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

                                 FORM 10-Q/A-1


                      AMENDMENT NO. 1 TO QUARTERLY REPORT
                     PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                 For the quarterly period ended March 31, 1998

                        Commission File Number: 0-23753

                                  CDnow, Inc.
             (Exact name of registrant as specified in its charter)


          Pennsylvania                                23-2813867
(State or other jurisdiction of         (I.R.S. Employer Identification No.)
 incorporation of organization)


                                  CDnow, Inc.
                          610 Old York Road, Suite 300
                       Jenkintown, Pennsylvania,   19046
             (Address of principal executive offices and Zip Code)

                               (215) - 517 - 7325
              (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 [(check mark)]    NO [ ]

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

      Common Stock,  No Par Value - 16,006,302 Shares Outstanding (May 11, 1998)

This Amendment No. 1 is filed to amend and restate in its entirety Item 6(a) of
Part II and to file certain additional exhibits.
<PAGE>
 
 
ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

(a)

Exhibit
Number                              Description
-------                             -----------
    3.1  Amended and Restated Articles of Incorporation of the Company.#
    3.2  Amended and Restated Bylaws of the Registrant.#
    3.3  Amendment No. 1 to Amended and Restated Bylaws of the Registrant#
  10.12  Amendment 1998-1 to the CDnow, Inc. 1996 Equity Compensation Plan.#
10.13 +  Linking Agreement dated March 26, 1998 between the Registrant, Lycos, 
         Inc., and Tripod, Inc.*
   11.1  Statement re:  Computation of Per Share Earnings.*
   27.1  Financial Data Schedule.*
------------------
*  Filed herewith.
#  Incorporated by reference to the Company's Registration Statement on Form S-1
   (File No. 333-41241)
+  Portions of this Exhibit were omitted and filed separately with the Secretary
   of the Commission pursuant to an application for confidential treatment filed
   with the Commission pursuant to Rule 24b-2 under the Securities Exchange Act
   of 1934, as amended.

<PAGE>
 
 
                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Amendment No. 1 to Form 10-Q to be signed on its
behalf by the undersigned thereunto duly authorized.



                                     CDnow, Inc.


Date:  June 4, 1998                  /s/    Jason Olim
                                     -----------------------
                                     Jason Olim
                                     Chairman, President &
                                     Chief Executive Officer
 

                                     /s/    Joel Sussman
                                     -----------------------
                                     Joel Sussman
                                     Vice President and
                                     Chief Financial Officer