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


                                   FORM 10-QSB
(Mark One)

[X]      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the quarterly period ended June 30, 2003
                                        -------------

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

         For the transition period from               to
                                        --------------   ------------------

                       Commission File Number: 333-62690
                                               ---------

                                 CYBERADS, INC.
                                 --------------
        (Exact name of Small Business Issuer as specified in its Charter)

               Florida                                  65-1000634
               -------                                  ----------
  (State or other jurisdiction of          (I.R.S. Employer Identification No.)
   incorporation or organization)

           6001 Park of Commerce Boulevard, Boca Raton, Florida 33487
           ----------------------------------------------------------
                    (Address of principal executive offices)

                                 (561) 338-9399
                                 --------------
                           (Issuer's telephone number)

         ---------------------------------------------------------------
         (Former Name, former address and former fiscal year, if changed
                              since last Report.)

         Check mark whether the Issuer (1) has filed all reports required to be
filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
past 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   [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

         State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 16,049,777 shares of Common
Stock, par value $.0001, as of May 1, 2002.


<PAGE>
<TABLE>
<CAPTION>
                                                    INDEX
                                                                                                   Page
                                                                                                   ----
<S>                                                                                                 <C>
PART I.  FINANCIAL INFORMATION                                                                      3
         ---------------------

Item 1.  Condensed Financial Statements (unaudited)                                                 3

         Balance Sheets                                                                             3

         Statements of Operations                                                                   4

         Condensed Statements of Cash Flows                                                         5

         Notes to Condensed Financial Statements                                                    6-11

Item 2.  Management's Discussion and Analysis and Plan of Operations                                12


PART II. OTHER INFORMATION                                                                          14
         -----------------

Item 1.  Legal Proceedings                                                                          14

Item 2.  Changes in Securities and Use of Proceeds                                                  14

Item 3.  Defaults Upon Senior Securities                                                            16

Item 4.  Submissions of Matters to a Vote of Security Holders                                       16

Item 5.  Other Information                                                                          16

Item 6.  Exhibits and Reports on Form 8-K                                                           16

Signature                                                                                           17
</TABLE>


























                                       2
<PAGE>
PART I.  FINANCIAL INFORMATION
         ---------------------

Item 1.  Financial Statements
<TABLE>
<CAPTION>
                                  CYBERADS, INC. AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED BALANCE SHEET
                                         AS OF JUNE, 2003

                                     ASSETS
                                     ------

   CURRENT ASSETS                                                                30-Jun-03
                                                                             ------------------
<S>                                                                                  <C>
   Cash                                                                              28,609.27
   Accounts Receivable - net                                                        139,061.92
   Inventory                                                                         18,027.00
                                                                             ------------------
      Total Current Assets                                                          185,698.19
                                                                             ------------------

   PROPERTY AND EQUIPMENT - NET                                                     152,468.85
                                                                             ------------------

   OTHER ASSETS
   Deposits                                                                          49,974.42
   Intangible Assets                                                                 75,000.00
   Other Assets                                                                      28,695.20
                                                                             ------------------
      Total Other Assets                                                            153,669.62
                                                                             ------------------

   TOTAL ASSETS                                                                     491,836.66
                                                                             ==================

                      LIABILITIES AND STOCKHOLDERS EQUITY
                      -----------------------------------

   CURRENT LIABILITIES
   Cash Overdraft                                                                            -
   Accounts Payable                                                                 738,608.92
   Advances from Related Parties                                                    762,823.87
   Accounts Payable _ Related Parties                                               807,713.00
   Accrued Expenses                                                                 651,231.34
   Defferred Commission Revenue                                                     216,620.00
   Factor Payable - net                                                           1,017,278.57
   Due to Officers                                                                   54,000.00
   Loan Payable - Convertible Deventures                                             60,000.00
                                                                             ------------------
      Total Current Liabilities                                                   4,308,275.70

   STOCKHOLDER'S DEFICIENCY
   Convertible Preferred Stock, $.001 par value, 5,000,000 shares authorized
   none issued and outstanding
   Common Stock, $.001 par value, $50,000,000 shares authorized, 16,049,777                  -
   shares issued and outstanding                                                     16,049.50
   Additional Paid In Capital                                                    13,682,441.40
   Accumulated Deficit                                                          (17,514,929.94)
                                                                             ------------------
      Total Stockholder's Deficiency                                             (3,816,439.04)
                                                                             ------------------
   Deferred Costs Financing
   TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIENCY                                   491,836.66
                                                                             ==================
</TABLE>







                                       3
<PAGE>
<TABLE>
<CAPTION>
                                      CYBERADS, INC. AND SUBSIDIARIES
                              CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                                            AS OF JUNE 30, 2003
                                                (UNAUDITED)



                                                   For the three      For the three      For the six        For the six
                                                   month ended        month ended        month ended        month ended
                                                   Jun 30 2003        Jun 30 2002        Jun 30 2003        Jun 30 2002
                                                 ------------------------------------------------------------------------
<S>                                                      <C>             <C>             <C>                   <C>
   NET REVENUES                                          1,115,845       2,110,368       3,576,874.37          4,240,529

   COST OF REVENUES                                         (9,611)      1,080,582         986,615.86          1,882,107
                                                 ------------------------------------------------------------------------

   GROSS PROFIT                                          1,125,456       1,029,786          2,590,259          2,358,422
                                                 ------------------------------------------------------------------------


   OPERATING EXPENSES
   Selling & Advertising                                   448,449         878,637          1,062,887          1,499,521
   Payroll Expenses                                        203,735         605,291            604,948          1,163,314
   General and Administrative                              246,014         594,985            980,538          1,302,132
                                                 ------------------------------------------------------------------------
      Total Expenses                                       898,197       2,078,913          2,648,373          3,964,967
                                                 ------------------------------------------------------------------------


   GAIN (LOSS) FROM OPERATIONS                             227,258      (1,049,127)           (58,114)        (1,606,545)


   OTHER INCOME (EXPENSES)
   Gain on theft of assets                                                   1,203                                 1,203
   Interest Expense                                        (10,653)        (71,631)           (29,257)          (121,142)
   Loss on Reduction of Inventory
   Loss on Idle Equipment                                                                     (52,314)
   Other Income                                              1,965                              2,972
   Interest Income
                                                 ------------------------------------------------------------------------
      Total Other Income                                    (8,688)        (70,428)           (78,599)          (119,939)

   NET GAIN (LOSS)                                         218,570      (1,119,555)          (136,713)        (1,726,484)
                                                 ========================================================================
   NET GAIN (LOSS) PER COMMON SHARE
   EQUIVALENT - BASIC AND DILUTED                            0.014          (0.078)            (0.010)            (0.120)
</TABLE>




















                                       4
<PAGE>
<TABLE>
<CAPTION>
                                    CYBERADS, INC. AND SUBSIDIARIES
                             CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
                       FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND JUNE 30, 2002
                                              (UNAUDITED)

                                                                      For the six       For the six
                                                                      months ended      months ended
                                                                      Jun 30 2003       Jun 30 2002
                                                                   ----------------------------------
<S>                                                                      <C>                <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net Gain (Loss)                                                          (136,713.00)     (1,726,484)
Provision for doubtful accounts                                                              172,151
Depreciation                                                               19,493.50          13,225
Impairment Fix Assets                                                      98,645.57


Amortization of deferred Consulting Fees                                           -         100,000
Amortization of deferred Interest                                           7,014.64           2,904
Stock and options issued for service                                               -         142,298
Gain on theft of assets                                                                       (1,203)
(Increase) decrease in:
Accounts Receivable                                                          934,698         588,964
Prepaid expenses                                                              (3,909)              -
Inventory                                                                    138,207         223,805
Deposits                                                                      27,277         (60,762)
Increase (decrease) in:
Accounts Payable                                                            (793,447)        129,836
Accounts Payable - Related Parties                                          (362,246)              -
Cash overdraft                                                              (112,649)
Accrued expenses, payroll and payroll taxes                                   (4,381)        257,078
                                                                   ----------------------------------
   Net Cash Used in Operating Activities                                    (188,010)       (158,188)

CASH FLOW FROM INVESTING ACTIVITIES
Good faith deposit on future adquisition                                           -         (75,000)
Puerchases of property and equipment                                                        (301,473)
                                                                   ----------------------------------
   Net Cash Used in Investing Activities                                           -        (376,473)

CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issuance of Common Stock, net of offering costs                                 55,000
Proceeds from issuance of convertible debentures                                              60,000
Advances from third parties- Inphonic                                        216,620        (125,000)
Prepayments to third parties, net                                                         274,826.00
Advances from factor, net                                                                    270,724
                                                                   ----------------------------------
   Net Cash Provided by Financing Activities                                 216,620         535,550
                                                                   ----------------------------------

NET INCREASE IN CASH                                                          28,609             889

CASH- BEGINNING OF PERIOD                                                          -          39,968
                                                                   ----------------------------------

CASH- END OF PERIOD                                                           28,609          40,857
                                                                   ==================================
</TABLE>
















                                       5
<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)


NOTE 1   BASIS OF PRESENTATION

         The accompanying interim unaudited condensed consolidated financial
         statements have been prepared in accordance with accounting principles
         generally accepted in the United States of America and the rules and
         regulations of the Securities and Exchange commission for the interim
         financial information. Accordingly, they do not include all of the
         information necessary for a comprehensive presentation of financial
         position and results of operations.

         In management's opinion, however, all material adjustments (consisting
         of normal recurring adjustments) have been made which are necessary for
         a fair financial statement presentation. The results of the interim
         period are not necessarily indicative of the results to be expected for
         the year.

         For further information, refer to the consolidated financial statements
         and footnotes for the year ended December 31, 2002 included in Form
         10-KSB of the Company as filed on May 16, 2003.

NOTE 2   RECENT ACCOUNTING PRONOUNCEMENTS

         In April 2003, the Financial Accounting Standards Board ("'FASB")
         issued Statements of Financial Accounting Standards ("SFAS") No. 149,
         "Amendment of Statement 133 on Derivative Instruments and Hedging
         Activities". SFAS 149 amends and clarifies financial accounting and
         reporting for derivative instruments, including certain derivative
         instruments embedded in other contracts (collectively referred to as
         derivatives) and for hedging activities under SFAS No. 133, "Accounting
         for Derivative Instruments and Hedging Activities". The changes in SFAS
         No. 149 improve financial reporting by requiring that contracts with
         comparable characteristics be accounted for similarly. This statement
         is effective for contracts entered into or modified after June 30, 2003
         and all of its provisions should be applied prospectively.

         In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
         Financial Instruments with Characteristics of both Liabilities and
         Equity." The Statement improves the accounting for certain financial
         instruments that, under previous guidance, issuers could account for as
         equity. The new Statement requires that those instruments be classified
         as liabilities in statements of financial position.

         SFAS No. 150 affects the issuer's accounting for three types of
         freestanding financial instruments. One type is mandatorily redeemable
         shares, which the issuing company is obligated to buy back in exchange
         for cash or other assets. A second type, which includes put options and
         forward purchase contracts, involves instruments that do or may require
         the issuer to buy back some of its shares in exchange for cash or other
         assets. The third type of instruments that are liabilities under this
         Statement is obligations that can be settled with shares, the monetary
         value of which is fixed, tied solely or predominantly to a variable


                                       6
<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)


         such as a market index, or varies inversely with the value of the
         issuers' shares. SFAS No. 150 does not apply to features embedded in a
         financial instrument that is not a derivative in its entirety.

         In addition to its requirements for the classification and measurement
         of financial instruments in its scope, SFAS No. 150 also requires
         disclosures about alternative ways of settling the instruments and the
         capital structure of entities, all of whose shares are mandatorily
         redeemable. Most of the guidance in SFAS No. 150 is effective for all
         financial instruments entered into or modified after May 31, 2003, and
         otherwise is effective at the beginning of the first interim period
         beginning after June 15, 2003. For private companies, mandatorily
         redeemable financial instruments are subject to the provisions of this
         Statement for the fiscal period beginning after December 15, 2003.

         Management does not expect the impact from the pronouncements in these
         statements to have a material impact on the Company's consolidated
         financial position or results of operations.

NOTE 3   IMPAIRMENT OF LONG-LIVED ASSETS

         The Company reviews long-lived assets for impairment under Statement of
         Financial Accounting Standards No. 144, "Accounting for the Impairment
         or Disposal of Long-Lived Assets." Long-lived assets to be held and
         used are reviewed for impairment whenever events or changes in
         circumstances indicate that the carrying amount of an asset may not be
         recoverable. The carrying amount of a long-lived asset is not
         recoverable if it exceeds the sum of the undiscounted cash flows
         expected to result from the use and eventual disposition of the asset.
         Long-lived assets to be disposed of are reported at the lower of
         carrying amount or fair value less cost to sell. An impairment loss of
         $52,313 was recognized in the quarter ended March 31, 2003 for assets
         that became idle as a result of further staff reductions.

NOTE 4  IMPAIRMENT OF INVENTORY

         During the quarter ended March 31, 2003, the Company changed its
         business model whereby it will no longer maintain an inventory of
         cellular phones. For the cellular phone subscriptions obtained in the
         future, the phones shall be shipped either directly by the carrier or
         from a fulfillment company. Thus, the Company will not be responsible
         for delivering cellular phones to subscribers and revenue shall be
         recognized solely on a net basis going forward. As a result, the
         Company recognized an impairment charge on the remaining inventory in
         the amount of $120,879, which is included in cost of revenues.










                                       7

<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)


NOTE 5  STOCKHOLDERS' DEFICIENCY

         (A) Stock Issued for Services
         -----------------------------

         On March 10, 2003, the Company entered into a marketing and
         distribution agreement whereby the Company will provide customer names
         and contact information (that it obtains through its marketing efforts)
         to the other party who will provide fulfillment, activation and
         customer service for cellular phone service and other communications
         products and services. The Company is paid a commission for each
         activation and can be charged back for activations that are prematurely
         terminated by the customer. During the three months ended March 31,
         2003, the Company received $150,000 in advances (pre-paid commissions)
         from the other party. The agreement provides for repayment of these
         pre-paid commissions via commissions earned on specific types of sales.
         As of March 31, 2003, the $150,000 in advances has been offset against
         the commission accounts receivable. The Company has placed 1,250,000
         restricted shares of its common stock in escrow as collateral in the
         event that the agreement is terminated for any reason prior to the time
         that the pre-paid commissions have been fully earned or repaid. As
         further consideration for performance of this agreement, a warrant will
         be issued to the Company for the purchase of 62,500 shares of common
         stock of the other party. Subsequent to March 31, 2003, the Company
         received an additional $200,000 in advances.

         (B) Common Stock Options
         ------------------------

         On November 1, 2001, the Company adopted the 2001 Stock Option Plan,
         (the "Plan") which authorized the issuance of up to 500,000 shares of
         common stock to employees, consultants, representatives, officers and
         directors of the Company. As of March 31, 2003, no shares have been
         issued under the Plan.

         During the three months ended March 31, 2003, the Company granted
         225,000 stock options to certain employees. The Company applies APB
         Opinion No. 25 and related interpretations in accounting for stock
         options issued to employees. Accordingly, compensation cost is
         recognized for options issued to employees only for the intrinsic value
         of those options. Had compensation cost been determined based on the
         fair market value at the grant date, consistent with SFAS 123, the
         Company's net loss for the period ended March 31, 2003 would have
         changed to the pro-forma amount indicated below.

         The fair value of each option grant is estimated on the date of grant
         using the Black-Scholes option pricing model in accordance with SFAS
         123 with the following weighted average assumptions: dividend yield of
         zero; expected volatility of 195% to 234%; risk-free interest rate of
         2.0%, and expected lives of two years.







                                       8

<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                 March 31,
                                                                                    2003
                                                                          ----------------------
<S>                                                                       <C>
         Net Gain                           As Reported                   $             218,570
                                                                          $
         Basic and Diluted Net Loss Per
          Share                             As Reported                   $               (0.14)
                                                                          $
</TABLE>
         The effect of applying Statement No. 123 is not likely to be
         representative of the effects on reported net loss for future years due
         to, among other things, the effects of vesting.

         A summary of the Company's stock options as of June 30, 2003, and the
         changes since December 31, 2002 is presented below:
<TABLE>
<CAPTION>
                                                                  June 30, 2003
                                                            --------------------------
                                                                             Weighted
                                                                             Average
                                                                             Exercise
         Fixed Options                                        Shares           Price
         ----------------------------------------           -----------     ----------
<S>                                                          <C>            <C>
         Outstanding at beginning of period                  8,150,000      $     .82
         Granted
         Forfeited                                                   -              -
         Expired                                              (100,000)           .25
         Exercised                                                   -              -
                                                            -----------     ----------
         Outstanding at end of period                        8,050,000      $     .82
                                                            ===========     ==========

         Options exercisable at end of period                8,050,000
                                                            ===========
         Weighted average fair value of options
          granted to employees during the period            $     0.03
                                                            ===========
</TABLE>
<TABLE>
<CAPTION>
                                    Options Outstanding                                      Options Exercisable
           -----------------------------------------------------------------------     -------------------------------
                                                        Weighted
                                                        Average         Weighted                            Weighted
                                     Number            Remaining         Average           Number            Average
               Range of          Outstanding at       Contractual       Exercise       Exercisable at       Exercise
            Exercise Price       March 31, 2003           Life            Price        March 31, 2003         Price
           -----------------     ---------------      ------------    ------------     ---------------     -----------
<S>        <C>         <C>            <C>                    <C>      <C>                   <C>            <C>
           $    0.00 - 0.99           2,225,000              1.89     $      0.35           2,225,000      $     0.35
           $    1.00 - 1.99           5,825,000              3.55            1.01           5,825,000            1.01
           -----------------     ---------------      ------------    ------------     ---------------     -----------
           $    0.00 - 1.99           8,050,000              3.09     $      0.82           8,050,000      $     0.82
                                 ===============      ============    ============     ===============     ===========
</TABLE>
         (C) Common Stock Warrants
         -------------------------

         In June 2000, the Company issued to an officer of the Company a
         five-year warrant to purchase up to 50,000 common shares at an exercise
         price of $1.00 per share as consideration for assistance with the sale
         of the Company's stock. The Company accounts for the warrants under APB
         25. Accordingly, no direct offering costs or compensation expenses were
         recognized.

                                       9
<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)


NOTE 6   SEGMENT INFORMATION AND DISCONTINUED OPERATIONS

         In January 2002, Cyad was formed and the Company received 80% of the
         shares issued at Cyad's inception. The Company began developing the
         business of wholesaling cellular phones. In August 2002, the Company
         chose to discontinue Cyad's operations. As of March 31, 2003, there
         were no assets or liabilities related to Cyad.

         Since the Company's only remaining segment is the Cellular Phone
         Contracts segment, segment information is not presented and the income
         statement has been updated to reflect the discontinued operations.

NOTE 7   GOING CONCERN

         The Company plans to raise additional funds through loans from third
         parties and the sale of common stock for cash. The Company is of the
         opinion that the cash generated from their resources will be sufficient
         to provide adequate liquidity and capital resources.

         The ability of the Company to continue as a going concern is dependent
         on the Company's ability to raise additional capital and implement its
         business plan. Management believes that when it accomplishes the steps
         outlined above that the Company would have sufficient liquidity to
         remain viable for at least twelve months following the date of these
         condensed consolidated financial statements.

NOTE 8   COMMITMENTS AND CONTINGENCIES

         On February 7, 2003, the Company entered into a one-year agreement to
         make a health card available to its customers, whereby its customers
         are entitled to receive savings on purchases of goods and services from
         program participants. The Company receives a commission on each card
         activated and the other party handles fulfillment, activation and
         customer service. The agreement will automatically renew for terms of
         one-year each unless mutually terminated.

         On February 10, 2003, the Company entered into a one-year agreement to
         make prepaid bank cards available to its customers, whereby its
         customers "load" their account with funds which they can the use via
         the bank card. The Company receives a commission on each card activated
         and the second party to the agreement handles card fulfillment,
         activation and customer service. The agreement will automatically renew
         for successive one-year terms.

         On March 14, 2003, the Company entered into a settlement agreement with
         a company owned by the former Chief Technology Officer. The other party
         is entitled to market the Company's customer list and the Company
         agrees to compensate the other party 50% of the revenue generated from





                                       10
<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                               -------------------
                                   (UNAUDITED)

         the list for revenue it claims it lost as a result of the marketing and
         distribution agreement referred to above. The compensation is limited
         to $15,000. As part of the settlement, the Company also provided the
         other party with used office furniture and equipment with an estimated
         market value of $3,680.

         On April 8, 2003, the Company renegotiated the lease for the building
         occupied by the corporate headquarters. The Company relinquished one of
         the two bays that it was occupying and reduced the leased space to
         approximately one-half of what was previously occupied. Rent expense
         was reduced accordingly. It was also agreed that the landlord would
         apply $35,000 of the $65,000 security deposit towards rent that was
         previously deferred. The lease amendment extends the lease term through
         February 28, 2006.

         As of May 8, 2003, the Company's subsidiary, IDS Cellular, Inc., is
         being sued by a vendor for non-payment of goods delivered to IDS
         Cellular, Inc. in 2003. The Company's attorney believes the likelihood
         of loss is probable, therefore the Company has appropriately accrued
         $80,895 for the loss in 2003.




































                                       11
<PAGE>
Item 2.  Management Discussion and Analysis

General

         Management's discussion and analysis contains various forward looking
statements within the meaning of the Securities and Exchange Act of 1934. These
statements consist of any statement other than a recitation of historical fact
and can be identified by the use of forward looking terminology such as "may,"
"expect," "anticipate," "estimates" or "continue" or use of negative or other
variations of comparable terminology. We caution that these statements are
further qualified by important factors that could cause actual results to differ
materially from those contained in our forward looking statements, that these
forward looking statements are necessarily speculative, and there are certain
risks and uncertainties that could cause actual events or results to differ
materially from those referred to in our forward looking statements.

Overview

         CyberAds, Inc. began operations in the fourth quarter of 2000 and began
generating revenues in December 2000. Through our wholly-owned subsidiary, IDS
Cellular, Inc., we generate revenues by marketing cell phone services to
potential consumers we are introduced to through our internet affiliate program
and other third party telemarketing services.

         Commencing in the fourth quarter 2001, we began operating as a direct
reseller of cellular phone service. This new operation provides us with
increased revenues as well as a requirement to provide cellular telephones with
each sale and maintaining an inventory of cellular telephones.

          Management notes that a comparison of results of operations may be
misleading as our operations were in its infancy during the first quarter of
2001.

Results of Operations

         Total revenues were $1,115,845 for the three months ended June 30, 2003
and $2,110,368 for the three months ended June 30, 2002. The $994,523 decrease
in revenues in the three months ended June 30, 2003 as compared to June 30, 2002
primarily reflects the change in operations. Since March, 2003 our main source
of revenue is from direct commissions from InPhonic, eliminating completely the
Cost of Goods Sold. As a result, our Gross profit is approximately 100% gross
sales.

         The Company did not have Cost of Revenues for the three months ending
June 30, 2003, and the (9,611) are returns of purchases. The gross profit for
this period was $1,125,456 or approximately 100%.













                                       12
<PAGE>
         Total expenses for the three months ended June 30, 2003 were $898,197
as compared to $2,078,913 three months ended June 30, 2002. Selling and
advertising expenses for the three month period ended June 30, 2003 decreased to
$430,188 as compared to $878,637 for the same period in 2002. The decrease in
selling expenses in 2003 as compared to 2002 is primarily attributable to the
decrease in our sales personnel. Payroll expense for the three month period
ended June 30, 2003 decreased to $203,735 or 18.3 % of sales as compared to
$605,291 or 28.7% of sales for the same period in 2002. The decrease is due to a
significant reduction of personnel.

         General and administrative expenses for the three-month period ended
June 30, 2003 decreased to $246,014 or 22.05% of sales as compared to $594,985
or 28.20% of sales for the same period in 2002. The decrease in general and
administrative expenses in 2003 as compared to 2002 is primarily attributable to
the decrease in professional fees, office expenses and miscellaneous expenses
directly related to decrease in personnel.

         Our Gain from operations for the three months ended June 30, 2003
increased by $1,276,68. Gain from operation from the Second Quarter, 2003 was
$227,258, as compared to a loss of $1,049,127 for the same quarter of 2002. Our
Net Gain for the three months ended June 30, 2003 increased by $1,338,125. Net
Gain for the three months ended June 30, 2003 was $218,570 as compared to
$1,119,555 Net Loss for the same period of 2002 The increase in net Gain was due
to an increase of our Gross Profit and a decrease in our Operating and Other
Expenses.

         Management believes that our increasing revenues and cost reductions
should improve our operating performance for future periods.

Liquidity and Capital Resources

         As of June 30, 2003 had an accumulated deficit of $17,514,930 and cash
in the bank of $28,609. We had a working capital deficit June 30, 2003 of
$3,816,439. The deficit was funded during the three-month period June 30, 2003
by advances from third parties.

         Accounts receivable increased $35,679 from $ 103,383 Net Receivables as
of March 31, 2003 to $139,062 Net Receivable as of June 30, 2003. This increase
is a result decrease in the allowance for charge-back during the current period.

         Since our inception we have experienced negative cash flow and have met
our cash requirements by issuing, through a private placement, our common stock
and by issuing stock as compensation for services provided. We have also funded
current obligations through the issuance of common stock and related party
loans. We generated additional funds through borrowings from a related party.

          As a result of improved operating results and increasing revenues, we
anticipate that cash generated from our operations should be sufficient to
satisfy our contemplated cash requirements for the next 12 months. We believe if
the trend of increasing revenues remains consistent, cash generated will be
sufficient to support operations over the next 12 months. After such time, we
anticipate that we will need to raise additional funds through private or public
offerings or additional borrowings.

         While our auditors have expressed substantial doubt as to our ability
to continue as a going concern, we anticipate that funds received from loans and
cash generated from our operations should be sufficient to satisfy our
contemplated cash requirements for the next 12 months. We intend to take several
steps that will provide the capital resources required to insure our viability
over the next 12 months. These steps include the reduction of operating costs
including rent, payroll and factoring expenses. These saving adding to the
benefits of the Inphonic's contract should provide all the liquidity the company
requires.

                                       13
<PAGE>
PART II. OTHER INFORMATION
         -----------------

Item 1.  Legal Proceedings

         None.

Item 2.  Changes in Securities and Use of Proceeds

         On January 5, 2002, we issued 50,000 shares of common stock and options
to purchase 50,000 shares of our common stock exercisable at $1.00 to Atlas
Pearlman, P.A. as consideration for legal services provided to our company. The
securities were issued under an exemption from registration pursuant to Section
4(2) of the Securities Act. The securities issued contain a legend restricting
their transferability absent registration or an available exemption. Atlas
Pearlman, P.A. had access to information about our company and had the
opportunity to ask questions about our company.

         During the three months ended March 31, 2002, we issued an aggregate of
124,000 shares of common stock for an aggregate amount of $90,400. These shares
were issued to two option holders pursuant to the exercise of options with
exercise prices ranging from $.60 to $1.00. The shares were issued under an
exemption from registration pursuant to Section 4(2) of the Securities Act. The
shares issued contain a legend restricting their transferability absent
registration or an available exemption. The option holders had access to
information about our company and had the opportunity to ask questions about our
company.

         On January 6, 2002, we entered into a business consulting agreement
with Gene Foland, under which Mr. Foland will provide our company with business
consulting services. Mr. Foland received options to purchase 1,300,000 shares of
our common stock exercisable at $1.00 per share in exchange for these services.
The options are exercisable for a six- month period commencing on the date of
the agreement. The options were issued under an exemption from registration
pursuant to Section 4(2) of the Securities Act. The options issued contain a
legend restricting their transferability absent registration or available
exemption. Mr. Foland had access to information about our company and had the
opportunity to ask questions about our company.

         On January 6, 2002, we entered into a product and sales development
consulting agreement with James L. Ricketts, under which Mr. Ricketts received
options to purchase 200,000 shares of our common stock exercisable at $1.00 per
share and options to purchase 1,100,000 shares of our common stock exercisable
at $2.00 per share in exchange for these services. The options are exercisable
for a six-month period commencing on the date of the agreement. The options were
issued under an exemption from registration pursuant to Section 4(2) of the
Securities Act. The options issued contain a legend restricting their
transferability absent registration or available exemption. Mr. Ricketts had
access to information about our company and had the opportunity to ask questions
about our company.










                                       14
<PAGE>
         On January 6, 2002, we entered into a product and sales development
consulting agreement with James L. Copley, under which Mr. Copley received
options to purchase 300,000 shares of our common stock exercisable at $2.00 per
share in exchange for these services. The options are exercisable for a
six-month period commencing on the date of the agreement. The options were
issued under an exemption from registration pursuant to Section 4(2) of the
Securities Act. The options issued contain a legend restricting their
transferability absent registration or available exemption. Mr. Copley had
access to information about our company and had the opportunity to ask questions
about our company.

         On January 7, 2002, we issued an option to purchase 50,000 shares
exercisable at $1.00 per share to our controller. Our controller received these
options for services performed. The options were issued under an exemption from
registration pursuant to Section 4(2) of the Securities Act. The options issued
contain a legend restricting their transferability absent registration or
available exemption. Our controller had access to information about our company
and had the opportunity to ask questions about our company.

         On January 8, 2002, we issued options to purchase an aggregate of
125,000 shares of our common stock exercisable at $1.00 per share to our current
officers and directors. The options were issued under an exemption from
registration pursuant to Section 4(2) of the Securities Act. The options issued
contain a legend restricting their transferability absent registration or
available exemption.

         On January 8, 2002, we issued an option to purchase 5,000,000 shares of
our common stock exercisable at $1.00 per share to Lawrence Levinson. This
option was issued in consideration for the advances that Mr. Levinson and his
affiliates have made to our company and personal guarantees Mr. Levinson has
made in favor of our company. The options were issued under an exemption from
registration pursuant to section 4(2) of the Securities Act. The options issued
contain a legend restricting their transferability.

         On January 21, 2002, we issued 625,000 shares of series A convertible
preferred stock to Lawrence Levinson as consideration for a $625,000 promissory
note made by Mr. Levinson in favor of our company. The note is repayable in ten
years. Interest for the term of the note is payable annually on the anniversary
date of the note at an annual rate of 4.5%. Each share of the series A
convertible preferred stock is convertible into one share of our common stock.
These shares were issued under an exemption from registration pursuant to
Section 4(2) of the Securities Act. The shares issued contain a legend
restricting their transferability absent registration or available exemption.

         On January 21, 2002, we filed a certificate of designation designating
625,000 of our 5,000,000 shares of preferred stock as series A convertible
preferred stock. The 625,000 shares of series A convertible preferred stock have
a stated value of $1.00 per share. The shares were issued to our chief executive
officer. The preferred stock has the following rights, preferences and
privileges:









                                       15
<PAGE>
         Conversion. Each share of series A convertible preferred stock is
convertible into one share of our common stock, at the option of the holder. The
conversion rate is subject to adjustment upon the occurrence of certain events,
including the issuance of our stock as a dividend or distribution on our common
stock.

         Redemption. The shares are redeemable at our sole option for $1.00 per
share.

         Voting. Each share of preferred stock is entitled to eight votes.

         Preference on Liquidation. Series A convertible preferred shares will
be entitled to a preference on liquidation.

Item 3.  Defaults Upon Senior Securities

         None.

Item 4.  Submission of Matters to a Vote of Security Holders

         None.

Item 5.  Other Information

         On April 1, 2002, we entered into a three-year lease agreement with
6001, LLC for new office space to consolidate all of our operating facilities.
Monthly rental under this agreement is $16,667, $18,333 and $20,000 during the
first, second and third year, respectively.

         On April 10, 2002, we issued options to purchase an aggregate of 50,000
shares of our common stock to an employee of the Company for services performed.
The options expire five years from the date of issuance and have an exercise
price of $1.00.

         On April 17, 2002, we experienced a theft of all our phone inventory
and some computer equipment at our new facilities. We estimate the loss to be
approximately $100,000 and anticipate to recuperate materially all of the loss
through insurance.

Item 6.  Exhibits and Reports on Form 8-K

         (a) Exhibits required by Item 601 of Regulation S-B
















                                       16
<PAGE>
<TABLE>
<CAPTION>
         Exhibit No.        Description of Document
         -----------        -----------------------
<S>      <C>                <C>
         2.2                Stock Purchase Agreement with IDS Cellular and its shareholders(1)
         3.1(a)             Articles of Incorporation(1)
         3.1(b)             Articles of Amendment(1)
         3.1(c)             Designation of Series A Convertible Preferred Stock(2)
         3.2                Bylaws(1)
         4.0                Form of Stock Certificate(1)
         4.2                Loan Agreement with Levinson(1)
         4.3                Promissory Note issued by Levinson in favor of CyberAds, dated January 21, 2002(3)
         10.1               Employment/Consulting Agreement with Levinson(1)
         10.2               Agreements with American Cellular, Inc. and GT Global Communications, Inc.(1)
         10.3               Agreement with Triton PCS(1)
         10.4               Agreement with Regal Marketing International(1)
         10.6               Agreement with Beck Management, Inc.(1)
         10.7               Consulting Agreement with Gene Foland(2)
         10.8               Consulting Agreement with James L. Ricketts(2)
         10.9               Consulting Agreement with James L. Copley(2)
         10.10              Sales Agency Agreement with MCI WorldCom Wireless(2)
         21.0               Subsidiaries of Registrant(1)
         31.                Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
                            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(4)
         32.                Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
                            Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(4)


         (1)                Previously filed in Registration Statement on Form SB-2, File No. 333-62690.
         (2)                Previously filed in Registration Statement on Form SB-2, File No. 333-82104.
         (3)                Previously filed in the Annual Report on Form 10-KSB for the year ended December 31, 2001.
         (4)                Filed herewith
</TABLE>
         (b) Reports on Form 8-K

         On January 29, 2002, we filed a current report on Form 8-K disclosing
that on January 22, 2002 we issued 625,000 shares of series A preferred stock to
Lawrence Levinson, our CEO, in consideration for advances in the aggregate of
approximately $350,000 that Mr. Levinson and his affiliates have made to our
company and a personal guarantee that Mr. Levinson has made on behalf of our
company.

         On February 6, 2002, we filed an amended current report on Form 8-K/A
to disclose the designation, rights and preferences of the series A preferred
stock that we issued to Lawrence Levinson on January 22, 2002. Each share of
series A preferred stock is convertible into one share of our common stock at
the option of the holder. In addition, the series A preferred shares have super
voting rights.



















                                       17
<PAGE>
                                   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 as duly authorized officers of the Registrant.

                                           CyberAds, Inc.


DATED: August 18, 2003                     By:/s/Lawrence Levinson
                                              ----------------------------------
                                           Lawrence Levinson, Chairman and
                                           Chief Executive Officer

DATED: August 18, 2003                     By:/s/Robert B. Kline
                                              ----------------------------------
                                           Robert B. Kline, Principal Accounting
                                           Officer and Director










































                                       18