continue to be included in the National
Market, a company must meet certain maintenance criteria. Continued inclusion
also requires two market makers and a minimum bid price of $1.00 per share;
provided, however, that if a company falls below such minimum bid price, it will
remain eligible for continued inclusion in the National Market if the market
value of the public float is at least $3,000,000 and the company has $4,000,000
in net tangible assets. The Nasdaq Stock Market, Inc. ("Nasdaq") has recently
proposed new maintenance criteria which, if implemented, would eliminate the
exception to the $1.00 per share minimum bid price and require, among other
things, $4,000,000 in net tangible assets and $5,000,000 market value of the
public float. Failure to meet these maintenance criteria in the future may
result in the delisting of the Company's Common Stock from the National Market
and the quotation of the Company's Common Stock on the Nasdaq SmallCap Market
(the "SmallCap Market") if the requirements for inclusion on the Small Cap
Market are met. As a result of quotation on the SmallCap Market, an investor may
find it more difficult to dispose of the Company's Common Stock.


<PAGE>   13

        Failure to meet the SmallCap Market inclusion criteria, or the failure
to meet the SmallCap Market maintenance criteria if the initial SmallCap Market
inclusion criteria are met, may result in the delisting of the Company's Common
Stock from Nasdaq. Trading, if any, in the Company's Common Stock would
thereafter be conducted in the non-Nasdaq over-the-counter market. As a result
of such delisting, an investor may find it more difficult to dispose of, or to
obtain accurate quotations as to the market value of, the Company's Common
Stock.

MANAGEMENT TRANSITION

        The Company is experiencing a period of management transition that has
placed, and may continue to place, a significant strain on its resources,
including its personnel. Robert R. Anderson resumed the role of Chief Executive
Officer in December 1996 and has assembled a new senior management team. The
Company's ability to manage growth successfully will require its new management
personnel to work together effectively and will require the Company to improve
its operations, management and financial systems and controls. If the Company
management is unable to manage this transition effectively, the Company's
business, competitive position, results of operations and financial condition
will be materially and adversely affected.



                           PART II. OTHER INFORMATION

Item 1.        Legal Proceedings:

               In June 1996, the Company entered into an agreement whereby the
               Company was granted the exclusive marketing rights to Bell Labs'
               CLOVER line of deep submicron verification products worldwide,
               with the exception of Japan and Taiwan, where the Company would
               co-market with Bell Labs' existing distributors. Pursuant to the
               four year agreement, the Company made prepaid royalty payments of
               $1,750. The agreement also provides for future prepaid royalty
               payments of: $1,250 in fiscal 1998 and $1,000 in fiscal 1999. In
               July and August 1997, both parties sent notices of termination,
               alleging breach of the agreement by the other party. The
               agreement provides that any dispute, controversy or claim arising
               out of the agreement shall be resolved through good faith
               consultation. If the dispute is not resolved by consultation, it
               shall be referred to and finally resolved by arbitration.
               Consultations between the parties continues. Arbitrators have not
               been appointed nor has demand for arbitration been made. The
               disputes are in the very early stages and the ultimate outcome
               cannot presently be determined. Accordingly, no provision for any
               recovery or any liability that may result upon resolution has
               been made in the consolidated financial statements.

Item 2.        Changes in Securities:  Not Applicable

Item 3.        Defaults Upon Senior Securities:  Not Applicable

Item 4.        Submission of Matters to a Vote of Securities Holders:  Not 
               Applicable

Item 5.        Other Information:   Not Applicable


<PAGE>   14

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

                                  (A) EXHIBITS:

EXHIBIT
 NUMBER     DESCRIPTION OF EXHIBIT
 ------     ----------------------

(a)(1)  The financial statements filed as part of this Report at Item 1 are
        listed in the Index to Financial Statements and Financial Statement
        Schedules on page 2 of this Report.

(a)(2)) The following exhibits are filed with this Quarterly Report on Form
        10-Q:

3.01    Registrant's Articles of Incorporation as amended to date (incorporated
        by reference to Exhibit 3.01 of Registrant's Registration Statement on
        Form S-1 ( File No. 2-89943) filed March 14, 1984, as amended (the "1984
        Registration Statement")).

3.02    Registrant's bylaws, as amended to date (incorporated by reference to
        Exhibit 4.01 of the 1984 Registration Statement).

10.01*  Registrant's 1990 Directors Stock Option Plan (incorporated by reference
        to Exhibit A of Registrant's Proxy Statement dated July 10, 1990).

10.02   Stock Purchase Agreement dated May 16, 1991 between the Registrant and
        Intergraph Corporation (incorporated by reference to Exhibit 4.01 of
        Registrant's Report on Form 8-K dated June 7, 1991).

10.03*  Registrant's 1988 Stock Option Plan, as amended to date, including the
        stock option grant form and the stock option exercise notice and
        agreement (incorporated by reference to Exhibit 10.15 of Registrant's
        Annual Report on Form10-KSB for the fiscal year ended March 31, 1993).

10.04   Warrant Agreement dated March 31, 1992 between the Registrant and
        Intergraph Corporation (incorporated by reference to Exhibit 10.18 of
        Registrant's Annual Report on Form10-KSB for the fiscal year ended March
        31, 1993).

10.05*  Registrant's 1993 Employee Stock Purchase Plan, as amended to date
        (incorporated by reference to Exhibit 10.20 of Registrant's Annual
        Report on Form 10-KSB for the fiscal year ended March 31, 1993).

10.06   Stock Purchase Agreement dated February 12,1993 between the Registrant
        and several investors (incorporated by reference to Exhibit 4.01 of
        Registrant's current report on Form 8-K filed on April 15, 1993).

10.07   Stock Purchase Agreement dated January 19,1994 between the Registrant
        and several investors (incorporated by reference to Exhibit 4.01 of
        Registrant's current report on Form 8-K filed on February 4, 1994).

10.08   Warrant Agreement dated March 22, 1994 between the Registrant and
        Prutech Research and Development Partnership II (incorporated by
        reference to Exhibit 10.22 of Registrant's Annual Report on Form 10-KSB
        for the fiscal year ended March 31, 1994).

10.09   Subordination debt agreement dated September 15, 1994 between the
        registrant and several investors (incorporated by reference to Exhibit
        4.01 of Registrant's current report on Form 8-K filed on November 4,
        1994).

10.10*  Employment Agreement dated October 31, 1995 between the Registrant and
        Glenn E. Abood (incorporated by reference to Exhibit 10.10 of
        Registrant's Registration Statement on Form S-2 filed December 6, 1995).

10.11   Stock Purchase Agreement dated June 6, 1995 between the Registrant and
        several investors (incorporated by reference to Exhibit 10.10 of the
        Registrant's Annual Report on Form 10-KSB for the fiscal year ended
        March 31, 1995).

10.12   Master Equipment Lease Agreement dated November 9, 1995 by and between
        Financing for Science International, Inc. and the Registrant
        (incorporated by reference to Exhibit 10.13 of the Registrant's
        Registration Statement on Form SB-2 filed December 6, 1995).



<PAGE>   15

 EXHIBIT
 NUMBER     DESCRIPTION OF EXHIBIT
 ------     ----------------------

10.14*  Change of Control and Severance Benefits Agreement as of February 19,
        1997 between the Registrant and Laurence G. Colegate, Jr. (incorporated
        by reference to Exhibit 10.14 of the Registrant's Annual Report on Form
        10-KSB for the fiscal year ended March 31, 1997).

10.15   Stock Transfer Terms and Conditions dated February 24, 1997 between the
        Registrant and Mentor Graphics, Inc. (incorporated by reference to
        Exhibit 4.1 of the Registrant's Registration Statement on Form S-3 
        (File No. 333-26599) filed May 7, 1997)

10.16   Form of Unit Purchase Agreement among the Company and several investors
        dated as of April 16, 1997 (incorporated by reference to Exhibit 4.2 of
        the Registrant's Registration Statement on Form S-3 (File No. 333-26599)
        filed May 7, 1997.)

10.17   Form of Warrant to Purchase Common Stock among the Company and several
        investors dated as of April 16, 1997 (incorporated by reference to
        Exhibit 4.3 of the Registrant's Registration Statement on Form S-3 
        (File No. 333-26599) filed May 7, 1997.)

27.00   Financial Data Schedule

        *Management Contract or Compensatory Plan or Arrangement

                        (B) REPORTS ON FORM 8-K: NONE FILED DURING PERIOD



<PAGE>   16

                                    SIGNATURE


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.


                                     SILICON VALLEY RESEARCH, INC.





Date:     August 14, 1997             /s/ Robert R. Anderson
          ---------------             ----------------------
                                      Robert R. Anderson
                                      Chief Executive Officer and
                                      Chairman of the Board


                                      /s/ Laurence G. Colegate, Jr.
                                      Laurence G. Colegate, Jr.
                                      Senior Vice President,
                                      Finance and Administration

                                      (Chief Financial and Accounting
                                       Officer)



<PAGE>   17

                                 EXHIBIT INDEX

EXHIBIT
 NUMBER     DESCRIPTION OF EXHIBIT
 ------     ----------------------

(a)(1)  The financial statements filed as part of this Report at Item 1 are
        listed in the Index to Financial Statements and Financial Statement
        Schedules on page 2 of this Report.

(a)(2)) The following exhibits are filed with this Quarterly Report on Form
        10-Q:

3.01    Registrant's Articles of Incorporation as amended to date (incorporated
        by reference to Exhibit 3.01 of Registrant's Registration Statement on
        Form S-1 (File No. 2-89943) filed March 14, 1984, as amended (the "1984
        Registration Statement")).

3.02    Registrant's bylaws, as amended to date (incorporated by reference to
        Exhibit 4.01 of the 1984 Registration Statement).

10.01*  Registrant's 1990 Directors Stock Option Plan (incorporated by reference
        to Exhibit A of Registrant's Proxy Statement dated July 10, 1990).

10.02   Stock Purchase Agreement dated May 16, 1991 between the Registrant and
        Intergraph Corporation (incorporated by reference to Exhibit 4.01 of
        Registrant's Report on Form 8-K dated June 7, 1991).

10.03*  Registrant's 1988 Stock Option Plan, as amended to date, including the
        stock option grant form and the stock option exercise notice and
        agreement (incorporated by reference to Exhibit 10.15 of Registrant's
        Annual Report on Form10-KSB for the fiscal year ended March 31, 1993).

10.04   Warrant Agreement dated March 31, 1992 between the Registrant and
        Intergraph Corporation (incorporated by reference to Exhibit 10.18 of
        Registrant's Annual Report on Form10-KSB for the fiscal year ended March
        31, 1993).

10.05*  Registrant's 1993 Employee Stock Purchase Plan, as amended to date
        (incorporated by reference to Exhibit 10.20 of Registrant's Annual
        Report on Form 10-KSB for the fiscal year ended March 31, 1993).

10.06   Stock Purchase Agreement dated February 12,1993 between the Registrant
        and several investors (incorporated by reference to Exhibit 4.01 of
        Registrant's current report on Form 8-K filed on April 15, 1993).

10.07   Stock Purchase Agreement dated January 19,1994 between the Registrant
        and several investors (incorporated by reference to Exhibit 4.01 of
        Registrant's current report on Form 8-K filed on February 4, 1994).

10.08   Warrant Agreement dated March 22, 1994 between the Registrant and
        Prutech Research and Development Partnership II (incorporated by
        reference to Exhibit 10.22 of Registrant's Annual Report on Form 10-KSB
        for the fiscal year ended March 31, 1994).

10.09   Subordination debt agreement dated September 15, 1994 between the
        registrant and several investors (incorporated by reference to Exhibit
        4.01 of Registrant's current report on Form 8-K filed on November 4,
        1994).

10.10*  Employment Agreement dated October 31, 1995 between the Registrant and
        Glenn E. Abood (incorporated by reference to Exhibit 10.10 of
        Registrant's Registration Statement on Form S-2 filed December 6, 1995).

10.11   Stock Purchase Agreement dated June 6, 1995 between the Registrant and
        several investors (incorporated by reference to Exhibit 10.10 of the
        Registrant's Annual Report on Form 10-KSB for the fiscal year ended
        March 31, 1995).

10.12   Master Equipment Lease Agreement dated November 9, 1995 by and between
        Financing for Science International, Inc. and the Registrant
        (incorporated by reference to Exhibit 10.13 of the Registrant's
        Registration Statement on Form SB-2 filed December 6, 1995).



<PAGE>   18

 EXHIBIT
 NUMBER     DESCRIPTION OF EXHIBIT
 ------     ----------------------

10.14*  Change of Control and Severance Benefits Agreement as of February 19,
        1997 between the Registrant and Laurence G. Colegate, Jr. (incorporated
        by reference to Exhibit 10.14 of the Registrant's Annual Report on Form
        10-KSB for the fiscal year ended March 31, 1997).

10.15   Stock Transfer Terms and Conditions dated February 24, 1997 between the
        Registrant and Mentor Graphics, Inc. (incorporated by reference to
        Exhibit 4.1 of the Registrant's Registration Statement on Form S-3 
        (File No. 333-26599) filed May 7, 1997)

10.16   Form of Unit Purchase Agreement among the Company and several investors
        dated as of April 16, 1997 (incorporated by reference to Exhibit 4.2 of
        the Registrant's Registration Statement on Form S-3 (File No. 333-26599)
        filed May 7, 1997.)

10.17   Form of Warrant to Purchase Common Stock among the Company and several
        investors dated as of April 16, 1997 (incorporated by reference to
        Exhibit 4.3 of the Registrant's Registration Statement on Form S-3 
        (File  No. 333-26599) filed May 7, 1997.)

27.00   Financial Data Schedule

        *Management Contract or Compensatory Plan or Arrangement