UNITED STATES
                       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 March 31, 1999

                                       or


    [ ]   Transition Report pursuant to Section 13 or 15(d) of the Securities 
          Exchange Act of 1934 for the transition period from _______ to _______


                         COMMISSION FILE NUMBER 0-21529


                          GIGA INFORMATION GROUP, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


           Delaware                                06-1422860
       -----------------------                   ---------------
        (State or other jurisdiction of         (I.R.S. Employer
       incorporation or organization)           Identification No.)

                              ONE LONGWATER CIRCLE
                                NORWELL, MA 02061
                                 (781) 982-9500
                   -------------------------------------------
                   (Address, including zip code, and telephone
                    number, including area code, of principal
                               executive offices)


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


As of May 3, 1999, there were 9,986,311 shares of Common Stock, $.001 par value,
of the registrant outstanding.


================================================================================



                                       1
<PAGE>
                          GIGA INFORMATION GROUP, INC.



                                      INDEX
<TABLE>
<CAPTION>

                                                                                                        PAGE
<S>      <C>      <C>                                                                                     <C>  
PART I - FINANCIAL INFORMATION

         Item 1.  Financial Statements

                  Condensed Consolidated Statements of Operations for the three
                            months ended March 31, 1999 and March 31, 1998
                            (unaudited)                                                                   3.

                  Condensed Consolidated Balance Sheets at March 31, 1999  (unaudited)
                           and December 31, 1998                                                          4.

                  Condensed Consolidated Statements of Cash Flows for
                           the three months ended March 31, 1999 and March 31,
                           1998 (unaudited)                                                               5.

                  Notes to Condensed Consolidated Financial Statements (unaudited)                        6.

         Item 2.  Management's Discussion and Analysis of Financial Condition and
                           Results of Operations                                                          8.


PART II - OTHER INFORMATION

         Item 2.  Changes in Securities and Use of Proceeds                                               17.

         Item 6.  Exhibits and Reports on Form 8-K                                                        18.


SIGNATURE PAGE                                                                                            19.

INDEX TO EXHIBITS                                                                                         20.

</TABLE>

                                       2
<PAGE>

PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS

                          GIGA INFORMATION GROUP, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
           (unaudited, in thousands, except share and per share data)


                                                         Three Months Ended
                                                              March 31,
                                                        1999            1998
                                                    -----------     -----------
Revenues:

    Continuous information services                 $    10,354     $     6,804
    Other services                                        1,586           1,748
                                                    -----------     -----------

    Total revenues                                       11,940           8,552

Costs and expenses:
    Cost of services                                      5,940           4,462
    Sales and marketing                                   6,782           5,781
    Research and development                                254             339
    General and administrative                            2,118           1,352
    Depreciation and amortization                           379             385
                                                    -----------     -----------

    Total costs and expenses                             15,473          12,319
                                                    -----------     -----------

Loss from operations                                     (3,533)         (3,767)
                                                    -----------     -----------

Interest income                                             254              37
Interest expense                                            (37)            (86)
Foreign exchange gain/(loss)                               (244)            (16)
                                                    -----------     -----------

    Loss from operations before income taxes             (3,560)         (3,832)
Income tax (benefit)/charge                                  42               4
                                                    -----------     -----------

Net Loss                                                 (3,602)         (3,836)
                                                    ===========     ===========

Results per common share:
    Historical -  basic and diluted:
       Net loss                                     $     (0.36)    $     (1.81)
                                                    ===========     ===========
       Weighted average number of shares              9,955,957       2,115,837
                                                    ===========     ===========


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


                                       3
<PAGE>

                          GIGA INFORMATION GROUP, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                (in thousands, except share and per share data)

<TABLE>
<CAPTION>
                                                                                            March 31,   December 31,
                                                                                              1999        1998
                                                                                            ----------  -----------
                                                                                           (unaudited)
<S>                                                                                         <C>         <C>     
Assets
Current assets:
    Cash and cash equivalents                                                               $ 15,789    $ 14,149
    Marketable securities                                                                      4,371       6,908
    Trade accounts receivable, net of allowance for uncollectible accounts of $407
      and $410 at March 31, 1999 and December 31, 1998, respectively                           9,296      15,017
    Unbilled accounts receivable                                                               3,735       4,606
    Prepaid expenses and other current assets                                                  5,642       4,911
                                                                                            --------    --------
    Total current assets                                                                      38,833      45,591
Property and equipment, net                                                                    4,170       3,430
Other assets                                                                                     191         192
                                                                                            --------    --------
      Total assets                                                                          $ 43,194    $ 49,213
                                                                                            ========    ========

Liabilities and Stockholders' Equity
Current liabilities:
    Accounts payable                                                                           1,848       1,989
    Deferred revenues                                                                         27,978      29,470
    Accrued expenses and other current liabilities                                             6,100       7,443
    Debt - other, current portion                                                                481         461
                                                                                            --------    --------
    Total current liabilities                                                                 36,407      39,363
Long-term debt - other                                                                           316         444
                                                                                            --------    --------
      Total liabilities                                                                       36,723      39,807

Stockholders' equity:
    Preferred Stock, $.001 par value; 5,000,000 shares authorized, zero issued and
      outstanding at March 31, 1999 and December 31, 1998, respectively:                          --          --
    Common Stock, $.001 par value: 60,000,000 shares authorized, 9,969,436 and 9,943,502
      shares issued and outstanding at March 31, 1999 and December 31, 1998, respectively         10          10
Additional paid-in capital                                                                    80,489      80,550
Deferred compensation                                                                         (1,421)     (1,614)
Accumulated deficit                                                                          (73,259)    (69,657)
Accumulated other comprehensive income                                                           652         117
                                                                                            --------    --------
Total stockholders' equity                                                                     6,471       9,406
                                                                                            --------    --------
      Total liabilities and stockholders' equity                                            $ 43,194    $ 49,213
                                                                                            ========    ========
</TABLE>

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


                                       4
<PAGE>
                          GIGA INFORMATION GROUP, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (unaudited, in thousands)

<TABLE>
<CAPTION>

                                                                                              Three Months Ended
                                                                                                   March 31,
                                                                                               1999        1998
                                                                                             --------    --------
                                                                                                      
<S>                                                                                          <C>         <C>     
Cash flows from operating activities:
    Net loss                                                                                 $ (3,602)   $ (3,836)
    Adjustments to reconcile net loss to net cash used in continuing operating activities:
       Depreciation and amortization                                                              379         385
       Provision for doubtful accounts                                                             (2)        (79)
       Interest on long-term debt added to principal                                               --          13
       (Gain) loss on sale of fixed assets                                                          8          (9)
       Compensation expense related to stock options                                               65          29
       Other non-cash items                                                                        --           8
    Change in assets and liabilities:
       Decrease (increase) in accounts receivable                                               6,375       5,321
       Decrease (increase) in prepaid expenses and other current assets                        (1,386)        (53)
       (Decrease) increase  in deferred revenues                                               (1,349)     (2,045)
       (Decrease) increase  in accounts payable and accrued liabilities                          (188)     (1,023)
                                                                                             --------    --------

Net cash provided by (used in) operating activities:
    Net cash provided by (used in) continuing operations                                          300      (1,289)
    Net cash used in discontinued operations                                                       --         (13)
                                                                                             --------    --------
       Net cash provided by (used in) operating activities                                        300      (1,302)
                                                                                             --------    --------

Cash flows from investing activities:
    Acquisitions of equipment and improvements                                                 (1,137)       (261)
    Purchases of marketable securities                                                         (4,157)         --
    Proceeds from maturities of marketable securities                                           6,694          --
    Other, net                                                                                      4          10
                                                                                             --------    --------
       Cash provided by (used in) investing activities                                          1,404        (251)
                                                                                             --------    --------

Cash flows from financing activities:
    Proceeds from issuance of Common Stock under stock option plans                                28          65
    Proceeds from issuance of Common Stock due to exercise of warrants                             38          --
    Repayments of principal to related parties                                                     --        (224)
    Principal payments on long-term debt, current portion                                        (108)        (72)
                                                                                             --------    --------
       Cash provided by (used in) financing activities                                            (42)       (231)
                                                                                             --------    --------

    Effect of exchange rates on cash                                                              (22)         (2)
    Net increase (decrease) in cash and cash equivalents                                        1,640      (1,786)
    Cash and cash equivalents, beginning of period                                             14,149       3,539
                                                                                             --------    --------
       Cash and cash equivalents, end of period                                              $ 15,789    $  1,753
                                                                                             ========    ========
 
    Supplementary cash flow information:
       Income taxes paid                                                                     $     42    $      5
       Interest paid                                                                         $     37    $     55
</TABLE>

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

                                       5
<PAGE>


                         GIGA INFORMATION GROUP, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


1.       Interim Condensed Consolidated Financial Statements

The accompanying  condensed  consolidated financial statements of the Company at
March  31,  1999 and for the three  months  ended  March  31,  1999 and 1998 are
unaudited  and  have  been  prepared  in  accordance  with  generally   accepted
accounting   principles  for  interim   financial   information   and  with  the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes  required by generally accepted
accounting  principles  for  complete  financial  statements.   All  adjustments
(consisting only of normal recurring  adjustments)  have been made which, in the
opinion of  management,  are necessary for a fair  presentation.  The results of
operations  for the periods  presented  are not  necessarily  indicative  of the
results that may be expected  for any future  period.  For further  information,
refer to the Company's audited consolidated financial statements included in the
Company's  Annual Report on Form 10-K,  for the year ended December 31, 1998, as
filed with the Securities and Exchange Commission.

2.       Computation of Earnings per Share of Common Stock

Due to the losses  incurred by the Company  for the three  month  periods  ended
March 31, 1999 and 1998,  common  equivalent  shares  resulting from the assumed
exercise of outstanding stock options and warrants and the assumed conversion of
outstanding  convertible notes payable at March 31, 1998 have been excluded from
the  computation  of  diluted  net loss  per  share  as  their  effect  would be
anti-dilutive.  Options and warrants to purchase  2,630,150 and 1,883,598 shares
of Common Stock were outstanding at March 31,1999 and 1998, respectively. Common
equivalent   shares  resulting  from  the  assumed   conversion  of  outstanding
convertible  notes payable at March  31,1999 and 1998 were 0 and 78,910  shares,
respectively.

3.       Comprehensive Income (Loss)

         The table below sets forth "Comprehensive Income (Loss)" as defined
by SFAS No. 130 (in thousands):


                                                            Three Months Ended
                                                                 March 31,
                                                             1999        1998
                                                            -------     -------

Net loss                                                    $(3,602)    $(3,836)
     Other Comprehensive income (loss), net of tax:
        Foreign currency translation adjustment                 535          74
                                                            -------     -------

Comprehensive loss                                          $(3,067)    $(3,762)
                                                            =======     =======



                                       6
<PAGE>

                          GIGA INFORMATION GROUP, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


4.       Segment Information

         Giga has determined that it operates in one reportable segment,
information technology ("IT") advisory services. Revenues from the products and
services within, and in support of, Giga's IT advisory services are presented in
detail in the Company's Condensed Consolidated Statements of Operations.

         Giga conducts business principally in the United States and United
Kingdom. Operations in France, Germany and Italy have been aggregated
(collectively "Other International"). Revenues are reflected in the geographic
area in which the sales are made. The table below presents information about the
Company's reported revenues and total assets for the three months ended March
31, 1999 and 1998, respectively (in thousands).


Revenues
                                                                March 31,
                                                             1999      1998
                                                            -------   -------
United States                                               $10,762   $ 7,852
United Kingdom                                                  809       514
Other International                                             369       186
                                                            -------   -------
              subtotal                                       11,940     8,552
Transfers between areas                                          --        --
                                                            -------   -------
              Consolidated revenue                          $11,940   $ 8,552
                                                            =======   =======


Total Assets
                                                                March 31,
                                                              1999      1998
                                                            -------   -------
United States                                               $37,669   $12,353
United Kingdom                                                3,151     1,875
Other International                                           2,374     1,445
                                                            -------   -------
              Consolidated total assets                     $43,194   $15,673
                                                            =======   =======


                                       7
<PAGE>

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

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

Statements  that are not  historical  facts  may be  considered  forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Such forward looking statements,  including those concerning the Company's
expectations,  involve known and unknown risks,  uncertainties and other factors
which may cause the actual results,  performance or achievements of the Company,
or  industry  results,  to be  materially  different  from any  future  results,
performance,  or  achievements  expressed  or  implied by such  forward  looking
statements. In evaluating such statements as well as the future prospects of the
Company, specific consideration should be given to various factors including the
following:  the Company's prior losses and  anticipation  of future losses;  the
Company's  need  to  attract  and  retain  qualified  personnel;  the  Company's
dependence on sales and renewals of subscription-based  services;  the Company's
ability to achieve and sustain  high renewal  rates;  the  Company's  ability to
manage and sustain growth;  the Company's  future capital needs and the risks of
working  capital  deficiency;   the  Company's   dependence  on  key  personnel;
competition;  the risks  associated  with the  development  of new  services and
products;  the potential for  significant  fluctuations  in quarterly  operating
results; continued market acceptance and demand for Giga services; uncertainties
relating  to  proprietary  rights;  the  Company's  dependence  on the  Internet
infrastructure;  the risk of system failure;  the risks related to content;  and
the risks associated with international operations.


OVERVIEW


Giga is an  information  technology  (IT)  research and advisory  firm  offering
objective  analysis  and advice to help  clients  make sound  technology-related
decisions.  The Company's research focus is on helping companies integrate their
businesses  with the  Internet;  it also covers other issues  pertaining  to the
computing,   telecommunications  and  related  industries.  The  Company's  four
principal  products  and services  are (i)  Advisory  Service,  (ii) IT Practice
Services, (iii) Continuous Advisory Consulting and (iv) Events and Publications.
The Company provides its services  primarily  through  GigaWeb,  its intelligent
Internet-based information delivery interface.

The Company  introduced its Advisory  Service and GigaWeb in April 1996. In July
1996, the Company introduced its IT Practice Services.  Advisory  Consulting was
introduced in September 1997. The Company's Events and Publications product line
was acquired with the  acquisition  of BIS Strategic  Decisions,  Inc.  (BIS) in
April  1995.  For  financial  reporting  purposes,  revenues  from (i)  Advisory
Service,  IT Practice Services and Continuous Advisory Consulting are aggregated
into Continuous Information Services, and (ii) Events and publications and other
services,  principally  consulting,  are  aggregated  into Other  Services.  The
Company  expects that CIS revenues  will continue to increase as a percentage of
its total revenues.

The Company's Continuous Information Services ("CIS") are typically sold through
annual  contracts that generally  provide for payment at the commencement of the
contract period. A small number of CIS contracts, however, are billed quarterly.
Amounts received in advance of services  provided are reflected in the Company's
financial  statements  as  deferred  revenues  and are  recognized  monthly on a
prorata  basis over the term of the contract.  Revenues from Other  Services are
recognized as follows: events as they occur,  publications as they are delivered
and  consulting  as  such  services  are  performed.  Unbilled  receivables  are
primarily  generated as a result of contractual  quarterly billing terms offered
in connection with the Company's Continuous  Information  Services.  The Company
also records the related commission obligation upon acceptance of a CIS contract
and amortizes the corresponding  deferred commission over the contract period in
which the related CIS 

                                       8
<PAGE>


revenues  are  earned.  With the  consistent  application  of  these  accounting
policies  as well as growth in CIS  contract  value and volume,  trade  accounts
receivable,   deferred  revenues,  unbilled  accounts  receivable  and  deferred
commissions are expected to increase.

Essentially all of the Company's current international operations are located in
the  European  Community  and  Canada.  The  Company  operates  in the  European
Community  primarily  through wholly owned  subsidiaries  in the United Kingdom,
France and  Germany.  These  subsidiaries  manage  direct  sales  personnel  and
distributors  in other  countries in the European  Community as well. In Canada,
the  Company  utilizes a  full-scale  field sales  force and  provides  business
support to these  salespersons  through  its  operations  in the United  States.
Substantially  all of the  Company's  revenues  from the European  Community are
denominated  in  foreign  currencies,  particularly  the  British  pound,  while
essentially  all of the Company's  revenues from Canada are  denominated in U.S.
dollars. The Company markets in Israel, Korea and Italy through representatives.
Revenues from these representatives have been and are expected to continue to be
denominated  in  U.S.  dollars.  To  date,  however,  such  revenues  have  been
insignificant.  As a result of  fluctuations  in  exchange  rates,  transactions
denominated  in foreign  currencies  inherently  have  financial  risk. To date,
however,  the Company's  cumulative  translation  adjustments have been slightly
favorable,  although  there can be no assurance that this trend will continue in
the  future.  The  Company  does not  currently  hedge its  exposure  to foreign
currency adjustments.

The Company believes that a leading measure of the volume of its CIS business is
the annualized value ("Annualized Value" or "AV") of its Continuous  Information
Services  agreements in effect at a given point in time. The Company  calculates
Annualized  Value each month as the  cumulative  annualized  subscription  value
payable under the agreements  without regard to commencement  date,  duration or
risk of cancellation.  Annualized Value at March 31, 1999 increased 54% to $45.5
million from $29.5 million at March 31, 1998,  while Annualized Value per client
increased  29% to $47,800 at March 31, 1999 from $37,000 at March 31, 1998.  The
year-over-year growth rate of AV declined from 54% for the first quarter of 1999
as compared to 152% for the same period of 1998,  due primarily to a decrease in
business from new customers.  Price pressure has also increased as the Company's
competitors  have adjusted their prices in response to what Giga believes is the
superior value of its services.

The Company also measures its  performance on the basis of Net Annualized  Value
Increase  ("NAVI")  which is  calculated  on the  basis of new  agreements  plus
upgrades,  net of downgrades and cancellations.  The sum of all past NAVI equals
Annualized Value. NAVI for a period can also be derived by subtracting AV at the
beginning of the period from AV at the end of the period. Because of this simple
calculation, the Company does not generally report explicit NAVI data.

A majority of the Company's  annual  contracts  renew  automatically  unless the
customer cancels the subscription.  The Company's experience is that substantial
portions of customers renew expiring  contracts for an equal or greater level of
total CIS fees each year.  Approximately 26% of contract value up for renewal in
the first quarter of 1999 cancelled,  discontinuing  all Continuous  Information
Services,  as compared to 30% for the same  period of 1998.  These  cancellation
rates  do  not  include   contracts  lost  due  to  mergers,   acquisitions  and
bankruptcies.  The Company believes that a direct comparison of its cancellation
rate and those of its major competitors may not be meaningful due in part to the
Company's  limited operating history and its unified Advisory Service model (the
focus of which is an  integrated  approach  with  fewer  contracts/services  per
customer),  in contrast to the  multiple-service  model of the  Company's  major
competitors.

The  Company's  operating  expenses  consist of cost of  services,  selling  and
marketing,   research  and   development,   general  and   administrative,   and
depreciation and amortization. Cost of services consists primarily of the direct
costs  associated  with the  delivery of the  Company's  Continuous  Information
Services and other services including  personnel expenses for analysts and other
personnel, direct expenses for events and conferences, expenses to create, print
and distribute  publications and royalties to third party information providers.
Sales and marketing expenses include personnel expenses,  promotional  expenses,
and sales  commissions.  Sales commissions are typically  



                                       9
<PAGE>

deferred when paid and expensed as the related  revenue is recognized.  Research
and development expenses consist of personnel,  consulting and other expenses to
develop,  enhance and operate GigaWeb.  General and administrative  expenses are
primarily  personnel  costs and fees for  professional  services  supporting the
administrative functions of the Company.

Since its inception,  the Company has incurred  substantial costs to develop its
Continuous   Information  Services,   establish  its  GigaWeb  system,  build  a
management team and recruit, employ and train research analysts, sales personnel
and support staff for its  business.  The Company  expects to incur  significant
losses  through at least  fiscal  1999 as the  Company  continues  to expand and
develop its services, products and infrastructure.

         The Company has incurred  substantial tax losses since  inception,  and
acquired tax losses with its  acquisition  of BIS. Due to the magnitude of these
existing tax losses, continuing losses anticipated through at least 1999 and the
substantial uncertainties associated with its business, at this time the Company
concludes that it is more likely than not that the deferred tax associated  with
these tax losses will not be realized.  Accordingly, this deferred tax asset has
been fully reserved.  This valuation  allowance will be reduced and the deferred
tax asset will be  recognized  when and if it becomes  more likely than not that
the deferred tax asset will be realized.

                                       10
<PAGE>


RESULTS OF OPERATIONS

         The  following  table  sets  forth  certain  items  from the  Company's
condensed consolidated  statements of operations as a percentage of revenues for
the periods indicated:

                                                       Three Months Ended
                                                            March 31,
                                                        1999          1998
                                                      --------   ---------
Revenues:                                                        
    Continuous information services                       87%         80%
    Other services                                        13%         20%
                                                      --------   ---------
                                                                 
       Total revenues                                    100%        100%
                                                      --------   ---------
                                                                 
Costs and expenses:                                              
    Cost of services                                      50%         52%
    Sales and marketing                                   57%         68%
    Research and development                               2%          4%
    General and administrative                            18%         16%
    Depreciation and amortization                          3%          4%
                                                      --------   ---------
                                                                 
       Total costs and expenses                          130%        144%
                                                      --------   ---------
                                                                 
    Loss from operations                                 (30%)       (44%)
                                                                 
Interest income                                            2%           -
Interest expense                                            -         (1%)
Foreign exchange gain/(loss)                              (2%)          -
                                                      --------   ---------
                                                                 
    Loss from operations before income taxes             (30%)       (45%)
Income tax (benefit) charge                                 -           -
                                                      --------   ---------
                                                                 
    Net loss                                             (30%)       (45%)
                                                      ========   =========
                                                               

         In general, the decreases in the various operating expenses as a
percentage of total revenues are primarily due to leveraging those expenses over
increased revenues derived from a growing customer base.

                                       11
<PAGE>


THREE MONTHS ENDED MARCH 31, 1999 COMPARED TO THREE MONTHS ENDED
MARCH 31, 1998


         Revenues.  Total revenues  increased 40% to $11.9 million for the three
months ended March  31,1999  from $8.6 million for the same period in 1998.  The
increase in total  revenues was due to the increase in revenues from  Continuous
Information Services.

         Revenues from Continuous  Information  Services  increased 52% to $10.4
million for the three months ended March 31, 1999 from $6.8 million for the same
period in 1998.  The increase in revenues was  primarily  due to growing  market
acceptance of Giga's services.

         Revenues from Other Services decreased 9% to approximately $1.6 million
for the three  months ended March 31, 1999 from  approximately  $1.7 million for
the same period in 1998.  The decrease  was  primarily  due to lower  conference
revenues.

         Cost of services.  Cost of services  increased  33% to $5.9 million for
the three  months  ended March 31, 1999 from $4.5 million for the same period in
1998.  The increase in costs was primarily due to the expansion of analyst staff
to  support  an  increased  customer  base and other  expenses  associated  with
providing Continuous Information Services.

         Sales and marketing. Sales and marketing expenses increased 17% to $6.8
million for the three months ended March 31, 1999 from $5.8 million for the same
period in 1998. The increase was  principally  due to expansion of the Company's
direct sales organization when compared to the first quarter of 1998.

         Research and development.  Research and development  expenses decreased
25% to $254,000 for the three months ended March 31, 1999 from  $339,000 for the
same  three-month  period  in 1998.  The  decrease  was  primarily  due to lower
personnel costs and headcount.

         General  and  administrative.   General  and  administrative   expenses
increased  57% to $2.1  million for the three  months  ended March 31, 1999 from
$1.4 million for the same period in 1998.  The increase in expense was primarily
due to  enhancements  to  infrastructure  such as internal  systems,  additional
personnel and other items to support the Company's growth.

         Depreciation and  amortization.  Depreciation and amortization  expense
decreased 2% to $379,000 for the three months ended March 31, 1999 from $385,000
for the same  period in 1998.  The  decrease  was  primarily  due to lower costs
resulting  from the  culmination  of leasehold  amortization  charges  partially
offset by increased  depreciation  costs  resulting from computer  equipment and
software purchased for new personnel.

         Interest income and expense.  Interest income increased to $254,000 for
the three  months  ended March 31, 1999 from $37,000 for the same period in 1998
due to greater cash  balances  available  for  investment.  Interest  expense on
long-term  equipment financing decreased to $37,000 in the first quarter of 1999
from  $86,000 for the same period in 1998 due to a lower  outstanding  principal
balance.

         Foreign  exchange  gain/(loss).  Foreign  exchange losses  increased to
$244,000  for the three  months  ended March 31, 1999 from  $16,000 for the same
period in 1998 due  primarily to  unrealized  losses  caused by weakening of the
German Mark and the French Franc versus the U.S. Dollar.

                                       12
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES


         Prior to August  1998,  the  Company  funded its  operations  primarily
through  the  private  placement  of  equity  securities  and  borrowings  under
promissory  notes. The Company received  aggregate net proceeds of $42.4 million
from the private placement of equity  securities since its inception,  including
$1.9 million (net of issuance  costs of $81,000)  from the private  placement of
Series D Convertible  Preferred Stock and associated  Series D warrants in April
and May 1998.  In April 1998,  the Company  also issued  notes in the  aggregate
principal  amount of $10.0 million (the "Bridge Notes") and warrants to purchase
an aggregate of 166,666 shares of common stock at an exercise price of $3.00 per
share.  The notes were issued at a stated  interest  rate of 12% per annum.  The
outstanding  principal and interest on the notes became due and payable upon the
consummation of the Company's Offering. Between August 4, 1998 and March 8, 1999
warrants to purchase  60,665  shares of common stock were  exercised for cash of
$181,995,  at an  exercise  price  of  $3.00  per  share.  These  warrants  were
originally  issued  in April  1998  pursuant  to the Loan and  Warrant  Purchase
Agreement for the Bridge Notes.

         In August 1998, the Company  completed its public offering of 3,000,000
shares of common stock at $12.50 per share (the "Offering"). Net proceeds to the
Company aggregated  approximately $33.8 million.  The Company used $10.2 million
of the net proceeds to repay  obligations  for principal  and remaining  accrued
interest under the Bridge Notes issued in April 1998. Also upon the consummation
of the Offering,  all outstanding  shares of the Company's  Series A, B, C and D
Convertible  Preferred Stock  automatically  converted into 4,686,784  shares of
common stock.

         At  March  31,  1999,  the  Company  had  cash,  cash  equivalents  and
marketable securities of $20.2 million.  During the quarter ended March 31,1999,
the Company's capital expenditures totaled approximately $1.1 million, primarily
for computer  equipment  and  applications  software.  The Company  expects that
additional  purchases  of  computer  equipment  will be  made  as the  Company's
employee base and customer base grows.  As of March 31, 1999, the Company had no
material  commitments  for  capital  expenditures,  and  the  Company  does  not
currently expect the rate of capital spending to vary significantly  through the
end of 1999.

         Net cash provided by continuing  operations was approximately  $300,000
for the  quarter  ended  March  31,  1999  versus  net cash  used by  continuing
operations  of $1.3 million for the same quarter of 1998.  This increase in cash
generated by continuing  operations  was due  principally  to changes in various
balance sheet accounts,  particularly accounts receivable,  accounts payable and
accrued expenses.

         Net cash  provided  by  investing  activities  was  approximately  $1.4
million for the three-month  period ended March 31, 1999 versus $251,000 of cash
used in  investing  activities  for the same period of 1998.  The  increase  was
primarily due to the maturity of marketable debt securities  offset by purchases
of marketable securities and computer equipment and applications software.

         Cash  used  in  financing  activities  was  approximately  $42,000  and
$231,000  for the  quarter  ended March 31,  1999 and 1998,  respectively.  This
decrease was due primarily to lower  repayments of principal on outstanding debt
in 1999.

         The  Company  has spent  substantial  amounts  to date on  capital  and
operating  expenditures,  which have  contributed to an  accumulated  deficit of
$73.3  million.   Furthermore,   the  Company   expects  capital  and  operating
expenditures to increase due to numerous factors,  including the Company's plans
to increase  marketing  efforts for its  Continuous  Information  Services,  the
expected  costs to attract  and retain  qualified  employees,  the  response  of
competitors to the Company's services, the Company's plans to develop and market
new services and products, the further enhancement of the GigaWeb system and the
expansion of the Company's international operations.

                                       13
<PAGE>

         The Company believes that the remaining net proceeds from the Offering,
together  with its existing  cash,  cash  equivalents,  and maturing  marketable
securities  and  cash  expected  to be  generated  from  operations,  after  the
repayment of debt as it becomes due,  will be  sufficient  to fund the Company's
cash needs until at least the first quarter of 2000.

         However,  in the event  that the  Company  encounters  difficulties  in
collecting accounts receivable,  experiences low or reduced subscription renewal
rates or otherwise has revenues  that are lower than planned,  the Company might
require  additional  working  capital.  The  Company  has  access to an  invoice
factoring  arrangement  with a  commercial  bank under which the  Company  could
borrow up to $3.0 million or 80% of eligible accounts  receivable,  whichever is
less.  If  necessary,  the  Company  would  consider  various  other  sources of
financing, including, but not limited to, private placements, the sale of assets
and strategic alliances, but there can be no assurance that such financing would
be available to the Company on terms that are acceptable, if at all. If adequate
funds are not  available,  the Company may be required to reduce its fixed costs
and delay,  scale back or eliminate certain of its services,  any of which could
have a material adverse effect on the Company's  business,  financial  condition
and results of operations.

YEAR 2000 COMPLIANCE

         The  Company  has  commenced  a  readiness  program to ensure  that the
computer systems and applications  upon which it relies for internal  operations
and  external  communications  with  clients and others will  function  properly
beyond 1999. Giga is leveraging the knowledge of its research staff to focus the
efforts  of  its  readiness  program.  The  Company's  readiness  program  is an
extension  of  its  ongoing  effort  to  upgrade   systems,   applications   and
infrastructure  that have been  rendered  obsolete due to advances in technology
and the Company's high growth.

         Giga's products do not affect its client's internal  systems.  GigaWeb,
the delivery  mechanism for Giga's  Advisory  Service,  is  accessible  over the
Internet,  IntraGiga  (an FTP or HTTP  download  of Giga's  Research  for use on
internal  networks) and GigaNotes,  a Lotus Notes  database of Giga's  Research.
Giga does not provide software to enable clients to access research content.

         Giga's  products  are  not  directly  date  dependent.  Giga's  primary
product, Advisory Service, consists in part of original written research content
created by Giga analysts.  While some search or display  capabilities of GigaWeb
may be affected,  GigaWeb will not cease to function as a result of  limitations
in processing date/time data.

         GigaWeb uses enhanced  database,  search engine, and related technology
in order to provide  clients with a total  delivery  solution for Giga  research
content. Outlined below are some of the issues Giga is addressing with regard to
the  GigaWeb  Year 2000  Readiness  Program.  These  are  issues  that  exist in
GigaWeb's present form. An upgrade to GigaWeb, scheduled for release in the fall
of 1999,  is  expected  to resolve  these  concerns.  To the  extent  that these
improvements  contain date  dependent  technology,  they will be developed to be
fully Year 2000 compliant.

          o    Order Management: All dates used by Giga's order management
               system are stored in a format that correctly represents and
               enables manipulation of dates in the twentieth and twenty-first
               centuries and beyond. Accordingly, we do not anticipate any
               problems with passwords that would restrict our user's ability to
               access GigaWeb.

          o    Search Capabilities: Giga uses a third-party search engine, which
               is certified to be Y2K compliant by its manufacturer. We do not
               anticipate any problems with searching and retrieving GigaWeb
               content.

          o    Third Party Content: We are currently working with third-party
               content providers to ensure that the manner in which information
               is provided is free from Y2K associated problems.


                                       14
<PAGE>

         A few of Giga's IT Practice services  incorporate a software component.
These  software  programs are  designed to assist  clients in  evaluating  their
internal IT projects and therefore should not have Y2K implications.

         Prior to the  commencement  of the Company's Y2K readiness  initiative,
certain internal  business systems critical to the continuing  operations of the
Company had been  identified for  replacement  due to advances in technology and
the Company's  growth.  In addition,  as a result of the Company's Y2K readiness
program,  internal business systems that may require  remediation or replacement
specifically  due to the Y2K issue have been  identified.  In either  case,  the
systems  ranked  highest in priority  have either been replaced or scheduled for
replacement.  The Company  estimates that, as of April 30, 1999, the replacement
effort  was   approximately   90%  complete  for   software   applications   and
approximately 80% complete for computer hardware.  The Company's objective is to
substantially  complete the replacement of internal business systems by November
1999.  Replacement systems have been developed  internally and/or purchased from
third  party  vendors.   Internally  developed  systems  have  been  tested  for
compliance using simulated Y2K conditions including leap year conditions.  Newly
purchased systems are or will be verified as Y2K compliant by the vendors.

         The Company has completed its review of older computer hardware, mainly
desktop systems, particularly in its European operations and has begun replacing
non-compliant  equipment.  This  equipment is not  critical to ongoing  business
operations. The costs to replace the equipment will not be material and would
normally  be  capitalized.  In January  1999,  the Company  spent  approximately
$65,000 to replace hardware with possible Y2K issues. The Company estimates that
a total of $150,000 will be spent on this replacement effort.

         The Company has  identified  significant  service  providers,  vendors,
suppliers and customers believed to be most critical to its business  operations
and is assessing  the extent to which its  operations  are  vulnerable  if these
vendors fail to achieve Y2K  compliance.  For  approximately  90% of the vendors
identified,  the  Company has  surveyed  their  stage of Y2K  readiness  through
questionnaires,  disclosures  available from their websites and other  available
means. While these vendors have plans and programs underway to become compliant,
there is no guarantee that their systems will be converted on a timely basis.

         The Company  presently  believes that it may experience some disruption
in its business  due to the Y2K issue.  The Company is dependent on the Internet
infrastructure  for providing  reliable  GigaWeb access.  GigaWeb is an Internet
based  information  delivery  interface and the primary  delivery medium for the
Company's  Continuous  Information  Services.  Year 2000 issues could affect the
power  grid  and   communications   networks   that   provide   the   Internet's
infrastructure.  The  occurrence of such problems  would be beyond the Company's
control.  The  possible  consequences  of the  Company or its key  suppliers  or
customers not being Y2K compliant include, but are not limited to, (1) delays in
delivery or an inability to deliver its  Continuous  Information  Services,  (2)
vendor or  supplier  delays in  delivery  or an  inability  to deliver  goods or
services  critical to the Company's  continuing  operation,  (3) delays in or an
inability to bill and collect amounts due from  customers,  and (4) delays in or
an inability to remit on the part of Giga's customers. As a result, the business
and results of operations could be materially  adversely affected by a temporary
inability to conduct  ordinary  business  for a period of time after  January 1,
2000.  However,   the  Company  believes  that  its  actions  and  plans  should
significantly reduce the adverse effects of any disruptions.

         Concurrent with its readiness program, the Company is in the process of
developing  contingency plans in the event of possible interruptions in business
operations.  These plans may include the  complete  back-up of GigaWeb for quick
restoration at alternate geographic sites,  available and compliant  replacement
PC hardware and software and the development of internal  diagnostic  procedures
to quickly  identify  work-arounds  and solutions.  Once developed,  contingency
plans and their related costs will be continuously  evaluated and refined as new
and additional information becomes available.


                                       15
<PAGE>

         It is  currently  estimated  that the total cost of the  Company's  Y2K
efforts  will be  approximately  $415,000,  or 4% of the  Company's  actual  and
projected  IT costs over the project  period.  Of these costs  $19,000 are costs
incurred for the services of outside  consultants  and advisors and $396,000 are
primarily  payroll  costs  for  the  Company's  information  technology  groups,
incurred exclusively in connection with its Y2K efforts.  This estimate does not
include  costs  associated  with  systems  previously  scheduled  for upgrade or
replacement.  As of April 30, 1999, an approximate  cumulative total of $225,000
has been spent for its Y2K efforts of which  $18,000 are costs  incurred for the
services of outside  consultants and advisors and $207,000 are primarily payroll
costs for the Company's information  technology groups,  incurred exclusively in
connection  with its Y2K  efforts.  For the four months  ended  April 30,  1999,
approximately  $92,000  has been  spent on the  Company's  Y2K  efforts of which
$6,000 are costs incurred for the services of outside  consultants  and advisors
and $86,000 are primarily payroll costs for the Company's information technology
groups, incurred exclusively in connection with its Y2K efforts. These costs are
being  expensed as incurred and funded through  operating cash flow.  These cost
estimates  do not  include the costs  associated  with  contingency  plans under
development or the costs for computer  hardware and software  replacement  which
would normally be capitalized, estimated to be less than $150,000. The estimated
costs of the  Company's  readiness  program are subject to change as the program
progresses.

                                       16
<PAGE>

PART II - OTHER INFORMATION


ITEM 2.           CHANGES IN SECURITIES AND USE OF PROCEEDS

         Recent Sales of Unregistered Securities

         Set  forth  below is  information  regarding  the  number  of shares of
capital  stock issued by the Company  during the fiscal  quarter ended March 31,
1999 which were not registered under the Securities Act of 1933, as amended (the
"Securities Act") . Further included is the  consideration,  if any, received by
the Company for such shares of capital stock. The shares of capital stock issued
in the  following  transactions  were  offered  and  sold in  reliance  upon the
exemption  from  registration  under  Section  4 (2)  of the  Securities  Act or
Regulation D relative to sales by an issuer not involving any public offering.

          1.   In January 1999, the Company issued 10,000 shares of Common Stock
               upon the exercise of warrants at an exercise price of $3.00 per
               share for cash proceeds of $30,000. These warrants were
               originally issued in April 1998 pursuant to the Loan and Warrant
               Purchase Agreement for the Bridge Notes.

          2.   In March 1999, the Company issued 2,666 shares of Common Stock
               upon the exercise of warrants at an exercise price of $3.00 per
               share for cash proceeds of $7,998. These warrants were originally
               issued in April 1998 pursuant to the Loan and Warrant Purchase
               Agreement for the Bridge Notes.


         Use of Proceeds

         The  Company's  Registration  Statement on Form S-1  (Registration  No.
333-52899),  (the  "Registration  Statement"),  relating  to  the  Offering  was
declared  effective by the Securities and Exchange  Commission on July 29, 1998.
The sale of 3,000,000 shares of the Company's Common Stock, $0.001 par value, at
$12.50 per share commenced on July 30, 1998 and has been completed. The managing
underwriters  for the Offering were Friedman,  Billings,  Ramsey & Co., Inc. and
Prudential  Securities  Incorporated.  The total  price to the  public was $37.5
million  before  underwriting  discounts and  commissions  of $2.625 million and
offering  expenses of $1.082  million.  All such expenses are direct or indirect
payments to others.  None of such  expenses  were paid directly or indirectly to
any director or officer of the Company or their  associates,  persons owning ten
percent  or more  of any  class  of  equity  securities  of the  Company,  or an
affiliate of the Company.

         As of April 30,  1999,  the  Company  had used a  portion  of the $33.8
million net proceeds from the Offering to repay the Bridge Notes  aggregating to
$10.0  million  of  principal  plus  $210,000  of  accrued   interest   thereon.
Furthermore,  the Company had added  $18.8  million of such net  proceeds to the
general  funds of the  corporation  for use as working  capital and invested the
remaining  $4.8  million of the net  proceeds  in  short-term,  investment-grade
interest-bearing obligations. None of the net proceeds of the Offering were paid
directly  or  indirectly  to any  director  or officer  of the  Company or their
associates, persons owning ten percent or more of any class of equity securities
of the  Company or an  affiliate  of the  Company  except to the  extent  that a
portion  of the  working  capital  was used for (i)  salaries  and  expenses  of
officers and expenses of directors and (ii) to meet working capital needs of the
Company's subsidiaries, both in the normal course of business.


                                       17
<PAGE>
      
      
      ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K
      
      (a)    Exhibits
                                                                                
      11       Statement of Computation of Per Share Earnings

      27       Financial Data Schedule
            

      (b)      Reports on Form 8-K
      
      The Company filed a Current  Report on Form 8-K,  dated February 19, 1999,
      pertaining  to  a  press  release  announcing  the  Company's  results  of
      operations for the fiscal year ended December 31, 1998.

                                       18
<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.



                                             GIGA INFORMATION GROUP, INC.

    May 17, 1999                             By: /s/ Daniel M. Clarke
                                                 -------------------------------
                                                 Daniel M. Clarke
                                                 Senior Vice President.
                                                 Chief Financial Officer,
                                                 Secretary and Treasurer
                                                 (Principal Financial and
                                                 Accounting Officer)




                                       19
<PAGE>
                                  EXHIBIT INDEX

EXHIBIT
NUMBER            DESCRIPTION OF DOCUMENTS
------            ------------------------

11       Statement of Computation of Per Share Earnings

27       Financial Data Schedule








                                       20