SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.   20549
                                    FORM 10-Q
  (MARK ONE)
     [X]       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003

                                       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.
            WAYNE, NEW JERSEY                             07470
  (Address of Principal Executive Offices)             (Zip Code)

                                 (973) 837-2700
              (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
                                              ---    ---

     Indicate  by  checkmark  whether the registrant is an accelerated filer (as
defined  in  Rule  12b-2  of  the  Exchange  Act). YES     NO  X
                                                       ---    ---

     As  of  November  10,  2003,  32,280,152  shares  of  common stock ("Common
Stock"),  3,473,967  shares  of  Series A Convertible Preferred Stock, 1,250,000
shares of Series B Convertible Preferred Stock, and 1,111,111 shares of Series C
Convertible  Preferred  Stock  of  the  Registrant  were  outstanding.


                                        1
<PAGE>
                                  AUDIBLE, INC.

                                      INDEX

                                    FORM 10-Q

PART I - FINANCIAL INFORMATION                                              Page
                                                                            ----

Item 1.   Financial Statements:

          Condensed Balance Sheets as of September 30, 2003
          (unaudited) and December 31, 2002 . . . . . . . . . . . . . .       3

          Condensed Statements of Operations for the three and nine
          months ended September 30, 2003 and 2002 (unaudited). . . . .       4

          Condensed Statements of Cash Flows for the nine months ended
          September 30, 2003 and 2002 (unaudited) . . . . . . . . . . .       5

          Notes to Condensed Financial Statements (unaudited) . . . . .       6

Item 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations . . . . . . . .       17

Item 3.   Qualitative and Quantitative Disclosure
          about Market Risk . . . . . . . . . . . . . . . . . . . . . .       25

Item 4.   Controls and Procedures . . . . . . . . . . . . . . . . . . .       25

PART II - OTHER INFORMATION

Item 1.   Legal Proceedings . . . . . . . . . . . . . . . . . . . . . .       25

Item 2.   Changes in Securities and Use of Proceeds . . . . . . . . . .       26

Item 3.   Defaults Upon Senior Securities . . . . . . . . . . . . . . .       26

Item 4.   Submission of Matters to a Vote of Security Holders . . . . .       26

Item 5.   Other Information . . . . . . . . . . . . . . . . . . . . . .       26

Item 6.   Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . .       27

Signatures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       30


                                        2
<PAGE>
<TABLE>
<CAPTION>
                                            PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                                                    AUDIBLE, INC.
                                               CONDENSED BALANCE SHEETS


                                                                             SEPTEMBER 30, 2003    DECEMBER 31, 2002
                                                                            --------------------  -------------------
<S>                                                                         <C>                   <C>
                                          ASSETS                                (UNAUDITED)
Current assets:
      Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . .  $         6,882,519   $        2,822,080
      Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . .              250,593              189,263
      Royalty advances . . . . . . . . . . . . . . . . . . . . . . . . . .               46,664               58,425
      Prepaid expenses and other current assets. . . . . . . . . . . . . .              342,168              736,823
      Inventory. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              200,324               77,262
                                                                            --------------------  -------------------
        Total current assets . . . . . . . . . . . . . . . . . . . . . . .            7,722,268            3,883,853

Property and equipment, net. . . . . . . . . . . . . . . . . . . . . . . .              323,824              633,400
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              329,232               90,805
                                                                            --------------------  -------------------
        Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . .  $         8,375,324   $        4,608,058
                                                                            ====================  ===================

                      LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
      Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . .  $           615,893   $        1,077,509
      Accrued expenses and compensation. . . . . . . . . . . . . . . . . .            2,378,555            3,231,893
      Royalty obligations, current . . . . . . . . . . . . . . . . . . . .              418,500              598,500
      Advances, current. . . . . . . . . . . . . . . . . . . . . . . . . .              680,891              476,053
      Accrued dividends on convertible preferred stock . . . . . . . . . .              582,686              125,257
                                                                            --------------------  -------------------
        Total current liabilities. . . . . . . . . . . . . . . . . . . . .            4,676,525            5,509,212

Deferred cash compensation . . . . . . . . . . . . . . . . . . . . . . . .               58,750               90,550
Royalty obligations, non current . . . . . . . . . . . . . . . . . . . . .               72,500               25,000
Advances, non current. . . . . . . . . . . . . . . . . . . . . . . . . . .                   --               19,448

Redeemable convertible preferred stock;
    Series A, par value $.01, 4,500,000 shares authorized, none and
    3,277,327 shares issued and outstanding at September 30, 2003 and
    December 31, 2002, respectively. . . . . . . . . . . . . . . . . . . .                   --           12,289,976

Commitments and contingencies (see note 9)

Stockholders' equity (deficit):
    Convertible preferred stock;  Series A, par value $.01, 4,500,000
     shares authorized, 3,473,967 and no shares issued and outstanding at
     September 30, 2003 and December 31, 2002, respectively. . . . . . . .           13,027,375                   --
    Convertible preferred stock;  Series B, par value $.01, 1,250,000
     shares authorized, 1,250,000 shares issued and outstanding at
     September 30, 2003 and December 31, 2002, respectively. . . . . . . .            1,137,500            1,137,500
    Convertible preferred stock;  Series C, par value $.01, 1,111,111
     shares authorized, 1,111,111 and no shares issued and outstanding at
     September 30, 2003 and December 31, 2002, respectively. . . . . . . .            5,859,772                   --
    Common stock, par value $.01. 120,000,000 and 75,000,000 shares
     authorized; 31,768,304 and 31,687,169 shares issued at September
     30, 2003 and December 31, 2002, respectively. . . . . . . . . . . . .              317,683              316,779
    Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . .          101,712,718           98,033,060
    Deferred compensation and services . . . . . . . . . . . . . . . . . .             (273,538)            (591,155)
    Notes due from stockholders for common stock . . . . . . . . . . . . .              (58,750)            (289,545)

    Treasury stock at cost: 689,225 shares of common stock at September
     30, 2003 and December 31, 2002, respectively. . . . . . . . . . . . .             (184,740)            (184,740)
    Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . . . . .         (117,970,471)        (111,748,027)
                                                                            --------------------  -------------------
    Total stockholders' equity (deficit) . . . . . . . . . . . . . . . . .            3,567,549          (13,326,128)
                                                                            --------------------  -------------------

                                                                            --------------------  -------------------
    Total liabilities and stockholders' equity (deficit) . . . . . . . . .  $         8,375,324   $        4,608,058
                                                                            ====================  ===================

                                See accompanying notes to condensed financial statements.
</TABLE>


                                        3
<PAGE>
<TABLE>
<CAPTION>
                                             AUDIBLE, INC.
                                  CONDENSED STATEMENTS OF OPERATIONS

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

                                                   THREE MONTHS ENDED           NINE MONTHS ENDED
                                                      SEPTEMBER 30,               SEPTEMBER 30,
                                               --------------------------  ---------------------------
                                                   2003          2002          2003          2002
                                               ------------  ------------  ------------  -------------
                                                (UNAUDITED)   (UNAUDITED)   (UNAUDITED)   (UNAUDITED)
<S>                                            <C>           <C>           <C>           <C>

Revenue, net:
  Content and services
    Consumer content. . . . . . . . . . . . .  $ 4,789,921   $ 3,002,039   $12,882,505   $  7,442,070
    Services. . . . . . . . . . . . . . . . .       20,337        64,316        78,918        299,942
                                               ------------  ------------  ------------  -------------
  Total content and services. . . . . . . . .    4,810,258     3,066,355    12,961,423      7,742,012
  Hardware. . . . . . . . . . . . . . . . . .      136,198       152,243       488,522        734,877
  Other . . . . . . . . . . . . . . . . . . .       16,126        68,709        48,378        100,961
                                               ------------  ------------  ------------  -------------
    Total revenue, net. . . . . . . . . . . .    4,962,582     3,287,307    13,498,323      8,577,850
                                               ------------  ------------  ------------  -------------

Operating expenses:
  Cost of content and services revenue. . . .    1,351,606     1,475,558     3,493,540      3,596,012
  Cost of hardware revenue. . . . . . . . . .      444,544       604,644     1,505,356      2,053,196
  Production expenses . . . . . . . . . . . .    1,034,313     1,029,185     2,785,469      2,946,614
  Development . . . . . . . . . . . . . . . .      590,434       702,463     1,808,422      1,778,349
  Sales and marketing . . . . . . . . . . . .    1,514,568     3,016,255     4,924,963      9,264,769
  General and administrative. . . . . . . . .      904,692     1,005,882     2,578,928      2,850,421
                                               ------------  ------------  ------------  -------------
    Total operating expenses. . . . . . . . .    5,840,157     7,833,997    17,096,678     22,489,361
                                               ------------  ------------  ------------  -------------

  Loss from operations. . . . . . . . . . . .     (877,575)   (4,546,690)   (3,598,355)   (13,911,511)

  Other income, net . . . . . . . . . . . . .        5,171        17,134        15,183         76,399

                                               ------------  ------------  ------------  -------------
  Net loss. . . . . . . . . . . . . . . . . .     (872,404)   (4,529,556)   (3,583,172)   (13,835,112)
                                               ------------  ------------  ------------  -------------

  Accrued dividends on convertible preferred
  stock . . . . . . . . . . . . . . . . . . .     (454,197)     (354,195)   (1,194,828)    (1,014,942)
  Preferred stock discount. . . . . . . . . .   (1,444,444)           --    (1,444,444)            --
                                               ------------  ------------  ------------  -------------
    Total dividends . . . . . . . . . . . . .   (1,898,641)     (354,195)   (2,639,272)    (1,014,942)
                                               ------------  ------------  ------------  -------------

  Net loss applicable to common stockholders.  $(2,771,045)  $(4,883,751)  $(6,222,444)  $(14,850,054)
                                               ============  ============  ============  =============

Basic and diluted net loss per common share .  $     (0.09)  $     (0.16)  $     (0.20)  $      (0.49)
                                               ============  ============  ============  =============

Weighted average common shares outstanding. .   31,023,059    30,947,340    31,006,408     30,352,908
                                               ============  ============  ============  =============


                        See accompanying notes to condensed financial statements.
</TABLE>


                                        4
<PAGE>
<TABLE>
<CAPTION>
                                               AUDIBLE, INC.
                                     CONDENSED STATEMENTS OF CASH FLOWS
                                         -------------------------

                                                                                    NINE MONTHS ENDED
                                                                                       SEPTEMBER 30,
                                                                                ---------------------------
                                                                                    2003          2002
                                                                                ------------  -------------
                                                                                 (UNAUDITED)  (UNAUDITED)
<S>                                                                             <C>           <C>

Cash flows from operating activities:
  Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(3,583,172)  $(13,835,112)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . .      403,555      1,212,744
    Services rendered for common stock and warrants. . . . . . . . . . . . . .      884,068      4,594,223
    Services rendered for preferred stock. . . . . . . . . . . . . . . . . . .           --        454,998
    Non-cash compensation charge . . . . . . . . . . . . . . . . . . . . . . .      139,630        219,834
    Deferred cash compensation . . . . . . . . . . . . . . . . . . . . . . . .           --         (3,000)
    Non-cash forgiveness of notes due from stockholders for common stock . . .      198,995             --
    Changes in assets and liabilities:
      Interest receivable on short-term investments. . . . . . . . . . . . . .           --          1,260
      Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . .      (61,330)       (74,588)
      Royalty advances . . . . . . . . . . . . . . . . . . . . . . . . . . . .       11,761        (36,318)
      Prepaid expenses and other current assets. . . . . . . . . . . . . . . .      394,655        140,573
      Inventory. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (123,062)        50,501
      Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (238,427)       (75,000)
      Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . .     (461,616)      (304,395)
      Accrued expenses and compensation. . . . . . . . . . . . . . . . . . . .      646,662      1,057,602
      Royalty obligations. . . . . . . . . . . . . . . . . . . . . . . . . . .     (132,500)      (254,950)
      Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      185,390       (170,991)
                                                                                ------------  -------------
        Net cash used in operating activities. . . . . . . . . . . . . . . . .   (1,735,391)    (6,982,369)
                                                                                ------------  -------------


Cash flows from investing activities:
  Purchases of property and equipment. . . . . . . . . . . . . . . . . . . . .      (93,979)      (145,133)
                                                                                ------------  -------------
        Net cash used in investing activities. . . . . . . . . . . . . . . . .      (93,979)      (145,133)
                                                                                ------------  -------------

Cash flows from financing activities:
  Proceeds from sale of Series C Convertible Preferred Stock, net. . . . . . .    5,859,772             --
  Proceeds from sale of common stock, net. . . . . . . . . . . . . . . . . . .           --      3,159,250
  Proceeds from exercise of common stock options . . . . . . . . . . . . . . .       30,037          5,556
  Payments received on notes due from stockholders for common stock. . . . . .           --          4,911
                                                                                ------------  -------------
        Net cash provided by financing activities. . . . . . . . . . . . . . .    5,889,809      3,169,717
                                                                                ------------  -------------


        Increase (decrease) in cash and cash equivalents . . . . . . . . . . .    4,060,439     (3,957,785)
Cash and cash equivalents at beginning of period . . . . . . . . . . . . . . .    2,822,080      7,627,802
                                                                                ------------  -------------
Cash and cash equivalents at end of period . . . . . . . . . . . . . . . . . .  $ 6,882,519   $  3,670,017
                                                                                ============  =============


                         See accompanying notes to condensed financial statements.
</TABLE>


                                        5
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


(1)  DESCRIPTION OF BUSINESS AND BUSINESS CONDITIONS

          Audible,  Inc.  (Audible  or the Company), incorporated on November 3,
     1995,  was  formed  to  create  the  Audible service, a solution delivering
     premium  digital  spoken  audio  content.  The Company commenced commercial
     operations  in  October  1997.

          The  Company  has experienced recurring losses since its inception and
     as  a  result  as  of  September  30,  2003,  has an accumulated deficit of
     $117,970,471.  The Company raised $5,859,772, net of direct costs, from the
     sale  of  Series  C Convertible Preferred ("Series C") stock in August 2003
     (see  note  3).  The  Company's  cash  and  cash  equivalent balances as of
     September  30,  2003 was $6,882,519. The Company believes that its cash and
     cash  equivalents  balance  will  enable  it  to  meet its anticipated cash
     requirements  for  operations  and capital expenditures for the foreseeable
     future.

          The accompanying financial statements have been prepared assuming that
     the  Company  will  continue as a going concern. While the Company believes
     that  its  cash  and  cash  equivalents  balance will enable it to meet its
     anticipated  cash  requirements for operations and capital expenditures for
     the  foreseeable  future,  beyond  that  the  Company  may  need  to  raise
     additional funds through public or private financing or other arrangements.
     No assurance can be given that such additional financing, when needed, will
     be  available  on terms favorable to the Company or to the stockholders, if
     at  all.  The  accompanying  financial  statements  do  not  include  any
     adjustments  that  might  result  from  the  outcome  of  this uncertainty.


(2)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Reclassifications

          Certain  items in the 2002 financial statements have been reclassified
     to  conform  to  the  2003  presentation.

Basis  of  Presentation

          The  accompanying  condensed  financial statements as of September 30,
     2003,  and for the three and nine months ended September 30, 2003 and 2002,
     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
     accounting  principles  generally accepted in the United States of America.
     Operating  results  for  the three and nine months ended September 30, 2003
     are  not necessarily indicative of the results that may be expected for the
     year ending December 31, 2003. These financial statements should be read in
     conjunction with the audited financial statements and notes thereto for the
     year  ended  December  31,  2002,  from the Company's Annual Report on Form
     10-K.


                                        6
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


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  is  computed  by dividing net loss applicable 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.

          Diluted  net loss per common share for the three and nine months ended
     September  30,  2003 does not include the effects of outstanding options to
     purchase  10,692,400  shares  of  common  stock;  warrants  outstanding  to
     purchase  3,506,271  shares  of  common  stock; 14,008,078 shares of common
     stock issuable on conversion of outstanding Series A Redeemable Convertible
     Preferred  ("Series A") stock; 1,250,000 shares of common stock issuable on
     conversion  of  outstanding  Series  B  Convertible  Preferred ("Series B")
     stock,  and  11,111,110  shares  of common stock issueable on conversion of
     outstanding  Series  C  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, 2002 does not include the effects
     of  outstanding  options  to  purchase  7,372,150  shares  of common stock,
     outstanding  warrants  to  purchase  3,511,271  shares  of  common  stock,
     12,467,138  shares  of  common  stock issuable on conversion of outstanding
     Series  A,  and  1,250,000 shares of common stock issuable on conversion of
     outstanding  Series  B,  as  the  effect of their inclusion is antidilutive
     during  the  periods.


Stock-Based Compensation

          In  December  2002,  the  Financial  Accounting Standards Board (FASB)
     issued  Statement  No.  148,  "Accounting  for  Stock  Based  Compensation-
     Transition  and  Disclosure,  ("SFAS  148").  SFAS 148 provides alternative
     methods  of  transition  for a voluntary change to the fair value method of
     accounting  for stock-based compensation as originally provided by SFAS No.
     123  "Accounting  for  Stock-Based  Compensation".  Additionally,  SFAS 148
     amends  the  disclosure  requirements  of  SFAS  123  to  require prominent
     disclosure  in  both  the annual and interim financial statements about the
     method  of  accounting  for  stock-based compensation and the effect of the
     method  used on reported results. The transitional requirements of SFAS 148
     are  effective  for  all financial statements for fiscal years ending after
     December  15, 2002. We adopted the disclosure portion of this statement for
     the year ended December 31, 2002. The application of the disclosure portion
     of  this  standard  had  no  impact on our financial position or results of
     operations.  The FASB recently indicated that they will require stock-based
     employee  compensation  to be recorded as a charge to earnings beginning in
     2004.  We  will  continue to monitor their progress on the issuance of this
     standard as well as evaluate our position with respect to current guidance.


                                        7
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          The  Company's  1999  Stock  Incentive  Plan  (the "Plan") permits the
     granting  of  stock  options,  stock  appreciation  rights,  restricted  or
     unrestricted  stock awards, performance rights and other stock based awards
     to employees. For options granted to new Audible employees as part of their
     compensation package, the exercise price is determined by the closing price
     of  Audible's  common  stock on the day immediately preceding the employees
     start  date.  For  additional option grants made to existing employees, the
     exercise  price  is  determined  based  on  the  closing  price  of the day
     immediately  preceding  the grant date. The majority of the options granted
     vest  over  a  fifty-month period and expire ten years from the date of the
     grant.

          The  Plan  originally permitted up to 9,000,000 common stock shares to
     be  issued  under  the  Plan.  In  September 2003, at the annual meeting of
     stockholders, the stockholders approved an amendment to the Plan increasing
     the  number  of  authorized  common shares available for issuance under the
     plan  to  12,600,000  shares. As of September 30, 2003 and 2002, options to
     purchase  10,692,400  and 7,372,150, respectively, common stock shares were
     outstanding.

          Compensation  expense,  if any, based on the intrinsic value method is
     recognized  on a straight-line basis over the vesting term. Had the Company
     elected  to  recognize  compensation  cost based on fair value of the stock
     options  at  the  date  of grant under SFAS 148, such costs would have been
     recognized  ratably  over  the vesting period of the underlying instruments
     and the Company's net loss and net loss per common share would have changed
     to  the  pro  forma  amounts  indicated  in  the  table  below.

<TABLE>
<CAPTION>
                                                  Three Months Ended           Nine  Months Ended
                                                     September 30,                September 30,
                                                   2003          2002          2003          2002
                                               ------------  ------------  ------------  -------------
<S>                                            <C>           <C>           <C>           <C>

     Net loss applicable to common
     stockholders as Reported . . . . . . . .  $(2,771,045)  $(4,883,751)  $(6,222,444)  $(14,850,054)

     Add: Total stock based employee
     compensation cost included in reported
     net loss (based on intrinsic value
     method). . . . . . . . . . . . . . . . .       29,142        19,200        67,542         57,600

     Deduct: Total stock based employee
     compensation expense determined
     under fair value method for all
     awards . . . . . . . . . . . . . . . . .   (1,004,965)   (1,531,682)   (2,941,199)    (4,285,800)
                                               ------------  ------------  ------------  -------------
     Pro-forma net loss . . . . . . . . . . .  $(3,746,868)  $(6,396,233)  $(9,096,101)  $(19,078,254)
                                               ============  ============  ============  =============

     Basic and diluted net loss per common share:
     As Reported. . . . . . . . . . . . . . .  $     (0.09)  $     (0.16)  $     (0.20)  $      (0.49)
     Pro Forma. . . . . . . . . . . . . . . .  $     (0.12)  $     (0.21)  $     (0.29)  $      (0.63)
</TABLE>


                                        8
<PAGE>
                                  AUDIBLE, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                           SEPTEMBER 30, 2003 AND 2002
                                   (UNAUDITED)


(3)  STOCKHOLDERS' EQUITY

     Common Stock

          In  March  1999,  the Company issued 229,500 shares of common stock 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 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  of  $907,214  was recorded as deferred compensation, a component of
     stockholders'  deficit,  and is being amortized as an expense straight-line
     over  the vesting term. When employees have left the Company, the remaining
     unexpensed  deferred  compensation  has  been  reversed  against additional
     paid-in-capital.

          In  March  2000, the Company issued 370,000 options to purchase shares
     of  common  stock  to  employees  at  $1.00 less than the fair value of the
     common  stock at the time of issuance. These options are subject to vesting
     over  four years. The difference between the fair value and the issue price
     of  these options of $370,000 was recorded as deferred compensation, and is
     being  amortized  as  an  expense straight-line over the vesting term. When
     employees  have  left  the  Company,  the  remaining  unexpensed  deferred
     compensation  has  been  reversed  against  additional  paid-in-capital.

          In  May  2002, the Company issued 50,000 options to purchase shares of
     common stock to an employee at $0.50 less than the fair value of the common
     stock  at  the  time of issuance. These options are subject to vesting over
     four  years.  The  difference between the fair value and the issue price of
     these  options  of  $25,000  was recorded as deferred compensation, and was
     being  amortized as an expense straight-line over the vesting term. In July
     2002,  as a result of the employee no longer being employed by the Company,
     the  Company  stopped recording any further expense related to these 50,000
     options and reversed the remaining unexpensed deferred compensation against
     paid-in-capital.

          In  August  2003,  the  Company  issued  1,491,750 options to purchase
     shares  of  common  stock to employees at $0.16 less than the fair value of
     the  common  stock  at  the  time of issuance. These options are subject to
     vesting  over  four  years.  The  difference between the fair value and the
     issue  price  of  these  options  of  $238,680  was  recorded  as  deferred
     compensation,  and  is being amortized as an expense straight-line over the
     vesting  term.

          During the three months ended September 30, 2003 and 2002, $29,142 and
     $73,278,  respectively,  of  compensation expense was recognized related to
     these  transactions.  During  the  nine months ended September 30, 2003 and
     2002,  $139,630  and  $219,834,  respectively,  of compensation expense was
     recognized  related  to  these  transactions.

          In  February 2002, the Company issued 4,069,768 shares of common stock
     in  connection with an investment in the Company made by Special Situations
     Funds  (see  note  10).


                                        9
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          During the three and nine months ended September 30, 2003, the Company
     issued  60,800  shares  of  common stock in connection with the exercise of
     employee stock options and 20,335 shares of common stock in connection with
     the  cashless exercise of a warrant by a service provider. During the three
     and  nine  months  ended  September  30,  2002, the Company issued none and
     11,112,  respectively,  shares  of  common  stock  in  connection  with the
     exercise  of  employee stock options. No warrants were exercised during the
     three  and  nine  months  period  ended  September  30,  2002.

          In  March  2002, at a special meeting of stockholders of Audible Inc.,
     the  stockholders  approved  an  increase in the number of shares of common
     stock  authorized  from 50,000,000 to 75,000,000. In September 2003, at the
     annual  meeting  of shareholders, the stockholders approved an increased in
     the  number  of  shares  of  common  stock  authorized  from  75,000,000 to
     120,000,000.  As  of  September 30, 2003 and December 31, 2002, the Company
     had issued 31,768,304 and 31,687,169, respectively, shares of common stock.
     As  of  September 30, 2003 and December 31, 2002, the Company had 3,506,271
     and  3,523,271  shares of common stock, respectively, reserved for issuance
     upon  exercise  of  outstanding  common  stock warrants, and 10,692,900 and
     7,547,150  shares of common stock, respectively, reserved for issuance upon
     exercise  of outstanding options. As of September 30, 2003 and December 31,
     2002,  the  Company  had 14,008,078 and 13,215,166, respectively, shares of
     common  stock reserved for issuance upon conversion of outstanding Series A
     stock,  1,250,000  shares  of  common  stock  reserved  for  issuance  upon
     conversion  of  outstanding  Series  B stock, and 11,111,110 and no shares,
     respectively, reserved for issuance upon conversion of outstanding Series C
     stock.


     Convertible  Preferred  Stock

          In  February  2001,  Microsoft  purchased 2,666,666 shares of Series A
     stock for $10,000,000 at a per share price of $3.75. Each share of Series A
     was originally convertible into four shares of Common Stock, (equivalent to
     a  price  of  $.9375  per  share),  subject  to  adjustment  under  certain
     conditions.  As  a  result of the investment in the Company made by Special
     Situations Funds in the first quarter of 2002, the conversion rate has been
     adjusted as per the Series A Certificate of Designation to 4.0323 shares of
     Common  Stock. The stock was convertible at the option of the holder at any
     time.  Dividends  were  payable  semi-annually  at an annual rate of 12% in
     either additional preferred shares or in cash at the option of the Company.
     On  the  fifth  anniversary  of  the  original  issue date, the Company was
     required to redeem all remaining outstanding shares at a per share price of
     $3.75  plus all accrued and unpaid dividends. As of September 30, 2003, the
     Company  had  issued to Microsoft an aggregate of 807,301 additional shares
     of  Series  A  covering  the  dividends  payable  through  June  1,  2003.

          In  August  2003, Apax Partners purchased from Microsoft the 3,473,967
     outstanding  shares  of  Audible  Series  A  stock  and  agreed  to certain
     amendments  to  the  security.  As  amended,  the  Series  A  is  no longer
     mandatorily  redeemable,  is  convertible  at  any time by the holders into
     shares  of  common  stock,  and  dividends  will  accrue  and  compound
     semi-annually  for  a period of four years at the rate of 12% per annum. In
     the  event  of the conversion of the Series A stock, all accrued but unpaid
     preferred  dividends  will  be  converted  into  shares of Common Stock. In
     liquidation, the Audible Series A stock ranks pari passu with the Company's
     Series  B  and  Series  C  stock.


                                       10
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          During  the  three  months ended September 30, 2003 and 2002, $394,033
     and  $354,195,  respectively,  was  recognized  as accrued dividends on the
     Series  A  stock. During the nine months ended September 30, 2003 and 2002,
     $1,134,664  and  $1,014,942,  respectively,  was  recognized  as  accrued
     dividends on the Series A stock. As of September 30, 2003, and December 31,
     2002,  $522,522  and $125,257, respectively, of these accrued dividends are
     included  as  liabilities  in  the  accompanying  Balance  Sheets.

          In  March  2002, the Company issued 1,250,000 shares of Series B stock
     in connection with an amendment to its contract with Random House (see note
     6).  At any time on or after March 26, 2004, subject to certain conditions,
     all  outstanding  shares  of  Series  B stock will automatically convert to
     shares  of  common  stock at the then effective conversion price. Effective
     August 2003, the Audible Series B stock ranks pari passu with the Company's
     Series  A  stock  and  Series  C  stock.

          In  August  2003,  Apax Partners purchased 740,741 shares, Bertelsmann
     Multimedia,  Inc.  purchased  185,185 shares and Random House Ventures, LLC
     purchased  185,185 shares of Audible Series C stock at a per share price of
     $5.40.  Proceeds  received  by  the Company, net of estimated direct costs,
     were  approximately  $5,859,772.  Each share of Series C stock is currently
     convertible  into 10 shares of Common Stock. The Series C stock is entitled
     to  receive  dividends. Such dividends accrue and compound semi-annually at
     the  rate  of 6% per annum for four years from the date of issuance. In the
     event  of  the  conversion  of  the  Series C stock, all accrued but unpaid
     preferred  dividends  will  be  converted  into  shares of Common Stock. In
     liquidation, the Audible Series C stock ranks pari passu with the Company's
     Series  A stock and Series B stock. At the time of issuance, the conversion
     price  of the Series C stock was $0.13 per share lower than the fair market
     value  of  the  Company's  common  stock.  Since  the  Series  C  stock  is
     convertible  at  any time at option of the holder, the entire $1,444,444 in
     preferred  stock  discount  was  recognized  as  a  dividend at the time of
     issuance,  and  is  reflected  in  the  net  loss  applicable  to  common
     stockholders,  with  the  credit  to  additional  paid-in  capital.

          During the three and nine months ended September 30, 2003, $60,164 was
     recognized  as accrued dividends on the Series C stock. As of September 30,
     2003,  and  December  31,  2002,  $60,164  and none, respectively, of these
     accrued  dividends  are included as liabilities in the accompanying Balance
     Sheets.


(4)  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. In
     January  2001,  this services agreement was amended. Under the terms of the
     amended agreement, the previously issued warrant to purchase 500,000 shares


                                       11
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


     at  $8.00 was replaced with two new warrants. The first new warrant issued,
     which  is  fully  vested,  is  for the purchase of 200,000 shares of common
     stock  at  $0.91  per share. The second warrant for the purchase of 200,000
     shares  of  common  stock at $0.91 per share, was subject to vesting over a
     20-month  period  ending  December  31,  2002.

          The  fair  value  of  these warrants was determined in accordance with
     EITF  Issue  No.  96-18  and  was  being  amortized  as  an  expense  on  a
     straight-line  basis  over  the amended term of the service agreement which
     ended  in  January  2003,  using  variable plan accounting for any unvested
     portion  of  shares. Under variable plan accounting, the compensation costs
     vary  each  accounting  period until the final measurement date. During the
     three  months  ended  September  30,  2003  and  2002,  none  and $116,928,
     respectively,  of  expense  was recorded, primarily as a marketing expense,
     related  to  this  agreement  with  the  non-cash  credit  for  services to
     additional paid-in capital. During the nine months ended September 30, 2003
     and  2002,  $20,296  and  $354,564,  respectively, of expense was recorded,
     primarily  as  a  marketing  expense,  related  to  this agreement with the
     non-cash  credit  for  services  to  additional  paid-in  capital.


(5)  AMAZON AGREEMENTS

          In  January  2000,  the  Company  entered  into  two  agreements  with
     Amazon.com. Under the Co-Branding, Marketing and Distribution Agreement the
     Company  was the exclusive provider of digital spoken audio (as defined) to
     Amazon.com.  On  January 24, 2002, the Company signed Amendment No.1 to its
     Co-Branding,  Marketing,  and Distribution Agreement with Amazon.com. Under
     the  amendment, the annual fee for Year 3 (which ended January 24, 2003) of
     the  agreement  is reduced from $10,000,000 to $1,500,000 and an additional
     fee of $1,000,000 is payable in Year 2 of the agreement. Also in connection
     with  Amendment  No.1, the Company issued 500,000 fully vested common stock
     warrants  to  Amazon.com at an exercise price of $1.50 per share, which are
     exercisable  after  January  31, 2003. The fair value of these warrants was
     determined  in accordance with EITF Issue No. 96-18 and was being amortized
     as  an  expense  on  a  straight-line  basis over the remaining term of the
     agreement  which  ended  in  January  2003.  During  the three months ended
     September  30,  2003 and 2002, none and $43,200, respectively, was recorded
     as  a  marketing expense related to these warrants with the non-cash credit
     for  services  to  additional paid-in capital. During the nine months ended
     September  30,  2003  and  2002,  $14,400  and  $129,600, respectively, was
     recorded as a marketing expense related to these warrants with the non-cash
     credit  for  services  to  additional  paid-in  capital.


                                       12
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          During  the  three-year  term  of this agreement, in consideration for
     certain services, Amazon received $22,500,000 (as amended) plus a specified
     percentage  of revenue earned over a specified amount. Under the Securities
     Purchase  Agreement,  Amazon.com purchased 1,340,033 shares of common stock
     from  the  Company for $20,000,000. Under the agreements, the consideration
     due  from  Amazon  for  the purchase of the common stock, and the Company's
     obligation  for  the  annual  fee  for the first two years per the original
     Co-Branding,  Marketing,  and  Distribution  Agreement, which are identical
     amounts,  were  offset  and no cash was exchanged. Accordingly, $20,000,000
     was recorded as deferred services, a component of stockholders' equity, and
     was  being  amortized  over  the  first  two  years  of  the agreement on a
     straight-line  basis.  Prior  to  Amendment  No.  1,  through January 2002,
     $10,000,000  had  been  amortized  as  a  marketing  expense related to the
     initial  $20,000,000  of  deferred services. Subsequent to Amendment No. 1,
     the  unamortized  payment  for  year  2  of $10,000,000 plus the additional
     $2,500,000  payment required under the amendment, or $12,500,000, was being
     amortized on a straight-line basis over the remaining term of the agreement
     of  24  months  which  ended in January 2003. During the three months ended
     September  30,  2003  and  2002,  none  and  $1,250,000,  respectively, was
     recorded  as  a marketing expense related to the straight-line amortization
     of  the non-cash portion of deferred services. During the nine months ended
     September  30,  2003  and  2002, $416,667 and $3,750,000, respectively, was
     recorded  as  a marketing expense related to the straight-line amortization
     of  the  non-cash  portion  of  deferred  services.

          During  the  three  months ended September 30, 2003 and 2002, none and
     $312,500,  respectively,  was  recorded as a marketing expense representing
     the  straight-line  amortization  of the cash portion of payments due under
     this  agreement.  During the nine months ended September 30, 2003 and 2002,
     $104,167  and  $937,500,  respectively, was recorded as a marketing expense
     representing the straight-line amortization of the cash portion of payments
     due  under  this  agreement.

          Prior to the agreement reached with Amazon.com in August 2003, a total
     of  $1,500,000  in cash obligations, which was payable in four installments
     of  $375,000 each due on January 30, April 30, and July 31, and October 30,
     2002,  respectively,  remained  unpaid. As of December 31, 2002, $1,395,500
     had  been  accrued based on the straight-line amortization and was included
     in  Accrued  Expenses  on the accompanying December 31, 2002 Balance Sheet.
     Under  an agreement reached with Amazon.com in August 2003, the Company was
     released  from  this  $1,500,000  cash obligation. This $1,500,000 has been
     recorded  as  an  addition to paid-in-capital on the accompanying September
     30,  2003  Balance  Sheet.


                                       13
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


(6)  RANDOM HOUSE AGREEMENT

          On  May  5,  2000,  Audible  and  Random House entered into a 50-month
     Co-Publishing,  Marketing,  and  Distribution Agreement to form a strategic
     alliance  to  establish  Random  House  Audible,  a  publishing imprint, as
     defined  in  the  agreement,  to  produce  spoken word content specifically
     suited  for  digital  distribution. All titles published by the imprint are
     distributed  exclusively  over  the  Internet  by  Audible. As part of this
     alliance,  Random House, through its Random House Ventures, LLC subsidiary,
     purchased  169,780  shares  of  Audible  common  stock from the Company for
     $1,000,000.  Over  the  term  of  the  agreement  Audible was to contribute
     towards  the  funding  the acquisition and creation of digital audio titles
     through  Random House Audible. On March 26, 2002, the agreement was amended
     to  waive  the  cash  payment  due  to  Random House in 2002 of $1,250,000,
     thereby reducing the total payments due under the agreement from $4,000,000
     to $2,750,000. In exchange for this waiver, under the amendment the Company
     agreed to issue 1,250,000 shares of Series B stock. At any time on or after
     March  26,  2004,  subject to certain conditions, all outstanding shares of
     Series  B stock will automatically convert to shares of common stock at the
     then  effective  conversion price. Through December 31, 2002, $1,250,000 of
     the  $2,750,000  obligation  had  been  paid,  with the remaining amount of
     $1,500,000  due  in  2003  and 2004. On February 10, 2003 the agreement was
     further amended so that Audible is no longer required to pay the $1,500,000
     in  imprint  fees  that  were  due  in 2003 and 2004. At December 31, 2002,
     $134,997  of  this obligation had been expensed and was included in Accrued
     Expenses  in the accompanying December 31, 2002 Balance Sheet.

          The  fair  value  of  the  Series  B  stock  issued  was determined in
     accordance  with  EITF  Issue  No.  01-1,  "Accounting  for  a  Convertible
     Instrument  Granted  or  Issued to a Nonemployee for Goods or Services or a
     Combination  of  Goods  or  Services  and  Cash".  Accordingly,  using  the
     measurement  date  of  March 26, 2002, the fair value of the Series B stock
     issued  was determined to be $1,137,500. On April 1, 2002 when the Series B
     was  issued, the Company recorded $547,500 (the difference between the fair
     value  of  the  shares  and  the previously recognized accrued liability of
     $590,000)  as  deferred  services,  a  component  of stockholders' deficit.
     During  the  three  and  nine  months  ended September 30, 2003, none and a
     credit of $134,997 representing the reversal of the accrual was recorded as
     a credit to cost of content and services revenue related to this agreement.
     During  the  three  and  nine months ended September 30, 2002, $227,499 and
     $694,998,  respectively,  was recorded as an expense to cost of content and
     services  revenue  related  to  this  agreement.


                                       14
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          The original agreement further provides for Random House to be granted
     a  warrant  to  purchase  878,333 shares of Audible common stock at various
     exercise  prices  that  vest  over the term of the agreement as well as the
     granting  of additional warrants to Random House to purchase Audible common
     shares  based  on  future performance. The fair value of these warrants was
     determined  in  accordance with EITF Issue No. 96-18 and is being amortized
     as  an  expense  on  a  straight-line  basis  over the 50-month term of the
     agreement.  The  warrants  are accounted for using variable plan accounting
     whereby  compensation  costs  vary  each  accounting period until the final
     measurement  date.  During  the  three  months ended September 30, 2003 and
     2002,  $149,438  and  $124,079,  respectively,  was  recorded  as a cost of
     content  and  services  revenue related to these warrants with the non-cash
     credit  for  services to additional paid-in capital. During the nine months
     ended September 30, 2003 and 2002, $428,772 and $694,998, respectively, was
     recorded  as  a  cost  of  content  and  services  revenue related to these
     warrants  with  the  non-cash  credit  for  services  to additional paid-in
     capital


(7)  RELATED PARTY TRANSACTIONS

          On  April  11,  2001,  the  Company  amended  the payment terms of the
     $50,000  note  receivable  due from a stockholder-employee due on March 27,
     2001.  The  amendment  required  semi-annual principal payments of at least
     $5,000  beginning  July 15, 2001 until the note and all accrued interest is
     repaid.  The  interest rate on the note was 5.42% annually. On September 3,
     2002,  the  remaining  outstanding  principal  balance  of  $45,000 and all
     accrued interest was paid to the Company by the stockholder-employee giving
     the  Company  12,500  shares of Audible common stock with the fair value at
     the  date  of  the transaction of $4,750, and with the proceeds of a salary
     bonus  paid  to  the  stockholder-employee  on  the  same  date.


(8)  NOTES DUE FROM STOCKHOLDERS FOR COMMON STOCK

          Notes  due  from  stockholders  that  are current employees and former
     directors  of  $289,545  at December 31, 2002, were received by the Company
     for  payment for shares of common stock purchased under the Company's Stock
     Restriction  Agreements.  These notes have been reflected as a reduction to
     stockholders'  equity. The notes are full recourse promissory notes bearing
     interest at fixed rates ranging from 7.0% to 8.5% through December 31, 2002
     and  at  4%  subsequent  thereto  until  December 31, 2003. The notes began
     maturing  in  the  year  2000.

          Certain  employee  employment  agreements  prior  to  1998 contained a
     provision  whereby  the employee would be awarded a one-time bonus if still
     employed by the Company on the due date of the promissory note equal to the
     amount of the promissory note and any accrued interest payable on the note.
     Compensation  expense  is recognized on a straight-line basis over the term
     of  the  promissory  note. Deferred cash compensation related to bonuses in
     the  accompanying  balance  sheets represents the earned, unpaid portion of
     such  bonuses.


                                       15
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          As  of  January  29,  2003,  the  unpaid principal and unpaid interest
     balance  due  on  these  notes  to  the  Company from stockholders that are
     employees,  net  of  deductions  from the bonuses due to the employees, was
     $263,240.  On January 29, 2003 the employees were notified that the Company
     would  not  require  them  to  repay  the  unpaid  principal nor the unpaid
     interest  on  the  notes  payable.  The  employees  will  be  individually
     responsible  for  the  personal  income  tax  consequences  of  this  debt
     forgiveness. In connection with this debt forgiveness, the Company recorded
     a  charge of $212,566 in the three months ended March 31, 2003 as a general
     and  administrative  expense.  This  expense is the net of the total amount
     forgiven  by the Company, less the combined offset of all accrued interest.
     Of this $212,566 forgiveness of debt charge, $198,995 is a non-cash charge,
     with  the  remaining  $13,571  representing  the  Company's  payroll  taxes
     obligations  in  connection  with  the  bonuses  paid.

          In addition, for the remaining notes issued to former directors in the
     amount  of $58,750 not covered under this debt forgiveness, the Company has
     extended  the  due dates to December 31, 2003 and reduced the interest rate
     in  2003  to  4%.


(9)  CONTINGENCIES

          In  September  2001,  the  Company  was  named  as  a  defendant  in a
     securities  class  action  filed  in  United  States District court for the
     Southern  District  of  New  York  related  to  its initial public offering
     ("IPO")  in  July 1999. The lawsuits also named certain of the underwriters
     of  the  IPO, including Credit Suisse First Boston Corporation, J.P. Morgan
     Chase & Co., Volpe Brown Whelan & Co., LLC, and Wit Capital Corporation, as
     well  as certain Officers and Directors and former Directors of the Company
     as  defendants. Approximately 300 other issuers and their underwriters have
     had similar suits filed against them, all of which are included in a single
     coordinated  proceeding  in  the  Southern  District  of New York (the "IPO
     Litigation").  The  complaints  allege  that  the  prospectus  and  the
     registration statement for the IPO failed to disclose that the underwriters
     allegedly solicited and received "excessive" commissions from investors and
     that  some  investors  in the IPO allegedly agreed with the underwriters to
     buy  additional  shares in the aftermarket in order to inflate the price of
     the  Company's  stock. A consolidated amended complaint was filed April 19,
     2002.  The Company and certain officers, directors and former directors are
     named  in  the  suits pursuant to Section 11 of the Securities Act of 1933.
     The  complaints  seek  unspecified  damages,  attorney and expert fees, and
     other  unspecified  litigation  costs.

          On  July  1,  2002,  the  underwriter  defendants  in the consolidated
     actions  moved  to dismiss all of the IPO Litigations, including the action
     involving  the  Company.  On  July  15,  the  Company,  along  with  other
     non-underwriter  defendants in the coordinated cases, also moved to dismiss
     the  litigation.  On February 19, 2003, the Court ruled on the motions. The
     Court  granted  the Company's motion to dismiss the claims against it under
     Rule  10b-5,  due  to  the  insufficiency  of  the  allegations against the
     Company.  The  motions  to  dismiss  the  claims  under  Section  11 of the
     Securities  Act  were  denied  as to virtually all of the defendants in the
     consolidated  cases,  including  the  Company.  In addition, the individual
     defendants in the IPO Litigation, Donald R. Katz, Andrew P. Kaplan, Richard
     Brass,  R.  Bradford  Burnham,  W.  Bingham  Gordon,  Thomas P. Hirschfeld,
     Winthrop  Knowlton,  and  Timothy  Mott signed a tolling agreement and were
     dismissed  from  the  action  without  prejudice  on  October  9,  2002.


                                       16
<PAGE>
                                  AUDIBLE, INC.
                    NOTES TO CONDENSED FINANCIAL STATEMENTS
                          SEPTEMBER 30, 2003 AND 2002
                                  (UNAUDITED)


          On  June  26,  2003,  a  committee of the Company's Board of Directors
     conditionally approved a proposed partial settlement with the plaintiffs in
     this matter. The settlement would provide, among other things, a release of
     the Company and of the individual defendants for the conduct alleged in the
     action  to be wrongful in the amended complaint. The Company would agree to
     undertake  other  responsibilities  under the partial settlement, including
     agreeing  to  assign  away, not assert, or release certain potential claims
     the  Company may have against its underwriters. Any direct financial impact
     of  the  proposed  settlement  is  expected  to  be  borne by the Company's
     insurance  carriers. The committee agreed to approve the settlement subject
     to  a  number  of  conditions, including the participation of a substantial
     number  of  other Issuer Defendants in the proposed settlement, the consent
     of  the  Company's  insurers  to  the  settlement,  and  the  completion of
     acceptable  final  settlement documentation. Furthermore, the settlement is
     subject  to  a hearing on fairness and approval by the Court overseeing the
     IPO  Litigations.

          Due  to  the  inherent  uncertainties  of  litigation  and because the
     settlement  approval  process is at a preliminary stage, the Company cannot
     accurately  predict  the  ultimate  outcome  of  the  matter.

          Other  than what is disclosed above, the Company is not a party to any
     lawsuit  or  proceeding,  which  management  believes  is  likely to have a
     material  effect  on  us.


(10) SPECIAL SITUATION FUNDS INVESTMENT

          On  February  15,  2002,  Special Situations Funds purchased 4,069,768
     shares  of  common  stock for $3,500,000 at a per share price of $0.86. Net
     proceeds  received  by  the  Company  was $3,159,000 after deducting direct
     costs  of $331,000 in finders fees and $10,000 in legal fees. In connection
     with  this  transaction,  the  Company  issued  warrants  to  purchase  an
     additional  1,220,930 shares of common stock. The warrants were exercisable
     at a price of $1.15 per share anytime prior to the fifth anniversary of the
     issue  date.  As  a  result  of  the  issuance  of  the Series C stock at a
     conversion  price  of  $0.54,  the  exercise price of the Special Situation
     Funds warrants was adjusted down to $1.01 per share. The Company may demand
     the  warrantholder  exercise  its  rights in the event that the closing bid
     price  of  a  share  of the Company's common stock exceeds $2.30 for twenty
     consecutive  trading  sessions.


                                       17
<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 2002 Annual Report on Form 10-K.
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  are the leading provider of premium spoken audio content, such as audio
versions  of  books,  newspapers  and radio programs, that is delivered over the
Internet  and can be streamed, burned to CD or played back on personal computers
and  hand-held  electronic  devices  that  have  digital audio capabilities. The
Audible  service  allows consumers to purchase and download content from our Web
site at www.audible.com(TM).  We offer customers the opportunity to subscribe to
AudibleListener,  a  monthly  audio  service.  For  a  fixed  monthly  fee,
AudibleListener  customers  may  download  their choice of programs from our Web
site.  More  than 34,000 hours of audio content, much of which is only available
in  digital  audio  format at www.audible.com, is currently available on our Web
site.  We also sell at our Web site our own digital audio player under the brand
name  of  Otis,  which is manufactured to our specifications in Korea. Customers
can  also  access  Audible content products through the Apple-iTunes Music store
and  at  Amazon.com.  Several  manufacturers,  including Apple Corp., Palm, Sony
Electronics,  Kenwood,  Handspring,  Hewlett-Packard,  Franklin  Electronic
Publishers, and Digisette, LLC., have agreed to support and promote the playback
of  our  content  by  including  the  Audible  software  on  their  devices.

      The  market  for  the Audible service results from the increasing usage of
the  Internet  and  the  introduction  of hand-held electronic devices that have
digital  audio  capabilities.  In  contrast to traditional radio broadcasts, the
Audible  service  offers  customers  access  to  content of their choice and the
ability  to  listen  to  what  they  want,  when  and  where  they want--whether
commuting,  exercising,  relaxing or sitting at their personal computers. Unlike
traditional  and  online  bookstores,  which  are  subject to physical inventory
constraints  and  shipping  delays,  we  provide  customers  a selection that is
readily  available  in  digital  format  that  can be quickly delivered over the
Internet.

     Revenue from the sale of consumer content has increased in each of the last
four quarters.  We expect this trend to continue as we expand our customer base.
As  of September 30, 2003, more than 280,000 customers in over 100 countries 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.

     Our revenue is derived from three main categories: (1) content and services
revenue,  which  includes  consumer content and corporate services; (2) hardware
revenue;  and  (3)  other  revenue.


                                       18
<PAGE>
     Consumer  content  revenue consists of content sales made from our website.
Revenue  from  the sale of individual content titles is recognized in the period
when  the  content  is  downloaded  and the customer's credit card is processed.
Revenue  from  the sale of content subscriptions is recognized pro rata over the
term  of  the  subscription  period.  Revenue  from  the sale of AudibleListener
memberships  is  recognized each month the customer participates in the program.
Revenue  from  the  sale  of  UltimateListener,  our  prepaid discounted content
package  and  gift  programs  are  recognized the earlier of when the content is
downloaded  or  expiration.  Rebates  and refunds are recorded as a reduction of
revenue  over  the  period  in  which  the  related  revenue  is  recognized.

     Corporate  service  revenue  consists of library sales and audio production
services.  Where applicable, corporate service revenue is recognized as services
are  performed  after  the agreement has been finalized, the price is fixed, and
collectibility  is  assured. Collectibility is based on past transaction history
and  credit worthiness of the customer. Under multiple element arrangements, the
fair  value  of  different elements cannot usually be determined since we do not
sell  the  items  separately, therefore revenue is recognized on a straight-line
basis  over  the  term  of  the  agreement.

     Hardware  revenue  consists  of sales of AudibleReady digital audio players
sold  primarily  at  a discount or given away when a customer signs up for a one
year commitment to our AudibleListener(R) Membership. For these multiple-element
arrangements in which a customer signs up for a one year membership and receives
an  audio  player,  revenue  is recognized using the residual method whereby the
fair  value  of the undelivered content element is deferred until the content is
delivered  and  the  remaining  revenue  (if any) is recognized on the delivered
hardware  element.  The discounted selling price of the hardware device reflects
the  subsidy  that  we incur to acquire a customer with a one year commitment to
AudibleListener(R).  For players sold separately, hardware revenue is recognized
upon  shipment  of  the  device,  pursuant  to  a customer order and credit card
authorization  and  includes amounts received for shipping and handling. Cost of
hardware  revenue, regardless of whether the player is bundled with a membership
or  sold  separately,  is  recognized  upon  shipment.

     Other  revenue  consists  of  revenue  from  a  license granted for certain
technology  rights  to  a  device  manufacturer  which  is being recognized on a
straight-line  basis  over  the  term  of  the  agreement.

     We  are  party  to several joint marketing agreements with device and media
storage  manufacturers  such  as  Apple, Palm, and Hewlett-Packard.  Under these
agreements,  device  manufacturers  may receive a portion of the content revenue
generated  over  a  specified  period  of  time  from  each new Audible customer
referred  by  them  through  the purchase of a hand-held electronic device.  For
example,  a  purchaser  of Hewlett-Packard's hand-held electronic device will be
able to use the device and our AudibleManager software to access audible.com and
download  content.  Hewlett-Packard  will  receive  a  percentage of the revenue
related  to  content  downloaded  by  this  purchaser.  These  revenue  sharing
arrangements  typically  last  one  or  two  years from the date the device user
becomes  an  Audible  customer.

     In  January  2000,  we entered into two agreements with Amazon.com. We were
the  exclusive provider of digital spoken audio to Amazon.com, as defined in the
Co-Branding,  Marketing  and  Distribution  Agreement,  as  amended.  During the
three-year term of this agreement, in consideration for certain services, Amazon
is  entitled to $22,500,000 plus a specified percentage of revenue earned over a
threshold  amount  in  addition  to  common stock warrants. Under the Securities
Purchase Agreement dated January 30, 2000, Amazon.com purchased 1,340,033 shares
of  our  common  stock for $20,000,000. The first $20,000,000 in payments due to
Amazon.com  under the amended Co-Branding, Marketing and Distribution Agreement,
were  offset against the $20,000,000 in consideration due to us for the purchase
of  common  stock  and no cash was exchanged. Of the remaining $2,500,000 due in
cash  to  Amazon.com  under  the  agreement,  $1,000,000  had  been paid through
September  30,  2003  with  the remaining $1,500,000 released under an agreement
reached  with  Amazon.com in August 2003. This $1,500,000 has been recorded as a
capital  contribution  as an addition to paid-in capital in the third quarter of
2003.


                                       19
<PAGE>
     In  May  2000,  we  entered  into  a 50-month Co-Publishing, Marketing, and
Distribution  Agreement  with  Random  House  to  form  a  strategic alliance to
establish  Random  House  Audible,  a  publishing  imprint,  as  defined  in the
agreement,  to  produce  spoken  word  content  specifically  suited for digital
distribution.  All  titles  published  by  the  imprint  will  be  distributed
exclusively  on  the  Internet  by  us.  As part of this alliance, Random House,
through  its  Random House Ventures, LLC subsidiary, purchased 169,780 shares of
our  common  stock  for  $1,000,000.  Over  the term of the agreement we will be
contributing  towards  funding  the  acquisition  and  creation of digital audio
titles  through  Random  House  Audible.  On  March  26, 2002, the agreement was
amended  to  waive  the  cash payment due to Random House in 2002 of $1,250,000,
thereby  reducing  the total payments due under the agreement from $4,000,000 to
$2,750,000.  In exchange for this waiver, under the amendment  on April 1, 2002,
we  issued  1,250,000 shares of Series B stock to Random House. Through December
31,  2002,  $1,250,000  of  the  $2,750,000  obligation  had been paid, with the
remaining  amount  of $1,500,000 due in 2003 and 2004. On February 10, 2003, the
agreement  was  further  amended  so  that  we no longer are required to pay the
$1,500,000  imprint  fees that were due in 2003 and 2004.  At December 31, 2002,
$134,997  of  this  obligation  had  been  expensed  and was included in Accrued
Expenses  in  the accompanying December 31, 2002 Balance Sheet. This accrual was
reversed  during  the  nine  months  ended  September  30,  2003.

     In  February 2001, Microsoft purchased 2,666,666 shares of Audible Series A
stock  for  $10,000,000  at  a  per share price of $3.75. Each share of Series A
stock was originally convertible into four shares of Common Stock (equivalent to
a  price  of  $.9375 per share, which was greater than the common stock price at
the  date  of  grant,  therefore,  there  was  no  beneficial conversion feature
associated  with  these  preferred  shares), subject to adjustment under certain
conditions.  As  a  result  of  the  investment  in  us by Special Situations in
February  2002,  the conversion rate has been adjusted as per the Stock Purchase
Agreement  to  4.0323 shares of Common Stock. The Series A stock was convertible
at  the  option  of the holder at any time prior to the fifth anniversary of the
original  issue  date. Dividends were payable semi-annually at an annual rate of
12% in either additional preferred shares or in cash at our option. On the fifth
anniversary of the original issue date, we were required to redeem all remaining
outstanding  shares  at  a  per share price of $3.75 plus all accrued and unpaid
dividends.  In August 2003, Apax Partners purchased from Microsoft all 3,473,967
outstanding  shares of Audible's Series A stock and agreed to certain amendments
to  that  security.  As  amended,  the  Series  A stock is no longer mandatorily
redeemable,  is  convertible  at  any  time by the holders into shares of Common
Stock, and dividends will accrue and compound semi-annually for a period of four
years  at  the  rate  of  12%  per annum.  In the event of the conversion of the
Series  A  stock,  all  accrued but unpaid preferred dividends will be converted
into  shares  of  Common  Stock.

     In  February  2002,  Special Situations Funds purchased 4,069,768 shares of
common stock for $3,500,000 at a per share price of $0.86.  Proceeds received by
us  net of direct costs were $3,159,000. In connection with this transaction, we
issued  warrants to purchase an additional 1,220,930 shares of common stock. The
warrants  were  exercisable  at  a  price  of  $1.15  anytime prior to the fifth
anniversary of the issue date. As a result of the issuance of the Series C stock
at  a  conversion  price  of  $0.54, the exercise price of the Special Situation
Funds  warrants  was  adjusted  down  to  $1.01  per  share.  We  may demand the
warrantholder exercise its rights in the event that closing bid price of a share
of  our  common  stock  exceeds  $2.30  for twenty consecutive trading sessions.

     In  August  2003,  Apax  Partners  purchased  740,741  shares,  Bertelsmann
Multimedia,  Inc.  purchased  185,185  shares  and  Random  House  Ventures, LLC
purchased  185,185  shares  of  Audible  Series  C stock at a per share price of
$5.40.  Proceeds  received  by  the Company, net of estimated direct costs, were
approximately $5,839,772.  Each share of Series C stock is currently convertible
into  10  shares  of  Common  Stock.  The  Series C stock is entitled to receive
dividends.  Such  dividends  accrue and compound semi-annually at the rate of 6%
per  annum  for four years following the date of initial issuance.  In the event
of  the  conversion  of  the  Series  C  stock, all accrued but unpaid preferred
dividends  will  be  converted into shares of Common Stock.  In liquidation, the
Audible  Series  C  stock ranks pari passu with the Company's Series A stock and
Series  B  stock.


                                       20
<PAGE>
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,  2003  and  2002.

<TABLE>
<CAPTION>
========================================================================================================
                                                                THREE MONTHS            NINE MONTHS
                                                             ENDED SEPTEMBER 30,    ENDED SEPTEMBER 30,
                                                         -------------------------  --------------------
                                                             2003         2002          2003       2002
<S>                                                      <C>          <C>           <C>           <C>
                                                                (UNAUDITED)             (UNAUDITED)

     Revenue:
         Content and services
           Consumer content . . . . . . . . . . . . . .          97%           91%           95%     87%
           Services . . . . . . . . . . . . . . . . . .           -             2             1       3
                                                         -----------  ------------  ------------  ------
         Total content and services . . . . . . . . . .          97            93            96      90
         Hardware . . . . . . . . . . . . . . . . . . .           3             5             4       9
         Other. . . . . . . . . . . . . . . . . . . . .           -             2             -       1
                                                         -----------  ------------  ------------  ------
             Total revenue. . . . . . . . . . . . . . .         100%          100%          100%    100%

     Operating expenses:
         Cost of content and services revenue . . . . .          27            45            26      42
         Cost of hardware revenue . . . . . . . . . . .           9            18            11      24
         Production expenses. . . . . . . . . . . . . .          21            31            21      34
         Development. . . . . . . . . . . . . . . . . .          12            21            13      21
         Sales and marketing. . . . . . . . . . . . . .          31            92            36     108
         General and administrative . . . . . . . . . .          18            31            19      33
                                                         -----------  ------------  ------------  ------
             Total operating expenses . . . . . . . . .         118           238           126     262
                                                         -----------  ------------  ------------  ------

     Loss from operations.. . . . . . . . . . . . . . .         (18)         (138)          (27)   (162)

             Other income, net. . . . . . . . . . . . .           -             -             -       1

                                                         -----------  ------------  ------------  ------
     Net loss . . . . . . . . . . . . . . . . . . . . .         (18)         (138)          (27)   (161)

     Accrued dividends on convertible preferred stock..          (9)          (11)           (9)    (12)
     Discount on preferred stock. . . . . . . . . . . .         (29)            -           (10)      -

                                                         -----------  ------------  ------------  ------
     Net loss applicable to common stockholders . . . .        (56)%        (149)%         (46)%  (173)%
========================================================================================================
</TABLE>



THREE  MONTHS  ENDED SEPTEMBER 30, 2003 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30,  2002.

     Total  revenue,  net.    Total  revenue,  net  for  the  three months ended
September  30,  2003  was  $4,963,000,  as  compared to $3,287,000 for the three
months  ended  September  30,  2002,  an  increase  of  $1,676,000,  or  51%.

     Total  content  and services revenue.    Total content and services revenue
for  the  three  months  ended September 30, 2003 was $4,810,000, as compared to
$3,066,000  for  the  three  months  ended  September  30,  2002, an increase of
$1,744,000,  or  57%.

     Consumer  content.    Consumer  content  revenue for the three months ended
September  30,  2003  was  $4,790,000,  as  compared to $3,002,000 for the three
months  ended  September  30,  2002,  an  increase  of $1,788,000, or 60%.  This
increase  was  primarily the result of our customer base growing to over 280,000
customers.


                                       21
<PAGE>
     Services.    Services revenue for the three months ended September 30, 2003
was  $20,000,  as  compared  to $64,000 for the three months ended September 30,
2002,  a decrease of $44,000, or 69%.  This decrease was primarily the result of
fewer  corporate  projects.

     Hardware.    Hardware revenue for the three months ended September 30, 2003
was  $136,000,  as compared to $152,000 for the three months ended September 30,
2002,  a  decrease of $16,000, or 11%.  Hardware revenue decreased as the result
of  selling fewer AudibleReady hand-held devices, primarily the Audible Otis, in
the  2003  period  as  compared  to  the  2002  period.

     Other.    Other  revenue  for the three months ended September 30, 2003 was
$16,000, as compared to $69,000 for the three months ended September 30, 2002, a
decrease of $53,000, or 77%.  Other revenue in both periods consisted of $16,000
in  royalties  earned  from a license granted for certain technology rights to a
device  manufacturer.  Other revenue in the 2002 period also included $53,000 of
revenue earned from our profit participation from hard copy sales of products in
connection  with our agreement with Random House. There was no revenue from this
agreement in the 2003 period as a result of the agreement being amended in March
2002.

     Operating  expenses.

     Cost  of  content  and  services  revenue.    Cost  of content and services
revenue  was  $1,352,000,  or 28% of content and services revenue, for the three
months  ended  September  30, 2003, as compared to $1,476,000, or 48% of content
and  services  revenue,  for  the  three  months  ended September 30, 2002.  The
decrease  in  the  2003 period was primarily due to a reduction in expenses as a
result  of our amended agreement with Random House, offset in part by additional
expenses  corresponding  to  an  increase  in  content  and  services  revenue.

     Cost of hardware revenue.    Cost of hardware revenue was $445,000, or 326%
of  hardware revenue, for the three months ended September 30, 2003, as compared
to  $605,000,  or 397% of hardware revenue, for the three months ended September
30,  2002.  This decrease was primarily due to selling fewer Otis devices in the
2003  period  as  compared to the 2002 period.  The decrease in cost of hardware
revenue  as  a  percentage  of  hardware  sales was primarily due to the reduced
average  unit  cost  of  the  devices  purchased  in  the  2003  period.

     Production  expenses.    Production  expenses were $1,034,000 for the three
months  ended September 30, 2003, as compared to $1,029,000 for the three months
ended  September  30,  2002,  an  increase  of $5,000, or 1%.  This increase was
primarily due to a $200,000 payment made in the 2003 period to an officer of the
Company,  and  increased  hosting  expenses,  offset  in  part by a reduction in
depreciation  expense during the 2003 period. The payment in the 2003 period was
made pursuant to a plan that was put in place in calendar year 2000 and provided
that  if  Audible was successful in the future raising an additional $15 million
in equity, an incentive payment would be earned.  In a series of three rounds of
financing  beginning  in  2001  and ending with the Series C this past August, a
total  of  $19.5  million  was  raised,  thus  triggering  the  payment.

     Development.   Development  costs  were $590,000 for the three months ended
September 30, 2003, as compared to $702,000 for the three months ended September
30,  2002,  a  decrease of $112,000, or 16%.  This decrease was primarily due to
reduced  expenses  associated  with  a  technology license and reduced personnel
related  expenses  in  the  2003  period.

      Sales  and  marketing.    Sales and marketing expenses were $1,515,000 for
the  three  months  ended  September 30, 2003, as compared to $3,016,000 for the
three  months  ended  September 30, 2002, a decrease of $1,501,000, or 50%. This
decrease  was  primarily due to a reduction in expenses related to our agreement
with  Amazon  as  we  have  fully  expensed the costs associated with the Amazon
agreement  and  the  related  warrant  charges,  as  well  as  lower web related
advertising  in the 2003 period, offset in part by increased expenses related to
co-marketing  and  revenue  share  agreements,  personnel  and customer service.


                                       22
<PAGE>
     General  and  administrative.    General  and  administrative expenses were
$905,000  for  the  three  months  ended  September  30,  2003,  as  compared to
$1,006,000  for  the  three  months  ended  September  30,  2002,  a decrease of
$101,000,  or  10%.  The  decrease  was  primarily  due  to reduced depreciation
expense,  reduced  legal  fees, and a reduction in investor relation expenses in
the 2003 period, offset in part by a $200,000 payment made in the 2003 period to
an officer of the Company. The payment in the 2003 period was made pursuant to a
plan  was  put  in  place in calendar year 2000 and provided that if Audible was
successful  in  the  future  raising  an  additional  $15  million in equity, an
incentive  payment  would  be  earned.  In a series of three rounds of financing
beginning  in  2001  and  ending  with the Series C this past August, a total of
$19.5  million  was  raised,  thus  triggering  the  payment.

     Other  income,  net.   Other  income,  net  in  both  periods  consisted of
interest  income.  Interest  income  was  $5,000  for  the  three  months  ended
September  30, 2003, as compared to $17,000 for the three months ended September
30,  2002, a decrease of $12,000.  This decrease was due to less interest income
being  earned from lower cash and cash equivalent balances available in the 2003
period.

     Accrued  dividends  on  preferred  stock.   Accrued dividends on redeemable
preferred  stock  was  $454,000 for the three months ended September 30, 2003 as
compared  to  $377,000  for  the  three  months  ended September 30, 2002.  This
increase  was due to the additional shares of Audible Series A stock outstanding
during  the 2003 period, and the accrued dividends on shares of Audible Series C
stock  issued  in  the  2003  period.

     Preferred  Stock Discount .   In August 2003, we issued 1,111,111 shares of
Audible  Series  C  stock  convertible  into  10  shares  of  common  stock at a
conversion  price  of  $0.13  per  share lower than the fair market value of our
common  stock  at the time of issuance. The Series C stock is convertible at any
time  at  option  of the holder. As a result, the entire $1,444,444 in preferred
stock  discount  was  recognized  in  the  2003  period on the date of issuance.


NINE MONTHS ENDED SEPTEMBER 30, 2003 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
2002.

     Total  revenue,  net.    Total  revenue,  net  for  the  nine  months ended
September  30,  2003  was  $13,498,000,  as  compared to $8,578,000 for the nine
months  ended  September  30,  2002,  an  increase  of  $4,920,000,  or  57%.

     Total  content  and services revenue.    Total content and services revenue
for  the  nine  months  ended September 30, 2003 was $12,961,000, as compared to
$7,742,000  for  the  nine  months  ended  September  30,  2002,  an increase of
$5,219,000,  or  67%.

     Consumer  content.    Consumer  content  revenue  for the nine months ended
September  30,  2003  was  $12,883,000,  as  compared to $7,442,000 for the nine
months  ended  September  30,  2002,  an  increase  of $5,441,000, or 73%.  This
increase  was  primarily  the  result  of  our  increased  customer  base.

     Services.    Services  revenue for the nine months ended September 30, 2003
was  $79,000,  as  compared  to $300,000 for the nine months ended September 30,
2002, a decrease of $221,000, or 74%.  This decrease was primarily the result of
fewer  corporate  customers.

     Hardware.    Hardware  revenue for the nine months ended September 30, 2003
was  $489,000,  as  compared to $735,000 for the nine months ended September 30,
2002, a decrease of $246,000, or 34%.  Hardware revenue decreased as a result of
the  combined  effect of selling fewer AudibleReady hand-held electronic devices
in  the  period,  primarily  the  Audible  Otis,  as  well  as selling a greater
percentage  of  those  sold  in  the  2003  period at a deeper discount when the
customer  signed  up  for  a  one-year commitment to AudibleListener Membership.


                                       23
<PAGE>
     Other.    Other  revenue  for  the nine months ended September 30, 2003 was
$48,000, as compared to $101,000 for the nine months ended September 30, 2002, a
decrease  of  $53,000.  Other  revenue  in  both periods consisted of $48,000 in
royalties  earned  from  a  license  granted  for certain technology rights to a
device  manufacturer.  Other revenue in the 2002 period also included $53,000 of
revenue earned from our profit participation from hard copy sales of products in
connection  with our agreement with Random House. There was no revenue from this
agreement in the 2003 period as a result of the agreement being amended in March
2002


     Operating expenses.

     Cost  of  content  and  services  revenue.    Cost  of content and services
revenue  was  $3,494,000,  or  27% of content and services revenue, for the nine
months  ended  September  30, 2003, as compared to $3,596,000, or 46% of content
and  services  revenue,  for  the  nine  months  ended  September 30, 2002.  The
decrease  in  the  2003 period was primarily due to a reduction in expenses as a
result  of our amended agreement with Random House, offset in part by additional
expenses  corresponding  to  an  increase  in  content  and  services  revenue.

     Cost  of  hardware  revenue.    Cost of hardware revenue was $1,505,000, or
308%  of  hardware  revenue,  for  the  nine months ended September 30, 2003, as
compared  to  $2,053,000, or 279% of hardware revenue, for the nine months ended
September  30,  2002.  This decrease was primarily due to reduced per unit costs
in  acquiring  hand-held  electronic  devices in the 2003 period versus the 2002
period.  Cost  of hardware revenue as a percentage of hardware revenue increased
as  we  sold these hand-held electronic devices at a deeper discount from normal
retail  price  in  the  2003  period  than  in  the 2002 period, when a customer
enrolled  in  AudibleListener  for  a  12-month  period.

     Production  expenses.    Production  expenses  were $2,785,000 for the nine
months  ended  September 30, 2003, as compared to $2,946,000 for the nine months
ended  September  30,  2002,  a  decrease of $161,000, or 6%.  This decrease was
primarily  due  to  a  reduction in depreciation expense during the 2003 period,
offset  in part by increased hosting expenses and a $200,000 payment made in the
2003  period  to  an  officer of the Company. The payment in the 2003 period was
made pursuant to a plan that was put in place in calendar year 2000 and provided
that  if  Audible was successful in the future raising an additional $15 million
in equity, an incentive payment would be earned.  In a series of three rounds of
financing  beginning  in  2001  and ending with the Series C this past August, a
total  of  $19.5  million  was  raised,  thus  triggering  the  payment.

     Development.   Development  costs were $1,808,000 for the nine months ended
September  30,  2003,  as  compared  to  $1,778,000  for  the  nine months ended
September  30, 2002, an increase of $30,000, or 2%.  This increase was primarily
due to increased personnel and related expenses and expenses in the 2003 period,
offset  in  part  by  reduced  outside  consultants.

      Sales  and  marketing.    Sales and marketing expenses were $4,925,000 for
the nine months ended September 30, 2003, as compared to $9,265,000 for the nine
months  ended  September  30,  2002,  a  decrease  of  $4,340,000, or 47%.  This
decrease  was  primarily due to a reduction in expenses related to our agreement
with Amazon as we had fully expensed the costs associated with the agreement and
the  related  warrant charges upon its expiration on January 24, 2003, and lower
web related advertising in the 2003 period, offset in part by increased expenses
related to co-marketing and revenue share agreements, personnel, consultants and
customer  service.


                                       24
<PAGE>
     General  and  administrative.    General  and  administrative  expense  was
$2,578,000  for  the  nine  months  ended  September  30,  2003,  as compared to
$2,788,000 for the nine months ended September 30, 2002, a decrease of $210,000,
or 7%.  This decrease was primarily due to reduced depreciation expense, as well
as  reduced  consultants, investor relations expenses and legal fees in the 2003
period,  offset in part by the forgiveness of debt charge in connection with the
notes  due  from  employees  for common stock and a $200,000 payment made in the
2003  period  to  an officer of the Company. This payment was made pursuant to a
plan  was  put  in  place in calendar year 2000 and provided that if Audible was
successful  in  the  future  raising  an  additional  $15  million in equity, an
incentive  payment  would  be  earned.  In a series of three rounds of financing
beginning  in  2001  and  ending  with the Series C this past August, a total of
$19.5  million  was  raised,  thus  triggering  the  payment.

     Other  income,  net.   Other  income,  net  in  both  periods  consisted of
interest  income.  Interest  income  was  $15,000  for  the  nine  months  ended
September  30,  2003, as compared to $76,000 for the nine months ended September
30,  2002, a decrease of $61,000.  This decrease was due to less interest income
being earned from lower cash and cash equivalent balances available.

     Accrued  dividends  on  preferred  stock.   Accrued dividends on redeemable
preferred  stock  was $1,195,000 for the nine months ended September 30, 2003 as
compared  to  $1,015,000  for  the  nine  months  ended September 30, 2002. This
increase  was due to the additional shares of Audible Series A stock outstanding
during  the  2003  period,  and  accrued dividends on shares of Audible Series C
stock  issued  in  the  2003  period.

     Preferred  Stock Discount .   In August 2003, we issued 1,111,111 shares of
Audible  Series  C  stock  convertible  into  10  shares  of  common  stock at a
conversion  price  of  $0.13  per  share lower than the fair market value of our
common stock at the time of issuance. Since the Series C stock is convertible at
any  time  at  option  of  the  holder, the entire $1,444,444 in preferred stock
discount  was  recognized  in  the  2003  period  on  the  date  issuance.



FACTORS  AFFECTING  OPERATING  RESULTS

     We  have  only  a  limited  operating  history  with  which to evaluate our
business and prospects. Our limited operating history and emerging nature of the
market  for  Internet-delivered  audio  content  makes  predicting  our  future
operating  results  difficult.  In addition, our prospects must be considered in
light  of  the  risks  and  uncertainties  encountered by companies in the early
stages  of  development  in  new  and rapidly evolving markets, specifically the
rapidly  evolving  market for delivery of audio content over the Internet. These
risks  include  our  ability  to:
     .    acquire and retain customers;
     .    build awareness and acceptance of audible.com, the AudibleReady format
          and AudibleReady devices;
     .    extend existing and acquire new content provider relationships;
     .    manage growth to stay competitive and fulfill customer demand; and
     .    generate cash from operations and/or raise capital.

If  we  fail  to  manage these risks successfully, it would materially adversely
affect  our  financial  performance.

     We  have  incurred  significant losses since inception, and as of September
30,  2003,  we  had  an  accumulated  deficit of approximately $117,970,471.  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  continue  to  invest  in  sales  and
marketing,  content  acquisition  and  production  to  the extent available cash
allows.

     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 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) our ability to acquire new
customers; (5) our ability to retain existing customers; (6) the introduction of
new  products  or  services  by  a  competitor; (7) the cost and availability of
acquiring  sufficient  Web  site  capacity  to  meet  our  customers'  needs;


                                       25
<PAGE>
(8)  technical  difficulties  with our computer system or the Internet or system
downtime; (9) the cost of acquiring audio content; (10) the amount and timing of
capital  expenditures  and  other  costs  relating  to  the  expansion  of  our
operations;  and  (11)  general  economic  conditions  and  economic  conditions
specific  to  electronic  commerce and online media. In the past, we 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 our 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  that  could  cause
significant  declines  in  our  quarterly  operating  revenue.

     Our  limited  operating  history and the emerging nature of our market make
prediction  of  future  revenue  difficult. We have no assurance that we will be
able to predict our future revenue accurately. Because we have a number of fixed
expenses,  we  may  be  unable  to  adjust  our  spending  in a timely manner to
compensate  for  unexpected  revenue  shortfalls.  Accordingly,  any significant
shortfall  in  relation  to our expectations could cause significant declines in
our  operating  results.  We  believe  that  our quarterly revenue, expenses and
operating  results  could  vary  significantly  in  the  future,  and  that
period-to-period  comparisons should not be relied upon as indications of future
performance.  Due  to  the  foregoing  factors, it is likely that in some future
quarters  our  operating  results will fall below the expectations of securities
analysts  and  investors,  which  could  have  a  material adverse effect on the
trading  price  of  our  common  stock.


     LIQUIDITY AND CAPITAL RESOURCES

     From  inception  through  the date prior to our initial public offering, we
financed  our  operations  through  private  sales of our redeemable convertible
preferred  stock  and  warrants.  Net  proceeds  from  the  sales  of redeemable
convertible  preferred  stock  and warrants prior to our initial public offering
were  $28,719,000.

      On  July  15,  1999,  we completed an initial public offering of 4,600,000
shares  of  common  stock at $9.00 per share.   Total proceeds were $36,856,000,
net  of  underwriting discounts and commissions of $2,898,000 and offering costs
of  $1,641,000.   Concurrent  with  the  offering, all outstanding shares of our
redeemable  convertible preferred stock were converted into 13,400,985 shares of
common  stock.

     On  February 8, 2001 Microsoft purchased 2,666,666 shares of Audible Series
A  stock  for  $10,000,000  at  a  per  share  price  of  $3.75.

     On  February 15, 2002 Special Situations Fund purchased 4,069,768 shares of
Common  stock for $3,500,000 at a per share price of $0.86. Proceeds received by
the  Company  net  of  direct  costs  were  approximately  $3,159,000.

     On  August  1,  2003,  Apax  Partners purchased 740,741 shares, Bertelsmann
Multimedia,  Inc.  purchased  185,185  shares  and  Random  House  Ventures, LLC
purchased  185,185  shares  of  Audible  Series  C stock at a per share price of
$5.40.  Proceeds  received  by  the Company, net of estimated direct costs, were
approximately  $5,859,772.

     At  September 30, 2003, our principal source of liquidity was approximately
$6,883,000  in  cash  and  cash  equivalents.

     At  September  30, 2003, our principal commitments consisted of obligations
for  operating  lease  commitments,  contractual  commitments  with  content
providers,  and  revenue  sharing commitments pursuant to agreements with device
manufacturers.

     Net  cash  used in operating activities for the nine months ended September
30,  2003  and  2002 was $1,735,000 and $6,982,000, respectively.  Net cash used
during the 2003 period was primarily attributable to our net loss, a decrease in
accounts  payable  and  royalty obligations, and an increase in other assets and
inventory, offset in part by services rendered for common stock and warrants, an
increase in accrued expenses and compensation, depreciation


                                       26
<PAGE>
and  amortization,  an  increase  in  advances,  and the non cash portion of the
forgiveness  of  employee  notes.  Net  cash  used  during  the  2002 period was
primarily  attributable  to  our  net  loss  and a decrease in accounts payable,
royalty


     obligations  and  advances,  offset in part by services rendered for common
stock  and  warrants,  depreciation  and amortization and an increase in accrued
expenses  and  compensation.

     Net  cash  used in investing activities for the nine months ended September
30,  2003 and 2002, was $94,000 and $145,000, respectively. Net cash used during
both  periods  was  related  to  purchases  of  property  and  equipment.

     Net  cash  provided  by  financing  activities  for  the  nine months ended
September  30,  2003  and 2002, was $5,890,000 and $3,170,000, respectively. Net
cash  provided  by  financing  activities  in  the  2003  period  was  primarily
attributable  to the sale of our Series C stock in the amount of $5,859,000, net
of direct costs and proceeds from the exercise of common stock options. Net cash
provided  financing  activities  in the 2002 period resulting primarily from the
investment  in  the  Company  by  Special  Situations Fund of $3,159,000, net of
direct  costs,  the  exercise  of  common  stock options by an employee, and the
payment  on  notes  due  from  stockholders  for  common  stock.

     Based  on our currently proposed business plans and related assumptions, we
believe  that  our  cash and cash equivalents balance will enable us to meet our
anticipated  cash  requirements  for operations and capital expenditures for the
foreseeable  future.  Beyond  that,  we  may  need  additional  cash to fund the
business  and  finance our continued growth. No assurance can be given that such
additional  financing,  when needed, will be available on terms favorable to the
Company  or  the  stockholders,  if  at  all.


NEW  ACCOUNTING  STANDARDS

     In  December  2002,  the  FASB  issued  Statement  of  Financial Accounting
Standards  No.  148,  "Accounting  for Stock-Based Compensation - Transition and
Disclosure"  ("SFAS  148").  SFAS 148 provides alternative methods of transition
for  a  voluntary  change to the fair value method of accounting for stock-based
employee  compensation  as  originally  provided by SFAS No. 123 "Accounting for
Stock-Based  Compensation".  Additionally,  SFAS  148  amends  the  disclosure
requirements  of SFAS 123 to require prominent disclosure in both the annual and
interim  financial  statements  about  the  method of accounting for stock-based
compensation  and  the  effect  of  the  method  used  on  reported results. The
transitional requirements of SFAS 148 are effective for all financial statements
for  fiscal  years  ending  after  December  15, 2002. We adopted the disclosure
portion  of this statement for the year ended December 31, 2002. The application
of  the  disclosure  portion  of  this  standard  had no impact on our financial
position  or  results  of operations. The FASB recently indicated that they will
require stock-based employee compensation to be recorded as a charge to earnings
beginning in 2004. We will continue to monitor their progress on the issuance of
this standard as well as evaluate our position with respect to current guidance.

     In  May  2003,  the  FASB  issued  SFAS  No.  150,  "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity." SFAS
No.  150  clarifies  the  definition of a liability as currently defined in FASB
Concepts  Statement  No. 6, "Elements of Financial Statements," as well as other
revisions.  This  statement  requires  a  financial  instrument that embodies an
obligation  of  an  issuer  to  be  classified  as a liability. In addition, the
statement  establishes  standards  for the initial and subsequent measurement of
these  financial  instruments  and  disclosure  requirements.  SFAS  No.  150 is
effective  for financial instruments entered into or modified after May 31, 2003
and,  for  all  other  instruments, at the beginning of the first interim period
beginning after June 15, 2003. The Company adopted SFAS No. 150 on July 1, 2003,
which did not have an impact on our financial position or results of operations.




ITEM  3.   QUALITATIVE  AND  QUANTITATIVE  DISCLOSURE  ABOUT  MARKET  RISK


                                       27
<PAGE>
     We do not have operations subject to risk of foreign currency fluctuations,
or instruments subject to interest rate risk, nor do we use derivative financial
instruments  in  our  operations  or  investment  portfolio.




ITEM  4.   CONTROLS  AND  PROCEDURES

     Our  management, under the supervision and with the participation of Donald
Katz,  our  Chief  Executive  Officer,  and  Andrew  Kaplan, our Chief Financial
Officer,  performed  an  evaluation  of  the  effectiveness  of  the  design and
operation  of our disclosure controls and procedures as of the end of the period
covered  by  the  report.  Based  on  that  evaluation,  Messrs. Katz and Kaplan
concluded  that  our  disclosure  controls and procedures were effective.  There
have  been  no  significant changes in our internal controls or in other factors
that  could  significantly  affect  internal  controls  subsequent  to  their
evaluation.





                           PART II - OTHER INFORMATION


ITEM  1.   LEGAL  PROCEEDINGS.

     In  September  2001,  we  were  named  as a defendant in a securities class
action  filed  in  United States District court for the Southern District of New
York  related  to its initial public offering ("IPO") in July 1999. The lawsuits
also named certain of the underwriters of the IPO, including Credit Suisse First
Boston  Corporation, J.P. Morgan Chase & Co., Volpe Brown Whelan & Co., LLC, and
Wit  Capital  Corporation,  as well as certain of our officers and directors and
former  directors  as  defendants.  Approximately  300  other  issuers and their
underwriters  have  had  similar  suits  filed  against  them,  all of which are
included in a single coordinated proceeding in the Southern District of New York
(the  "IPO  Litigation").  The  complaints  allege  that  the prospectus and the
registration  statement  for  the  IPO  failed to disclose that the underwriters
allegedly solicited and received "excessive" commissions from investors and that
some  investors  in  the  IPO  allegedly  agreed  with


                                       28
<PAGE>
the underwriters to buy additional shares in the aftermarket in order to inflate
the  price  of  our  stock. A consolidated amended complaint was filed April 19,
2002.  We  and certain officers, directors and former directors are named in the
suits  pursuant to Section 11 of the Securities Act of 1933. The complaints seek
unspecified  damages, attorney and expert fees, and other unspecified litigation
costs.

     On  July  1,  2002,  the underwriter defendants in the consolidated actions
moved  to dismiss all of the IPO Litigations, including the action involving us.
On  July  15,  we along with other non-underwriter defendants in the coordinated
cases,  also  moved  to dismiss the litigation.  On February 19, 2003, the Court
ruled  on  the  motions.  The  Court  granted  our  motion to dismiss the claims
against us under Rule 10b-5, due to the insufficiency of the allegations against
us.  The  motions  to  dismiss the claims under Section 11 of the Securities Act
were  denied  as  to  virtually all of the defendants in the consolidated cases,
including  us.  In  addition,  the  individual defendants in the IPO Litigation,
Donald R. Katz, Andrew P. Kaplan, Richard Brass, R. Bradford Burnham, W. Bingham
Gordon,  Thomas  P.  Hirschfeld,  Winthrop  Knowlton,  and Timothy Mott signed a
tolling  agreement  and  were  dismissed  from  the  action without prejudice on
October  9,  2002.

     On  June  26,  2003,  a  committee  of our Board of Directors conditionally
approved  a proposed partial settlement with the plaintiffs in this matter.  The
settlement  would  provide,  among other things, a release of the Company and of
the  individual  defendants for the conduct alleged in the action to be wrongful
in  the  amended  complaint.  We would agree to undertake other responsibilities
under  the partial settlement, including agreeing to assign away, not assert, or
release  certain  potential  claims  we  may have against our underwriters.  Any
direct  financial  impact  of the proposed settlement is expected to be borne by
our  insurance carriers.  The committee agreed to approve the settlement subject
to  a  number of conditions, including the participation of a substantial number
of  other  Issuer  Defendants  in  the  proposed  settlement, the consent of our
insurers  to  the  settlement, and the completion of acceptable final settlement
documentation.  Furthermore,  the settlement is subject to a hearing on fairness
and  approval  by  the  Court  overseeing  the  IPO  Litigations.

     Due  to the inherent uncertainties of litigation and because the settlement
approval  process  is  at  a preliminary stage, we cannot accurately predict the
ultimate  outcome  of  the  matter.

     Other  than  what  is disclosed above, we are not a party to any lawsuit or
proceeding,  which  we  believe  is  likely  to  have  a  material effect on us.




ITEM  2.   CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS


     In  August  2003,  Apax  Partners  purchased  from  Microsoft all 3,473,967
outstanding  shares of Audible's Series A stock and agreed to certain amendments
to  that  security.  As  amended,  the  Series  A stock is no longer mandatorily
redeemable,  is  convertible  at  any  time by the holders into shares of Common
Stock, and dividends will accrue and compound semi-annually for a period of four
years  at  the  rate  of  12%  per  annum.

     On  August  1,  2003,  Apax  Partners purchased 740,741 shares, Bertelsmann
Multimedia,  Inc.  purchased  185,185  shares  and  Random  House  Ventures, LLC
purchased  185,185  shares  of  Audible  Series  C stock at a per share price of
$5.40.  Proceeds  received net of estimated direct costs, were $5,859,772.  Each
share of Series C stock is currently convertible into 10 shares of Common Stock.
The  Series C stock is entitled to receive dividends.  Such dividends accrue and
compound  semi-annually at the rate of 6% per annum for four years following the
date of initial issuance.  In the event of the conversion of the Series C stock,
all  accrued  but  unpaid  preferred  dividends will be converted into shares of
Common  Stock.  In liquidation, the Audible Series C stock ranks pari passu with
the  Company's  Series A stock and Series B stock.  In conducting this offering,
the  Company relied upon the exemption from the registration


                                       29
<PAGE>
requirements  of  the  Securities Act of 1933, as amended (the "Act"), available
under  Rule  506  of  Regulation  D  of  the  Act.





ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     Inapplicable



ITEM 4.   SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS

          (a)  The  Company held its Annual Meeting of Stockholders on September
          25,  2003  (the  "Annual  Meeting").

          (b)  Inapplicable

          (c)  The  following  matters  were  voted  upon at the Annual Meeting:

          (i)  The  election  of  two  directors  to serve until the 2006 annual
meeting  of  stockholders,  and  until  their  successors  are  elected and duly
qualified,  with  93.7%  of the preferred and common stock present and voting at
the  meeting  voting  for  Messers  Ginsberg  and  Mohn  as  follows:

          Nominee                     For          Against or Withheld
          -------                     ---          -------------------
          Gary L. Ginsberg            53,637,333          101,850
          Johanness Mohn .            53,645,448          93,735





          (ii)  The  appointment of KPMG LLP as our independent auditors for the
year  ending  December  31,  2003  was  ratified  by  99.7% of the shares of the
preferred  and  common  Stock  present  and  voting  at  the meeting (votes for:
53,574,432;  votes  against  or  withheld:  23,572;  abstention  141,179).

          (iii)  An  amendment to the Company's Amended and Restated Certificate
of Incorporation increasing the Company's authorized number of common stock from
75,000,000  shares  to 120,000,000 shares was ratified by 92.8% of the shares of
the  preferred  and  common  stock present and voting at the meeting (votes for:
53,245,456;  votes  against  or withheld: 457,724; abstention 36,000.), 88.3% of
the  common stock present and voting at the meeting (votes for: 26,876,268 votes
against  or  withheld:  457,724;  abstention  36,000).


                                       30
<PAGE>
          (iv)  An  amendment  to  the Company's 1999 Stock Incentive Plan which
will  increase  the  authorized  number  shares  of  common  stock available for
issuance  under the plan from 9,000,000 shares to 12,600,000 shares was ratified
by  89.3%  of the shares of the preferred and common Stock present and voting at
the  meeting.  (votes  for:  32,884,518;  votes  against or withheld: 3,815,000;
abstention  36,600).

          (d)  Inapplicable




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
          3.1.1***  Certificate  of  Designation  of  Designations, Limitations,
                    Restrictions And Relative Rights of the Series A Convertible
                    Preferred  Stock  of  Audible,  Inc.
          3.1.2 !   Certificate  of  Amendment  to  the  Amended  and  Restated
                    Certificate  of  Incorporation.
          3.1.3 !!  Certificate  of  Designation  of  Designations, Limitations,
                    Restrictions and Relative Rights of the Series B Convertible
                    Preferred  Stock  of  Audible,  Inc.
          3.1.4 >   Certificate  of  Designation  of  Designations, Limitations,
                    Restrictions and Relative Rights of the Series C Convertible
                    Preferred  Stock  of  Audible,  Inc.
          3.1.5 >   First  Amended  and  Restated  Certificate of Designation of
                    Designations,  Limitations, Restrictions and Relative Rights
                    of the Series A Convertible Preferred Stock of Audible, Inc.
          3.1.6 >   Certificate  of  Amendment  to Certificate of Designation of
                    Designations,  Limitations, Restrictions and Relative Rights
                    of the Series B Convertible Preferred Stock of Audible, Inc.
          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)
          10.8*     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
          10.10*    Security  and  Loan  Agreement  dated  November  20,  1996,
                    between  Audible, as borrower, and Imperial Bank, as lender,
                    for  up  to  $500,000
          10.14*    Amended  and  Restated  Registration  Rights Agreement dated
                    February  26,  1998,  by  and  among  Audible  and  certain
                    stockholders  named  therein


                                       31
<PAGE>
          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
          10.16*    Form  of  Common  Stock  Warrants  issued  June  30, 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 March 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
                    March  10,  1996
          10.24*    Employment Offer Letter from Audible to Brian Fielding dated
                    April  25,  1997
          10.25     Omitted.
          10.26*    Employment  Offer Letter from Audible to Andrew Kaplan dated
                    May  25,  1999
          10.27     Omitted.
          10.28**   Warrant  Agreement to purchase 10,000 shares of Common Stock
                    at a price of $7.65 per share, dated October 8, 1999, issued
                    by  Audible  to  National  Public  Radio,  Inc.
          10.29*    Common Stock Purchase Warrant, W-1, issued June 17, 1999, to
                    Robin  Williams
          10.30*    Common Stock Purchase Warrant, W-2, issued June 17, 1999, to
                    Robin  Williams
          10.30.1## Amendment  No.  1  to  Common  Stock  Purchase Warrant, W-2,
                    issued  January  25,  2002,  to  Robin Williams (relating to
                    Exhibit  10.30)
          10.31++#  Securities Purchase Agreement dated January 30, 2002, by and
                    between  Audible  and  Amazon.com  Commerce  Services,  Inc.
          10.32++#  Co-Branding, Marketing and Distribution Agreement dated
                    January  30,  2002,  by  and  between Audible and Amazon.com
                    Commerce  Services,  Inc.
          10.33***  Series  A  Convertible Preferred Stock Purchase Agreement by
                    and  between Audible Inc. and Microsoft Corporation dated as
                    of  February  8,  2002.
          10.34++!  Amendment  No.  1 to Co-Branding, Marketing and Distribution
                    Agreement  dated  as  of  January  24,  2002  by and between
                    Amazon.com  Commerce Services, Inc. and Audible (relating to
                    Exhibit  10.32)
          10.35!    Securities  Purchase Agreement dated January 25, 2003 by and
                    between Audible Inc., and Special Situations Fund III, L.P.,
                    Special  Situations  Cayman  Fund,  L.P., Special Situations
                    Private  Equity Fund, L.P. and Special Situations Technology
                    Fund,  L.P.
          10.36!    Registration  Rights Agreement dated January 25, 2003 by and
                    between Audible Inc., and Special Situations Fund III, L.P.,
                    Special  Situations  Cayman  Fund,  L.P., Special Situations
                    Private  Equity Fund, L.P. and Special Situations Technology
                    Fund,  L.P.
          10.37!    Form  of  Common Stock Warrant issued in connection with the
                    sale  of  common  stock  to  Special  Situation  Funds.
          10.38 >   Series  C  Convertible Preferred Stock Purchase Agreement by
                    and  between  Audible, Inc. and the investor parties thereto
                    dated  as  of  August  1,  2003.
          10.39 >   Series  A  Investor  Rights  Agreement.
          31.1      Quarterly  Certifications  of  the  Chief  Executive Officer
                    pursuant  to  Section 302 of the Sarbanes-Oxley Act of 2003.
          31.2      Quarterly  Certifications  of  the  Chief  Financial Officer
                    pursuant  to  Section 302 of the Sarbanes-Oxley Act of 2003.


                                       32
<PAGE>
          32.1      Quarterly  Certifications  of  the  Chief  Executive Officer
                    pursuant  to  Section 906 of the Sarbanes-Oxley Act of 2003.
          32.2      Quarterly  Certifications  of  the  Chief  Financial Officer
                    pursuant  to  Section 906 of the Sarbanes-Oxley Act of 2003.


          *    Incorporated  by  reference  from  the  Company's  Registration
               Statement  on  Form  S-1  (No.  333-76985)

          **   Incorporated  by  reference from the Company's Form 10K/A for the
               fiscal  year  ended  December  31,  1999

          ***  Incorporated  by  reference  from the Company's Form 10-K for the
               fiscal  year  ended  December  31,  2000.

          #    Incorporated  by  reference  from the Company's Form 10-Q for the
               quarterly  period  ended  September  30,  2000

          ##   Incorporated  by  reference  from the Company's Form 10-Q for the
               quarterly  period  ended  September  30,  2001

          ###  Incorporated  by  reference  from the Company's Form 10-Q for the
               quarterly  period  ended  September  30,  2001

          !    Incorporated  by  reference  from the Company's Form 10-K for the
               fiscal  year  ended  December  31,  2001.

          !!   Incorporated  by  reference  from the Company's Form 10-Q for the
               quarterly  period  ended  June  30,  2002.

          !!!  Incorporated  by  reference  from the Company's Form 10-Q for the
               quarterly  period  ended  September  3,  2002.

          >    Incorporated  by  reference  from the Company's Form 8-K filed on
               August  5,  2003.

          +    Portions  of  these  Exhibits  were  omitted  and have been filed
               separately  with  the Secretary of the Commission pursuant to the
               Company's  Application  requesting  Confidential  Treatment under
               Rule  406  of  the  Securities  Act  of  1933.

          ++   Portions  of  these  Exhibits  were  omitted  and have been filed
               separately  with  the Secretary of the Commission pursuant to the
               Company's  Application  requesting  Confidential  Treatment under
               Rule  24b-2  of  the  Securities  Exchange  Act  of  1934.




                                       33
<PAGE>
(b)  Reports on Form 8-K

     Form  8-K,  dated  August 5, 2003, announcing the purchase by Apax Partners
and  Bertelsmann  of the Company's Series C stock and the acquisition by Apax of
the  Company's  outstanding  Series  A  stock  from  Microsoft.

     Form  8-K,  dated  August 6, 2003, announcing certain financial results for
the  quarter  ended  June  30,  2003.

     Form  8-K,  dated  August  25, 2003, announcing the Company's new marketing
alliance  with  Amazon.com.

     Form 8-K, dated September 17, 2003, announcing the immediate resignation of
Robert  Kramer.


                                       34
<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:
                                    ---------------------------------------
                            Name:   Andrew P. Kaplan
                            Title:  Chief Financial Officer and
                                    Executive Vice President, Finance and
                                    Administration


Dated: November ___, 2003


                                       35
<PAGE>