UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

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

               For the period ended November 30, 2002


          [ ]  Transition Report Pursuant to Section 13 or 15(d) of the
               Securities Exchange Act of 1934

               For the transition period from ________ to ________


     Commission File Number:                        0-8656
                            ----------------------------------------------------

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

            Delaware                                     13-2635899
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

                      400 Oser Avenue, Hauppauge, NY 11788
                    ----------------------------------------
                    (Address of principal executive offices)

                                  631-231-0333
                         -------------------------------
                         (Registrant's telephone number)


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

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



                               SHARES OUTSTANDING

           4,418,012 shares of common stock, par value $.01 per share,
                            as of December 31, 2002


                                     Page 1
<PAGE>


                           TSR, INC. AND SUBSIDIARIES
                                      INDEX

                                                                           Page
                                                                          Number
                                                                          ------
Part I. Financial Information:

  Item 1. Financial Statements:

    Condensed Consolidated Balance Sheets -
      November 30, 2002 and May 31, 2002.....................................  3

    Condensed Consolidated Statements of Earnings -
      For the three months and six months ended November 30, 2002 and 2001...  4

    Condensed Consolidated Statements of Cash Flows -
      For the six months ended November 30, 2002 and 2001....................  5

    Notes to Condensed Consolidated Financial Statements.....................  6

  Item 2. Management's Discussion and Analysis of Financial Condition and
            Results of Operations............................................  9

  Item 3.  Quantitative and Qualitative Disclosure About Market Risk ........ 15

  Item 4.  Procedures and Controls........................................... 16

Part II. Other Information................................................... 16

Signatures................................................................... 16


                                     Page 2
<PAGE>


Part I. Financial Information
        Item 1. Financial Statements

                           TSR, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                    November 30,     May 31,
ASSETS                                                                 2002           2002
                                                                    -----------   -----------
                                                                    (Unaudited)
<S>                                                                 <C>           <C>
Current Assets:
  Cash and cash equivalents (Note 3) ............................   $ 5,515,294   $ 5,793,896
  Marketable securities (Note 5) ................................     8,958,256     8,941,535
  Accounts receivable (net of allowance for
    doubtful accounts of $430,000) ..............................    11,290,227    10,131,579
  Other receivables .............................................        49,524        49,819
  Prepaid expenses ..............................................        35,065        50,926
  Prepaid and recoverable income taxes ..........................        18,857        69,357
  Deferred income taxes .........................................       180,000       180,000
                                                                    -----------   -----------
      Total current assets ......................................    26,047,223    25,217,112

Equipment and leasehold improvements, at cost (net of accumulated
  depreciation and amortization of $691,452 and $703,930) .......        35,635        76,044
Other assets ....................................................        50,087        52,182
Deferred income taxes ...........................................       123,000       123,000
Acquired client relationships, (net of accumulated amortization
  of $71,503 and $42,902) (Note 6) ..............................       100,105       128,706
                                                                    -----------   -----------
                                                                    $26,356,050   $25,597,044
                                                                    ===========   ===========

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities:
  Accounts and other payables ...................................   $   112,083   $   119,176
  Accrued expenses and other current liabilities ................     2,059,549     2,529,264
  Advances from customers .......................................     1,652,806     1,814,611
  Income taxes payable ..........................................       243,529       235,888
                                                                    -----------   -----------
      Total current liabilities .................................     4,067,967     4,698,939
                                                                    -----------   -----------

Minority Interest ...............................................        19,320         2,578
                                                                    -----------   -----------

Shareholders' Equity:
  Preferred stock, $1 par value, authorized
    1,000,000 shares; none issued ...............................          --            --
  Common stock, $.01 par value, authorized
    25,000,000 shares; issued 6,078,326 shares ..................        60,783        60,783
  Additional paid-in capital ....................................     4,134,053     4,134,053
  Retained earnings .............................................    30,105,228    28,731,992
                                                                    -----------   -----------

                                                                     34,300,064    32,926,828
  Less: Treasury Stock, 1,660,314 shares, at cost ...............    12,031,301    12,031,301
                                                                    -----------   -----------
                                                                     22,268,763    20,895,527
                                                                    -----------   -----------
                                                                    $26,356,050   $25,597,044
                                                                    ===========   ===========

</TABLE>

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


                                     Page 3
<PAGE>



                           TSR, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
          FOR THE THREE AND SIX MONTHS ENDED NOVEMBER 30, 2002 AND 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                       Three Months Ended            Six Months Ended
                                                                          November 30,                 November 30,
                                                                   --------------------------   --------------------------
                                                                       2002          2001          2002           2001
                                                                   -----------    -----------   -----------    -----------
<S>                                                                <C>            <C>           <C>            <C>
Revenues .......................................................   $13,859,074    $15,380,782   $27,539,840    $32,848,178

Cost of sales ..................................................    10,781,431     12,016,964    21,481,039     25,627,241
Selling, general and administrative expenses ...................     1,887,943      2,186,629     3,738,974      4,591,753
                                                                   -----------    -----------   -----------    -----------
                                                                    12,669,374     14,203,593    25,220,013     30,218,994
                                                                   -----------    -----------   -----------    -----------

Income from operations .........................................     1,189,700      1,177,189     2,319,827      2,629,184

Other income:
  Interest and dividend  income ................................        61,848        122,686       123,839        198,374
  Unrealized gain (loss) from marketable  securities,  net .....         4,749          2,950        (5,688)           761
  Minority interest in subsidiary  operating loss. (profits) ...       (14,834)           889       (16,742)           889
                                                                   -----------    -----------   -----------    -----------

Income before income taxes .....................................     1,241,463      1,303,714     2,421,236      2,829,208
Provision for income taxes .....................................       532,000        541,000     1,048,000      1,205,000
                                                                   -----------    -----------   -----------    -----------
    Net income .................................................   $   709,463    $   762,714   $ 1,373,236    $ 1,624,208
                                                                   ===========    ===========   ===========    ===========
Basic and diluted net income per
  Common share .................................................   $      0.16    $      0.17   $      0.31    $      0.37
                                                                   ===========    ===========   ===========    ===========
Weighted average number of basic and diluted
  Common shares outstanding ....................................      4,418,012     4,418,012    4,418,012       4,418,012
                                                                   ===========    ===========   ===========    ===========

</TABLE>


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


                                     Page 4
<PAGE>


                           TSR, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE SIX MONTHS ENDED NOVEMBER 30, 2002 AND 2001
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                    Six Months Ended
                                                                      November 30,
                                                               --------------------------

                                                                  2002           2001
                                                               -----------    -----------
<S>                                                            <C>            <C>
Cash flows from operating activities:
 Net income ................................................   $ 1,373,236    $ 1,624,208

 Adjustments to reconcile net income
   to net cash provided by (used in) operating activities:
  Depreciation and amortization ............................        69,010         60,092
  Unrealized loss (gain) from marketable securities, net ...         5,688           (761)
  Deferred income taxes ....................................          --           62,000
  Provision for doubtful accounts ..........................          --          100,000
  Minority interest in subsidiary operating profit (loss) ..        16,742           (889)

Changes in assets and liabilities:
 Accounts receivable .......................................    (1,158,648)      (535,375)
 Other receivables .........................................           295         (3,377)
 Prepaid expenses ..........................................        15,861         (1,130)
 Prepaid and recoverable income taxes ......................        50,500        125,757
 Other assets ..............................................         2,095           --
 Accounts payable and accrued expenses .....................      (476,808)      (796,722)
 Income taxes payable ......................................         7,641       (107,656)
 Advances from customers ...................................      (161,805)      (153,046)
                                                               -----------    -----------
   Net cash (used in) provided by operating activities .....      (256,193)       373,101
                                                               -----------    -----------

Cash flows from investing activities:
 Proceeds from maturities and sales of marketable securities     8,915,150      4,400,221
 Purchases of marketable securities ........................    (8,937,559)    (5,911,805)
 Purchases of fixed assets .................................          --              781
 Purchases of net assets, net of cash acquired .............          --         (274,564)
                                                               -----------    -----------
   Net cash used in investing activities ...................       (22,409)    (1,785,367)
                                                               -----------    -----------
Cash flows from financing activities:
 Proceeds from sale of minority interest ...................          --            1,000
                                                               -----------    -----------

   Net cash provided by financing activities ...............          --            1,000
                                                               -----------    -----------

Net decrease in cash and cash equivalents ..................      (278,602)    (1,411,266)
Cash and cash equivalents at beginning of period ...........     5,793,896      6,208,361
                                                               -----------    -----------

Cash and cash equivalents at end of period .................   $ 5,515,294    $ 4,797,095
                                                               ===========    ===========
Supplemental Disclosures:
 Income tax payments .......................................   $   990,000    $ 1,125,000
                                                               ===========    ===========

</TABLE>

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


                                     Page 5
<PAGE>


                           TSR, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                NOVEMBER 30, 2002
                                   (UNAUDITED)

1.   Basis of Presentation

     The accompanying condensed consolidated interim financial statements
     include the accounts of TSR, Inc. and its subsidiaries (the "Company"). All
     significant inter-company balances and transactions have been eliminated in
     consolidation. These interim financial statements have been prepared in
     accordance with accounting principles generally accepted in the United
     States of America applying to interim financial information and with the
     instructions to Form 10-Q of Regulation S-X of the Securities and Exchange
     Commission. Accordingly, certain information and footnote disclosures
     required by accounting principles generally accepted in the United States
     of America and normally included in the Company's annual financial
     statements have been condensed or omitted. These interim financial
     statements as of and for the three and six months ended November 30, 2002,
     are unaudited; however, in the opinion of management, such statements
     include all adjustments (consisting of normal recurring accruals) necessary
     to present fairly the consolidated financial position, results of
     operations, and cash flows of the Company for the periods presented. The
     results of operations for the interim periods presented are not necessarily
     indicative of the results that might be expected for future interim periods
     or for the full year ending May 31, 2003. These interim financial
     statements should be read in conjunction with the Company's consolidated
     financial statements and notes thereto included in the Company's Annual
     Report on Form 10-K for the year ended May 31, 2002.

2.   Net Income Per Common Share

     Basic net income per common share is computed by dividing income available
     to common shareholders (which for the Company equals its net income) by the
     weighted average number of common shares outstanding, and diluted net
     income per common share adds the dilutive effect of stock options and other
     common stock equivalents. Options covering 160,000 and 190,000 shares of
     common stock have been omitted from the calculations of diluted net income
     per common share for the three and six month periods ended November 30,
     2002 and November 30, 2001 respectively, as their effect would have been
     antidilutive.

3    Cash and Cash Equivalents

     The Company considers short-term highly liquid investments with maturities
     of three months or less at the time of purchase to be cash equivalents.
     Cash and cash equivalents were comprised of the following as of November
     30, 2002:

     Cash in banks ..........................................  $      --
     Money Market Funds .....................................   2,527,264
     US Treasury Bills ......................................   2,988,030
                                                               ----------
                                                               $5,515,294

4.   Revenue Recognition

     The Company's contract computer programming services are generally provided
     under time and materials agreements with customers. Accordingly, the
     Company recognizes such revenues as services are provided. Advances from
     customers represent amounts received from customers prior to the Company's
     provision of the related services. The services, with respect to such
     advances, are expected to be provided within the next fiscal year.

     Effective March 1, 2002, the Company adopted Emerging Issues Task Force
     Issue No. 01-14, "Income Statement Characterization of Reimbursements
     Received for `Out-of-Pocket' Expenses Incurred." Accordingly,
     reimbursements received by the Company for out-of-pocket expenses are
     characterized as revenue. Prior to adoption of EITF 01-14, the Company
     characterized such amounts as a reduction of cost of sales. Accordingly,
     amounts previously reported for revenues and cost of sales for the three
     months and six months have been increased by $45,981 and $95,485, for
     fiscal year 2001.


                                     Page 6
<PAGE>


                           TSR, INC. AND SUBSIDIARIES
         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
                          NOVEMBER 30, 2002 (UNAUDITED)


5.   Marketable Securities

     The Company accounts for its marketable securities in Accordance with
     Statement of Financial Accounting Standards No. 115 "Accounting for Certain
     Investments in Debt and Equity Securities." Accordingly, the Company
     classifies its marketable securities at acquisition as either (i)
     held-to-maturity (ii) trading or (iii) available-for-sale. Based upon the
     Company's intent and ability to hold its US Treasury securities to maturity
     (which maturities range between three months and two years), such
     securities have been classified as held-to-maturity and are carried at
     amortized cost. The Company's equity securities are classified as trading
     securities, which are carried at fair value with unrealized gains and
     losses included in earnings. The Company's marketable securities as of
     November 30, 2002 are summarized as follows:

<TABLE>
<CAPTION>

                                                     Gross          Gross
                                                  Unrealized     Unrealized
                                     Amortized      Holding        Holding         Fair
                                       Cost          Gains         Losses          Value
                                    -----------   -----------    -----------    -----------
<S>                                 <C>           <C>            <C>            <C>
United States Treasury Securities   $ 8,937,558          --             --      $ 8,937,558
Equity Securities ...............        28,287          --           (7,589)        20,698
                                    -----------   -----------    -----------    -----------
                                    $ 8,965,845   $      --      $    (7,589)   $ 8,958,256
                                    ===========   ===========    ===========    ===========

</TABLE>

6.   Acquisition

     In August 2001, the Company capitalized a newly formed subsidiary with
     $4,000 and simultaneously sold a 20% interest to a third party for $1,000.
     On August 14, 2001, this subsidiary acquired substantially all of the
     assets and assumed certain liabilities of a computer-consulting firm for
     cash of $286,500 (including cash acquired of $11,936). In accordance with
     Statement of Financial Accounting Standards No. 141, "Accounting for
     Business Combinations" (SFAS No. 141), this transaction was accounted for
     as a purchase business combination. Accordingly, the purchase price has
     been allocated to the assets acquired and liabilities assumed based on
     their estimated fair values, summarized as follows:

                     Cash ................................  $   11,936
                     Other current assets ................     303,520
                     Equipment ...........................      16,235
                     Acquired client  relationships ......     171,608
                     Current  liabilities ................   (216,799)
                                                            ----------
                                                            $  286,500
                                                            ==========

     In connection with the acquisition, the Company acquired certain
     contractual client relationships. The related intangible asset is being
     amortized over a three-year period, reflecting the estimated average life
     of the underlying client relationships. Amortization expense for the three
     and six months ended November 30, 2002 was $14,300 and $28,601.

     The results of operations of the acquired business have been included in
     the Company's consolidated financial statements from the date of
     acquisition. Had the acquisition been completed as of June 1, 2001,
     unaudited pro forma consolidated revenues, net income and net income per
     common share would have been $33,236,000, $1,635,000, and $0.37,
     respectively, for the six months ended November 30, 2001.


                                     Page 7
<PAGE>


                           TSR, INC. AND SUBSIDIARIES
         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
                                NOVEMBER 30, 2002
                                   (UNAUDITED)

7.   Recent Accounting Pronouncements

     In July 2002, the FASB issued Statement No. 146, "Accounting for Costs
     Associated with Exit or Disposal Activities" (SFAS 146). SFAS 146 requires
     companies to recognize costs associated with exit or disposal activities
     when they are incurred rather than at the date of commitment to an exit or
     disposal plan. SFAS 146 will be applied to exit or disposal activities
     after December 31, 2002 and is not expected to have a material effect on
     the Company.

     In November 2002, the Emerging Issues Task Force (EITF) issued EITF Issue
     No. 00-21, "Revenue Arrangements with Multiple Deliverables", which
     provides guidance on the timing and method of revenue recognition for sales
     arrangements that include the delivery of more than one product or service.
     EITF 00-21 is effective prospectively for arrangements entered into in
     fiscal periods beginning after June 15, 2003. The Company does not expect
     that the adoption of EITF 00-21 will have a significant impact on its
     consolidated financial statements.


                                     Page 8
<PAGE>


PART I.  FINANCIAL INFORMATION
         ITEM 2.

                           TSR, INC. AND SUBSIDIARIES
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the
condensed consolidated financial statements and the notes to such financial
statements.

Forward-Looking Statements

Certain statements contained in Management's Discussion and Analysis of
Financial Condition and Results of Operations, including statements concerning
the Company's future prospects and the Company's future cash flow requirements
are forward looking statements, as defined in the Private Securities Litigation
Reform Act of 1995. Actual results may differ materially from those projections
in the forward looking statements which statements involve risks and
uncertainties, including but not limited to the following: risks relating to the
competitive nature of the markets for contract computer programming services;
the extent to which market conditions for the Company's contract computer
consulting services will continue to adversely affect the Company's business;
the concentration of the Company's business with certain customers; uncertainty
as to the Company's ability to maintain its relations with existing customers
and expand its contract computer consulting services business; the impact of
changes in the industry, such as the use of vendor management companies in
connection with the consulting procurement process, on the Company's business,
and other risks and uncertainties set forth in the Company's filings with the
Securities and Exchange Commission.

Results of Operations

The following table sets forth for the periods indicated certain financial
information derived from the Company's condensed consolidated statements of
earnings. There can be no assurance that trends in operating results will
continue in the future:

Three months ended November 30, 2002 compared with three months ended November
30, 2001

<TABLE>
<CAPTION>

                                                               Three Months Ended
                                                                  November 30,
                                                         (Dollar amounts in Thousands)
                                                    ---------------------------------------
                                                           2002                 2001
                                                    ------------------   ------------------
                                                                % of                 % of
                                                     Amount   Revenues   Amount    Revenues
                                                    -------   --------   -------   --------
<S>                                                 <C>         <C>      <C>         <C>
Revenues* .......................................   $13,859     100.0    $15,381     100.0
Cost of sales* ..................................    10,781      77.8     12,017      78.1
                                                    -------     -----    -------     -----
Gross profit ....................................     3,078      22.2      3,364      21.9

Selling, general, and administrative expenses ...     1,888      13.6      2,187      14.2
                                                    -------     -----    -------     -----
Income from operations ..........................     1,190       8.6      1,177       7.7

Other income ....................................        51       0.3        127       0.8
                                                    -------     -----    -------     -----
Income before income taxes ......................     1,241       8.9      1,304       8.5
Provision for income taxes ......................       532       3.8        541       3.5
                                                    -------     -----    -------     -----
Net income ......................................   $   709       5.1    $   763       5.0
                                                    =======     =====    =======     =====
</TABLE>

* For fiscal 2001, amounts revised to reflect the Company's adoption of EITF
01-14, "Income Statement Characterization of Reimbursements Received for
`Out-of-Pocket' Expenses Incurred", effective March 1, 2002.


                                     Page 9
<PAGE>


                           TSR, INC. AND SUBSIDIARIES

Revenues

Revenues consist primarily of revenues from computer programming consulting
services. Revenues for the quarter ended November 30, 2002 decreased $1,522,000
or 9.9% from the comparable period in fiscal 2002. This decrease resulted from
an overall decrease in the average number of programmers on billing with clients
from approximately 380 during the quarter ended November 30, 2001 to
approximately 365 during the quarter ended November 30, 2002. This decrease also
resulted from reductions in the average daily billing rates due to customers
requiring price reductions. The continuing weak economic environment has
significantly reduced the IT spending levels of many of our major customers,
limiting opportunities to place new consultants on billing.

The calendar year end budget and planning process at many of our clients
normally results in projects ending at year end, resulting in a reduction in
programmers on billing. In prior years, much of this effect was offset by
consultants starting new projects. At the end of calendar 2001, however, new
starts were down significantly as a result of the economic condition referred to
above, resulting in the number of consultants on billing being reduced. While we
had been experiencing a stabilization of the number of consultants on billing
over the past six months, we expect to experience a similar reduction in the
number of consultants at the end of calendar 2002 due to continuing budget
restrictions at many of our clients.

Cost of Sales

Cost of sales for the quarter ended November 30, 2002, decreased $1,236,000 or
10.3% to $10,781,000 from $12,017,000 in the prior year period. The decrease in
costs resulted primarily from the decrease in the number of programmers on
billing with clients. Cost of sales as a percentage of revenues decreased from
78.1% in the quarter ended November 30, 2001 to 77.8% in the quarter ended
November 30, 2002. This decrease is primarily attributable to rate reductions in
the amounts paid to consultants.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of expenses
relating to account executives, technical recruiters, facilities costs,
management and corporate overhead. These expenses decreased $299,000 or 13.7%
from $2,187,000 in the quarter ended November 30, 2001 to $1,888,000 in the
quarter ended November 30, 2002. This decrease was primarily attributable to a
reduction of account executives, technical recruiting professionals and
administrative assistants, as well as a reduction of commissions paid to the
remaining account executives and recruiters.

Other Income

Other income resulted primarily from interest and dividend income, which
decreased by $61,000 to $62,000 due to lower interest rates in the quarter ended
November 30, 2002. Additionally, the Company also had a net unrealized gain of
$5,000 in the quarter ended November 30, 2002 versus a net unrealized gain of
$3,000 in the quarter ended November 30, 2001 from marketable securities due to
mark to market adjustments of its trading securities equity portfolio.

Income Taxes

The effective income tax rate of 42.9% for the quarter ended November 30, 2002
increased from a rate of 41.5% in the quarter ended November 30, 2001.

Net Income

Net income for the quarter ended, November 30, 2002 decreased by $54,000 or 7.1%
from the prior year period. Income from operations increased by $13,000 or 1.1%
for the same periods. The decrease in revenues was offset by decreases in both
cost of sales and selling, general and administration expenses. Net income
decreased primarily due to a significant decrease in other income described
above.


                                    Page 10
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Six months ended November 30, 2002 compared with six months ended November 30,
2001

<TABLE>
<CAPTION>

                                                                Six Months Ended
                                                                  November 30,
                                                         (Dollar amounts in Thousands)
                                                    ---------------------------------------
                                                           2002                 2001
                                                    ------------------   ------------------
                                                                % of                 % of
                                                     Amount   Revenues   Amount    Revenues
                                                    -------   --------   -------   --------
<S>                                                 <C>         <C>      <C>         <C>

Revenues* .......................................   $27,540     100.0    $32,848     100.0
Cost of sales* ..................................    21,481      78.0     25,627      78.0
                                                    -------     -----    -------     -----
Gross profit ....................................     6,059      22.0      7,221      22.0

Selling, general, and administrative expenses ...     3,739      13.6      4,592      14.0
                                                    -------     -----    -------     -----
Income from operations ..........................     2,320       8.4      2,629       8.0

Other income ....................................       101       0.4        200       0.6
                                                    -------     -----    -------     -----
Income before income taxes ......................     2,421       8.8      2,829       8.6
Provision for income taxes ......................     1,048       3.8      1,205       3.7
                                                    -------     -----    -------     -----
Net income ......................................   $ 1,373       5.0    $ 1,624       4.9
                                                    =======     =====    =======     =====
</TABLE>

* For fiscal 2001, amounts revised to reflect the Company's adoption of EITF
01-14, "Income Statement Characterization of Reimbursements Received for
`Out-of-Pocket' Expenses Incurred", effective March 1, 2002.

Revenues

Revenues consist primarily of revenues from computer programming consulting
services. Revenues for the six months ended November 30, 2002 decreased
$5,308,000 or 16.2% from the comparable period in fiscal 2002. This decrease
resulted from an overall decrease in the average number of programmers on
billing with clients from approximately 396 during the six months ended November
30, 2001 to approximately 360 during the six months ended November 30, 2002. The
continuing weak economic environment has significantly reduced the IT spending
levels of many of our major customers, limiting opportunities to place new
consultants on billing.

The Company's revenues from programmers on billing have also been affected by
discounts required by major customers as a condition to remaining on their
approved vendor lists, such as discounts for prompt payment and volume
discounts. In addition, some major customers have retained a third party to
provide vendor management services and centralize the consultant hiring process.
Under this system, the third party retains the Company to provide contract
computer programming services and the Company bills the third party and the
third party bills the ultimate customer. This process weakens the relationship
the Company has built with its client contacts, the project managers, who the
Company would normally work directly with to place consultants. Instead the
Company is required to interface with the vendor management provider, making it
more difficult to maintain its relationships with its customers and preserve and
expand its business. These effects had a greater impact in the first quarter
than the second quarter of fiscal 2003. The Company is unable to predict the
long-term effects of these changes.

The calendar year end budget and planning process at many of our clients
normally results in projects ending at year end, resulting in a reduction in
programmers on billing. In prior years, much of this effect was offset by
consultants starting new projects. At the end of calendar 2001, however, new
starts were down significantly as a result of the economic condition referred to
above, resulting in the number of consultants on billing being reduced. While we
had been experiencing a stabilization of the number of consultants on billing
over the past six months, we expect to experience a similar reduction in the
number of consultants at the end of calendar 2002 due to continuing budget
restrictions at many of our clients.


                                     Page 11
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Cost of Sales

Cost of sales for the six months ended November 30, 2002, decreased $4,146,000
or 16.2% to $21,481,000 from $25,627,000 in the prior year period. The decrease
in costs resulted primarily from the decrease in amounts paid to programmers
resulting from the decrease in contract computer programming services revenues.
Cost of sales as a percentage of revenues remained at 78.0% in the six months
ended November 30, 2001 and 2002.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of expenses
relating to account executives, technical recruiters, facilities costs,
management and corporate overhead. These expenses decreased $853,000 or 18.6%
from $4,592,000 in the six months ended November 30, 2001 to $3,739,000 in the
six months ended November 30, 2002. This decrease was primarily attributable a
reduction of account executives, technical recruiting professionals and
administrative assistants, as well as a reduction of commissions paid to the
remaining account executives and recruiters.

Other Income

Other income resulted primarily from interest and dividend income, which
decreased by $75,000 to $124,000 due to lower interest rates in the six months
ended November 30, 2002. Additionally, the Company also had a net unrealized
loss of $6,000 in the six months ended November 30, 2002 versus a net unrealized
gain of $1,000 in the six months ended November 30, 2001 from marketable
securities due to mark to market adjustments of its trading securities equity
portfolio.

Income Taxes

The effective income tax rate of 43.3% for the six months ended November 30,
2002 increased from a rate of 42.6% in the six months ended November 30, 2001.


                                     Page 12
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Liquidity and Capital Resources

The Company expects that cash flow generated from operations together with its
cash and marketable securities will be sufficient to provide the Company with
adequate resources to meet its liquidity requirements for the foreseeable
future.

At November 30, 2002, the Company had working capital of $21,979,000 and cash
and cash equivalents of $5,515,000 as compared to working capital of $20,518,000
and cash and cash equivalents of $5,794,000 at May 31, 2002. Working capital
increased primarily due to the Company's net income of $1,373,000 in the six
months ended November 30, 2002.

Net cash used by operating activities amounted to $256,000 for the six months
ended November 30, 2002, compared to cash provided of $373,000 for the six
months ended November 30, 2001. The cash used by operating activities and the
increase in accounts receivable primarily resulted from reduced collections of
receivables as compared to the prior year period. The comparative reduction in
collections occurred primarily because of delays associated with collections
from a major customer due to the implementation of a vendor management system,
and associated reconciliation difficulties. There were also delayed payments
from another major account due to the changing of the head of the IT department
of a local government. However, we do not believe that the ultimate
collectibility of the amounts due from this customer are subject to greater than
normal collection risks.

Net cash used in investing activities amounted to $22,000 for the six months
ended November 30, 2002, compared to $1,785,000 for the six months ended
November 30, 2001. The decrease in net cash flows used in investing activities
primarily resulted from the reduction in net purchases of marketable securities
as well as the purchase of the net assets of an acquired business in August
2001.

The Company's capital resource commitments at November 30, 2002 consisted of
lease obligations on its branch and corporate facilities. The Company intends to
finance these lease commitments from cash flow provided by operations, available
cash and short-term marketable securities. A summary of non-cancelable long-term
operating lease commitments as of November 30, 2002 follows:

                    FY 03     FY 04     FY 05     FY 06   Thereafter     Total
Operating Leases  $169,000  $343,000  $349,000  $170,000   $118,000   $1,149,000

The Company's cash and marketable securities were sufficient to enable it to
meet its cash requirements during the six months ended November 30, 2002. The
Company has available a revolving line of credit of $5,000,000 with a major
money center bank through October 6, 2003. As of November 30, 2002, no amounts
were outstanding under this line of credit.


                                     Page 13
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Recent Accounting Pronouncements

In July 2002, the FASB issued Statement No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities" (SFAS 146). SFAS 146 requires
companies to recognize costs associated with exit or disposal activities when
they are incurred rather than at the date of commitment to an exit or disposal
plan. SFAS 146 will be applied to exit or disposal activities after December 31,
2002 and is not expected to have a material effect on the Company.

In November 2002, the Emerging Issues Task Force (EITF) issued EITF Issue No.
00-21, "Revenue Arrangements with Multiple Deliverables", which provides
guidance on the timing and method of revenue recognition for sales arrangements
that include the delivery of more than one product or service. EITF 00-21 is
effective prospectively for arrangements entered into in fiscal periods
beginning after June 15, 2003. The Company does not expect that the adoption of
EITF 00-21 will have a significant impact on its consolidated financial
statements.


                                     Page 14
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Critical Accounting Policies

The Securities and Exchange Commission ("SEC") issued disclosure guidance for
"critical accounting policies." The SEC defines "critical accounting policies"
as those that require the application of management's most difficult, subjective
or complex judgments, often as a result of the need to make estimates about the
effect of matters that are inherently uncertain and may change in subsequent
periods.

The Company's significant accounting policies are described in Note 1 to the
Company's consolidated financial statements, contained in its May 31, 2002
Annual Report on Form 10-K, as filed with the SEC. The Company believes that the
following accounting policies require the application of management's most
difficult, subjective or complex judgments:

Estimating Allowances for Doubtful Accounts Receivable
We perform ongoing credit evaluations of our customers and adjust credit limits
based upon payment history and the customer's current credit worthiness, as
determined by our review of their current credit information. We continuously
monitor collections and payments from our customers and maintain a provision for
estimated credit losses based upon our historical experience and any specific
customer collection issues that we have identified. While such credit losses
have historically been within our expectations and the provisions established,
we cannot guarantee that we will continue to experience the same credit loss
rates that we have in the past. A significant change in the liquidity or
financial position of any of our significant customers could have a material
adverse effect on the collectibility of our accounts receivable and our future
operating results.

Valuation of Deferred Tax Assets
We regularly evaluate our ability to recover the reported amount of our deferred
income taxes considering several factors, including our estimate of the
likelihood of the Company generating sufficient taxable income in future years
during the period over which temporary differences reverse. Presently, the
Company believes that it is more likely than not that it will realize the
benefits of its deferred tax assets based primarily on the Company's history of
and projections for taxable income in the future. In the event that actual
results differ from our estimates or we adjust these estimates in future
periods, we may need to establish a valuation allowance against a portion or all
of our deferred tax assets, which could materially impact our financial position
or results of operations.

Valuation of Long-lived and Intangible Assets
We assess the recoverability of long-lived assets and intangible assets whenever
we determine that events or changes in circumstances indicate that their
carrying amount may not be recoverable. Our assessment is primarily based upon
our estimate of future cash flows associated with these assets. Although there
has been a sustained weakness in our operating results, through November 30,
2002, we have continued to generate net income. Accordingly, we have not
determined that there has been an indication of impairment of any of our assets.
However, should our operating results deteriorate, we may determine that some
portion of our long-lived assets or intangible assets are impaired. Such
determination could result in non-cash charges to income that could materially
affect our financial position or results of operations for that period.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

The Company's earnings and cash flows are subject to fluctuations due to (i)
changes in interest rates primarily affecting its income from the investment of
available cash balances in money market funds and (ii) changes in market values
of its investments in trading equity securities. Under its current policies, the
Company does not use interest rate derivative instruments to manage exposure to
interest rate changes. The Company's present exposure to changes in the market
value of its investments in equity securities is not significant.


                                     Page 15
<PAGE>


                           TSR, INC. AND SUBSIDIARIES


Item 4. Procedures and Controls

Within the 90 days prior to the date of this report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based
upon that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the Company's disclosure controls and procedures are effective.
There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls subsequent to the date of
their evaluation.

Part II. Other Information

Item 6. Exhibits and Reports on Form 8K

          (a). Exhibit 99.1 - Certification by J.F. Hughes pursuant to 18 U.S.C.
               Section 1350, as adopted pursuant to Section 906 of the
               Sarbanes-Oxley Act of 2002.

               Exhibit 99.2 - Certification by John G. Sharkey pursuant to 18
               U.S.C. Section 1350, as adopted pursuant to Section 906 of the
               Sarbanes-Oxley Act of 2002.

          (b). Reports on Form 8K: None

                                   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.


                                    TSR, Inc.
                            ------------------------
                                  (Registrant)


Date:    January 3, 2003          /s/ J.F. Hughes
                              ----------------------------------------------
                              J.F. Hughes, Chairman, President and Treasurer



Date:    January 3, 2003         /s/ John G. Sharkey
                              ----------------------------------------------
                              John G. Sharkey, Vice President Finance


                                     Page 16
<PAGE>


  CERTIFICATION BY J.F. HUGHES PURSUANT TO SECURITIES EXCHANGE ACT RULE 13A-14


I, J.F. Hughes, certify that:

1. I have reviewed this quarterly report on Form 10-Q of TSR, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a)
designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared; b) evaluated the
effectiveness of the registrant's disclosure controls and procedures as of a
date within 90 days prior to the filing date of this quarterly report (the
"Evaluation Date"); and c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and b) any fraud, whether
or not material, that involves management or other employees who have a
significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: January 3, 2003

                                               /s/ J.F. Hughes
                                               ---------------------------------
                                               J.F. Hughes
                                               Chairman, President and Treasurer


                                     Page 17
<PAGE>


CERTIFICATION BY JOHN G. SHARKEY PURSUANT TO SECURITIES EXCHANGE ACT RULE 13A-14


I, John G. Sharkey, certify that:

1. I have reviewed this quarterly report on Form 10-Q of TSR, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a)
designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared; b) evaluated the
effectiveness of the registrant's disclosure controls and procedures as of a
date within 90 days prior to the filing date of this quarterly report (the
"Evaluation Date"); and c) presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and b) any fraud, whether
or not material, that involves management or other employees who have a
significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:  January 3, 2003

                                                     /s/ John G. Sharkey
                                                     -----------------------
                                                     John G. Sharkey
                                                     Vice President, Finance


                                     Page 18