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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
            Act of 1934 for the quarterly period ended April 29, 2001

                                       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 1-8690

                             Datametrics Corporation
          ------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                                           95-3545701
           --------                                           ----------
(State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                         Identification Number)

             1717 Diplomacy Row
              Orlando, Florida                                     32809
             ------------------                                     -----
   (Address of principal executive offices)                     (Zip Code)

                                 (407) 251-4577
                                 --------------
              (Registrant's telephone number, including area code)

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

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

Common Stock, $.01 Par Value - 20,512,227 shares as of 7/23/01

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                                     1 of 13


<PAGE>

                    DATAMETRICS CORPORATION AND SUBSIDIARIES
                              Index to Form 10-QSB

                                                                        Page No.
                                                                        --------
Part I - Financial Information
      Item 1. Financial Statements (unaudited):

            Consolidated Balance Sheet as of April 29, 2001 .............   3
            Consolidated  Statements of Operations  for the Three and
              Six Months Ended April 29, 2001 and April 30, 2000 ........   4
            Consolidated Statements of Cash Flows for the Six
              Months  Ended  April 29,  2001 and April 30, 2000 .........   5
            Notes to Consolidated Financial Statements ..................   6

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

Part II - Other Information
      Item 1. Legal Proceedings .........................................  12
      Item 2. Changes in securities and uses of funds. ..................  12
      Item 3. Defaults upon Senior Securities ...........................  12
      Item 4. Submission of matters to a vote of security holders .......  12
      Item 5. Other Information .........................................  12
      Item 6. Exhibits and Reports on Form 8-K ..........................  12

Signatures ..............................................................  13


                                     2 of 13


<PAGE>

                    DATAMETRICS CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET (UNAUDITED)
                      (in thousands, except per share data)

                                                                      April 29,
                                                                        2001
                                                                      ---------

                                     ASSETS
Current assets:
        Cash and cash equivalents                                   $        39
Accounts receivable, net of allowance for doubtful
  accounts of $50                                                           389
        Inventories, net                                                  1,871
        Prepaid expenses and other current assets                            17
                                                                    -----------

             Total current assets                                         2,316
                                                                    -----------
Property and equipment, at cost:
        Land                                                                420
        Building and improvements                                         1,042
        Machinery and equipment                                           2,554
        Furniture, fixtures and computer equipment                        2,501
        Leasehold improvements                                                0
                                                                    -----------
                                                                          6,517

Less: Accumulated depreciation and amortization                          (4,535)
                                                                    -----------

             Net property and equipment                                   1,882
        Non-Current Inventories, net                                      1,700
        Other assets                                                         25
                                                                    -----------
                                                                    $     5,923
                                                                    ===========
                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
        Revolving line of credit                                    $         0
        Current maturities of long-term debt                              6,385
        Accounts payable                                                    881
        Other accrued expenses                                            1,466
                                                                    -----------
             Total current liabilities                                    8,707
                                                                    -----------
        Long-term debt, less current maturities                             888
        Loan payable                                                      3,351
        Debt-Senior Secured                                                 225
                                                                    -----------
             Total liabilities                                           13,196
Minority interest                                                            --
Stockholders' equity
        Preferred stock, $.01 par value; 5,000,000                           --
          shares authorized, none issued
        Common stock, $.01 par value; 40,000,000 shares
          authorized 20,512,227 shares issued and outstanding               205
        Additional paid-in capital                                       44,033
        Accumulated deficit                                             (51,511)
                                                                    -----------
             Total stockholders' equity                                  (7,273)
                                                                    -----------
                                                                    $     5,923
                                                                    ===========

          See accompanying notes to consolidated financial statements.


                                     3 of 13


<PAGE>

                    DATAMETRICS CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
                                                                    (Unaudited)                      (Unaudited)
                                                                Three months ended                Six months ended
                                                           April 29,          April 30,        April 29,       April 30,
                                                             2001               2000            2001             2000
                                                           ----------------------------        -------------------------
                                                                         (in thousands, except per share data)
<S>                                                         <C>              <C>              <C>              <C>
Sales                                                       $    772         $  1,188         $  1,630         $  2,319

      Cost of sales                                              200            1,491            1,381            2,882
      Selling, general and administrative                       2042              542            2,595            1,183
      Write-down of inventory                                    950              950
                                                            --------         --------         --------         --------
Income (loss) from operations                                 (2,420)            (845)          (3,296)          (1,746)
Life insurance proceeds                                                                          1,046
Interest expense, net                                           (278)            (461)            (588)            (912)
                                                            --------         --------         --------         --------
Income (loss) before minority interest                        (2,698)          (1,306)          (2,838)          (2,658)

Minority interest                                                                  18                                18
                                                            --------         --------         --------         --------
      Net income (loss)                                     $ (2,698)        $ (1,288)        $ (2,838)        $ (2,640)
                                                            ========         ========         ========         ========
Loss per share of common stock:
      Basic and diluted                                     $  (0.13)        $  (0.07)        $  (0.14)        $  (0.14)
                                                            ========         ========         ========         ========
Weighted average number of shares outstanding:
      Basic and diluted                                       20,435           18,997           20,435           18,997
                                                            ========         ========         ========         ========
</TABLE>

          See accompanying notes to consolidated financial statements.


                                     4 of 13


<PAGE>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                               SIX MONTHS ENDED
                                                                                           APRIL 29,      APRIL 30,
                                                                                              2001           2000
                                                                                           ---------      ---------
<S>                                                                                         <C>          <C>
Cash Flows from Operating Activities:
      Net loss                                                                              $(2,838)     $(2,640)
      Adjustments to reconcile net loss to net cash used in operating activities:
           Depreciation and amortization                                                        151          180
           Non-cash interest and financing costs                                                 85          456
           Minority interest                                                                                 (18)

      Changes in assets and liabilities:
           Accounts receivable                                                                 (344)       1,163
           Inventory                                                                           (222)         241
           Prepaid expenses and other current assets                                           (332)        (283)
           Other assets                                                                         (84)         179
           Accounts payable                                                                      47          (45)
           Accrued expenses                                                                   1,840           61
                                                                                            -------      -------
                Net cash used in operating activities                                        (1,697)        (706)

Cash Flows from Investing Activities:
      Capital expenditures for property and equipment                                            22         (333)
      Proceeds from sale of equity in subsidiary                                                  0        1,200
                                                                                            -------      -------
                Net cash provided by (used in) investing activities                              22          867

Cash Flows from Financing Activities:
      Borrowings on revolving line of credit                                                     --          545
      Payments on revolving line of credit                                                       --         (500)
      Payments on capitalized lease obligations                                                  --           --
      Borrowings on long-term debt                                                           (1,032)          --
      Payments on long-term debt                                                              2,474          (11)
      Borrowings on loan payable                                                                225
      Proceeds from bridge notes                                                                 --
      Proceeds from short term loans                                                             --
      Proceeds from the issuance of common stock and warrants                                    --
                                                                                            -------      -------
                Net cash provided by financing activities                                     1,667           34
                                                                                            -------      -------
      Net increase in cash and cash equivalents                                                 (08)         195

      Cash and cash equivalents at the beginning of the period                                   47          137
                                                                                            -------      -------
      Cash and cash equivalents at the end of the period                                    $    39      $   332
                                                                                            =======      =======
      Supplemental Disclosures of Cash Flow Information:
           Interest paid, net                                                               $            $   289
      Non-cash transactions:
           Exchange of 7% Convertible Debentures for 10% Senior Subordinates Notes
                 Due 2000                                                                   $    --      $    --
           Exchange of Senior Subordinated Debentures for 10% Senior Subordinates
                Notes Due 2000                                                              $    --      $    --
           Conversion of accrued interest to 12% Subordinated Convertible Secured Notes
                Due 2000                                                                    $    --      $   248
</TABLE>

          See accompanying notes to consolidated financial statements.


                                     5 of 13


<PAGE>

                             DATAMETRICS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                 April 29, 2001
                                   (Unaudited)

1. The  consolidated  financial  statements  include the accounts of Datametrics
Corporation and its wholly-and majority-owned  subsidiaries  (collectively,  the
"Company").

      The consolidated  financial  statements included herein have been prepared
by the Company,  without  audit,  pursuant to the rules and  regulations  of the
Securities and Exchange  Commission for the requirements of the Quarterly Report
on Form 10-QSB. Certain information and footnote disclosure normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles   have  been  condensed  or  omitted   pursuant  to  such  rules  and
regulations,  although the Company believes that the disclosures are adequate to
make the  information  presented  not  misleading.  It is  suggested  that these
consolidated financial statements be read in conjunction with the statements and
notes thereto  included in the  Company's  latest Annual Report on Form 10-K for
the fiscal year ended October 29, 2000 as filed with the Securities and Exchange
Commission.

The  information  reflects  all  adjustments  (consisting  of  normal  recurring
adjustments)  which are, in the opinion of  management,  necessary  to present a
fair statement of the results of operations for the interim periods. Much of the
Company's business is longer term and involves varying development,  production,
and  delivery  schedules.  Accordingly,  results  of  a  particular  quarter  or
quarter-to-quarter  comparisons  of  recorded  sales  and  profits  may  not  be
indicative of future operating  results,  including  results for the fiscal year
ending October 29, 2000.

2. INVENTORIES  Stockroom inventories consist primarily of materials used by the
Company for  existing  and  anticipated  contracts  and  materials  and finished
assemblies  which are held to satisfy spare parts  requirements of the Company's
customers. Those parts not expected to be sold within one year are classified as
a non-current  asset.  The Company does not amortize its non-current  inventory,
but the Company evaluates all inventory for obsolescence on a periodic basis and
records  estimated  reserves.  Inventories  as of April 29, 2001  consist of the
following:

         Inventories of parts and sub-assemblies              $  10,681
         Work in process                                            389
         Finished Goods                                             401
                                                              ---------
                                                              $  11,471

                  Current inventories                             1,871
                  Total Current Inventories                   $   1,871

                  Non current inventories                         9,600
                  Less reserve for obsolescence                  (7,900)
                  Total Non-Current Inventories               $   1,700
                                                              ----------
                                                              $   3,571
                                                              ==========

3. OTHER  EVENTS

      A plan was  proposed  by  management  to reduce  the  number of  non-vital
employees in or around the June time period.  No specific number of employees is
indicated, but it is planned to be substantial.


                                     6 of 13


<PAGE>

4. DEBT STRUCTURE

      Note Payable

In December  2000, an investment  group headed by the  Company's  chairman,  And
including  the six  associated  investors  who advanced  bridge loans  )("Bridge
Financings")  to the Company during 2000,  formed DMTR,  LLC, a New York limited
liability  company  ("DMTR").  DMTR  has  satisfied  the  $1,496,140  due to the
guarantors  of the Company's  Senior Bank Facility  ("Senior Bank Loan") and has
taken an assignment of the loan documents and the collateral securing that loan.
In addition,  DMTR has repaid in December all of the Company's Bridge Financings
in the  aggregate  amount  of  $1,305,000  plus  interest  thereon  and taken an
assignment  of the  loan  documents  evidencing  the  Bridge  Financings  and an
assignment of the collateral securing the Bridge Financings.

Effective  January 31, 2001,  DMTR and the Company  executed  loan  documents to
provide the Company with a line of credit in the maximum amount of $798,860 (the
"Line of Credit").  Accordingly, the Company (assuming a draw of the entire Line
of Credit) is obligated to DMTR in the aggregate amount of $3,600,000 (comprised
of $1,496,140 on the Senior Bank Loan,  $1,305,000 on the Bridge  Financings and
$798,860 on the Line of Credit and subject to the agreement, described below, to
exchange a portion of the Bridge  Financings  for Common Stock of the  Company).
The Line of Credit has a term of two years with  interest  (payable  monthly) at
the Base Rate of  Citibank,  N.A.  plus 100 basis  points  and is secured by all
assets of the Company,  a pledge of the Company's stock in  MadeMyWay.com,  Inc.
("MadeMyWay")  and the assets of MadeMyWay.  To the extent such assets and stock
are  pledged  to secure  the Senior  Bank Loan and the  Bridge  Financings,  the
security for the Line of Credit is subject to such prior security interests. The
Company is also obligated to make mandatory  prepayments of the principal of the
Line of Credit on a monthly basis to the extent the Company has  available  cash
in excess of  $200,000  Simultaneously  with the  closing of the Line of Credit,
DMTR and the Company  modified  the terms of the Senior Bank Loan and the Bridge
Financings to conform those terms to the terms of the Line of Credit. Therefore,
the Senior  Bank Loan and the Bridge  Financings  mature on  January  31,  2003,
accrue  interest  (payable  monthly) at the Base Rate of Citibank  N.A. plus 100
basis points and are subject to the mandatory  prepayment provision set forth in
the Line of Credit. As additional  consideration for the financings  provided by
DMTR, the Company issued a Warrant to DMTR to acquire up to 7,000,000  shares of
the Common Stock of the Company on a fully diluted basis with an exercise  price
of $.125 per share,  exercisable  through January 31, 2007.  Further,  DMTR will
exchange  $700,000 in principal amount of the Bridge Financings for the issuance
of 700,000  shares of the  Company's  Common  Stock  (with  demand  registration
rights), such number of shares determined on the basis of and giving effect to a
proposed reverse stock split described below.

      Long-term debt

      The  Company  is  currently  negotiating  with  the  holders  of  its  10%
Subordinated Notes dated December 24, 1998 in the aggregate principal amount of
$3,524,000  as of  December  31,  2000  (the  "10%  Notes")  and its 12%  Senior
Subordinated  Convertible  Secured  Notes dated August 2, 1999 in the  aggregate
principal  amount of  $2,835,607  as of  December  31,  2000 (the 12% Notes") to
restructure such indebtedness.  In each case, the negotiations have assumed that
the  Company  will  amend its  Certificate  of  Incorporation  to  increase  its
authorized  capital  stock and to effect a 1 for 20  reverse  stock  split.  The
current Chairman and a director of the Company hold certain of the 10% Notes and
12% Notes and have  investment  discretion  over  certain  accounts of the other
noteholders.

      The Company has reached an agreement  in principle  with a majority of the
Holders of the 10% Notes,  subject to the  execution  and delivery of definitive
Documents,  to exchange each $1.00 face amount of the  outstanding 10% Notes for
$1.5050 face amount of a new series of step-up coupon convertible two-year Notes
(the "New  Notes").  The  following  describes the terms of the New Notes if the
exchange is completed.  The holders of the 10% Notes will waive accrued interest
owing  since  March 2000 and all other  amounts,  whether  principal,  interest,
premium  or  penalty,  owing in  respect  of the 10%  Notes  or any  instruments
delivered  in  connection  with the 10%  Notes.  The New Notes  will not  accrue
interest  until the  second  year  after  issuance.  Interest  will then be paid
semi-annually,  with the first payment at a rate of 12% per annum and the second
payment at a rate of 16% per  annum.  The  holders of the New Notes may  convert
amounts owing under the New Notes to the Company's Common Stock at a price of up
to $3.00 per share.  The Company may force  conversion  to Common Stock of up to
twenty percent (20%) of the aggregate principal of the New Notes each quarter if
the trading price of the Company's  Common Stock averages $3.25 or more (with an
average daily trading volume of 30,000 shares) for twenty or thirty trading days
during such quarter and the Company may force  conversion  to Common Stock of up
to fifty percent (50%) of the aggregate  principal of the New Notes each quarter
if the trading price of the Company's  Common Stock  averages  $4.50 or more for
twenty of thirty trading days during such quarter.


                                     7 of 13
<PAGE>

    The  Company may redeem the New Notes for cash at 85% of par up to the six
month  anniversary  of  their  issuance,  at  90%  of  par  from  the  six-month
anniversary  through the first  anniversary  of their issuance and thereafter at
95% of par  through  the  first  interest  payment  date.  The  Company  will be
obligated  to redeem 20% of the  original  principal  amount of the New Notes on
each of the first  anniversary of their issuance and the first interest  payment
date.  Such  redemption may be effected by payment of cash or forced  conversion
into Common Stock if the Company is then permitted so to convert the New Notes.

      The Company is also  negotiating with the holders of the 12% Notes and the
Company has reached an  agreement in  principle,  subject to the  execution  and
delivery of  definitive  documents,  with a majority of such holders to exchange
1.1 shares of the  Company's  Common  Stock for each $1.00 in  principal  of the
outstanding 12% Notes.  If the exchange is  consummated,  the holders of the 12%
Notes will waive accrued interest owing since January 2001 and all other amounts
whether of principle,  interest, premium or penalty, owing in respect of the 12%
Notes or any instruments delivered in connection with the 12% Notes.

      The  Company  seeks to effect  the  exchange  on  substantially  the terms
described above.  Although the Company has received  commitments from a majority
of the  holders  of the 10% Notes  (94%  received  as of April  29,  2001) and a
majority  of the holders of the 12% Notes (89%  received as of April 29,  2001),
the  closing of the  exchange  is  subject  to the  execution  and  delivery  of
definitive  documents  and  the  amendment  of  the  Company's   Certificate  of
Incorporation to increase the Company's authorized capital and to effect a 1 for
20 reverse  stock  split.  Further any holder may accept or reject the  proposed
exchange as to his 10% Note or 12% Note,  as the case may be, and  preserve  his
claims under his Notes regardless of acceptance of the exchange by any number of
other holders. The Company expects to obtain the consents of the required number
of  stockholders  under  Delaware law for the  amendment and reverse stock split
described  above and such  consents  shall be  effective  twenty (20) days after
proper notice of the actions  covered by such consents has been delivered to all
nonconsenting  stockholders.  In the unlikely event that stockholder approval is
not obtained  for the  amendment  and stock split noted  above,  the 10% and 12%
Noteholders  would retain their  rights  under the  original  Notes,  whether of
principal,  interest, premium or significant penalty. This would have a material
adverse effect on the financial position of the Company.

      The reverse  stock splits and the  conversion of the 10% and 12% Notes has
not occurred as of the date of this report.  However,  management  has proceeded
with requesting consents of the stockholders to effectuate this transaction.  It
is  anticipated  to occur in the fourth  quarter of this  fiscal  year.  Several
transactions  which  were  anticipated  as a result of the  split  have not been
recorded (i.e. exchange of principal debt to DMTR and its effects).

SUBSEQUENT EVENTS

      After the close of the period a number of events  occurred  at the Company
that shall have an impact on its business in the future.

      On May 18, 2001,  Vincent  Cahill  presented his  resignation as the Chief
Executive  Officer and  President.  On May 18, 2001,  he also  resigned from the
Company's Board of Directors.

      On May 18, 2001, the Company  announced the  appointment of Daniel Bertram
as  its  Chief  Executive  Officer,  President  and a  member  of the  Board  of
Directors. Upon his appointment,  Mr. Bertram presented as plan of restructuring
which  the  Company's  Board of  Directors  approved.  The Plan  called  for the
reduction  in  staff  and  payroll  expenses,   the  closing  of  the  Company's
wholly-owned subsidiary, MadeMyWay, Inc., pending further financing from outside
sources and the closing of the Company's accounting offices in New Jersey.

      On  June  1,  2001,  with  the  relocation  of the  Company's  New  Jersey
accounting offices to Florida, the Company accepted the resignation of its Chief
Financial Officer, Larry Silverman.

      In June, 2001, the Company completed a subsequent  financing in the amount
of  $1,025,000.  Such financing is in the form of debt and shall have a security
interest senior to that of DTMR, LLC.


                                     8 of 13


<PAGE>

5. SEGMENT DATA. The Company has two reportable segments: industrial printer and
internet. The industrial segment designs, develops and sells industrial printers
for defense  contractors and commercial  users.  The internet  segment  consists
primarily  of a newly  incorporated  subsidiary  engaged in the  fulfillment  of
customized  and  personalized  products  primarily for the  business-to-business
e-commerce  market.  The reportable  segments are strategic  business units that
offer different products and services.  Results for the two reportable  segments
are as follows:

                                              Printers    INTERNET       TOTAL
For the six months ended April 29, 2001

Sales                                         $ 1,630      $    --      $ 1,630

Cost of Sales                                  (2,330)                   (2,330)

Selling, general and administrative            (2,595)                   (2,595)
                                              -------      -------      -------

Loss from operations                           (3,295)                   (3,295)

Life Insurance proceeds                         1,046                      1,046

Total other expenses, net                         589           --          589
                                              -------      -------      -------
Loss before minority interest                 $(2,838)     $            $(2,838)
                                              =======      =======      =======

6. COMITTMENTS AND CONTINGENCIES

      In connection with a Mutual Release and Settlement  Agreement  between the
Company and the owner of premises formerly leased in California,  the Company is
required to issue an additional  approximate  2.7 million shares of Common Stock
in  accordance  with the  terms of the  agreement,  which  shares  have not been
issued.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

                              RESULTS OF OPERATIONS

                 SIX MONTH PERIOD ENDED APRIL 29, 2001 COMPARED
                    TO SIX MONTH PERIOD ENDED APRIL 30, 2000

Sales for the six month period ended April 29, 2001 were $1,630,000,  a decrease
of $689,000 or 30%,  compared with sales of $2,319,000 in the same period in the
prior fiscal year. The decrease in sales for the six months ended April 29, 2001
is attributable to the Company's  decision to withdraw from the military defense
business and reversing  that decision by  reintroducing  itself into the defense
market.

Cost of sales for the first six  months of fiscal  2001 was  $1,381,000  (85% of
sales),  an decrease of $1,501,000  or 52%,  compared  with  $2,882,000  (125 of
sales) for the same period in the prior  fiscal  year.  Cost of sales  decreased
compared to the same  period in the prior  fiscal  year  primarily  because a of
lower  sales  volume to  support.  However,  there was a $950,000  writedown  of
obsolete inventory.


                                     9 of 13


<PAGE>

Selling,  general and administrative  ("SG&A") expenses for the six month period
ended April 29, 2001 were $2,595,000  (159% of sales), a increase of $1,412,000,
or 119%,  compared  with  $1,183,000  (51% of sales) for the same  period in the
prior fiscal  year.  The  increase is due to higher  administrative  and support
staff expenses  throughout the Company, an additional  reserve for lease default
and other  writedowns.  The SG&A expense  column on the  statement of operations
included significant adjustments for writedowns.  The non-recurring expenses are
$250,000 for lease  abandonment  of the corporate  executive  offices in Florham
Park, New Jersey,  $643,584 for writedown of the company's  investment Madmy Way
and $83,830 for writedown of the company's investment in our year book.

Net interest  expense  amounted to $588,000 for the six month period ended April
29, 2001 compared  with net interest  expense of $912,000 for the same period in
the prior year.  This decrease is due to a change in debt structure as indicated
in Note 4.

The net  loss  for the  six-month  period  ended  April  29,  2001  amounted  to
$2,838,000 a increased  loss of $198,000  compared with a net loss of $2,640,000
for the same period in the prior year. The loss for the current six-month period
is attributable to the lead time required to redevelop  defense  business and an
increase in reserves of  $1,200,000  for lease  liability  and inventory and the
writeoff of idle  investments  deemed to be worthless.  The net loss for the six
months was  significantly  increased by the  writedown of certain  non-recurring
expenses and a large  reserve for  obsolescense  inventory.  The actual loss for
operations was $2,833,332 less non-recurring expenses of $1,931,414 or $915,918.
There were other large expenses in SG&A during this period relating to marketing
and administration which have not continued.

                THREE MONTH PERIOD ENDED APRIL 29, 2001 COMPARED
                   TO THREE MONTH PERIOD ENDED APRIL 30, 2000

Sales for the three-month period ended April 29, 2001 were $772,000,  a decrease
of $416,000 or 35%,  compared with sales of $1,188,000 in the same period in the
prior fiscal year.  The decrease in sales for the second quarter ended April 30,
2001 is attributable to the Company's  change in business plan and the lead time
to develop the military/defense business.

Cost of sales for the second quarter of fiscal 2001 was $200,000 (26% of sales),
an decrease of $1,291,000 or 87%,  compared with $1,491,000  (125% of sales) for
the same  period in the prior  fiscal  year.  The  decrease  in cost of sales is
attributable  to lower volume.  However,  there was a substantial  provision for
inventory reserve ($950,000).

Selling, general and administrative ("SG&A") expenses for the three month period
ended April 29, 2001 were $2,042,000 (264% of sales), an increase of $1,500,000,
or 194%,  compared with $542,000 (46% of sales) for the same period in the prior
fiscal year.  The increase is due to higher costs for marketing,  travel,  trade
shows and legal  expenses for the Company and a significant  increase in reserve
for lease default and other writedowns.

Net interest expense amounted to $278,000 for the three month period ended April
29, 2001 compared  with net interest  expense of $461,000 for the same period in
the prior year.  The decrease is due to a change in debt  structure as indicated
in Note 4.

The net loss for the  three-month  period  ended  April  29,  2001  amounted  to
$2,698,000 an increase of $1,410,000, compared with net income of $1,288,000 for
the same period in the prior year. The loss for the current  three-month  period
is  attributable  to the  Company's  lack of  volume  of  defense  business  and
absorption  of  expenses  from  prior  periods  not  related  to  operations  ,a
substantial  increase in reserves for lease default and  inventory  obsolescense
and a writedown of other assets which are deemed by management to be worthless.


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<PAGE>

Management has determined  that, based on the Company's  historical  losses from
recurring operations, the Company will not recognize its net deferred tax assets
at April 29, 2001.  Ultimate  recognition  of these tax assets is dependent,  to
some  extent,  on future  revenue  levels and  margins.  It is the  intention of
management  to assess the  appropriate  level for the valuation  allowance  each
quarter.

The contract  process in which  products  are offered for sale is generally  set
before costs are incurred, and prices are based on estimates of the costs, which
include the anticipated impact of inflation.

The Company's  backlog of funded  orders not yet  recognized as revenue at April
29,  2001 was  approximately  $1,135,000.  All of the  backlog is expected to be
delivered during the next twelve months.

                         LIQUIDITY AND CAPITAL RESOURCES

The Company's  principal capital  requirements have been to fund working capital
needs,  capital  expenditures and the payment of long term debt. The Company has
recently  relied  primarily on internally  generated  funds,  private  placement
proceeds, subordinated debt and other bank debt to finance its operation.

The Company's liquidity and cash resources are significantly impaired by ongoing
losses and significant  reductions in revenues. The Company has substantial debt
due for repayment  during fiscal 2002,  which debt cannot be repaid from cash or
other proceeds from operations.  As a result,  significant  additional equity or
other capital are required to meet its debt  obligations  and satisfy  operating
expenses in the short and long term.

The Company  expects  that such debt can be repaid in whole or in part only from
the  proceeds  of  additional   financings  of  its  business  or  that  of  its
subsidiaries,  the sale of some or all of its  interests  in  MadeMyWay or other
subsidiaries,from  the proceeds of sale of its common stock, directly or through
the conversion of outstanding warrants or other rights to purchase common stock.

Subsequent to the close of the quarter ended April 29, 2001,  the Company raised
additional  debt financing of $1,025,000  from certain  members of DMTR LLC. The
$1,025,000  loan bears  interest  at a rate of 10% per  annum,  is due on May 1,
2003,  and is secured by a first lien on the  Company's  assets,  senior to that
DMTR, LLC this capital will be used to support the current working capital needs
of the Company.  The Company  anticipates  that it will need to raise additional
financing in the future, in the form of either debt, equity or both.


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<PAGE>

FORWARD LOOKING STATEMENTS-CAUTIONARY FACTORS

Except for the historical  information and statements  contained in this report,
the matters  set forth in this  report are  "forward  looking  statements"  that
involve  uncertainties  and risks,  some of which are  discussed at  appropriate
points in this report and the Company's  other SEC filings and the  availability
of funding for the Company's on-going operations.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

      The Company is, from time to time, the subject of legal litigation, claims
and assessments  arising out of matters occurring during the normal operation of
the Company's  business.  In the opinion of management,  the liability,  if any,
under such  current  litigation,  claims and  assessments  would not  materially
affect the  financial  position or the  results of  operations  of the  Company,
except as disclosed therein.

      In connection with a Mutual Release and Settlement  Agreement  between the
Company and the owner of premises formerly leased in California,  the Company is
required to issue an additional 2.7 million shares of Common Stock in accordance
with the terms of the agreement, which shares have not been issued.

ITEM 2. CHANGES IN SECURITIES AND USES OF PROCEEDS.

      None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

      The  Company  has failed to repay  when due  amounts  owing  under its 12%
Subordinated  Convertible  Secured Notes and 10% Subordinated Notes. The Company
is currently  negotiating  an exchange of such 12% Notes and 10% Notes for other
securities of the Company and a  simultaneous  waiver of all amounts owing under
the 12% Notes and the 10% Notes.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None.

ITEM 5. OTHER INFORMATION. None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

      Exhibits: None.

      Reports on Form 8-K.

      During the quarter ended April 29, 2001, the Company filed two (2) reports
on Form 8-K.  The first report was filed on February 23, 2001 and relates to: 1)
the  approval  by the Board of  Directors  of the  Company  (the  "Board") of an
increase in the authorized  shares of the Company's  Preferred Stock; and 2) the
approval  by the Board of a twenty  (20) to one (1)  reverse  stock split of the
Company's  Common Stock.  both of these  approvals  were subject to  shareholder
approval.  On February 28, 2001,  an amendment to the Form 8-K filed on February
23, 2001 was filed for the sole  purpose of changing  the address and  telephone
number of the Company on the cover page of the  February  23, 2001 Form 8-K. The
second report on Form 8-K was filed on April 27, 2001, and relates to Michael R.
Planit's resignation from the Board.


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<PAGE>

                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
Registrant  has duly  caused  this Form 10-QSB to be signed on its behalf by its
duly authorized representatives.

                                                     DATAMETRICS CORPORATION
                                                     -----------------------
                                                     (Registrant)

Dated: July 31, 2001                                 /s/ DANIEL BERTRAM
                                                     ---------------------------
                                                     Daniel Bertram
                                                     Chief Executive Officer

Dated: July 31, 2001                                 /s/ PHILLIP E. LAMBERT
                                                     ---------------------------
                                                     Phillip E. Lambert,
                                                     Chief Accounting Officer


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