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

---

#### FORM 10-Q

| | [X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2003
| | --- | ------------------------------------------------------------------------------------------------------------------------------------

|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.: 0-22693

|InfoTech USA, Inc.                                    
|------------------------------------------------------
|(formerly SysComm International Corporation)          
|(Exact name of registrant as specified in its charter)

| | Delaware |  | 11-2889809 | 
| | -------- |  | ---------- | 

| | (State or other jurisdiction of  incorporation or organization) |  | (I.R.S. EmployerIdentification No.) | 
| | --------------------------------------------------------------- |  | ----------------------------------- | 

|7 Kingsbridge Road, Fairfield, New Jersey 07004    
|---------------------------------------------------
|(Address of principal executive offices) (Zip code)

Registrant's telephone number, including area code: (973) 227-8772

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

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

The
number of shares outstanding of each class of our common stock as of August 12, 2003 is as
follows:

|Class of Common Stock                  | Number of Shares
|-------------------------------------- | ----------------
|Common Stock, par value $.01 per share | 4,895,998       

INFOTECH USA, INC.(FORMERLY SYSCOMM
INTERNATIONAL CORPORATION)

TABLE OF CONTENTS

| | Item | Description | Page | 
| | ---- | ----------- | ---- | 

| |  | PART I  FINANCIAL INFORMATION |  | 
| |  | ------------------------------ |  | 

| | 1. | Consolidated Condensed Financial Statements
 Consolidated Condensed Balance Sheets -June 30, 2003 (unaudited) and September 30, 2002 | 3  | 
| | -- | ------------------------------------------------------------------------------------------------------------------------------------ | -- | 
| |    | Consolidated Condensed Statements of Operations -
Three and Nine Months Ended June 30, 2003 and 2002 (unaudited)                     | 4  | 
| |    | Consolidated Condensed Statement of Stockholders' Equity -
Nine Months Ended June 30, 2003 (unaudited)                               | 5  | 
| |    | Consolidated Condensed Statements of Cash Flows -
Nine Months Ended June 30, 2003 and 2002 (unaudited)                               | 6  | 
| |    | Notes to Consolidated Condensed Financial Statements (unaudited)                                                                     | 7  | 
| | 2. | Management's Discussion and Analysis of Financial Condition
and Results of Operations                                                | 9  | 
| | 3. | Quantitative and Qualitative Disclosures About Market Risk                                                                           | 13 | 
| | 4. | Controls and Procedures                                                                                                              | 13 | 

| |  | PART II  OTHER INFORMATION |  | 
| |  | --------------------------- |  | 

| | 4.        | Submission of Matters to a Vote of Security Holders | 14 | 
| | --------- | --------------------------------------------------- | -- | 
| | 6.        | Exhibits and Reports on Form 8-K                    | 14 | 
| | SIGNATURE | 15                                                  |   
| | EXHIBITS  | 18                                                  |   

2

PART
I    FINANCIAL INFORMATION     ITEM 1.    FINANCIAL STATEMENTS

|INFOTECH USA, INC. AND SUBSIDIARIES  
|-------------------------------------
|CONSOLIDATED CONDENSED BALANCE SHEETS
|(In thousands)                       

|Assets                                                           |  |               |   |                    |  
|---------------------------------------------------------------- |  | ------------- | - | ------------------ | -
|                                                                 |  | June 30, 2003 |   | September 30, 2002 |  
|                                                                 |  | (Unaudited)   |   |                    |  
|Current Assets                                                   | 
|Cash and cash equivalents                                        |  | $ 1,143       |   | $ 3,398            |  
|Accounts receivable (net of allowance for doubtful accounts of   |  | 3,170         |   | 1,913              |  
|$124 and $208)                                                   | 
|Inventories                                                      |  | 26            |   | 91                 |  
|Note receivable - Parent Company                                 |  | 1,000         |   | --                 |  
|Deferred tax assets                                              |  | 13            |   | 42                 |  
|Other current assets                                             |  | 233           |   | 135                |  
|                                                                
|Total Current Assets                                             |  | 5,585         |   | 5,579              |  
|Property, equipment and improvements, net                        |  | 374           |   | 524                |  
|Goodwill, net                                                    |  | 2,154         |   | 2,154              |  
|Other assets                                                     |  | 1,910         |   | 1,500              |  
|                                                                
|Total Assets                                                     |  | $ 10,023      |   | $ 9,757            |  
|                                                                
|Liabilities and Stockholders' Equity                             | 
|Current Liabilities                                              | 
|Current maturities of capital lease obligation                   |  | $      21     |   | $      21          |  
|Amounts due to Parent Company                                    |  | 93            |   | 127                |  
|Accounts payable                                                 |  | 583           |   | 190                |  
|Accrued expenses and other liabilities                           |  | 1,689         |   | 1,160              |  
|                                                                
|Total Current Liabilities                                        |  | 2,386         |   | 1,498              |  
|Capital lease obligation                                         |  | 5             |   | 21                 |  
|                                                                
|Total Liabilities                                                |  | 2,391         |   | 1,519              |  
|                                                                
|Commitments and Contingencies                                    | 
|Stockholders' Equity                                             | 
|Preferred shares:                                                | 
|Authorized 5,000 shares, no par value; none issued               |  | --            |   | --                 |  
|Common shares:                                                   | 
|Authorized 80,000 shares of $.01 par value; 5,757 shares issued; |  | 58            |   | 58                 |  
|4,896 shares outstanding                                         | 
|Additional paid-in capital                                       |  | 6,653         |   | 6,653              |  
|Retained earnings                                                |  | 1,839         |   | 2,445              |  
|Treasury stock (861 shares, carried at cost)                     |  | (918          | ) | (918               | )
|                                                                
|Total Stockholders' Equity                                       |  | 7,632         |   | 8,238              |  
|                                                                
|Total Liabilities and Stockholders' Equity                       |  | $ 10,023      |   | $ 9,757            |  
|                                                                

---

|See the accompanying notes to consolidated
condensed financial statements. | 3
|-------------------------------------------------------------------------- | -

|INFOTECH USA, INC. AND SUBSIDIARIES                       
|----------------------------------------------------------
|CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS           
|(In thousands, except share and per share data)(Unaudited)

|                                             |  | For the Three MonthsEnded June 30, |   | For the Nine MonthsEnded June 30,
|-------------------------------------------- |  | ---------------------------------- | - | ---------------------------------
|                                             | 
|                                             |  | 2003                               |   | 2002                             
|
|Revenues:                                    |  |                                    |   |                                  
|Product revenue                              |  | $        3,333                     |   | $        4,127                   
|Service revenue                              |  | 637                                |   | 668                              
|                                            
|Total revenues                               |  | 3,970                              |   | 4,795                            
|                                            
|Cost of sales:                               | 
|Cost of products sold                        |  | 3,004                              |   | 3,412                            
|Cost of services sold                        |  | 410                                |   | 419                              
|                                            
|Total cost of products and services sold     |  | 3,414                              |   | 3,831                            
|                                            
|Gross profit                                 |  | 556                                |   | 964                              
|Selling, general and administrative expenses |  | 658                                |   | 917                              
|Depreciation and amortization                |  | 55                                 |   | 68                               
|                                            
|Loss from operations                         |  | (157                               | ) | (21                              
|Other expense (income)                       |  | 9                                  |   | --                               
|Interest (income) expense                    |  | (3                                 | ) | 45                               
|                                            
|Loss before income tax (benefit) expense     |  | (163                               | ) | (66                              
|Income tax (benefit) expense                 |  | (65                                | ) | 6                                
|                                            
|Net loss applicable to common stockholders   |  | $          (98                     | ) | $          (72                   
|                                            
|                                            
|Net loss per common share  basic            |  | $       (0.02                      | ) | $       (0.01                    
|                                            
|Weighted average number of common            | 
|shares outstanding  basic                   |  | 4,895,998                          |   | 4,895,998                        
|                                            

---

|See the accompanying notes to consolidated
condensed financial statements. | 4
|-------------------------------------------------------------------------- | -

|INFOTECH USA, INC. AND SUBSIDIARIES                                                                    
|-------------------------------------------------------------------------------------------------------
|CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS EQUITY 
For the Nine Month Period Ended June 30, 2003
|(In thousands, except share data)(Unaudited)                                                           

|                         |  | Preferred Stock |  | Common Stock |  | AdditionalPaid-In |  | Retained |  | Treasury Stock |  | TotalStockholders' |  
|------------------------ |  | --------------- |  | ------------ |  | ----------------- |  | -------- |  | -------------- |  | ------------------ | -
|                         |  | Number          |  | Amount       |  | Number            |  | Amount   |  | Capital        |  | Earnings           |  
|                         |  |                 |  |              |  |                   |  |          |  |                |  |                    |  
|Balance, October 1, 2002 |  |                |  | $           |  | 5,757             |  | $     58 |  | $  6,653       |  | $  2,445           |  
|Net loss                 |  |                |  |             |  |                  |  |         |  |               |  | (606               | )
|                        
|Balance, June 30, 2003   |  |                |  | $           |  | 5,757             |  | $     58 |  | $  6,653       |  | $ 1,839            |  
|                        

---

|See the accompanying notes to consolidated
condensed financial statements. | 5
|-------------------------------------------------------------------------- | -

|INFOTECH USA, INC. AND SUBSIDIARIES            
|-----------------------------------------------
|CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
|(In thousands)(Unaudited)                      

|                                                                                     |  | For the Nine MonthsEnded June 30, |  
|------------------------------------------------------------------------------------ |  | --------------------------------- | -
|                                                                                     |  | 2003                              |  
|
|Cash flows from operating activities                                                 |  |                                   |  
|Net loss                                                                             |  | $  (606                           | )
|Adjustments to reconcile net loss to cash (used in) provided by operating activities | 
|Depreciation and amortization                                                        |  | 168                               |  
|Deferred income taxes                                                                |  | (378                              | )
|Change in assets and liabilities:                                                    | 
|(Increase) decrease in accounts receivable                                           |  | (1,257                            | )
|Decrease in inventories                                                              |  | 65                                |  
|(Increase) decrease in other current assets                                          |  | (116                              | )
|(Increase) decrease in other assets                                                  |  | (3                                | )
|Increase (decrease) in accounts payable and accrued expenses                         |  | 922                               |  
|                                                                                    
|Net cash (used in) provided by operating activities                                  |  | (1,205                            | )
|                                                                                    
|Cash flows from investing activities                                                 | 
|Capital expenditures                                                                 |  | (18                               | )
|Payments received on notes receivable - other                                        |  | 18                                |  
|Notes received for loan to Parent Company                                            |  | (1,000                            | )
|Proceeds from disposition of property and equipment                                  |  | --                                |  
|                                                                                    
|Net cash (used in) provided by investing activities                                  |  | (1,000                            | )
|                                                                                    
|Cash flows from financing activities                                                 | 
|Payments on capital lease obligation and long term debt                              |  | (16                               | )
|Net payments on Parent Company line of credit                                        |  | (34                               | )
|                                                                                    
|Net cash used in financing activities                                                |  | (50                               | )
|                                                                                    
|Net (decrease) increase in cash and cash equivalents                                 |  | (2,255                            | )
|Cash and cash equivalents - beginning of period                                      |  | 3,398                             |  
|                                                                                    
|Cash and cash equivalents - end of period                                            |  | $ 1,143                           |  
|                                                                                    

---

|See the accompanying notes to consolidated
condensed financial statements. | 6
|-------------------------------------------------------------------------- | -

|INFOTECH USA, INC. AND SUBSIDIARIES                       
|----------------------------------------------------------
|NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS      
|(In thousands, except share and per share data)(Unaudited)

# 1.      Basis of Presentation

In the opinion of management,  the accompanying  unaudited consolidated condensed financial statements reflect
all adjustments,  consisting of normal recurring  accruals,  necessary to present fairly the financial  position of
InfoTech  USA,  Inc.   (formerly   SysComm   International   Corporation)  (the  Company)  and  its  wholly-owned
subsidiaries,  as of June 30, 2003,  their results of operations  for the three and nine months ended June 30, 2003
and 2002,  their changes in  stockholders  equity for the nine months ended June 30, 2003 and their cash flows for
the nine months ended June 30, 2003 and 2002.  Information included in the consolidated  condensed balance sheet as
of September  30, 2002 has been derived  from the audited  consolidated  balance  sheet  included in the  Companys
Annual  Report  on Form  10-K for the year  ended  September  30,  2002  (the  10-K)  previously  filed  with the
Securities  and  Exchange  Commission  (the  SEC).  Pursuant  to the rules and  regulations  of the SEC,  certain
information  and  disclosures  normally  included in financial  statements  prepared in accordance  with accounting
principles  generally  accepted  in the  United  States of  America  have been  condensed  or  omitted  from  these
consolidated  condensed financial  statements unless significant changes have taken place since the end of the most
recent fiscal year.  Accordingly,  these unaudited  consolidated  condensed financial  statements should be read in
conjunction with the consolidated  financial statements,  notes to consolidated  financial statements and the other
information in the 10-K.

The  consolidated  results of operations for the three and nine months ended June 30, 2003 are not necessarily
indicative of the results to be expected for the full year ending September 30, 2003.

# 2.      Principles of
Consolidation

The
financial statements include the accounts of the Company and its wholly-owned
subsidiaries. All significant intercompany accounts and transactions have been eliminated
in consolidation.

# 3.      Inventories

|Inventories
at June 30, 2003 and September 30, 2002 consist of: |                                       |  |              |  |                  
|--------------------------------------------------------------- | ------------------------------------- |  | ------------ |  | -----------------
|                                                                |                                       |  | June 30,2003 |  | September 30,2002
|                                                                | Finished goods                        |  | $   65       |  | $  169           
|                                                                | Allowance for excess and obsolescence |  | (39)         |  | (78)             
|                                                                |                                       |  | $   26       |  | $   91           

# 4.      Loss Per Share

As further  explained in Note 1 to the Companys  audited  financial  statements  included in the
10-K  previously  filed with the SEC, the Company  presents basic net income (loss) per share and, if  appropriate,
diluted net income per share in accordance with the provisions of Statement of Financial  Accounting  Standards No.
128, Earnings per Share.

Since the  Company  had net losses for the three and nine  months  ended June 30,  2003 and 2002,  the assumed
effects of the exercise of employee  stock  options for the  purchase of 3,660 and 5,070 common  shares at June 30,
2003 and 2002,  respectively,  and warrants for the purchase of 300 common shares at $0.5775 per share  outstanding
at June 30, 2003 would have been anti-dilutive.

# 5.     Stock-Based Compensation

The Company  continues to measure  compensation  cost related to stock options  issued to employees  using the
intrinsic value method of accounting prescribed by Accounting Principles Board Opinion No. 25, Accounting For Stock  Issued To  Employees.  The  Company  has  adopted  the  disclosure-only  provisions  of  Statement  of
Financial

7

|INFOTECH USA, INC. AND SUBSIDIARIES                        
|-----------------------------------------------------------
|NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS       
|(In thousands, except share and per share data) (Unaudited)

Accounting Standards No. 123 (SFAS 123),  Accounting For Stock-Based  Compensation.  Accordingly,  no
earned  or  unearned  compensation  cost  was  recognized  in the  accompanying  consolidated  condensed  financial
statements  for the stock  options  granted by the Company to its  employees  since all of those  options have been
granted  at  exercise  prices  that  equaled  or  exceeded  the market  value at the date of grant.  The  Company's
historical  net loss and net loss per common  share and pro forma net loss and net loss per common  share  assuming
compensation  cost had been  determined  in 2003 and 2002  based on the fair value at the grant date for all awards
by the Company consistent with the provisions of SFAS 123 are set forth below:

|                                                  |  | Three Months EndedJune 30, |   | Nine Months EndedJune 30, |  
|------------------------------------------------- |  | -------------------------- | - | ------------------------- | -
|                                                  |  |                            |   |                          
|                                                  |  | 2003                       |   | 2002                      |  
|                                                  |  |                            |   |                           |  
|Net loss - as reported                            |  | $(98                       | ) | $(72                      | )
|Deduct total stock-based employee compensation    | 
|expense determined under a fair value based       | 
|method for all awards, net of related tax effects |  | (23                        | ) | (70                       | )
|                                                  |  |                           
|Net loss - pro forma                              |  | $(121                      | ) | $(142                     | )
|                                                  |  |                           
|Net loss per share:                               | 
|Basic - as reported                               |  | $(.02                      | ) | $(.01                     | )
|Basic - pro forma                                 |  | $(.02                      | ) | $(.03                     | )

# 6.     Related Party Transaction

On
June 27, 2003, the Company loaned $1.0 million to its majority stockholder, Applied
Digital Solutions, Inc. (Applied Digital).  Under the terms of the loan, interest, which
accrues at an annual rate of 16%, is due and payable on a monthly basis beginning July
31, 2003.  The principal amount of the loan and any unpaid interest is due on or
before June 30, 2004.  As collateral for the loan, Applied Digital pledged 750,000 shares
of common stock of Digital Angel Corporation (Digital Angel), a majority-owned subsidiary of Applied
Digital.  As of June 27, 2003, the market value of the shares of stock of Digital Angel
was approximately $2,137,500 based on the closing price of Digital Angels common stock.

8

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

This
discussion should be read in conjunction with the accompanying consolidated condensed
financial statements and related notes in Item 1 of this report as well as our Annual
Report on Form 10-K for the year ended September 30, 2002. Certain statements made in this
report may contain forward-looking statements. For a description of risks and
uncertainties relating to such forward-looking statements, see the Forward-Looking
Statements and Associated Risk section later in this Item.

# RECENT DEVELOPMENTS

# Resignation of Director

On June 16, 2003, Scott Silverman  resigned as a director.  A search committee  consisting of two directors is
currently in the process of  identifying  candidates to fill the  vacancies  that  currently  exist on our Board of
Directors.

# Loan Made to Majority Stockholder

On June 27, 2003, we loaned $1.0 million to our majority  stockholder,  Applied Digital Solutions,  Inc. Under
the terms of the loan,  interest,  which accrues at an annual rate of 16%, is due and payable by Applied Digital on
a monthly  basis  beginning  July 31,  2003.  The loan will  provide  us with  approximately  $13,300  per month in
interest  income.  The principal  amount of the loan and any unpaid  interest is due on or before June 30, 2004. As
collateral  for the loan,  Applied  Digital    pledged  750,000  shares of common  stock of Digital  Angel
Corporation,  a majority-owned  subsidiary of Applied Digital.  As of June 27, 2003, the market value of the shares
of stock of Digital  Angel was  approximately  $2,137,500  based on the  closing  price of Digital  Angels  common
stock,  which is traded on the  American  Exchange  under the symbol  DOC.  As of August 12, 2003,
the market  value of the shares of common stock of Digital Angel held by us as collateral under the loan was approximately $1,575,000.

BUSINESS DESCRIPTION

We are a Delaware  corporation  incorporated in 1997. Through our two wholly-owned  subsidiaries,  Information
Technology  Services,  Inc.  and  InfoTech  USA,  Inc.,  we provide  professional  services  in the area of systems
integration,  information  technology  procurement  and  logistics,  and  technology  strategy in the New York City
metropolitan  area and in New Jersey.  We are a full  service  provider of  information  technology  solutions  and
products.  We  specialize  in  tailoring  our  approach to the  individual  customer  needs of medium to large size
entities.  We  provide  information  technology  consulting,  networking,  procurement,   deployment,  integration,
migration  and  security  services  and  solutions.  We  also  provide  on-going  system  and  network  maintenance
services.  We are controlled by our 53% majority stockholder, Applied Digital.

# RESULTS OF OPERATIONS

We
operate in a highly competitive industry, which in turn places constant pressures on
maintaining gross profit margins. Many of our sales are high volume equipment sales, which
produce lower than average gross profit margins, but are often accompanied by a service
arrangement, which yields higher than average gross profit margins.

9

The
following table sets forth, for the periods indicated, the percentage relationship to
total revenue of certain items in our consolidated condensed statements of operations.

|                                             |  | Relationship to Revenue    |    
|-------------------------------------------- |  | -------------------------- | ---
|                                             | 
|                                             |  | Three Months EndedJune 30, |    
|                                             | 
|                                             |  | 2003%                      |    
|Product revenue                              |  | 84                         | .0 
|Service revenue                              |  | 16                         | .0 
|                                             |  |                           
|Total revenues                               |  | 100                        | .0 
|                                             |  |                           
|Cost of products sold                        |  | 75                         | .7 
|Cost of services sold                        |  | 10                         | .3 
|                                             |  |                           
|Total cost of products and services sold     |  | 86                         | .0 
|                                             |  |                           
|Gross profit                                 |  | 14                         | .0 
|Selling, general and administrative expenses |  | 16                         | .6 
|Depreciation and amortization                |  | 1                          | .4 
|                                             |  |                           
|Loss from operations                         |  | (4                         | .0)
|Other expense (income)                       |  | 0                          | .2 
|Interest (income) expense                    |  | (0                         | .1)
|                                             |  |                           
|Loss before income tax (benefit) expense     |  | (4                         | .1)
|Income tax (benefit) expense                 |  | (1                         | .6)
|                                             |  |                           
|Net loss applicable to common stockholders   |  | (2                         | .5)
|                                             |  |                           

Three Months Ended June 30, 2003
Compared to the Three Months Ended June 30, 2002(in $'000 unless otherwise noted)

Revenue for the third quarter of fiscal 2003  decreased  $825, or 17.2%,
to $3,970 from $4,795 for the third quarter of
2002.  The decrease was due to a continued  soft market  affecting  sales volume in both product  sales and service
sales,  combined  with our decision in April 2002 to cease selling some of our lower margin  computer  hardware and
focus on the higher margin  products and related  technical  services.  Product  revenue for the three months ended
June 30, 2003 decreased $794, or 19.2%, and service revenue decreased $31, or 4.6%, from the same period last year.

Gross profit  declined by $408,  or 42.3%,  in the third quarter of fiscal year 2003, to $556 from $964 in the
third  quarter of fiscal year 2002.  The  decrease in gross  profit was  primarily  due to the overall  decrease in
revenue and a large  volume,  low margin  sale made in the  current  quarter.  The large  sale,  which  represented
approximately  30% of the total  revenue for the quarter,  is part of a large project that will be completed in the
fourth  quarter.  Service  revenue and  manufacturers'  rebates  associated  with the  completion of the project are
expected to be  approximately  $70 and will be  earned  in the fourth  quarter  when the project is  completed.
Overall  gross  margin  decreased  from 20.1% in the third  quarter of 2002 to 14.0% in the third  quarter of 2003.
This  decrease  in gross  margin was  primarily  a result of the large  volume,  low margin sale during the current
quarter which we previously described.  Product  gross  margin  fell to 9.9% for the quarter  ended June 30, 2003  compared to 17.3% for the same
quarter last year.  Service  gross margin  declined to 35.6% for the quarter ended June 30, 2003 from 37.3% for the
quarter ended June 30, 2002.

Selling,  general and  administrative  expenses were $658 for the quarter  ended June 30, 2003,  down $259, or
28.2%,  from the $917 reported for the same period last year. The decrease in selling,  general and  administrative
expenses was primarily due to headcount  reductions,  reduced commissions on lower sales and the effects of other
cost control programs.

10

Depreciation
and amortization  expense for the current quarter was $55, a decrease of $13, or 19.1%,
 from $68 reported  for the same quarter last year.  Net interest  income for the quarter
 ended June 30, 2003 was $3 compared to net interest expense of $45 for the same quarter last year.
 This  change in interest  expense was due to the  repayment of certain notes to
Applied Digital Solutions in August of 2002.

Loss
from  operations  for the  quarter  ended  June 30,  2003 was $157  compared  to loss of
$21 for the same quarter  last year.  Loss before  income taxes for the quarter was $163
 compared to a loss before  income taxes of $66 for the  quarter  ended June 30,  2002.
 Our income tax benefit  was $65 for the  current  quarter  compared to income tax
expense of $6 for the same quarter last year.

Our
net loss for the quarter  ended June 30,  2003 was $98  compared  to a net loss of $72
 reported  the same period last year.

Nine Months Ended June 30, 2003 Compared to the Nine Months Ended June, 2002(in $'000 unless
otherwise noted)

Revenue
for the nine months  ended June 30, 2003  decreased  $11,257 or 54.5% from $20,641 for
the nine months ended June 30, 2002. The majority of the decrease was due to two large
 customers  that had one-time  orders in the quarter ended March 31, 2002.  The sales to
the two customers  were  primarily  product sales and were in excess of $5,300.
 Additionally,  revenue  decreased as a result of a continued soft market in both product
sales and service sales  combined  with our decision in April 2002 to cease  selling some
of our lower margin  computer  hardware and focus on the higher  margin  products and
related  technical  services.  Product  revenue for the nine months ended June 30, 2003
decreased  $10,763,  or 58.4%,  and service revenue  decreased  $494, or 22.2%,  from the
same period last year.

Gross
 profit  declined  by $1,554,  or 47.9%,  in the first nine  months of fiscal  year 2003
to $1,688  from $3,242 in the first nine  months of fiscal  year 2002.  The  decrease  in
gross  profit  was  primarily  due to the overall  decrease in  revenue.  Despite a lower
gross  margin for the quarter  ended June 30, 2003  compared to the quarter ended June
30, 2002,  overall gross margin  increased from 15.7% in the first nine months of fiscal
2002 to 18.0% in the first nine months of 2003.  This  increase in gross  margin was
 primarily a result of our strategy to cease  selling  some of our lower  margin
 computer  hardware  and to focus our  efforts on selling  higher  margin products as
well as on increasing the proportion of higher margin  technical  services sales.  The
overall increase in gross margin for the first nine months of fiscal 2003 was offset by a
large  volume,  low margin sale during the third  quarter of fiscal year 2003.  Product
 gross  margin  rose to 13.5% for the nine months  ended June 30, 2003 compared  to 12.0%
for the same  period  last year.  Service  gross  margin  declined  to 37.8% for the nine
months ended June 30, 2003 from 46.4% for the nine months ended June 30, 2002,  primarily
due to the  underutilization  of high-end technical service personnel.

Selling,
 general and administrative  expenses were $2,488 for the nine months ended June 30,
2003, down $840, or 25.2%,  from the  $3,328  reported  for the same  period  last  year.
 The  decrease  in  selling,  general  and administrative  expenses was somewhat  offset
by severance  payments of $147 made during the nine months ended June 30, 2003.  The
overall  decrease in selling,  general and  administrative  expenses was  primarily due
to headcount reduction,  the elimination of expenses related to the Shirley, New York
facility,  which was sold in January 2002, reduced commissions on lower sales and the
effects of other cost control programs.

Depreciation
 and  amortization  expense for the nine months was $168, a decrease of $38, or 18.4%,
 from $206 reported  for the same period last year.  Net interest  income for the nine months
 ended June 30, 2003 was $5 compared to  net interest  expense of $205 for the same  period
last year.  This  change in  net interest  expense was due to the payoff of the mortgage
on the Shirley,  New York  facility in January of 2002 and the repayment of certain notes
to Applied Digital Solutions in August of 2002.

Loss
from  operations  for the nine months ended June 30, 2003 was $968 compared to a loss
from  operations of $292 for the same  period  last year.  Loss  before  income  taxes
for the nine  months was $984  compared  to loss before  income  taxes of $496 for the
nine months ended June 30, 2002.  Our  effective  tax rate for the period was 38.4%
compared to 33.3% for the same period last year.

Our
net loss for the nine months  ended June 30, 2003 was $606  compared  to a net loss of
$331  reported  the same period last year.

# Liquidity and Capital
Resources

Our current  ratio at June 30, 2003 was 2.3 compared to 3.7 at September  30,  2002.  Working  capital at June
30, 2003 was $3,199 down from $4,081 at September 30, 2002, a decrease of $882.

11

Cash
used in operating activities in the first nine months of fiscal year 2003 was $1,205
compared to cash provided by operating activities in the first nine months of fiscal year
2002 of $2,596.   The cash used in operating activities during the period was primarily a
result of our net loss and an increase in accounts receivable offset by an increase in
accounts payable.  Additionally, there was an increase in other current assets.  The cash
provided by operating activities during the nine months ended June 30, 2002
 was a result of large reductions in accounts receivable, which were somewhat
offset by a decrease in accounts payable.

Cash
used in investing activities was $1,000 for the first nine months of fiscal 2003 compared
to cash provided by investing activities of $2,461 for the same period last year.  Cash
used in investing activities of $1,000 for the nine months ended June 30, 2003 was
primarily a result of the short term loan made to our majority stockholder, Applied
Digital.  The cash provided by investing activities of $2,461 in the nine
months ended June 30, 2002 was primarily a result of the sale of the Shirley, New York
facility, in January 2002.

Cash used in financing activities was $50 for the nine months ended June 30, 2003 versus
cash used in financing activities of $1,491 for the nine months ended June 30, 2002.  The
$50 of cash used in financing activities in the first nine months of this year was a
combination of payments made to pay down our borrowings on our line of credit with
Applied Digital and payments made on our capital lease obligation.  The $1,491
of cash used in financing activities in the first nine months of last year was primarily
a combination of paying off the mortgage on the Shirley, New York facility and paying
down the line of credit to Applied Digital.

Our
business activities are capital intensive and, consequently, we finance our accounts
receivable and inventory.  Failure to obtain adequate product financing on a timely basis
could have a material adverse affect on our business, results of operations, financial
condition and cash flows.  Our current financing agreements with IBM Credit LLC provide
financing on inventory purchases up to $2,500.  Borrowing for purchases is
based upon 75% of all eligible receivables due within 90 days and up to 100% of all
eligible inventories.  IBM Credit may grant temporary increases, thereby increasing the
line of credit in order to accommodate high volume sale opportunities.  Interest for
balances not paid within the interest free period provided in the agreements accrues at
prime plus 6.5%.

Combined
borrowings under the financing  arrangements  described above amounted to $1,696 and $236
at June 30, 2003 and September 30, 2002,  respectively,  and are included in either
 accounts  payable or accrued  expenses and other liabilities.

On
June 30, 2003, our majority stockholder, Applied Digital, made cash payments to
IBM Credit totaling $30 million in satisfaction of its obligations to IBM Credit.  Under
the terms of its agreement with IBM Credit, Applied Digital had pledged its
shares of our common stock as collateral for amounts outstanding under the credit
agreement, and IBM Credit had a security interest in our receivables and inventories, up
to the amount advanced to us from Applied Digital under the line of credit.  We
understand that Applied Digital has fully satisfied its obligations to IBM
Credit and, accordingly, IBM Credits security interest in the shares of common stock
owned by Applied Digital and in our receivables and inventories have been
released under Applied Digitals credit agreement.  As disclosed above, IBM
Credit will continue to have a security interest in our receivables and inventories to
the extent we borrow under our existing financing agreements with IBM Credit.

We
believe  that our  present  financing  arrangements  with IBM  Credit and  current  cash
 position  will be sufficient  to fund our  operations  and capital  expenditures  through at
least June 30, 2004 without  utilizing any additional  loans.  Our  long-term  capital
 needs  may  require  additional  sources  of  credit.  There can be no assurances that
we will be successful in our ability to negotiate  additional  sources of credit.  Our
inability to have  continuous  access to such financing at reasonable  costs may
 materially and adversely  impact our long-term financial condition, results of
operations and cash flows.

# FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISK

Certain
statements in this report, constitute forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities
Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. We intend
that such forward-looking statements be subject to the safe harbors created thereby. Such
forward-looking statements involve known and unknown risks, uncertainties and other
factors which may cause our actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, among others, the following: the
ability to retain key personnel; the continued development of our technical, sales,
marketing and management capabilities; relationships with and dependence on third-party
suppliers; anticipated competition; uncertainties relating to economic conditions where we
operate; uncertainties relating to government and regulatory policies; uncertainties
relating to customer plans and commitments; rapid technological developments and
obsolescence in the industries in which we operate and compete; potential performance
issues with suppliers and customers; governmental export and import policies; global trade
policies; worldwide political stability and economic growth; the highly competitive
environment in which we operate; potential entry of new, well-capitalized competitors into
our markets; our ability to maintain available sources of financing; and changes in our
capital structure and cost of capital. The words believe, expect,
anticipate, intend and plan 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 the statement was made.

12

# ITEM 3.   QUANTITATIVE AND
QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We presently do not use any derivative  financial  instruments  to hedge our exposure to adverse  fluctuations
in interest rates,  foreign  exchange  rates,  fluctuations  in commodity  prices or other market risks,  nor do we
invest in speculative  financial  instruments.  For InfoTech USA, borrowings under the financing agreement with IBM
Credit are at zero percent  interest  for the first 30 days,  thereafter  the interest  rate is the prime rate plus
6.5%.  Our interest  income is  sensitive to changes in the general  level of U. S.  interest  rates,  particularly
since the majority of our investments are in short-term investments.

Due
to the nature of our borrowings and our short-term investments, we have concluded that
there is no material market risk exposure and, therefore, no quantitative tabular
disclosures are required.

# ITEM 4.   CONTROLS AND
PROCEDURES

As of the end of the period  covered by this report,  management,  including our principal  executive  officer
and  principal  financial  officer,  evaluated  the  effectiveness  of the design and  operation of our  disclosure
controls and procedures  with respect to the  information  generated for use in our reporting system.  Based upon, and as of
the date of that evaluation,  our principal  executive  officer and principal  financial officer concluded that our
disclosure controls and procedures were effective to provide reasonable  assurance that information  required to be
disclosed  in the  reports  that we file  or  submit  under  the  Securities  Exchange  Act of 1934  are  recorded,
processed, summarized and reported within the time periods specified by the Commissions rules and forms.

There
was no change in our internal control over financial reporting during the quarter ended
June 30, 2003 that has materially affected, or that is reasonably likely to materially
affect, our internal control over financial reporting.

It
should be noted that our  management,  including our principal  executive  officer and
principal  financial officer,  does not expect  that our  disclosure  controls  and
 procedures  or  internal  controls  over  financial reporting will prevent all error and
all fraud.  A control  system,  no matter how well conceived or operated,  can provide
only reasonable,  not absolute,  assurance that the objectives of the control system are
met. Further,  the design of a control  system  must  reflect  the fact that  there are
 resource  constraints,  and the  benefits  of controls must be considered  relative to
their costs.  Because of the inherent  limitations in all control systems, no evaluation
of controls can provide  absolute  assurance that all control issues and instances of
fraud,  if any, have been detected.  These inherent  limitations  include the realities
 that judgments in  decision-making  can be faulty,  and that  breakdowns  can  occur
 because  of  simple  error or  mistake.  Additionally,  controls  can be circumvented
 by the  individual  acts of some  persons,  by  collusion  of two or more  people,  or
by  management override of the  controls.  The design of any system of controls is based
in part upon  certain  assumptions  about the  likelihood  of future  events,  and there
can be no assurance  that any design will  succeed in achieving  its stated goals under
all potential future  conditions;  over time,  controls may become inadequate because of
changes in  conditions,  or the degree of  compliance  with the  policies or  procedures
 may  deteriorate.  Because of the inherent limitations in a cost-effective  control
system,  misstatements due to error or fraud may occur and not be detected.

13

PART
II    OTHER INFORMATION      ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

(i)   An annual meeting of our stockholders was held on March 27, 2003 to:

| | (i) | Elect Charles L. Doherty and Scott R. Silverman as directors and ratify the appointment of Kevin McLaughlin as a director;
| | --- | --------------------------------------------------------------------------------------------------------------------------

| | (ii) | Amend our certificate of incorporation to change our name to "InfoTech USA, Inc.", and
| | ---- | --------------------------------------------------------------------------------------

| | (iii) | Ratify  the  appointment  of J. H.  Cohn  LLP,  as our  independent  public  accountants  for the year  ending
September 30, 2003.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------

(ii)    The results of the votes were as follows:

|                                                                        |  | For       |  | Against |  | Abstain | 
|----------------------------------------------------------------------- |  | --------- |  | ------- |  | ------- | 
|                                                                        |  |           | 
|Election of directors and ratification of the appointment of a director |  | 4,810,226 |  | 10,017  |  |        | 
|Amendment of certificate of incorporation                               |  | 4,810,338 |  | 9,017   |  | 888     | 
|Ratification of independent public accountants                          |  | 4,809,338 |  | 9,017   |  | 1,888   | 

# ITEM 6.    EXHIBITS AND
REPORTS ON FORM 8-K

(a)   
Exhibits (listed by numbers corresponding to the Exhibit Table of Item 601
in Regulation S-K).

See
list of exhibits attached hereto.

(b)   
Reports on Form 8-K

On
April 9, 2003, we filed a Current Report on Form 8-K under Items 5 and 7 reporting the
resignation of Jerome C. Artigliere as chairman, chief executive officer and president
and the appointment of Sebastian Perez as chief operating officer and announcing that
Applied Digital Solutions had entered into a forbearance agreement with IBM Credit LLC.

On
July 11,  2003,  we filed a Current  Report on Form 8-K under Items 2 and 7 reporting a
 short-term  loan for $1.0 million to Applied Digital Solutions, our majority stockholder.

14

# 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.

| | INFOTECH USA, INC.
| | ------------------

|Dated:   August 13, 2003 | By: | /s/ J. ROBERT PATTERSON                                                                                                                    
|------------------------ | --- | -------------------------------------------------------------------------------------------------------------------------------------------
|                         |     | J. Robert PatersonVice President, Chief Financial Officer, Treasurer and
Director (Principal Financial Officer and Chief AccountingOfficer)

15

Exhibits

|ExhibitNumber |  | Description
|------------- |  | -----------

| | 3.1 |  | Amended
and Restated Certificate of Incorporation dated April 21, 1997 (incorporated by
          reference to Exhibit 3.1 to the registrants Quarterly Report on Form 10-Q
filed with the           Commission on May 14, 2003)
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2 |  | Certificate
of Amendment of Certificate of Incorporation dated March 22, 2002 (incorporated by
          reference to Exhibit 3.2 to the registrants Quarterly Report on Form 10-Q
filed with the           Commission on May 14, 2003)
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.3 |  | Certificate
of Amendment of Certificate of Incorporation dated April 9, 2003  (incorporated by
          reference to Exhibit 3.3 to the registrants Quarterly Report on Form 10-Q
filed with the           Commission on May 14, 2003)
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.4 |  | Amended
and Restated By-Laws  (incorporated by reference to Exhibit 3.4 to the registrants
          Quarterly Report on Form 10-Q filed with the Commission on May 14, 2003)
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.1 |  | Summary
of Terms and Conditions setting forth  the terms and conditions of the Forbearance
          Agreement among IBM Credit, LLC, Applied Digital Solutions, Inc., Digital Angel
Share Trust and           their applicable subsidiaries (if any) dated March 24, 2003
(incorporated by reference to           Exhibit 10.2 to Applied Digital Solution, Inc.s
Current Report on Form 8-K, dated March 21,           2003)
| | ---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.2 |  | Forbearance
Agreement, Consent and Amendment, dated as of April 2, 2003, among IBM Credit, LLC,
          Applied Digital Solutions, Inc., Digital Angel Share Trust and the other Loan
Parties thereto           (incorporated by reference to Exhibit 10.27 to Applied Digital
Solution, Inc.s Post-Effective           Amendment No. 1 to Registration Statement
on Form S-1 (File No. 333-102165) filed with the           Commission on April 11, 2003)
| | ---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.3 |  | Commercial
Loan Agreement, dated June 27, 2003, between InfoTech USA, Inc. and Applied Digital
          Solutions, Inc. (incorporated by reference to Exhibit 10.1 to the registrants
Current Report           on Form 8-K, dated June 27, 2003, filed with the Commission on
July 11, 2003)
| | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.4 |  | Term
Note, dated June 27, 2003, issued by Applied Digital Solutions, Inc. in favor of InfoTech
          USA, Inc. (incorporated by reference to Exhibit 10.2 to the registrants
Current Report on Form           8-K, dated June 27, 2003, filed with the Commission on
July 11, 2003)
| | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.5 |  | Stock
Pledge Agreement, dated June 27, 2003, between Applied Digital Solutions, Inc. and
          InfoTech USA, Inc. (incorporated by reference to Exhibit 10.3 to the registrants
Current           Report on Form 8-K, dated June 27, 2003, filed with the Commission on
July 11, 2003)
| | ---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 31.1 |  | Certification
by Chief Executive Officer of the registrant pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------

| | 31.2 |  | Certification
by Chief Financial Officer of the registrant pursuant to Section 302 of the
          Sarbanes-Oxley Act of 2002
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------

| | 32.1 |  | Certification
by Chief Executive Officer of the registrant pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------

| | 32.2 |  | Certification
by Chief Financial Officer of the registrant pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002
| | ---- |  | ------------------------------------------------------------------------------------------------------------------------------

16