<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549
                                   Form 10-Q

(Mark One)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
 [x]                THE SECURITIES EXCHANGE ACT OF 1934

               For the quarterly period ended September 30, 1999

                                       OR

 [_]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

             For the transition period from _________ to __________

                       Commission File Number:  000-26529

                                 AUDIBLE, INC.
             (Exact name of Registrant as specified in its Charter)

                  DELAWARE                             22-3407945
      (State or other jurisdiction of               (I.R.S. employer
      incorporation or organization)             identification number)

            65 WILLOWBROOK BLVD.                         07470
             WAYNE, NEW JERSEY                        (Zip Code)
  (Address of principal executive offices)

                                 (973) 890-4070
              (Registrant's telephone number, including area code)

                                      None
                    (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.  Yes    X      No  ____
                                                ------

     As of October 31, 1999, 25,631,004 shares of common stock ("Common Stock")
of the Registrant were outstanding.
<PAGE>

                                 AUDIBLE, INC.

                                     INDEX

                                   FORM 10-Q
<TABLE>
<CAPTION>
PART I  -       FINANCIAL INFORMATION                                              Page
                                                                                    ----
<S>              <C>                                                                <C>

Item 1.          Financial Statements :

                 Condensed Balance Sheets as of September 30, 1999 (unaudited)
                 and December 31, 1998.......................................          3

                 Condensed Statements of Operations for the three
                 and nine months ended September 30, 1999
                 and 1998 (unaudited)........................................          4

                 Condensed Statements of Cash Flows for the nine months ended
                 September 30, 1999 and 1998 (unaudited).....................          5

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

Item 2.          Management's Discussion and Analysis of
                 Financial Condition and Results of Operations...............         10

Item 3.          Qualitative and Quantitative Disclosure
                 about Market Risk...........................................         18

PART II  -       OTHER INFORMATION

Item 1.          Legal Proceedings...........................................         19

Item 2.          Changes in Securities.......................................         19

Item 3.          Defaults Upon Senior Securities.............................         19

Item 4.          Submission of Matters to a Vote of Securities Holders.......         20

Item 5.          Other Information...........................................         20

Item 6.          Exhibits and Reports on Form 8-K............................         20

Signatures...................................................................         22
</TABLE>

                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.    Financial Statements

                                 AUDIBLE, INC.
                            CONDENSED BALANCE SHEETS

                           -------------------------
<TABLE>
<CAPTION>

                                                                              September 30, 1999       December 31, 1998
                                                                           ---------------------       -----------------
                                  Assets                                          (unaudited)

<S>                                                                           <C>                      <C>
Current assets:
   Cash and cash equivalents...............................................  $        42,170,914        $     10,526,299
   Accounts receivable, net................................................              327,521                   8,516
   Advance royalty payments................................................               94,121                 228,402
   Prepaid expenses........................................................              259,592                 102,916
   Inventory...............................................................                    -                 129,535
                                                                           ---------------------       -----------------
    Total current assets...................................................           42,852,148              10,995,668
Property and equipment, net................................................            1,269,562                 397,837
Notes receivable due from stockholders.....................................              150,000                 100,000
Other assets...............................................................               78,004                 106,153
                                                                           ---------------------       -----------------
    Total assets...........................................................  $        44,349,714        $     11,599,658
                                                                           =====================       =================
             Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
  Accounts payable.........................................................  $         2,157,831        $        482,971
  Accrued expenses and compensation........................................            1,562,813                 471,753
  Current maturities of obligations under capital leases...................              313,114                 471,224
  Advances, current........................................................              806,516                 491,304
                                                                           ---------------------       -----------------
    Total current liabilities..............................................            4,840,274               1,917,252
Deferred compensation......................................................              247,805                 167,318
Advances, net of current portion...........................................              441,312               1,008,696
Obligations under capital leases, net of current maturities................               94,740                 310,507
Redeemable convertible preferred stock (non-cumulative)....................                    -              27,724,654

Stockholders' equity (deficit):
Common stock, par value $.01. 50,000,000 and 16,000,000 shares
 authorized, 25,603,254 and 7,394,355 shares issued and outstanding as of
 September 30, 1999 and December 31, 1998, respectively....................              256,033                  73,944
  Additional paid-in capital...............................................           67,358,617               1,162,420
  Notes due from stockholders for common stock.............................           (1,057,525)             (1,040,158)
  Accumulated deficit......................................................          (27,831,542)            (19,724,975)
                                                                           ---------------------       -----------------
    Total stockholders' equity (deficit)...................................           38,725,583             (19,528,769)
                                                                           ---------------------       -----------------

  Total liabilities and stockholders' equity (deficit).....................  $        44,349,714        $     11,599,658
                                                                           =====================       =================
</TABLE>

           See accompanying notes to condensed financial statements.

                                       3
<PAGE>

                                 AUDIBLE, INC.
                       CONDENSED STATEMENTS OF OPERATIONS

                           -------------------------
<TABLE>
<CAPTION>
                                                       Three Months Ended                    Nine Months Ended
                                                          September 30,                        September 30,
                                              ----------------------------------    --------------------------------
                                                     1999              1998               1999             1998
                                              ----------------    --------------    ---------------   --------------
                                                 (unaudited)        (unaudited)       (unaudited)        (unaudited)
 <S>                                              <C>               <C>                <C>               <C>
Revenue:
 Content and services.......................     $   131,178        $    42,131       $   280,877        $    89,983
 Hardware...................................          98,527             28,573           279,292            190,157
 Other......................................         249,129                  -           762,172                  -
                                              ---------------   ----------------    ---------------   --------------
  Total revenue.............................         478,834             70,704         1,322,341            280,140
                                              ---------------   ----------------    ---------------   --------------


Operating expenses:
 Cost of content and services revenue.......         160,144             87,560           473,983            250,051
 Cost of hardware revenue...................          78,177            120,222           271,203            527,064
 Production expenses........................         914,729            340,824         2,132,148          1,193,401
 Research and development...................       1,021,092            378,357         1,768,848          1,145,675
 Sales and marketing........................       1,973,978            381,352         3,273,271            883,086
 General and administrative.................       1,074,377            459,833         2,048,508          1,449,719
                                              ---------------   ----------------    ---------------   --------------
  Total operating expenses..................       5,222,497          1,768,148         9,967,961          5,448,996
                                              ---------------   ----------------    ---------------   --------------


  Loss from operations......................      (4,743,663)        (1,697,444)       (8,645,620)        (5,168,856)

  Other (income) expense, net...............        (400,546)             3,951          (539,053)            22,028
                                              ---------------   ----------------    ---------------   --------------
  Net loss..................................     $(4,343,117)       $(1,701,395)      $(8,106,567)       $(5,190,884)
                                              ===============   ================    ===============   ==============


Basic and diluted net loss per
  common share..............................          $(0.19)            $(0.23)           $(0.65)            $(0.74)
                                              ===============   ================    ===============   ==============

Weighted average shares outstanding.........      22,603,090          7,396,580        12,552,475          6,996,974
                                              ===============   ================    ===============   ==============
</TABLE>

           See accompanying notes to condensed financial statements
<PAGE>

                                 AUDIBLE, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS

                           -------------------------
<TABLE>
<CAPTION>
                                                                                               Nine Months Ended
                                                                                                 September 30,
                                                                                     ----------------------------------
                                                                                            1999               1998
                                                                                     -----------------      -----------
                                                                                         (unaudited)        (unaudited)
<S>                                                                                     <C>                 C>
 Cash flows from operating activities:
 Net loss............................................................................    $(8,106,567)       $(5,190,884)
 Adjustments to reconcile net loss to net cash used in operating activities:
  Depreciation and amortization......................................................        306,301            514,667
  Services rendered for common stock.................................................              -             16,250
  Non-cash compensation charge.......................................................        745,077                  -
  Cancellation of common stock issued for services rendered..........................         (1,250)                 -
  Deferred compensation..............................................................         80,487             17,691
  Changes in assets and liabilities:
    Increase in accounts receivable..................................................       (319,005)           (17,608)
    Decrease in advance royalty payments.............................................        134,281            147,899
    (Increase) decrease in prepaid expenses..........................................       (156,676)            40,811
    Decrease (increase) in inventory.................................................        129,535           (299,452)
    Decrease in other assets.........................................................         28,149             16,706
    Increase in accounts payable.....................................................      1,674,860             76,283
    Increase (decrease) in accrued expenses and compensation.........................      1,091,060            (97,117)
    Decrease in advances.............................................................       (252,172)                 -
                                                                                     -----------------      -----------
     Net cash used in operating activities...........................................     (4,645,920)        (4,774,764)
                                                                                     -----------------      -----------

Cash flows from investing activities:
 Purchases of property and equipment.................................................     (1,178,026)           (11,404)
 Note receivable issued to stockholder...............................................        (50,000)                 -
                                                                                     -----------------      -----------
     Net cash used in investing activities...........................................     (1,228,026)           (11,404)
                                                                                     -----------------      -----------

Cash flows from financing activities:
 Proceeds from Initial Public Offering, net of issuance costs........................     36,856,000                  -
 Proceeds from issuance of Series D redeemable convertible preferred
  stock, net of issuance costs.......................................................        994,472          5,374,511
 Payments received on notes due from stockholders for common stock...................         41,966              6,130
 Payment of principal on obligations under capital leases............................       (373,877)          (328,914)
                                                                                     -----------------      -----------
     Net cash provided by financing activities.......................................     37,518,561          5,051,727
                                                                                     -----------------      -----------

     Increase in cash and cash equivalents...........................................     31,644,615            265,559
Cash and cash equivalents at beginning of period.....................................     10,526,299            646,186
                                                                                     -----------------      -----------
Cash and cash equivalents at end of period...........................................    $42,170,914        $   911,745
                                                                                     =================      ===========
</TABLE>

           See accompanying notes to condensed financial statements.

                                       5
<PAGE>

                                 AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          September 30, 1999 and 1998



(1) Initial Public Offering

    On July 15, 1999, the Company completed an initial public offering (IPO) of
  4,600,000 shares of common stock at $9.00 per share. Total proceeds to the
  Company were approximately $36.9 million, net of underwriting discounts and
  commissions of approximately $2.9 million and offering costs of approximately
  $1.6 million. Concurrent with the IPO, all shares of the Company's redeemable
  convertible preferred stock were converted into 13,400,985 shares of common
  stock.


(2) Summary of Significant Accounting Policies

 Basis of Presentation

    The accompanying condensed financial statements as of September 30, 1999
  and for the three and nine months ended September 30, 1999 and September 30,
  1998 are unaudited and, in the opinion of management, include all adjustments
  (consisting of normal recurring adjustments and accruals) necessary to present
  fairly the results for the periods presented in accordance with generally
  accepted accounting principles. Operating results for the three and nine
  months ended September 30, 1999 are not necessarily indicative of the results
  that may be expected for the year ending December 31, 1999. These financial
  statements should be read in conjunction with the audited financial statements
  and notes thereto for the year ended December 31, 1998 from the Company's
  Registration Statement Form S-1 (333-76985).

    Audible was incorporated in 1995, and commenced commercial operations in
  October 1997, and through March 31, 1999, was in the development stage for
  financial reporting purposes. Subsequent to March 31, 1999, Audible
  substantially completed its development efforts in establishing its business
  and accordingly is no longer considered a development stage company.

 Reclassifications

    Certain items in the December 31, 1998 Balance Sheet have been reclassified
  to conform with the September 30, 1999 presentation.

 Basic and Diluted Net Loss Per Common Share

    Basic and diluted net loss per common share is presented in accordance with
  the provisions of SFAS No. 128, "Earnings Per Share." Basic net loss per
  common share excludes dilution for common stock equivalents and is computed by
  dividing net loss available to common stockholders by the weighted average
  number of common shares outstanding for the period. Diluted net loss per
  common share reflects the potential dilution that could occur if securities or
  other contracts to issue common stock were exercised or converted into common
  stock and resulted in the issuance of common stock. Diluted net loss per
  common share is equal to basic net loss per common share, since all common
  stock equivalents are antidilutive for each of the periods presented.



                                       6
<PAGE>

                                 AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          September 30, 1999 and 1998



     Diluted net loss per common share for the three and nine months ended
  September 30, 1999 does not include the effects of options to purchase 929,950
  shares of common stock; and warrants to purchase 1,769,905 shares of common
  stock; as the effect of their inclusion is antidilutive during the periods.
  Diluted net loss per common share for the three and nine months ended
  September 30, 1998 does not include the effects of warrants to purchase
  675,001 shares of common stock; warrants to purchase 94,904 shares of
  preferred stock; and 9,276,000 shares of convertible preferred stock on an
  "as-if" converted basis; as the effect of their inclusion is antidilutive
  during the periods.


(3)  Stockholders' Equity (Deficit)

 Stock Split

     On May 26, 1999, the Company affected a three-for-two stock split to all
  stockholders of record at the close of business on May 26, 1999. Accordingly,
  all share and per share data in the accompanying financial statements have
  been adjusted retroactively to reflect the split.

 Common Stock

     In 1998, the Company increased the number of shares of common stock
  authorized from 12,000,000 to 16,000,000. In April 1999, the Company increased
  the number of shares of common stock authorized to 50,000,000. As of September
  30, 1999 and as of December 31, 1998, the Company had 25,603,254 and
  7,394,355, respectively, common stock shares issued and outstanding and none
  and 13,120,905 common stock shares, respectively, reserved for conversion of
  Series A convertible preferred stock, Series B convertible preferred stock,
  Series C convertible preferred stock, Series D convertible preferred stock and
  related convertible preferred stock warrants. As of September 30, 1999 and as
  of December 31, 1998, the Company had 1,675,001 and 675,001 common stock
  shares, respectively, reserved for common stock warrants and 929,950 and no
  common stock shares, respectively, reserved for common stock options. All
  shares of preferred stock were converted into 13,400,985 shares of common
  stock at the closing of the Company's IPO.

     In March 1999, the Company issued common shares to employees at a price
  less than the fair value of the stock at the time of issuance. These shares,
  which are subject to vesting of over four years, were paid for by full
  recourse promissory notes executed by the employees. The difference between
  the fair value and the issue price of these common shares is being recorded as
  an expense over the vesting term. During the nine months ended September 30,
  1999, $127,012 of this expense was recognized with an offset to additional
  paid-in-capital. During the nine months ended September 30, 1998, all common
  shares issued by the Company to employees were issued at the fair value of the
  stock at the time of issuance.

     In April 1999, the Company established the 1999 Stock Incentive Plan (the
  "Plan") and has reserved 9,000,000 common stock shares to be issued under the
  Plan. The Plan permits the granting of stock options, stock appreciation
  rights, restricted or unrestricted stock awards, phantom stock, performance
  awards and other stock-based awards. As of September 30, 1999, options to
  purchase 929,950 common stock shares have been granted under this Plan, the
  majority of which have been granted at fair market value.

                                       7
<PAGE>

                                 AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          September 30, 1999 and 1998



(4) Redeemable Convertible Preferred Stock

    In February 1998, the Company authorized 1,375,000 shares of Series D
  convertible preferred stock. The number of shares of Series D convertible
  preferred stock authorized was increased to 4,375,000 in December 1998. In
  February, June and December 1998, the Company issued an aggregate of 3,850,000
  shares of Series D convertible preferred stock at $4.00 per share for
  aggregate net proceeds of $15,347,009. On February 9, 1999, the Company issued
  250,000 shares of Series D convertible preferred stock at $4.00 per share, for
  net proceeds of $994,472. Each holder of outstanding shares of Series D
  convertible preferred stock had voting rights equal to the number of shares of
  common stock into which the Series D convertible preferred stock are
  convertible, which is a 3 for 2 share basis, subject to certain adjustments
  for antidilution, at the option of the stockholder, as defined in the
  Company's Certificate of Incorporation, as amended.

    At the closing of the Company's IPO on July 15, 1999 all shares of Series A
  convertible preferred stock, Series B convertible preferred stock, Series C
  convertible preferred stock, Series D convertible preferred stock were
  automatically converted into 13,400,985 shares of common stock.


(5) Microsoft Agreement

    In November 1998, the Company entered into a five-year agreement with
  Microsoft. The agreement provides for services related to integration of
  products, the granting of various rights and licenses, and the provision for
  Microsoft to be paid future royalties for content distributed as a result of
  the software developed in the agreement. Under the terms of the agreement,
  Microsoft committed a minimum of $2.0 million in payments to the Company to
  integrate certain products and acquire various rights and licenses.

    Microsoft advanced Audible $1,500,000 in November 1998 in consideration of
  Audible granting Microsoft the right to distribute software enabling users of
  Microsoft platforms to access and use Audible content. The Company has
  allocated $50,000 of this advance to certain development work that will be
  recognized as revenue upon its completion. The remaining $1,450,000 of this
  advance is being recognized as revenue on a straight line basis beginning in
  the quarter ended June 30, 1999 through the initial term of the agreement
  which ends the second quarter of 2001. During the nine months ended September
  30, 1999, $252,172 of this advance was recognized.

    Audible will pay Microsoft a royalty on content licensed and distributed by
  Audible to each end user that accesses its content using the developed
  software. Royalties will be recognized during the period that the related
  content revenue is earned. Through September 30, 1999, Audible had not
  recognized any royalties under this agreement.

    Also under the agreement, during the nine months ended September 30, 1999
  Audible (i) has performed technology integration services for which the
  Company has recognized other revenue of $200,000, (ii) has delivered a license
  for certain technology rights for which the Company has recognized other
  revenue of $250,000, and (iii) has delivered 300 Audible MobilePlayers for
  which the Company recognized hardware revenue of $50,000. Microsoft has
  options under the agreement to acquire additional rights and licenses and
  extend the term of the agreement for additional financial consideration.

                                       8
<PAGE>

                                 AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          September 30, 1999 and 1998



    In April 1999, in connection with an amendment to the agreements with
  Microsoft, the Company issued to Microsoft a warrant which expires November
  18, 2003 to purchase 100,000 shares of common stock at the IPO price of $9.00
  per share. The fair value of this warrant is being amortized as an expense on
  a straight-line basis over the same period as the $1,450,000 advance described
  above. During the three and nine months ended September 30, 1999, $67,215 and
  $89,620 respectively, was recorded as a production expense with an offset to
  additional paid-in-capital.


(6) Services Agreement

    In June 1999, in connection with a services agreement, the Company issued a
  warrant to purchase 150,000 shares of common stock at $0.01 per share, which
  is fully vested, and a warrant to purchase 500,000 shares of common stock at
  $8.00 per share, which is subject to vesting over a three year period. The
  agreement allows for an additional warrant to purchase 250,000 shares of
  common stock at $8.00 per share upon extension of the agreement for an
  additional year also subject to vesting. The fair value of these warrants is
  being amortized as an expense on a straight-line basis over the initial term
  of the service agreement of three years. During the three and nine months
  ended September 30, 1999, $457,155 and $528,445 respectively, was recorded as
  a marketing expense with an offset to additional paid-in-capital.


                                       9
<PAGE>

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

  The following discussion and analysis of our financial condition and results
of operations should be read in conjunction with our audited financial
statements and notes thereto appearing in our Registration Statement Form S-1
(333-76985). This discussion and analysis contains forward-looking statements
that involve risks and uncertainties. Our actual results may differ materially
from those anticipated in these forward-looking statements as a-result of a
number of factors.

Overview

  We provide Internet-delivered premium spoken audio content for playback on
personal computers and hand-held electronic devices. We have the largest and
most diverse collection of premium digital spoken audio content available for
Dpurchase and download from the Internet, most of which is currently available
only at our Web site audible.com.

  In order to test consumer behavior, demonstrate to content providers the
viability of digital distribution of audio content and test our business model,
we designed, created and sold limited numbers of our own Internet-enabled
mobile audio playback device, the Audible MobilePlayer. Sales of the
MobilePlayer accounted for 68% of our revenue for the nine months ended
September 30, 1998, and 21% of the revenue for the nine months ended September
30, 1999. Revenue from the sale of the Audible MobilePlayer will cease in the
fourth quarter of 1999 because production of the player was discontinued in
April 1999 and we do not expect to realize any additional hardware revenue from
our remaining inventory as of September 30, 1999. Our primary focus is the
aggregation and delivery of digital spoken audio content, and, in the future,
we will depend supon computer and consumer electronics companies to manufacture
and sell devices that are promoted as AudibleReady. The first of these devices
became commercially available in March 1999. Revenue from the sale of audio
content through our Web site has increased in each of the last four quarters.
We expect that trend to continue and, over the next several quarters, sales of
audio content will increase and eventually account for the majority of our
revenue. As of September 30, 1999, more than 8,600 customers had purchased
content from our Web site.

  Although we have experienced revenue growth in our content sales in recent
periods, there can be no assurance that such growth rates are sustainable, and
therefore such growth rates should not be considered indicative of future
operating results. There can also be no assurance that we will be able to
continue to increase our revenue or attain profitability or, if increases in
revenue and profitability are achieved, that they can be sustained. We believe
that period-to-period comparisons of our historical operating results are not
meaningful and should not be relied upon as an indication of future performance.

  We recognize revenue from: (i) content sales in the period the content is
downloaded, (ii) subscription sales pro rata over the subscription term, (iii)
sales of the Audible MobilePlayer upon shipment, and (iv) audio production,
hosting services, and other services provided to third parties as the services
are performed.

  Typically, we pay our content providers a 12% royalty based upon net sales of
the content downloaded by our customers. Some of our content agreements require
us to make advance royalty payments for minimum guarantees which are amortized
on a straight-line basis over the term of the agreement or are expensed as
royalties are earned, whichever is sooner.

                                       10
<PAGE>

  We are party to several joint marketing agreements, with device manufacturers
including Casio, Compaq, Diamond Multimedia, Everex and Philips. Under these
agreements, our device manufacturers may receive a portion of the content
revenue generated over a specified period of time by each new Audible customer
referred by them through the purchase of a new device. These revenue sharing
arrangements typically last one or two years from the date the device user
becomes an Audible customer.

  We have incurred significant losses since inception, and as of September 30,
1999, we had an accumulated deficit of approximately $27.8 million. We believe
that our success will depend largely on our ability to extend our leadership
position as a provider of premium digital spoken audio content over the
Internet. Accordingly, we plan to invest heavily in sales and marketing and
content acquisition and production over the next several quarters, to add
additional personnel and to make capital expenditures to upgrade our systems
capacity.

  It is with deepest regret that we report that our President and Chief
Executive Officer (CEO) Andrew Huffman died of an apparent heart attack on
October 24, 1999. Mr. Huffman had served as President and CEO of Audible since
joining the Company in February 1998. Chairman and Founder Donald Katz, who was
also Audible's original President and CEO from 1995 to 1998, will serve as
Acting CEO until a successor is named.


Results of Operations

  The following table sets forth certain financial data for the periods
indicated as a percentage of total revenue for the three and nine months ended
September 30, 1999 and 1998.



<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------
                                                                                Three Months             Nine Months
                                                                                   Ended                    Ended
                                                                               September  30,           September  30,
                                                                              --------------            --------------
                                                                              1999      1998            1999      1998
                                                                                 (unaudited)              (unaudited)
<S>                                                                          <C>         <C>            <C>         <C>
Revenue:
  Content and services.......................................                 27%          60%           21%        32%
  Hardware...................................................                 21           40            21         68
  Other......................................................                 52            0            58          0
     Total revenue...........................................                100%         100%          100%       100%
Operating expenses:
  Cost of content and services revenue.......................                 34          124            36         89
  Cost of hardware revenue...................................                 16          170            20        188
  Production expenses........................................                191          482           161        426
  Research and development...................................                213          535           134        409
  Sales and marketing........................................                412          539           248        315
  General and administrative.................................                225          650           155        518
     Total operating expenses................................              1,091        2,500           754      1,945

Loss from operations.........................................               (991)      (2,400)         (654)    (1,845)

     Other (income) expense, net.............................                (84)           6           (41)         8

Net loss.....................................................               (907)%     (2,406)%        (613)%   (1,853)%
---------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       11
<PAGE>

Three Months Ended September 30, 1999 Compared to Three Months Ended September
30, 1998.

  Total revenue.   Total revenue for the three months ended September 30, 1999,
was $479,000, as compared to $71,000 for the three months ended September 30,
1998, an increase of $408,000, or 575%.

  Content and services.   Content and services revenue for the three months
ended September 30, 1999, was $131,000, as compared to $42,000 for the three
months ended September 30, 1998, an increase of $89,000, or 212%. Content and
services revenue increased primarily as a result of our increased customer base.

  Hardware.   Hardware revenue for the three months ended September 30, 1999,
was $99,000, as compared to $29,000 for the three months ended September 30,
1998, an increase of $70,000, or 241%. Hardware revenue increased as a result of
selling a higher quantity of the Audible MobilePlayer. However, hardware revenue
from the sale of the Audible MobilePlayer will cease in the fourth quarter of
1999 as we do not expect to realize any additional hardware revenue from our
remaining inventory of MobilePlayers as of September 30, 1999.

  Other.   Other revenue for the three months ended September 30, 1999, was
$249,000, as compared to no other revenue for the three months ended September
30, 1998. Revenue for the three month period consisted of  $189,000 in amortized
revenue from the advance relating to our agreement with Microsoft Corporation
granting Microsoft the right to distribute software platforms to enable users to
access and use Audible content, and $60,000 in services relating to an agreement
with Compaq Computer Corporation.

Operating expenses.

  Cost of content and services revenue.  Cost of content and services revenue
consists primarily of the amortization of minimum guarantees and royalties
earned in excess of the amortized guaranteed amount. These minimum guarantees
consist of advance royalties paid or guaranteed to be paid to our content
providers regardless of the amount of content sold by us during that period.
These amounts are amortized on a straight-line basis over the terms of the
content agreements or are expensed as royalties when earned, whichever is
sooner. Cost of content and services revenue was $160,000, or 122% of content
and services revenue, for the three months ended September 30, 1999, as compared
to $88,000, or 210% of content and services revenue, for the three months ended
September 30, 1998. This increase was primarily due to the acquisition of
additional content licenses which resulted in amortization of new content
agreement guarantees. The decrease of cost of content and services revenue as a
percentage of content and services revenue is a result of the amortized
guaranteed amount being applied to an increased content and services revenue
amount.

  Cost of hardware revenue.   Cost of hardware revenue consists primarily of the
cost of manufacturing the Audible MobilePlayers sold, write-downs of
MobilePlayers in inventory to their estimated net realizable value, packaging
and collateral material, and fulfillment and shipping costs. Cost of hardware
revenue was $78,000, or 79% of hardware revenue, for the three months ended
September 30, 1999, as compared to $120,000, or 414% of hardware revenue, for
the three months ended September 30, 1998. This decrease was primarily due to
the discontinuation of production of the MobilePlayer and the subsequent write-
down of units produced to their net realizable value.

  Production expenses.  Production expenses consist primarily of personnel and
outsourced costs to support our infrastructure and systems including our Web
site, internal data communications, audio production activities and acquisition
of content. Production expenses were $915000 for the three months ended
September 30, 1999, as compared to $341,000 for the three months ended September
30, 1998, an increase of $574,000, or 168%. This increase was primarily due to
increased personnel, increased Web site and related operating expenses, and
increased audio production.

                                       12
<PAGE>

  Research and development.   In 1999, research and development expenses consist
of costs incurred in the improvement of our Web site and development of new
versions of AudibleManager, the software that enables customers to download and
manage audio content, and the development of other Audible Ready applications.
In 1998, research and development costs consisted primarily of costs incurred
under agreements for the continued design and manufacture of the Audible
MobilePlayer, development of our Web site and AudibleManager 1.0. Research and
development costs were $1,021,000 for the three months ended September 30, 1999,
as compared to $378,000 for the three months ended September 30, 1998, an
increase of $643,000, or 170%. This increase was primarily due to increased
personnel and outsourced costs in the development of new versions of Audible
Manager, AudibleReady formats, and the upgrade of our Web site.

  Sales and marketing.   Sales and marketing expenses consist primarily of
personnel costs, advertising, travel, promotional materials, tradeshows, public
relations and customer service. Sales and marketing expenses were $1,974,000 for
the three months ended September 30, 1999, as compared to $381,000 for the three
months ended September 30, 1998, an increase of $1,593,000, or 418%. This
increase was primarily due to increased advertising costs as we begin to
increase our marketing efforts.

  General and administrative.   General and administrative expense consists
primarily of administrative and business development personnel costs, legal and
accounting fees, recruiting costs and facility costs. General and administrative
expense was $1,074,000 for the three months ended September 30, 1999, as
compared to $460,000 for the three months ended September 30, 1998, an increase
of $614,000, or 133%. This increase was primarily due to increased personnel and
higher professional fees.

  Other (income) expense, net.   Other (income) expense consists primarily of
interest income earned on our cash and cash equivalents balances, and interest
expense paid in connection with a capital equipment lease line. Interest income
was $413,000 for the three months ended September 30, 1999, as compared to
$11,000 for the three months ended September 30, 1998, an increase of $402,000.
This increase was primarily due to additional interest income earned from a
higher average cash and cash equivalent balance resulting from the proceeds from
our IPO which occurred on July 15, 1999.  Interest expense was $12,000 for the
three months ended September 30, 1999, as compared to $15,000 for the three
months ended September 30, 1998, a decrease of $3,000. This decrease was
primarily due to the lower principal balance on our capital equipment lease
line.

Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30,
1998.

  Total revenue.   Total revenue for the nine months ended September 30, 1999,
was $1,322,000, as compared to $280,000 for the nine months ended September 30,
1998, an increase of $1,042,000, or 372%.

  Content and services.   Content and services revenue for the nine months ended
September 30, 1999, was $281,000, as compared to $90,000 for the nine months
ended September 30, 1998, an increase of $191,000, or 212%. Content and services
revenue increased primarily as a result of the our increased customer base.

  Hardware.   Hardware revenue for the nine months ended September 30, 1999, was
$279,000, as compared to $190,000 for the nine months ended September 30, 1998,
an increase of $89,000, or 47%. Hardware revenue increased as a result of
selling a higher quantity of the Audible MobilePlayer.  However, hardware
revenue from the sale of the Audible MobilePlayer will cease in the fourth
quarter 1999 as we do not expect to realize any additional hardware revenue from
our remaining inventory of MobilePlayers as of September 30, 1999.

  Other.   Other revenue for the nine months ended September 30, 1999, was
$762,000, as compared to no other revenue for the nine months ended September
30, 1998. Most of the other revenue was generated in connection with our
agreement with Microsoft Corporation. Under the agreement, revenue for the nine
month period consisted of $200,000 for services provided to create an
AudibleReady software player for Microsoft's Windows CE product; $250,000 for
delivery of a license for certain technology rights; and $252,000 relating to
the amortization of revenue from the advance for granting Microsoft the right to
distribute software platforms enabling users to access and use

                                       13
<PAGE>

Audible content. The remaining $60,000 in other revenue for the nine months
ending September 30, 1999 related to services provided under our agreement with
Compaq Computer Corporation. For the nine months ended September 30, 1999,
$510,000 of the other revenue is considered nonrecurring.

Operating expenses.

  Cost of content and services revenue.   Cost of content and services revenue
was $474,000, or 169% of content and services revenue, for the nine months ended
September 30, 1999, as compared to $250,000, or 278% of content and services
revenue, for the nine months ended September 30, 1998. This increase was
primarily due to the acquisition of additional content licenses which resulted
in additional amortization of new content agreement guarantees. The decrease of
cost of content and services revenue as a percentage of content and services
revenue is a result of the amortized guaranteed amount being applied to an
increased content and services revenue amount.

  Cost of hardware revenue.   Cost of hardware revenue was $271,000, or 97% of
hardware revenue, for the nine months ended September 30, 1999, as compared to
$527,000, or 277% of hardware revenue, for the nine months ended September 30,
1998. This decrease was primarily due to the discontinuation of production of
the MobilePlayer and the subsequent write-down of units produced to their net
realizable value.

  Production expenses.   Production expenses were $2,132,000 for the nine months
ended September 30, 1999, as compared to $1,193,000 for the nine months ended
September 30, 1998, an increase of $939,000, or 79%. This increase was primarily
due to increased personnel, increased audio production, and increased expenses
to support and expand our infrastructure and systems.

  Research and development.   Research and development costs were $1,769,000 for
the nine months ended September 30, 1999, as compared to $1,146,000 for the nine
months ended September 30, 1998, an increase of $623,000, or 54%. This increase
was primarily due to increased personnel and outsourced costs in the development
of the original and subsequent versions of Audible Manager, AudibleReady
formats, and the upgrade of our Web site.

  Sales and marketing.   Sales and marketing expenses were $3,273,000 for the
nine months ended September 30, 1999, as compared to $883,000 for the nine
months ended September 30, 1998, an increase of $2,390,000, or 271%. This
increase was primarily due to an increase in personnel and increased advertising
costs associated with increased marketing efforts.

  General and administrative.   General and administrative expense was
$2,049,000 for the nine months ended September 30, 1999, as compared to
$1,450,000 for the nine months ended September 30, 1998, an increase of
$599,000, or 41%. This increase was primarily due to increased personnel and
higher professional fees during the period.

  Other (income) expense, net.   Interest income was $579,000 for the nine
months ended September 30, 1999, as compared to $37,000 for the nine months
ended September 30, 1998, an increase of $542,000. This increase was primarily
due to additional interest income resulting from a higher average cash and cash
equivalent balance resulting from the proceeds from our IPO which occurred on
July 15, 1999.  Interest expense was $40,000 for the nine months ended September
30, 1999, as compared to $59,000 for the nine months ended September 30, 1998, a
decrease of $19,000. This decrease was primarily due to the lower principal
balance on our capital equipment lease line.

                                       14
<PAGE>

Factors Affecting Operating Results

  Our operating results have varied on a quarterly basis during our short
operating history and may fluctuate significantly in the future as a result of a
variety of factors, many of which are outside of our control. Factors that may
affect our quarterly operating results include but are not limited to: (1) the
demand for the Audible service; (2) the availability of premium audio content;
(3) sales and consumer usage of AudibleReady devices; (4) the introduction of
new products or services by a competitor; (5) the cost and availability of
acquiring sufficient web site capacity to meet our customers' needs; (6)
technical difficulties with our computer system or the Internet or system
downtime; (7) the cost of acquiring audio content; (8) the amount and timing of
capital expenditures and other costs relating to the expansion of our
operations; and (9) general economic conditions and economic conditions specific
to electronic commerce and online media. In the past, we have experienced
fluctuations in demand for the Audible service based on the level of marketing
expenditures, the occurrence of external publicity and the quality of our
software and Web site. Any one of these factors could cause revenue and
operating results to vary significantly in the future. In addition, as a
strategic response to changes in the competitive environment, we may from time
to time make pricing, service or marketing decisions or acquisitions that could
cause significant declines in our quarterly operating revenue.


Liquidity and Capital Resources

  From inception through the date prior to our IPO, we have financed our
operations through private sales of our redeemable convertible preferred stock
and warrants. Net proceeds from the sales of redeemable convertible stock and
warrants were approximately $28.7 million since inception.

  On July 15, 1999, we completed an initial public offering (IPO) of 4,600,000
shares of common stock at $9.00 per share.  Total proceeds were approximately
$36.9 million, net of underwriting discounts and commissions of approximately
$2.9 million and offering costs of approximately $1.6 million.  Concurrent with
the IPO, all shares of our redeemable convertible preferred stock were converted
into 13,400,985 shares of common stock.  At September 30, 1999, our principal
source of liquidity was approximately $42.1 million of cash and cash
equivalents.

  At September 30, 1999, our commitments consisted of principal payments under a
capital lease line, which allows us  to purchase up to $1.8 million of
equipment, operating lease commitments, contractual commitments with content
providers and revenue sharing commitments pursuant to agreements with device
manufacturers. At September 30, 1999, we had leased approximately $1.2 million
in equipment on our lease line and had an outstanding balance of approximately
$408,000. During 1998, we had a $1.0 million bank line of credit agreement to
provide letters of credit which expired in April 1999 and under which we did not
draw any amounts. This credit agreement was not renewed nor replaced.

  Net cash used in operating activities was $4.8 million for the nine months
ended September 30, 1998. Net cash used during the period was primarily
attributable to net losses in the period and increased inventory, partially
offset by depreciation and amortization.  Net cash used in operating activities
for the nine months ended September 30, 1999 was $4.6 million. Net cash used in
the period was primarily attributable to net losses in the period and increased
accounts receivable, partially offset by higher accounts payable and accrued
expenses.

  Net cash used in investing activities was $61,000 for the nine months ended
September 30, 1998 and $1,228,000 for the nine months ended September 30, 1999.
Net cash used in investing activities during both periods was primarily related
to purchases of property and equipment. In the nine months ended September 30,
1999 we issued a note receivable to a shareholder in the amount of $50,000.

                                       15
<PAGE>

  Net cash provided by financing activities was $5.1 million for the nine months
ended September 30, 1998. Net cash provided by financing activities during the
period resulted primarily from the issuance of redeemable convertible preferred
stock partially offset by capital lease payments. Net cash provided by financing
activities for the nine months ended September 30, 1999 was $37.5 million. Net
cash provided by financing activities during the period resulted primarily from
the proceeds of the IPO as well as the issuance of redeemable convertible
preferred stock partially offset by capital lease payments.

  We believe our current cash and cash equivalents, will be sufficient to meet
our anticipated cash requirements for at least the next 12 months. We plan to
use these funds to increase our sales and marketing efforts, acquire new
content, extend arrangements with current content providers, acquire companies
or technologies, add additional personnel and make capital expenditures to
upgrade systems capacity.  Our current plans provide that approximately $6.0
million of the net proceeds from the IPO has been allocated for marketing
activities, approximately $5.0 million for acquisition and production of new
audio content, and the remaining $25.9 million of the proceeds from the IPO will
be available for use at the discretion of our management. In the future, we may
need to raise additional funds through public or private financing, or other
arrangements. We have no assurance that such additional financing, if needed,
will be available on terms favorable to us or to our stockholders.


Year 2000 Readiness

General

  Many of the world's computer systems (including those in non-information
technology equipment and systems) currently record years in a two-digit format.
If not addressed, these computer systems will be unable to properly interpret
dates beyond the year 1999, which could lead to business disruptions. The
potential costs and uncertainties associated with the Year 2000 issue will
depend on a number of factors, including software, hardware and the nature of
the industry in which a company operates.

  We have instituted a company-wide project for addressing the Year 2000 issue.
We are integrating this project with a project involving the upgrade of our Web
site. The Year 2000 project is divided into two parts--System Infrastructure
Upgrades and Vendor Compliance. These sections are discussed separately below.
The project is on schedule for completion by the end of November 1999.

System Infrastructure Upgrades

  We intend to achieve Year 2000 compliance for our internal systems by the end
of November 1999. Our limited number of personal computers and application
systems are anticipated to facilitate rapid progress toward Year 2000
compliance. We are in the process of upgrading to more recent versions of
operating systems software that are Year 2000 compliant.

  Our Year 2000 plan incorporates the following steps:

            .  update the inventory of computer hardware, software and
               miscellaneous network components,

            .  evaluate application development environment compliance,

            .  conduct overall assessment of systems infrastructure compliance,

             . complete business risk analysis,

            .  take remedial actions (upgrade, repair, replace, retire or
               retain),


                                       16
<PAGE>

            . test all upgrades and development, and

            . develop appropriate contingency plans, and develop and implement
              regimes to test Year 2000 compliance for mission-critical systems.

  We are at the end of the remedial action stage, and currently anticipate
completion of the entire process by the end of November 1999 in order to avoid
an adverse Year 2000 impact on our systems.

Vendor Compliance

  This part of our plan includes identifying and prioritizing critical suppliers
of technology and communicating with them about their plans and progress in
addressing the Year 2000 problem. This process includes not only manufacturers
with which we have agreements, but also providers of insurance, financial and
other services.

 Our vendor compliance program includes the following steps:

            . catalog and classify all vendors,

            .  on-site review and testing of out-sourced services or systems,

            .  review responses from vendors to determine the level of
               compliance,

            .  determine the timing, method and cost of vendor solutions,

            .  assess vendor Year 2000 compliance and business risks, and

            .  develop remedial actions or contingency plans, as necessary.

  We are at the remedial action stage of this program.  Achievement of vendor
Year 2000 compliance is anticipated to be an on-going effort during the
remainder of 1999.  The current target is to achieve compliance and complete
contingency plans by the end of November 1999.

Costs

  The estimated cost to compete the Year 2000 compliance project is
approximately $100,000, not including software and hardware upgrades already
budgeted as part of our next generation Web site, of which $66,000 have been
expended through September 30, 1999.  These costs are being incurred primarily
for the use of outside consultants, setting up Year 2000 testing environments
and the replacement of existing software and hardware.

Risks

  The failure to correct a material Year 2000 problem could result in an
interruption in, or a failure of, our Web site and some of our normal business
activities or operations. Such failures could materially and adversely affect
our business, financial condition and results of operations. Moreover, even if
we successfully remediate our Year 2000 issues, we can be materially and
adversely affected by failures of our vendors to remediate their own Year 2000
issues. The failure of our vendors which have financial or operational
relationships to remediate their computer and non-information technology systems
issues in a timely manner could result in a material financial risk to us . Due
to the general uncertainty inherent in the Year 2000 problem, resulting in part
from the uncertainty of the Year 2000 readiness of vendors, we are unable to
determine at this time whether the consequences of Year 2000 failures will have
a material impact on our business, financial condition and results of
operations. Accordingly, we may experience business interruption or shutdown,
financial loss, damage to our reputation and legal liability. We believe

                                       17
<PAGE>

that, with the implementation of new business systems and completion of the
project as scheduled, the possibility of significant interruptions of normal
operations should be reduced.

  Our expectations about future costs and the timely completion of our Year 2000
project are subject to uncertainties that could cause actual results to differ
materially from what has been discussed above. Factors that could influence the
amount of future costs and the effective timing of remediation efforts include
our success in identifying computer programs and non-information technology
systems that contain two-digit year codes, the nature and amount of programming
and testing required to upgrade or replace each of the affected programs and
systems, the rate and magnitude of related labor and consulting costs, and the
success of our vendors in addressing the Year 2000 issue.

  In addition, we cannot assure you that Internet access companies, utility
companies and telecommunications providers will be Year 2000 compliant. The
failure by these companies to be Year 2000 compliant could result in a
systematic failure beyond our control, such as a prolonged Internet,
telecommunications or electrical failure, which could prevent us from delivering
the Audible service to our customers, decrease the use of the Internet or
prevent users from accessing audible.com, which would have a material adverse
effect on our business, results of operations and financial condition.

ITEM 3.  Qualitative and Quantitative Disclosure about Market Risk

  Inapplicable

                                       18
<PAGE>

                          PART II - OTHER INFORMATION

ITEM 1.   Legal Proceedings.

  None

ITEM 2.   Changes in Securities and Use of Proceeds

  Recent Sales of Unregistered Securities

  The following information relates to securities issued or sold by us within
the period covered by this Form 10-Q.  During that time, we issued unregistered
securities in the transactions described below.  Securities issued in such
transactions were offered and sold in reliance upon the exemption from
registration under Section 4(2) of the Securities Act, relating to sales by an
issuer not involving any public offering, or under Rule 701 under the Securities
Act on the basis that these options were offered and sold either pursuant to a
written compensatory benefit plan or pursuant to written contracts relating to
compensation.  The sales of securities were made without the use of an
underwriter and the certificates evidencing the shares bear a restrictive legend
permitting the transfer thereof only upon registration of the shares or an
exemption under the Act.

  (1)  Between April 1, 1999 and September 30, 1999, we issued options to our
       employees and directors exercisable for an aggregate of 929,950 shares of
       common stock net of forfeitures at exercise prices between $2.00 and
       $12.75 per share, pursuant to our 1999 Stock Incentive Plan.

  (2)  In April 1999, we issued a warrant to purchase 100,000 shares of common
       stock at $9.00 per share. This warrant may be exercised until November
       18, 2003.

  (3)  In June 1999, in connection with a services agreement, we issued a
       warrant to purchase 150,000 shares of common stock at $0.01 per share,
       which is fully vested, and a warrant to purchase 500,000 shares of common
       stock at $8.00 per share, which is subject to vesting over a three year
       period.

  Report of Offering of Securities and Use of Proceeds Therefrom

  In July 1999, we commenced and completed a firm commitment underwritten
initial public offering of 4,600,000 shares of our common stock at a price of
$9.00 per share. The shares were registered with the Securities and Exchange
Commission pursuant to a registration statement on Form S-1 (No. 333-76985),
which was declared effective on July 15, 1999. The public offering was
underwritten by a syndicate of underwriters led by Credit Suisse First Boston
Corporation, J. P. Morgan Securities Inc., Volpe Brown Whelan & Company, LLC and
Wit Capital Corporation as their representatives. After deducting underwriting
discounts and commissions of $2.9 million and expenses of $1.6 million, we
received net proceeds of $36.9 million.

  As of November 2, 1999, we had invested the net proceeds from our initial
public offering in Government backed obligations with maturities of up to one
year.  This use of proceeds from the offering does not represent a material
change in the use of proceeds described in the Registration Statement. None of
the net proceeds of the offering were paid directly or indirectly to any of our
directors or officers, or their associates, or persons owning 10 percent or more
of any class of our equity securities.

ITEM 3.   Defaults Upon Senior Securities

  Inapplicable

                                       19
<PAGE>

ITEM 4.   Submission of Matters to Vote of Security Holders

  None.

ITEM 5.   Other Information

  None

ITEM 6.   Exhibits and Reports on Form 8-K

  (a)  Exhibits

      3.1#      Amended and Restated Certificate of Incorporation of Audible
      3.2##     Amended and Restated Bylaws of Audible
      10.1+*    License Agreement dated November 4, 1998, by and between
                Microsoft Corporation and Audible
      10.2+*    Digital Rights Management Agreement dated November 4, 1998,
                between Microsoft Corporation and Audible
      10.3+*    Development Agreement dated November 12, 1998, by and between
                RealNetworks, Inc. and Audible
      10.4*     RealMedia Architecture Partner Program Internet Agreement dated
                November 12, 1998, between RealNetworks, Inc. and Audible
      10.5*     Master Lease Agreement dated November 19, 1996, by and between
                Comdisco, Inc. as lessor, and Audible as lessee
      10.5.1*   Addendum to Master Lease Agreement dated November 20, 1996, by
                and between Comdisco, Inc., as lessor, and Audible, as lessee
                (relating to Exhibit 10.5)
      10.6*     Warrant Agreement to purchase 30,573 shares of Series B
                preferred stock at a price of $2.68 per share, dated November
                19, 1996, and re-issued as of August 17, 1998, by Audible to
                Comdisco, Inc.
      10.7*     Warrant Agreement to purchase 12,188 shares of Series C
                preferred stock at a price of $4.00 per share, dated July 24,
                1997, issued by Audible to Comdisco, Inc.
      10.8*     Loan and Security Agreement dated April 6, 1998, by and between
                Silicon Valley Bank, as lender, and Audible, as borrower, for a
                revolving line of credit of up to $1,000,000
      10.9*     Warrant to Purchase Stock issued April 6, 1998, by Audible to
                Silicon Valley Bank
      10.10*    Security and Loan Agreement dated November 20, 1996, between
                Audible, as borrower, and Imperial Bank, as lender, for up to
                $500,000
      10.11*    Warrant Agreement to purchase 12,500 shares of Series B
                preferred stock at a price of $3.00 per share, dated November
                20, 1996, issued by Audible to Imperial Bank
      10.12*    Promissory Note dated March 28, 1997, from Donald Katz in favor
                of Audible, in the principal amount of $100,00010.12.1 Allonge
                to Note dated April 21, 1999 between Donald Katz and Audible
                (relating to Exhibit 10.12.1)
      10.12.1*  Allonge to Note dated April 21, 1999 between Donald Katz and
                Audible (relating to Exhibit 10.12.1)
      10.13*    Security Agreement dated March 28, 1997, by and between Donald
                Katz and Audible
      10.14*    Amended and Restated Registration Rights Agreement dated
                February 26, 1998, by and among Audible and certain stockholders
                named therein
      10.14.1*  Amendment No. 1 to Amended and Restated Registration Rights
                Agreement dated December 18, 1998 (relating to Exhibit 10.14)
      10.14.2*  Amendment No. 2 to Amended and Restated Registration Rights
                Agreement dated June 17, 1999 (relating to Exhibit 10.14)
      10.15*    1999 Stock Incentive Plan


                                       20
<PAGE>

      10.16*    Form of Common Stock Warrants issued March 31, 1997 by Audible
                to various investors in connection with the Series C preferred
                stock financing
      10.17*    Form of Stock Restriction Agreement by and between Audible and
                the Named Executive Officers made in connection with various
                purchases and sales of shares of restricted common stock
      10.18*    Form of Promissory Note made by the Named Executive Officers in
                favor of Audible in connection with various purchases and sales
                of shares of restricted common stock
      10.19*    Office Lease dated June 20, 1997, by and between Audible, as
                tenant, and Passaic Investment LLC, Sixty-Five Willowbrook
                Investment LLC and Wayne Investment LLC, as tenants-in-common,
                as landlord
      10.20*    Sublease Agreement dated July 19, 1996, by and between Audible,
                as sublessee, and Painewebber Incorporated, as sublessor
      10.21+*   Agreement dated April 3, 1999 by and between Audible and Diamond
                Multimedia Systems, Inc.
      10.22*    Common Stock Purchase Warrant, issued April 22, 1999, to
                Microsoft Corporation
      10.23*    Employment Offer Letter from Audible to Guy Story dated June
                10, 1996
      10.24*    Employment Offer Letter from Audible to Matthew Fine dated March
                31, 1997
      10.25*    Employment Offer Letter from Audible to Brian Fielding dated
                April 25, 1997
      10.26*    Employment Offer Letter from Audible to Travis Millman dated
                September 29, 1997
      10.27*    Employment Offer Letter from Audible to Foy Sperring dated April
                23, 1998

      10.29*    Employment Offer Letter from Audible to Andrew Kaplan dated May
                25, 1999
      10.30*    Common Stock Purchase Warrant, W-1, issued June 17, 1999, to
                Robin Williams
      10.31*    Common Stock Purchase Warrant, W-2, issued June 17, 1999,
                to Robin Williams
      27**      Financial Data Schedule

 #Incorporated by reference from the Company's Registration Statement on
Form S-1 (No. 333-76985) as Exhibit No. 3.2.
##Incorporated by reference from the Company's Registration Statement on
Form S-1 (No. 333-76985) as Exhibit No. 3.4.
* Incorporated by reference from the Company's Registration Statement on
Form S-1 (No. 333-76985).
+ Information has been omitted from this exhibit pursuant to a request for
confidential treatment filed with the Securities and Exchange Commission.
** Filed herewith.

(b) Reports on Form 8-K

    None




                                       21
<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 thereunto duly authorized.

                                           AUDIBLE, INC.



                                           By:    /s/  Andrew P. Kaplan
                                                  ---------------------
                                           Name:  Andrew P. Kaplan
                                           Title: Chief Financial Officer and
                                                  Vice President, Finance and
                                                  Administration


Dated: November 12th, 1999

                                       22