<PAGE>   1

===============================================================================

                                 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, 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. 0-19494


                              PAGING NETWORK, INC.

             (Exact name of the Registrant as specified in charter)

           DELAWARE                                            04-2740516
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                          Identification Number)

                     4965 PRESTON PARK BOULEVARD, SUITE 800
                               PLANO, TEXAS 75093

          (Address of principal executive offices, including zip code)

                                (972) 985-4100

              (Registrant's telephone number, including area code)


     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 Registrant's classes
of Common Stock, as of the latest practicable date.

<TABLE>
<CAPTION>
             Title                      Shares Outstanding as of July 31, 1997
---------------------------------       --------------------------------------
<S>                                     <C>        
   Common Stock, $ .01 par value                      102,624,232
</TABLE>

The Company's Common Stock is publicly traded under the symbol "PAGE" through
the National Association of Securities Dealers Automated Quotation National
Market System.


===============================================================================
<PAGE>   2

                         PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS.


                         Index to Financial Statements

<TABLE>
<CAPTION>
                                                                           Page
                                                                           ----
<S>                                                                          <C>
Paging Network, Inc. Consolidated Balance Sheets as of
     June 30, 1997 and December 31, 1996 (Unaudited) .....................   3

Paging Network, Inc. Consolidated Statements of Operations
     for the Three and Six Months Ended June 30, 1997 and 1996 (Unaudited)   4

Paging Network, Inc. Consolidated Statements of Cash Flows
     for the Six Months Ended June 30, 1997 and 1996 (Unaudited) .........   5

Paging Network, Inc. Notes to Consolidated Financial Statements ..........   6
</TABLE>


                                       2
<PAGE>   3

                              PAGING NETWORK, INC.
                          CONSOLIDATED BALANCE SHEETS
                    (in thousands, except share information)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                   June 30,     December 31,
                                                                     1997           1996
                                                                 -----------    -----------
<S>                                                              <C>            <C>        
ASSETS

Current assets:
    Cash and cash equivalents ................................   $     2,020    $     3,777
    Accounts receivable, less allowance
       for doubtful accounts .................................        74,567         60,089
    Inventories ..............................................        69,210         57,690
    Prepaid expenses .........................................         8,834          8,872
                                                                 -----------    -----------
       Total current assets ..................................       154,631        130,428

Property, equipment, and leasehold improvements, at cost .....     1,333,008      1,171,090
    Less accumulated depreciation ............................      (408,615)      (330,055)
                                                                 -----------    -----------
       Net property, equipment, and leasehold improvements ...       924,393        841,035

Other non-current assets, at cost ............................       620,789        547,067
    Less accumulated amortization ............................       (65,825)       (56,417)
                                                                 -----------    -----------
       Net other non-current assets ..........................       554,964        490,650
                                                                 -----------    -----------
                                                                 $ 1,633,988    $ 1,462,113
                                                                 ===========    ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
    Accounts payable .........................................   $    63,500    $    59,857
    Accrued interest .........................................        42,124         41,853
    Accrued expenses .........................................        51,870         38,460
    Customer deposits ........................................        23,866         22,430
                                                                 -----------    -----------
       Total current liabilities .............................       181,360        162,600

Long-term obligations ........................................     1,702,598      1,459,188

Commitments and contingencies ................................             -              -

Stockholders' deficit:
    Common Stock:  $.01 par, 250,000,000 shares
       authorized, 102,621,077 shares issued and
       outstanding in 1997 and 1996, respectively ............         1,026          1,026
    Paid-in capital ..........................................       124,522        124,522
    Accumulated deficit ......................................      (375,704)      (285,327)
    Foreign currency translation adjustments .................           186            104
                                                                 -----------    -----------
             Total stockholders' deficit .....................      (249,970)      (159,675)
                                                                 -----------    -----------
                                                                 $ 1,633,988    $ 1,462,113
                                                                 ===========    ===========
</TABLE>

                             See accompanying notes


                                       3
<PAGE>   4

                              PAGING NETWORK, INC.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                  (in thousands, except per share information)
                                  (Unaudited)


<TABLE>
<CAPTION>
                                                             Three Months Ended         Six Months Ended
                                                                  June 30,                  June 30,
                                                           ----------------------    ----------------------
                                                              1997         1996         1997         1996
                                                           ---------    ---------    ---------    ---------
<S>                                                        <C>          <C>          <C>          <C>      
Services, rent and maintenance revenues ................   $ 200,561    $ 167,036    $ 389,441    $ 325,811
Product sales ..........................................      33,666       32,143       70,034       59,741
                                                           ---------    ---------    ---------    ---------
    Total revenues .....................................     234,227      199,179      459,475      385,552
Cost of products sold ..................................     (28,805)     (27,124)     (60,162)     (50,476)
                                                           ---------    ---------    ---------    ---------
                                                             205,422      172,055      399,313      335,076

Operating expenses:
    Services, rent and maintenance .....................      42,653       35,910       83,595       69,561
    Selling ............................................      25,427       20,570       53,698       39,081
    General and administrative .........................      62,318       53,071      122,716      102,867
    Depreciation and amortization ......................      71,860       51,517      138,928       96,855
                                                           ---------    ---------    ---------    ---------
         Total operating expenses ......................     202,258      161,068      398,937      308,364
                                                           ---------    ---------    ---------    ---------

Operating income .......................................       3,164       10,987          376       26,712

Other income (expense):
    Interest expense ...................................     (38,281)     (29,907)     (75,860)     (59,642)
    Interest income ....................................         561          519        1,306        2,538
    Equity in loss of an unconsolidated subsidiary .....        (363)        (131)        (655)        (246)
                                                           ---------    ---------    ---------    ---------
         Total other income (expense) ..................     (38,083)     (29,519)     (75,209)     (57,350)
                                                           ---------    ---------    ---------    ---------

Loss before extraordinary item .........................     (34,919)     (18,532)     (74,833)     (30,638)
Extraordinary loss .....................................     (15,544)           -      (15,544)           -
                                                           ---------    ---------    ---------    ---------

Net loss ..............................................    $ (50,463)   $ (18,532)   $ (90,377)   $ (30,638)
                                                           =========    =========    =========    =========

Net loss per share:
    Loss before extraordinary item .....................   $   (0.34)   $   (0.18)   $   (0.73)   $   (0.30)
    Extraordinary loss .................................       (0.15)           -        (0.15)           -
                                                           ---------    ---------    ---------    ---------

Net loss per share .....................................   $   (0.49)   $   (0.18)   $   (0.88)   $   (0.30)
                                                           =========    =========    =========    =========
</TABLE>


                             See accompanying notes


                                       4
<PAGE>   5

                              PAGING NETWORK, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                  (Unaudited)


<TABLE>
<CAPTION>
                                                                   Six Months Ended
                                                                       June 30,
                                                                ----------------------
                                                                   1997         1996
                                                                ---------    ---------
<S>                                                             <C>          <C>       
Operating activities:
    Net loss ................................................   $ (90,377)   $ (30,638)
       Adjustments to reconcile net loss to net cash 
       provided by operating activities:
           Extraordinary loss ...............................      15,544            -
           Depreciation .....................................     126,153       85,980
           Amortization .....................................      12,775       10,875
           Provision for doubtful accounts ..................       8,933        5,817
           Equity in loss of an unconsolidated subsidiary ...         655          246
           Amortization of debt issuance costs ..............       4,330        2,567
       Changes in operating assets and liabilities:
           Accounts receivable ..............................     (23,411)      (8,198)
           Inventories ......................................     (11,520)     (18,180)
           Prepaid expenses .................................          38       (1,957)
           Accounts payable .................................       3,643      (26,875)
           Accrued interest .................................         271       (2,444)
           Accrued expenses .................................      13,410        1,200
           Customer deposits ................................       1,436          736
                                                                ---------    ---------
Net cash provided by operating activities ...................      61,880       19,129
                                                                ---------    ---------

Investing activities:
    Capital expenditures ....................................    (208,754)    (191,340)
    Payments for spectrum licenses ..........................     (66,905)      (7,683)
    Business acquisitions and joint venture investments .....      (4,806)      (5,276)
    Restricted cash invested in money market instruments ....      (4,619)     (19,200)
    Other ...................................................     (10,234)      (3,710)
                                                                ---------    ---------
Net cash used in investing activities .......................    (295,318)    (227,209)
                                                                ---------    ---------

Financing activities:
    Borrowings under credit agreements ......................     443,207       45,516
    Redemption of $200 million senior subordinated notes ....    (211,750)           -
    Increase in capital lease obligations ...................         203            -
    Proceeds from exercise of Common Stock options ..........           -        2,149
    Debt issuance costs on credit agreements ................           -       (3,432)
    Other ...................................................          21           (2)
                                                                ---------    ---------
Net cash provided by financing activities ...................     231,681       44,231
                                                                ---------    ---------

Net decrease  in cash and cash equivalents ..................      (1,757)    (163,849)
Cash and cash equivalents at beginning of period ............       3,777      198,182
                                                                ---------    ---------
Cash and cash equivalents at end of period ..................   $   2,020    $  34,333
                                                                =========    =========
</TABLE>


                             See accompanying notes


                                       5
<PAGE>   6

                              PAGING NETWORK, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 JUNE 30, 1997
                                  (Unaudited)

1.   THE COMPANY

          Paging Network, Inc. (the Company) is a provider of paging and
     wireless messaging services. The Company provides paging services in all
     50 states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico,
     and Canada, including local paging service in all of the largest 100
     markets (in population) in the United States, and owns a minority interest
     in paging companies in Spain and Brazil. The consolidated financial
     statements include the accounts of all of its wholly and majority-owned
     subsidiaries. All intercompany transactions have been eliminated.


2.   UNAUDITED INTERIM FINANCIAL STATEMENTS

          The interim consolidated financial information contained herein is
     unaudited but, in the opinion of management, includes all adjustments,
     which are of a normal recurring nature, necessary for a fair presentation
     of the financial position, results of operations, and cash flows for the
     periods presented. These financial statements have been prepared in
     accordance with generally accepted accounting principles for interim
     financial information and the instructions to Form 10-Q and Article 10 of
     Regulation S-X. Accordingly, they do not include all of the information
     and footnotes required by generally accepted accounting principles for
     complete financial statements. The balance sheet as of December 31, 1996,
     has been derived from the audited financial statements as of that date.
     Results of operations for the periods presented herein are not necessarily
     indicative of results of operations for the entire year. These financial
     statements and related notes should be read in conjunction with the
     financial statements and notes included in the Company's Annual Report on
     Form 10-K for the year ended December 31, 1996.

          Certain 1996 amounts have been reclassified to conform with the 1997
     presentation.

3.   LONG-TERM OBLIGATIONS

          On May 14, 1997, the Company redeemed all $200.0 million of its
     outstanding 11.75% Senior Subordinated Notes (11.75% Notes), utilizing
     funds borrowed under the Company's domestic $1.0 billion revolving credit
     agreement (the Credit Agreement). The Company recorded an extraordinary
     loss of $15.5 million in the second quarter of 1997 on the early
     retirement of the 11.75% Notes. The extraordinary loss was comprised of
     the redemption premium of $11.8 million and the write-off of unamortized
     issuance costs of $3.7 million.

          As of June 30, 1997, the Company had $468.0 million of borrowings
     outstanding under the Credit Agreement.



                                       6
<PAGE>   7

4.   DEPRECIATION EXPENSE

          Effective January 1, 1997, the Company shortened the depreciable
     lives of its pagers from four to three years, and revised the related
     residual values. The change had an effect of increasing depreciation
     expense by approximately $8 million and $16 million for the three and six
     months ended June 30, 1997, respectively.


5.   INCOME TAX PROVISION

          No provision or benefit for income taxes has been made for the six
     months ended June 30, 1997 and 1996, as the deferred benefit from
     operating losses was offset by the increase in the valuation allowance.

6.   COMMON STOCK AND NET LOSS PER SHARE

          Net loss per share amounts are computed based on the weighted average
     number of common shares outstanding. The number of shares used to compute
     per share amounts for the three and six months ended June 30, 1997 was
     102.6 million. The number of shares used to compute per share amounts for
     the three and six months ended June 30, 1996 were 102.5 million and 102.4
     million, respectively.

          The Company has 275.0 million authorized shares, of which 250.0
     million are Common Stock and 25.0 million are preferred stock. As of 
     June 30, 1997, there were no preferred shares issued or outstanding.

          In February 1997, the Financial Accounting Standards Board issued
     Statement of Financial Accounting Standards No. 128, "Earnings Per Share"
     (SFAS No. 128), which the Company will be required to initially adopt in
     the fourth quarter of 1997. The Company anticipates the adoption of SFAS
     No. 128 will have no impact on its reporting of loss per share for 1997 or
     prior years.

          On May 22, 1997, the Company's stockholders approved an amendment to
     its 1991 Stock Option Plan (1991 Plan) to increase the number of the
     Company's Common Stock issuable pursuant thereto from 6,450,000 shares to
     13,950,000 shares and reserving an additional 7,500,000 shares of Common 
     Stock for options to be issued pursuant to the 1991 Plan.

          On May 22, 1997, the Company's stockholders approved the adoption of
     an additional stock option plan, the "Paging Network, Inc. 1997 Restricted
     Stock Plan" (Restricted Stock Plan). The maximum number of shares of
     Common Stock which may be available for purchase or grant pursuant to the
     Restricted Stock Plan is 300,000 shares.

         On June 12, 1997, the Company offered an election to its employees
     with options granted during 1995 and 1996 under the 1991 Plan to cancel
     such options and accept new options at a lower price. As a result of the
     election by certain of its employees, the Company canceled 2.9 million
     options with exercise prices ranging from $13.69 to $26.50 and granted
     approximately 1.1 million options to the same optionees with an exercise
     price of $8.25 per share.


7.   STATEMENT OF CASH FLOWS INFORMATION

          Cash and cash equivalents include highly liquid debt instruments with
     an original maturity of three months or less. Cash payments made for
     interest during the six months ended June 30, 1997 and 1996 were
     approximately $77.2 million and $59.4 million, respectively. There were no
     significant federal or state income taxes paid or refunded for the six
     months ended June 30, 1997 and 1996.

                                       7
<PAGE>   8

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


SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT 
OF 1995

          The statements contained in this filing which are not historical
facts, such as future capital expenditures, future borrowings, international
investments expectations, and introduction of new products are forward-looking
statements that are subject to risks and uncertainties that could cause actual
results to differ materially from those set forth in the forward-looking
statements. Among the factors that could cause actual future results to differ
materially are competitive pressures, growth rates, new market opportunities,
supplier constraints, market conditions, timing and techniques used in
marketing by third-party distributors, and acceptance of the Company's services
in the marketplace.

RESULTS OF OPERATIONS

          Throughout this section the Company makes reference to earnings 
before interest, income taxes, depreciation, amortization, and equity in loss
of an unconsolidated subsidiary (EBITDA). EBITDA is a key performance measure
used in the paging industry and is one of the financial measures by which the
Company's covenants are calculated under the agreements governing its debt
obligations. EBITDA is not a measure defined in generally accepted accounting
principles and should not be considered in isolation or as a substitute for
measures of performance in accordance with generally accepted accounting
principles.

          The following table presents certain items in the Consolidated
Statements of Operations as a percentage of revenues from services, rent and
maintenance plus product sales less the cost of products sold (Net Revenues)
for the three and six months ended June 30, 1997 and 1996, respectively.

<TABLE>
<CAPTION>
                                                Three Months Ended      Six Months Ended
                                                     June 30,                June 30,
                                                ------------------      ------------------
                                                1997         1996       1997         1996
                                                -----        -----      -----        -----
<S>                                             <C>          <C>        <C>          <C>   
Net Revenues ................................   100.0%       100.0%     100.0%       100.0%

Operating expenses:
      Services, rent and maintenance ........    20.8(1)      20.9       20.9(1)      20.7
      Selling ...............................    12.4(1)      12.0       13.5(1)      11.7
      General and administrative ............    30.3         30.8       30.7         30.7
      Depreciation and amortization .........    35.0(1)      29.9       34.8(1)      28.9
                                                -----        -----      -----        -----

Operating income ............................     1.5          6.4        0.1          8.0

Net loss ....................................   (24.6)       (10.8)     (22.6)        (9.1)

EBITDA ......................................    36.5         36.3       34.9         36.9

EBITDA for domestic operations ..............    37.7         37.5       36.1         37.6

EBITDA for core domestic paging operations...    38.7         37.5       38.3         37.6
</TABLE>

(1) Excluding expenses related to the launch of the Company's new VoiceNow(R)
    service, which was introduced during the first quarter of 1997, services,
    rent and maintenance expenses, selling expenses, and depreciation and
    amortization expenses as a percentage of Net Revenues were 20.6%, 11.5%,
    and 33.8%, respectively, for the three months ended June 30, 1997, and were
    20.6%, 11.7%, and 34.1%, respectively, for the six months ended June 30, 
    1997.


                                       8
<PAGE>   9

      Net Revenues for the three-and six-month periods ended June 30, 1997,
were $205.4 million and $399.3 million, respectively, an increase of 19.4% and
19.2% from $172.1 million and $335.1 million for the comparable periods ended
June 30, 1996. Revenues from services, rent and maintenance, which the Company
considers its primary business, increased 20.1% to $200.6 million for the three
months ended June 30, 1997, compared to $167.0 million for the three months
ended June 30, 1996. Services, rent and maintenance revenues for the six months
ended June 30, 1997 increased 19.5% to $389.4 million, compared to $325.8
million for the six months ended June 30, 1996. These increases were primarily
due to continued growth in the number of pagers in service with subscribers of
the Company. The number of pagers in service with subscribers at June 30, 1997
was 10,057,941 compared to 7,881,764 pagers in service with subscribers at
June 30, 1996, an increase of 27.6%, and 9,002,733 pagers in service with
subscribers at December 31, 1996, an increase of 11.7%. Contributing to the
growth in the number of pagers in service with subscribers is the Company's
expanding local and national third-party reseller customer base, which includes
the impact of the Company's National Accounts Division. The Company's increased
reliance on distribution of pagers and paging services through resellers and
marketing affiliates could generate variability in quarterly and annual results
relating to the net addition of pagers.

      Product sales, less cost of products sold, were relatively flat for the
three and six months ended June 30, 1997, compared to the same periods in 1996.
Product sales, less cost of products sold, were $4.9 million (2.4% of Net
Revenues) for the second quarter of 1997 compared to $5.0 million (2.9% of Net
Revenues) for the second quarter of 1996 and were $9.9 million (2.5% of Net
Revenues) for the first six months of 1997 compared to $9.3 million (2.8% of
Net Revenues) for the first six months of 1996.

      Services, rent and maintenance expenses increased 18.8% to $42.7 million
(20.8% of Net Revenues) for the three months ended June 30, 1997, compared to
$35.9 million (20.9% of Net Revenues) for the three months ended June 30, 1996.
Services, rent and maintenance expenses increased 20.2% to $83.6 million (20.9%
of Net Revenues) for the six months ended June 30, 1997, compared to $69.6
million (20.7% of Net Revenues) for the six months ended June 30, 1996. The
increases in services, rent and maintenance expenses for the three and six
months ended June 30, 1997 and the increase as a percentage of Net Revenues for
the first six months of 1997 were the result of the continued growth in the
number of pagers in service with subscribers of the Company, expenses
associated with an increase in transmitter sites, expansion of the nationwide
transmission networks, costs incurred by the Company's Canadian operations, and
costs associated with the Company's new VoiceNow service, which was introduced
on February 24, 1997.

      For the three months ended June 30, 1997, selling expenses increased
23.6% to $25.4 million (12.4% of Net Revenues) from $20.6 million (12.0% of Net
Revenues) for the three months ended June 30, 1996. Selling expenses increased
37.4% to $53.7 million (13.5% of Net Revenues) for the six months ended June
30, 1997, compared to $39.1 million (11.7% of Net Revenues) for the six months
ended June 30, 1996. The increases in selling expenses and the increases as a
percentage of Net Revenues resulted primarily from certain VoiceNow marketing
research and development costs along with advertising expenses associated with
the Company's new VoiceNow service, and from the addition of sales personnel to
support continued growth in both Net Revenues and the number of pagers in
service with subscribers. The VoiceNow marketing research and development costs
and advertising expenses associated with the Company's new VoiceNow service
were $1.7 million and $7.2 million (0.8% and 1.8% of Net Revenues),
respectively, for the three and six months ended June 30, 1997.

      General and administrative expenses increased 17.4% to $62.3 million
(30.3% of Net Revenues) for the second quarter of 1997, compared to $53.1
million (30.8% of Net Revenues) for the corresponding period of 1996. General
and administrative expenses increased 19.3% to $122.7 million (30.7% of Net
Revenues) for the first six months of 1997, compared to $102.9 million (30.7%
of Net Revenues) for the corresponding period of 1996. The increases in general
and administrative expenses occurred to support the growth in the number of
pagers in service with subscribers of the Company. The decrease in general and
administrative 



                                       9
<PAGE>   10

expenses as a percentage of Net Revenues for the three months ended June 30,
1997 was due to the general and administrative expenses being absorbed by a
larger subscriber base.

      Depreciation and amortization expenses increased by 39.5% for the second
quarter of 1997 as compared to the corresponding period in the prior year from
$51.5 million (29.9% of Net Revenues) to $71.9 million (35.0% of Net Revenues).
Depreciation and amortization expenses increased 43.4% to $138.9 million (34.8%
of Net Revenues) for the six months ended June 30, 1997, compared to $96.9
million (28.9% of Net Revenues) for the six months ended June 30, 1996. The
increases in depreciation and amortization expenses were primarily attributable
to the increase in the number of pagers owned by the Company and leased to
subscribers, the increase in computer and paging equipment, the changes in
pager depreciation, and the commencement of amortization of the licenses for
spectrum. Effective January 1, 1997, the Company shortened the depreciable life
of its pagers from four to three years, and revised the related residual
values, in order to better reflect the estimated periods during which the
pagers will remain in service. The change had an effect of increasing
depreciation expense by approximately $8 million in the second quarter of 1997
and by approximately $16 million for the first six months of 1997. The
commencement of amortization of the licenses for spectrum and certain other
costs associated with the Company's VoiceNow service increased amortization
expense by approximately $2.3 million for the three months ended June 30, 1997.
As previously reported, depreciation and amortization expenses will increase
significantly for the year ended December 31, 1997 due to the shorter
depreciable lives for pagers (which is expected to increase depreciation
expense by approximately $35 million for the year ended December 31, 1997) and
the commencement of amortization of the licenses for spectrum and certain other
costs associated with the introduction of the Company's VoiceNow service (which
is expected to increase amortization expense by approximately $19 million for
the year ended December 31, 1997).

      As a result of the above factors, EBITDA increased 20.0% to $75.0 million
(36.5% of Net Revenues) for the second quarter of 1997 compared to $62.5
million (36.3% of Net Revenues) for the corresponding period in 1996. For the
six months ended June 30, 1997, EBITDA increased 12.7% to $139.3 million (34.9%
of Net Revenues) compared to $123.6 million (36.9% of Net Revenues) for the
corresponding period of 1996. As expected, in the second quarter of 1997 and
for the first six months of 1997, EBITDA and EBITDA as a percentage of Net
Revenues were negatively impacted by the Company's international operations and
its new VoiceNow service. The Company's international operations and its
start-up of the VoiceNow service resulted in a decrease to EBITDA of $1.8
million and $2.1 million, respectively, in the second quarter of 1997. EBITDA
for the Company's domestic operations increased 18.9% to $76.8 million (37.7%
of Net Revenues) for the second quarter of 1997, compared to $64.6 million
(37.5% of Net Revenues) for the second quarter of 1996. Excluding the Company's
VoiceNow operations, EBITDA for the Company's core domestic paging operations
increased 22.2% to $78.9 million (38.7% of Net Revenues) for the second quarter
of 1997, compared to $64.6 million (37.5% of Net Revenues) for the second
quarter of 1996. The Company's international operations and its start-up of the
VoiceNow service resulted in a decrease to EBITDA of $3.9 million and $8.6
million, respectively, for the six months ended June 30, 1997. EBITDA for the
Company's domestic operations increased 13.7% to $143.1 million (36.1% of Net
Revenues) for the six months ended June 30, 1997, compared to $125.9 million
(37.6% of Net Revenues) for the six months ended June 30, 1996. Excluding the
Company's VoiceNow operations, EBITDA for the Company's core domestic paging
operations increased 20.5% to $151.7 million (38.3% of Net Revenues) for the
first six months of 1997, compared to $125.9 million (37.6% of Net Revenues)
for the corresponding period of 1996. The Company anticipates that during 1997
its VoiceNow service will have an incremental negative impact of less than $15
million on consolidated EBITDA.

      Interest expense increased $8.4 million and $16.2 million, respectively,
from the three- and six-month periods ended June 30, 1996, to the corresponding
periods in 1997, due to a higher average level of indebtedness outstanding in
1997. The average level of indebtedness outstanding during the three and six
months ended June 30, 1997 was approximately $1.66 billion and $1.60 billion,
respectively, compared to 



                                      10
<PAGE>   11

approximately $1.16 billion and $1.15 billion, respectively, outstanding during
the three and six months ended June 30, 1996.

      On May 14, 1997, the Company redeemed all $200.0 million of its
outstanding 11.75% Notes, utilizing funds borrowed under the Company's Credit
Agreement. The Company recorded an extraordinary loss of $15.5 million in the
second quarter of 1997 on the early retirement of the 11.75% Notes.


LIQUIDITY AND CAPITAL RESOURCES

      The Company's operations and expansion into new markets and product lines
require substantial capital investment for the development and installation of
wireless communications systems and for the procurement of pagers and paging
equipment. Capital expenditures (excluding payments for licenses) were $208.8
million for the six months ended June 30, 1997 and $191.3 million for the same
period in 1996. For the first six months of 1997, capital expenditures were
funded by net cash provided by operating activities ($61.9 million) and
borrowings.

      During April 1996, the Company concluded its participation in a Federal
Communications Commission auction of specialized mobile radio (SMR) frequency
licenses, and ultimately acquired rights to two to four blocks of two-way
spectrum in markets across the United States for a purchase price of $45.6
million. The Company is in the process of purchasing exclusive rights to
certain of these SMR frequencies from incumbent operators. The total cost of
the investment will be approximately $250 million (including the $45.6 million
auction purchase price), of which $109 million was paid in 1996 and $66 million
was paid in the first six months of 1997, and the remainder will be paid in the
last six months of 1997 and in 1998.

      The Company intends to utilize its narrowband personal communications
services and SMR frequencies for additional capacity as needed for its paging
operations, such as digital and alphanumeric, and to build a two-way network 
over which it can deploy new products such as its new voice paging service,
VoiceNow, and various data products. The Company has expended $47 million in
1996 and $63 million in the first six months of 1997 to construct the two-way
network and expects to incur an additional $40 million during the remainder of
1997. Additional capital expenditures for the two-way network after 1997 will be
determined based on the market introduction and success of new products.

      Through its wholly-owned subsidiary, PageNet Canada, the Company began
offering paging services in Canada in April 1996. In July 1996, the Company
purchased a 25% interest in an existing Spanish paging company. In December
1996, the Company signed agreements as the operational partner with a 20%
interest in a joint venture to provide paging services in Brazil which
commenced operations during the first quarter of 1997. The Company is
considering other opportunities for international expansion, with the goal of
creating a portfolio of select international operations. Paging market
penetration in many international markets is relatively low, and many such
markets have only a small number of existing paging providers. Additional 
investments will depend on such factors as growth rates, new market 
opportunities, and execution of financing plans that maximize value for the 
Company's stockholders.

      Under the Credit Agreement, the Company is able to borrow, provided it
meets certain financial covenants, the lesser of $1.0 billion or an amount
based upon a calculation which is reduced by total outstanding domestic
indebtedness for borrowed monies (as defined) and outstanding letters of
credit. The amount of total indebtedness allowed at the end of each quarter is
equal to 6.5 times annualized domestic EBITDA. As of June 30, 1997, the Company
had $468.0 million of borrowings outstanding under the Credit Agreement and,
under the terms of the Credit Agreement, an additional $328.6 million was
available for borrowings as of that date. Such amount will increase or decrease
during the third quarter based on the 



                                      11
<PAGE>   12

domestic EBITDA for the third quarter. As of July 31, 1997, the Company had
$487.0 million of borrowings outstanding under its Credit Agreement. The
maximum borrowings which may be outstanding under its Credit Agreement. The
maximum borrowing which may be outstanding under the Credit Agreement will
begin reducing on June 30, 2001, and the Credit Agreement expires on December 
31, 2004.

      The two credit agreements of the Company's Canadian subsidiaries provide
for total borrowings of approximately $65 million, of which approximately $36
million was initially available under fully collateralized borrowings. The
remaining amounts are available for borrowings provided they are either
collateralized or certain financial covenants are met. As of June 30, 1997,
approximately $34 million of borrowings were outstanding under the credit
facilities. The maximum borrowings which may be outstanding under the credit
facilities will begin reducing on June 30, 1999, and both credit agreements 
expire on June 30, 2003.

      On May 14, 1997, the Company redeemed all $200.0 million of its
outstanding 11.75% Notes, utilizing funds borrowed under the Company's Credit
Agreement. The 11.75% Notes were redeemed to achieve an annual interest cost
savings of approximately $8 million per year for five years based on current
interest rates, including savings of approximately $4 million in 1997.

      It is anticipated that 1997 net cash from operating activities will be
insufficient to fund 1997 capital expenditures (including the costs to build
the two-way network) and frequency purchases. These expenditures, which are
expected to approximate $500 million, primarily relate to the development of a
new digital transmission network and the Company's ongoing paging operations,
including greater market share of existing markets. These expenditures will be
funded through the Company's operating cash flow and from borrowings under its
credit facility. The Company currently estimates 1997 incremental indebtedness
may aggregate in excess of $400 million.

      Relative to amounts previously disclosed, the reductions in projected
1997 capital expenditures and incremental indebtedness are the result of
revisions in the Company's strategy for its new VoiceNow product. The Company
will continue to offer VoiceNow service in its three existing markets and
initiate service in one additional market, Chicago, in 1997. The Company will
also begin to utilize, where economically feasible, excess capacity in the
spectrum and two-way network constructed for use for VoiceNow for certain
existing paging services offered by the Company.




                                      12
<PAGE>   13

                          PART II - OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS.

          The Company is involved in various lawsuits arising in the normal
     course of business. In management's opinion, the ultimate outcome of these
     lawsuits will not have a material adverse effect on the Company's
     financial position or results of operations.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

          On May 22, 1997, the Company held its Annual Meeting of Stockholders,
     at which all of the matters listed below were approved.

     (a)  Mr. Bryan C. Cressey was elected as a Class III Director for a three
          year term to expire in 2000 (83,814,979 voting for and 1,194,045
          withholding authority). Mr. Richard C. Alberding was elected as a
          Class III Director for a three year term to expire in 2000
          (83,758,826 voting for and 1,250,198 withholding authority). Mr. Lee
          M. Mitchell was elected as a Class III Director for a three year term
          to expire in 2000 (83,812,623 voting for and 1,196,401 withholding
          authority).

     (b)  The adoption of an amendment to the Company's 1991 Stock Option Plan
          to increase the number of shares of common stock issuable pursuant
          thereto from 6,450,000 shares to 13,950,000 shares was approved
          (50,994,494 voting for, 20,129,665 voting against, and 13,884,865
          abstaining or not voting).

     (c)  The adoption of the Company's amended and restated 1992 Stock Option
          Plan for Directors was approved (69,801,000 voting for, 5,125,054
          voting against, and 10,082,970 abstaining or not voting).

     (d)  The adoption of the Company's 1997 Restricted Stock Plan was approved
          (70,094,694 voting for, 4,830,276 voting against, and 10,084,054
          abstaining or not voting).

          As of the record date there were 102,621,077 shares of common stock
     issued and outstanding and entitled to vote.


ITEM 5.  OTHER INFORMATION

          On August 4, 1997, Glenn W. Marschel resigned as President and Chief
     Executive Officer of the Company and George M. Perrin resigned as Chairman
     of the Board of Directors. Mr. Perrin will remain on the Company's Board
     of Directors. On August 5, 1997, the Company announced that effective
     August 4, 1997, John P. Frazee, Jr. was elected by its Board of Directors 
     as Chairman, President and Chief Executive Officer.


                                      13
<PAGE>   14

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

     (a)  Exhibits

          The exhibits listed on the accompanying index to exhibits are filed
          as part of this quarterly report.

     (b)  Reports on Form 8-K

          On May 20, 1997, the Company filed a Current Report on Form 8-K
          relating to the redemption of all of its outstanding $200 million
          11.75% Senior Subordinated Notes due May 15, 2002.


                                      14
<PAGE>   15

                                   SIGNATURES



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



                               Paging Network, Inc.




Date: August 6, 1997           /s/ John P. Frazee, Jr.
                               -----------------------------------------------
                               John P. Frazee, Jr.
                               Chairman of the Board of Directors,
                               President and Chief Executive Officer
                               (Principal Executive Officer)




Date: August 6, 1997           /s/ Kenneth W. Sanders
                               -----------------------------------------------
                               Kenneth W. Sanders
                               Senior Vice President-Finance, Treasurer,
                               Chief Financial Officer and Assistant Secretary
                               (Principal Financial Officer and Principal
                               Accounting Officer)


                                      15
<PAGE>   16

                                 EXHIBIT INDEX



<TABLE>
<CAPTION>
  EXHIBIT NO.                          DESCRIPTION
  -----------                          -----------
<S>            <C>  
     4.1       Articles Sixth, Seventh, Eighth, Twelfth, and Thirteenth of the
               Restated Certificate of Incorporation of the Registrant, as 
               amended(1)

     4.2       Articles II, III, and VII and Section I of Article VIII of the
               Registrant's By-laws, as amended(1)

     4.3       Form of Indenture(2)

     4.4       Article V, Sections I, VI, and VII of the Registrant's By-Laws, 
               as amended(4)

    10.1       1982 Incentive Stock Option Plan, as amended and restated(1)

    10.2       Form of Stock Option Agreement executed by recipients of options
               granted under the 1982 Incentive Stock Option Plan(1)

    10.3       Form of Management Agreement executed by recipients of options
               granted under the 1982 Incentive Stock Option Plan(1)

    10.4       Form of Vesting Agreement executed by recipients of options
               granted under the 1982 Incentive Stock option Plan(1)

    10.5       1991 Stock Option Plan(1)

    10.6       Form of Stock Option Agreement executed by recipients of options
               granted under the 1991 Stock Option Plan(1)

    10.7       Form of Indemnification Agreement executed by directors and
               officers of the Registrant(1)

    10.8       Form of First Amendment to Vesting Agreement executed by
               recipients of options granted under the 1982 Incentive Stock
               Option Plan(1)

    10.9       Form of First Amendment to Management Agreement executed by
               recipients of options granted under the 1982 Incentive Stock
               Option Plan(1)

   10.10       1992 Stock Option Plan for Directors(3)

   10.11       Amended and Restated Credit Agreement dated as of May 2, 1995
               among the Registrant, NationsBank of Texas, N.A., Toronto
               Dominion (Texas), Inc., The First National Bank of Boston, and
               certain other lenders(4)

   10.12       Amendment No. 1 dated as of December 12, 1995 to the Amended and
               Restated Credit Agreement dated as of May 2, 1995 among the
               Registrant, NationsBank of Texas, N.A., Toronto Dominion
               (Texas), Inc., The First National Bank of Boston, and certain
               other lenders(5)
</TABLE>


                                      16
<PAGE>   17
<TABLE>
<CAPTION>
  EXHIBIT NO.                          DESCRIPTION
  -----------                          -----------
<S>            <C>  
    10.13      Employment Agreement dated as of December 1, 1995 among the
               Registrant and Glenn W. Marschel(5)

    10.14      Second Amended and Restated Credit Agreement dated as of June 5,
               1996, among the Registrant, NationsBank of Texas, N.A., Toronto
               Dominion (Texas), Inc., The First National Bank of Boston, Chase
               Securities Inc., and certain other lenders(6)

    10.15      Loan Agreement dated as of June 5, 1996 among Paging Network of
               Canada Inc., The Toronto-Dominion Bank, and such other financial
               institutions as become banks(6)

    10.16      Loan Agreement dated as of June 5, 1996 among Madison
               Telecommunications Holdings, Inc., The Toronto-Dominion Bank,
               and such other financial institutions as become banks(6)

    10.17      1991 Stock Option Plan, as amended and approved by stockholders
               on May 22, 1997(7)

    10.18      1992 Stock Option Plan for Directors, as amended and restated
               and approved by stockholders on May 22, 1997(7)

    10.19      1997 Restricted Stock Option Plan and approved by stockholders
               on May 22, 1997(7)

       12      Ratio of Earnings to Fixed Charges for the three and six months
               ended June 30, 1997 and 1996(7)
</TABLE>

               ---------------------------------------------------------------

               (1)  Previously filed as an exhibit to Registration Statement
                    No. 33-42253 on Form S-1 and incorporated herein by
                    reference.

               (2)  Previously filed as an exhibit to Registration Statement
                    No. 33-46803 on Form S-1 and incorporated herein by
                    reference.

               (3)  Previously filed as an exhibit to the Registrant's Annual
                    Report on Form 10-K for the fiscal year ended December 31,
                    1991.

               (4)  Previously filed as an exhibit to the Registrant's
                    Quarterly Report on Form 10-Q for the quarterly period
                    ended June 30, 1995.

               (5)  Previously filed as an exhibit to the Registrant's Annual
                    Report on Form 10-K for the fiscal year ended December 31,
                    1995.

               (6)  Previously filed as an exhibit to the Registrant's
                    Quarterly Report on Form 10-Q for the quarterly period
                    ended June 30, 1996.

               (7)  Filed herewith.


                                      17