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 June 30, 1997

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the transition period from                  to                  
                                    ------------------  ------------------


                           Commission File No. 0-25866
                                 ---------------

                        PHOENIX GOLD INTERNATIONAL, INC.
        (Exact name of small business issuer as specified in its charter)


             OREGON                                  93-1066325
      (State or other jurisdiction of    (I.R.S. employer identification number)
      incorporation or organization)

               9300 NORTH DECATUR STREET, PORTLAND, OREGON, 97203
               (Address of principal executive offices) (Zip code)


                                 (503) 288-2008
                           (Issuer's telephone number)

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

As of July 31, 1997,  there were issued and outstanding  3,458,985 shares of the
Company's Common Stock.

Transitional Small Business Disclosure Format (check one):
                YES [  ]        NO [X]

<PAGE>


                        PHOENIX GOLD INTERNATIONAL, INC.
                 FORM 10-QSB FOR THE QUARTER ENDED JUNE 30, 1997


                                      INDEX


Part I.    FINANCIAL INFORMATION                                           Page

           Item 1.    Financial Statements

                      Balance Sheets at June 30, 1997 (unaudited)
                      and September 30, 1996 (audited)                        3

                      Unaudited Statements of Operations for the
                      Three and Nine Months Ended June 30, 1997
                      and 1996                                                4

                      Unaudited Statements of Cash Flows for the
                      Nine Months Ended June 30, 1997 and 1996                5

                      Notes to Financial Statements                           6

           Item 2.    Management's Discussion and Analysis or
                      Plan of Operation                                       8


Part II.   OTHER INFORMATION

           Items 1 through 6                                                  10

           Signatures                                                         11

           Index to Exhibits                                                  12


<PAGE>
PART I.   FINANCIAL INFORMAITON
Item 1:   Financial Statements

                        PHOENIX GOLD INTERNATIONAL, INC.
                        --------------------------------
                                 BALANCE SHEETS
                                 --------------
<TABLE>
<CAPTION>
                                                                                 JUNE 30,                    SEPTEMBER 30,
                                                                                   1997                          1996
                                                                           ----------------------        ----------------------
                                                                                (Unaudited)                    (Audited)
<S>                                                                              <C>                            <C>          
ASSETS

Current assets:
    Cash and cash equivalents                                                             $2,601                        $2,599
    Accounts receivable, net                                                           5,157,149                     5,119,360
    Inventories:
        Raw materials                                                                  3,188,894                     4,288,206
        Work-in-process                                                                   38,247                     1,101,414
        Finished goods                                                                 4,501,863                     3,411,342
        Supplies                                                                         135,956                       170,598
                                                                           ----------------------        ----------------------
                                                                                       7,864,960                     8,971,560
    Prepaid expenses                                                                     297,731                       285,777
    Deferred taxes                                                                       390,000                       525,428
                                                                           ----------------------        ----------------------
        Total current assets                                                          13,712,441                    14,904,724

Property and equipment, net                                                            3,565,572                     3,938,790
Goodwill, net                                                                            267,230                       296,946
Deferred taxes                                                                           233,000                       230,333
Other assets                                                                             499,729                       461,734
                                                                           ----------------------        ----------------------

Total assets                                                                         $18,277,972                   $19,832,527
                                                                           ======================        ======================


LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
    Accounts payable                                                                  $1,974,858                    $3,529,450
    Notes payable                                                                      3,672,619                     4,278,983
    Accrued expenses                                                                     565,366                       932,767
    Current portion of long-term obligations                                             390,123                       130,334
                                                                           ----------------------        ----------------------
        Total current liabilities                                                      6,602,966                     8,871,534

Long-term obligations, net of current portion                                            593,706                       171,995

Shareholders' equity:
    Preferred stock;
        Authorized - 5,000,000 shares; none outstanding                                        -                             -
    Common stock, no par value;
        Authorized - 20,000,000 shares
        Issued and outstanding - 3,458,985 and 3,454,605 shares                        7,521,865                     7,477,939
    Retained earnings                                                                  3,559,435                     3,311,059
                                                                           ----------------------        ----------------------
        Total shareholders' equity                                                    11,081,300                    10,788,998
                                                                           ----------------------        ----------------------


Total liabilities and shareholders' equity                                           $18,277,972                   $19,832,527
                                                                           ======================        ======================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

                        PHOENIX GOLD INTERNATIONAL, INC.
                        --------------------------------
                            STATEMENTS OF OPERATIONS
                            ------------------------
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                        THREE MONTHS ENDED                             NINE MONTHS ENDED
                                                            JUNE 30                                         JUNE 30
                                          ----------------------------------------------     --------------------------------------
                                                  1997                     1996                    1997                 1996
                                          ------------------      --------------------     ------------------      ----------------
<S>                                             <C>                      <C>                      <C>                  <C>         

Net sales                                         $8,263,509              $7,461,921               $20,099,215          $19,348,725

Cost of sales                                      5,781,313               5,092,831                15,141,842           13,769,299
                                          -------------------     -------------------       -------------------    -----------------

Gross profit                                       2,482,196               2,369,090                 4,957,373            5,579,426


Operating expenses:
    Selling                                          871,457               1,082,590                 2,383,211            2,411,069
    General and administrative                       522,082                 815,562                 1,781,004            2,010,647
    In-process research and development                    -                       -                         -            1,120,500
                                          -------------------     -------------------       -------------------    -----------------

     Total operating expenses                      1,393,539               1,898,152                 4,164,215            5,542,216
                                          -------------------     -------------------       -------------------    -----------------

Income from operations                             1,088,657                 470,938                   793,158               37,210

Other income (expense):
    Interest expense                                (131,616)                (72,829)                 (383,951)            (112,945)
    Other income, net                                  3,892                       -                     5,169               19,495
                                          -------------------     -------------------       -------------------    -----------------

        Total other income (expense)                (127,724)                (72,829)                 (378,782)             (93,450)

Earnings (loss) before income taxes                  960,933                 398,109                   414,376              (56,240)
Income tax benefit (expense)                        (375,000)               (152,882)                 (166,000)              22,033
                                          -------------------     -------------------        ------------------    -----------------

Net earnings (loss)                                 $585,933                $245,227                  $248,376             $(34,207)
                                          ===================     ===================       ===================    =================

Net earnings (loss) per share                          $0.17                   $0.07                     $0.07               $(0.01)
                                          ===================     ===================       ===================    =================

Shares used in per share calculation               3,495,297               3,641,755                 3,528,003            3,447,237
                                          ===================     ===================       ===================    =================

</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

                        PHOENIX GOLD INTERNATIONAL, INC.
                        --------------------------------
                            STATEMENTS OF CASH FLOWS
                            ------------------------
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                               NINE MONTHS ENDED
                                                                                                   JUNE 30,
                                                                              ---------------------------------------------------
                                                                                       1997                        1996
                                                                              -----------------------     -----------------------
<S>                                                                                  <C>                        <C>               
Cash flows from operating activities:
  Net earnings (loss)                                                                      $248,376                   $(34,207)
  Adjustments to reconcile net earnings (loss) to
    net cash provided by (used in) operating activities:
      Depreciation and amortization                                                         728,698                    601,085
      Deferred taxes, net                                                                   132,761                    (22,030)
      In-process research and development                                                         -                  1,120,500
      Changes in operating assets and liabilities:
        Accounts receivable                                                                 (37,789)                (2,093,958)
        Inventories                                                                       1,106,600                 (4,730,643)
        Prepaid expenses                                                                    (11,954)                  (267,124)
        Accounts payable                                                                 (1,554,592)                 2,186,586
        Accrued expenses                                                                   (367,401)                    65,242
                                                                              -----------------------     -----------------------

  Net cash provided by (used in) operating activities                                       244,699                 (3,174,549)


Cash flows from investing activities:
  Capital expenditures, net                                                                (288,463)                (1,135,626)
  Acquisition of Carver professional sound division                                               -                 (1,792,616)
  Other                                                                                     (39,128)                  (187,051)
                                                                              -----------------------     -----------------------

  Net cash used in investing activities                                                    (327,591)                (3,115,293)


Cash flows from financing activities:
  Notes payable, net                                                                       (606,364)                 4,229,930
  Proceeds from long-term obligations                                                       800,000                          -
  Repayment of long-term obligations                                                       (154,668)                   (84,350)
  Proceeds from exercise of stock options                                                    43,926                     44,949
                                                                              -----------------------     -----------------------

  Net cash provided by financing activities                                                  82,894                  4,190,529
                                                                              -----------------------     -----------------------

Increase (decrease) in cash and cash equivalents                                                  2                 (2,099,313)

Cash and cash equivalents, beginning of period                                                2,599                  2,101,563
                                                                              -----------------------     -----------------------

Cash and cash equivalents, end of period                                                     $2,601                     $2,250
                                                                              =======================     =======================


Supplemental disclosures:
  Cash paid for interest                                                                   $386,497                   $111,488
  Cash paid for income taxes                                                                169,859                    101,800
  Cash received for income tax refund                                                       108,376                          -
  Equipment financed by capital lease                                                        36,168                          -
  Note payable issued for acquisition of Carver professional                                      -                    350,000

</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS


<PAGE>


                        PHOENIX GOLD INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)

(1)   Unaudited Financial Statements.
---   -------------------------------

Certain  information  and  note  disclosures   normally  included  in  financial
statements prepared in accordance with generally accepted accounting  principles
have been omitted from these  unaudited  financial  statements.  These unaudited
financial statements should be read in conjunction with the financial statements
and notes  included in the  Company's  Annual Report on Form 10-KSB for the year
ended September 30, 1996 filed with the Securities and Exchange Commission.  The
results of operations for the three- and nine-month  periods ended June 30, 1997
are not  necessarily  indicative of the operating  results for the full year. In
the opinion of management, all adjustments,  consisting only of normal recurring
accruals,  have been made to present fairly the Company's  financial position at
June 30, 1997 and the results of its  operations  for the three- and  nine-month
periods  ended  June 30,  1997 and 1996 and its cash  flows for the nine  months
ended June 30, 1997 and 1996.

(2)   Reporting Periods.
---   ------------------

The  Company's  fiscal  year is the  52-week or 53-week  period  ending the last
Sunday in September. Fiscal 1996 was a 53-week year and fiscal 1997 is a 52-week
year. For presentation convenience, the Company has indicated in these financial
statements  that its fiscal  year ended on  September  30 and that the three and
nine months  presented  ended on June 30. The first quarter of fiscal 1996 was a
14-week  period and the same  quarter in fiscal 1997 was a 13-week  period.  The
remaining quarters in fiscal 1996 and 1997 are 13-week quarters.

(3)   Property and Equipment.
---   -----------------------

Property and equipment consist of the following:

                                               June 30,           September 30,
                                                 1997                 1996
                                                 ----                 ----

Machinery, equipment and vehicles           $  4,425,823         $  4,144,651
Leasehold improvements                         1,580,717            1,425,816
Construction in progress                          50,642              193,685
                                            ------------         ------------
                                               6,057,182            5,764,152
Less accumulated depreciation
 and amortization                            ( 2,491,610)          (1,825,362)
                                            ------------         ------------
  Total property and equipment, net         $  3,565,572         $  3,938,790
                                            =============        ============


<PAGE>

(4)  Acquisition of Carver Professional Sound Division.
---  --------------------------------------------------

Effective  November  20, 1995,  the Company  acquired  substantially  all of the
assets of the professional sound division (the "Division") of Carver Corporation
("Carver").  The  assets  acquired  included  finished  goods  and  intellectual
property,  including  the  license of the name  "Carver  Professional"  for five
years. The purchase price for the assets was $2.14 million, of which the Company
paid $1.79 million in cash and issued a $350,000  note payable,  which has since
been paid. The Company  accounted for the acquisition  under the purchase method
of accounting and recorded in-process research and development expenses of $1.12
million,  finished goods of $780,000, other intangibles of $110,000 and goodwill
of  $132,000.  Other  intangibles  and goodwill  are being  amortized  using the
straight-line  method of accounting over a period of five years. The Company has
included the results of operations for the Division in its financial  statements
from the date of acquisition.

(5)  Long-term Obligations.
---  ----------------------

In March 1997, the Company borrowed  $800,000  pursuant to a secured loan from a
third  party  lender.  The loan bears  interest at 11.1% per annum and is due in
monthly  installments  of $26,258 until  maturity on March 1, 2000.  The loan is
secured by certain of the Company's machinery and equipment.

(6)  Prospective Accounting Changes.
---  -------------------------------

In February  1997,  the  Financial  Accounting  Standards  Board  (FASB)  issued
Statement of Financial  Accounting Standards (SFAS) No. 128, Earnings Per Share.
SFAS No. 128 will  have no effect  on the  financial  position  or  results  of
operations  of the  Company  as the  statement  establishes  new  standards  for
computing and presenting earnings per share and supercedes Accounting Principles
Board  Opinion No. 15,  Earnings Per Share.  SFAS No. 128 will be adopted by the
Company in the  quarter  ending  December  31,  1997.  Earlier  adoption  is not
permitted.  Pro forma earnings (loss) per share under SFAS No. 128 for the three
and nine months  ended June 30, 1997 and 1996 would not differ  materially  from
the earnings (loss) per share presently reported.

In June 1997, the FASB issued SFAS No. 130, Reporting Comprehensive Income. SFAS
No. 130  establishes  requirements  for disclosure of  comprehensive  income and
becomes   effective  for  the  Company's  fiscal  year  ending  September  1999.
Reclassification  of earlier  financial  statements for comparative  purposes is
required.

In June 1997,  the FASB issued SFAS No. 131,  Disclosures  about  Segments of an
Enterprise  and Related  Information.  SFAS No. 131  establishes  standards  for
disclosure about operating segments in annual financial  statements and selected
information in interim  financial  reports.  It also establishes  standards for
related  disclosures  about  products and services,  geographic  areas and major
customers.  This  statement  supersedes  SFAS No. 14,  Financial  Reporting  for
Segments of a Business  Enterprise.  The new standard becomes  effective for the
Company's  fiscal year ending  September  1999,  and requires  that  comparative
information  from earlier  years be restated to conform to the  requirements  of
this standard.


<PAGE>



PART I.   FINANCIAL INFORMATION
Item 2:   Management's Discussion and Analysis or Plan of Operation

                        PHOENIX GOLD INTERNATIONAL, INC.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS
---------------------

Net sales for the third  quarter  ended June 30,  1997  increased  $802,000,  or
10.7%,  to $8.3 million  from $7.5 million in the third  quarter in fiscal 1996.
Speaker sales  increased  116.3% compared to the same quarter in fiscal 1996 due
in part to the  recommencement  of XMAX subwoofer sales in the third quarter and
increased  distribution of existing  products.  Accessories sales increased 9.9%
compared to the same quarter in fiscal 1996. Sales of electronics  products were
comparable to sales in the quarter ended June 30, 1996.  Increased  sales of car
audio   electronics  were  offset  by  weaker  demand  for  professional   audio
electronics.  The Company began shipping in the quarter initial models of its QX
Series and XS Series car audio  amplifiers  that are  designed to address  lower
price points.

Net sales for the nine months ended June 30, 1997 increased  $750,000,  or 3.9%,
to $20.1 million from $19.3 million in fiscal 1996. Sales of speakers  increased
91.4% in the first nine  months of fiscal  1997  compared  to the same period in
fiscal  1996.  Sales  of  electronics  products  increased  3.9%  and  sales  of
accessories declined 11.1% in the respective periods.

International  sales  increased 15.9% to $3.4 million for the three months ended
June  30,  1997  from  $2.9  million  in the  comparable  fiscal  1996  quarter.
International  sales  represented  40.6%  and  38.8% of net  sales for the three
months ended June 30, 1997 and 1996, respectively.

International  sales  decreased  0.5% to $7.8  million for the nine months ended
June 30, 1997,  from $7.9 million in the  comparable  1996 period.  The decrease
resulted  primarily  from  sales  made to a  European  distributor  in the prior
nine-month period in anticipation of European regulatory changes effective as of
December  31,  1995  that  were  not   repeated  in  the  more  recent   period.
International sales represented 39.0% and 40.7% of net sales for the nine months
ended June 30, 1997 and 1996, respectively.

Gross  margin  decreased  to 30.0% of net sales from 31.7% for the three  months
ended June 30, 1997 and 1996, respectively.  Gross margin decreased to 24.7% for
the nine months ended June 30, 1997 from 28.8% for the comparable  prior period.
The decreases in gross margin resulted primarily from changes in product mix and
lower than expected sales volume which caused manufacturing overhead to increase
as a percentage of sales.


Operating  expenses  consist of selling,  general and  administrative  expenses.
Operating expenses decreased  $505,000,  or 26.6%, to $1.4 million for the three
months ended June 30, 1997  compared  $1.9 million in the same quarter in fiscal
1996.  Operating  expenses  were 16.9% and 25.4% of net sales in the  respective
three-month  periods.  Operating expenses  decreased $1.4 million,  or 24.9%, to
$4.2 million for the nine months ended June 30, 1997 compared to the  comparable
period in fiscal 1996.  Operating  expenses were 20.7% and 28.6% of net sales in
the respective  nine-month periods.  Operating expenses for the first quarter of
fiscal 1996 included a one-time  pre-tax  charge of $1.12 million for in-process
research and development  acquired from Carver Corporation.  See Note 4 of Notes
to Financial Statements.

Selling expenses declined  $211,000,  or 19.5%, to $871,000 for the three months
ended June 30, 1997  compared to the  comparable  fiscal 1996  quarter.  Selling
expenses  were  10.5%  and 14.5% of net sales in the  respective  quarters.  The
decreased  selling  expenses  in dollar  amount were  principally  due to salary
reductions by senior  management  and  marketing,  advertising  and  promotional
expense reductions.  Selling expenses decreased 1.2% in the first nine months of
fiscal 1997,  to $2.4 million  compared to the first nine months of fiscal 1996.
Selling expenses were 11.9% and 12.5% of net sales in the respective  nine-month
periods.
<PAGE>
General and administrative expenses declined $293,000, or 36.0%, to $522,000 for
the three  months  ended June 30, 1997  compared  to $816,000 in the  comparable
fiscal 1996 quarter.  General and administrative expenses were 6.3% and 10.9% of
net sales in the respective quarters. The decrease in general and administrative
expenses for the quarter resulted primarily from reductions in bad debt expense,
labor expenses and facilities costs.  General and  administrative  expenses were
8.9% and 10.4% of net sales in the respective nine-month periods

Other expense  increased $55,000 to $128,000 in the third quarter of fiscal 1997
from other  expense of $73,000 for third  quarter of fiscal 1996.  Other expense
increased  $285,000 to $379,000 in the first nine months of fiscal 1997 compared
to $93,000 in the first nine months of fiscal 1996.  The  increases  were due to
higher interest rates on larger borrowings.

Net earnings were $586,000,  or $0.17 per share, for the three months ended June
30,  1997,  compared to net earnings of  $245,000,  or $0.07 per share,  for the
three  months  ended June 30,  1996.  Net  earnings for the first nine months of
fiscal  1997  were  $248,000,  or $0.07  per  share,  compared  to a net loss of
$34,000, or $0.01 per share, for the first nine months of fiscal 1996.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The Company's  primary needs for funds are for working  capital and, to a lesser
extent,  capital  expenditures.  The Company financed its operations  during the
nine months ended June 30, 1997 primarily from cash provided from operations and
increased long-term debt. Rather than accumulating excess cash, the Company pays
down in part the balances owing on its operating line of credit on a daily basis
when cash flow from  operations  exceeds  current  needs,  resulting in low cash
balances.

During the nine months  ended June 30, 1997,  accounts  payable  decreased  $1.6
million,  inventories  decreased $1.1 million,  notes payable decreased $606,000
and  accrued  expenses  decreased  $367,000,  leading to an  increase in working
capital of $1.1 million.

The Company made capital  expenditures of $325,000 in the nine months ended June
30, 1997. Management  anticipates that capital expenditures for the remainder of
fiscal 1997 will be approximately $200,000.  These anticipated expenditures will
be financed from proceeds of short-term debt and cash provided from operations.

The Company has a $5.5 million  revolving bank operating line of credit expiring
on  December  31,  1997.  Borrowings  under the line of credit  are  limited  to
eligible  accounts  receivable  and  inventory,   and  are  subject  to  certain
additional  limits.  Interest on borrowings is equal to the bank's prime lending
rate  (8.5%  at June  30,  1997)  plus an  additional  percentage  based  on the
Company's tangible net worth. At June 30, 1997, the additional  percentage above
prime was 2.0%. Borrowings under the line of credit are secured by substantially
all of the Company's  assets.  As of June 30, 1997,  the Company was eligible to
borrow $5.4 million  under the line of credit and  borrowings  under the line of
credit as of that date were $3.7 million.

FORWARD-LOOKING STATEMENTS
--------------------------

This  Report  contains  "forward-looking  statements"  within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
statements as to expectations,  beliefs and future financial  performance,  that
are based on current  expectations and are subject to certain risks,  trends and
uncertainties  that could  cause  actual  results to vary from those  projected,
which  variances may have a material  adverse  effect on the Company.  Among the
factors that could cause actual results to differ  materially are the following:
business  conditions and growth in the car audio,  professional sound and custom
audio/video  and home  theater  markets  and the  general  economy;  competitive
factors such as rival products and price pressures;  the failure of new products
to compete  successfully  in  existing  or new  markets;  the failure to achieve
timely  improvement  in the  manufacturing  ramp with  respect to new  products;
changes in product mix; availability and price of components,  subassemblies and
products  supplied by third party vendors;  and cost and yield issues associated
with production at the Company's factory.

<PAGE>

PART II.    OTHER INFORMATION

Item 1.    Legal Proceedings                                               NONE

Item 2.    Changes in Securities                                           NONE

Item 3.    Defaults Upon Senior Securities                                 NONE

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

           (a)  Exhibits

               10.1 Amendment  dated June 27, 1997 to Loan Agreement dated as of
                    February  4, 1997  between  the  Company  and United  States
                    National Bank of Oregon

               10.2 Amendment to Promissory Note dated February 3, 1997 from the
                    Company to United States National Bank of Oregon.

               27   Financial Data Schedule

           (b)  Reports on Form 8-K

                   None.


<PAGE>



                                   SIGNATURES


In accordance with 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.

PHOENIX GOLD INTERNATIONAL, INC.



By: /s/Joseph K. O'Brien
------------------------
   Joseph K. O'Brien
   Chief Financial Officer
  (Principal Financial and Accounting Officer)

Dated:  August 6, 1997

<PAGE>

                                INDEX TO EXHIBITS


                                                                           PAGE


10.1  Amendment dated June 27, 1997 to Loan Agreement dated
      as of February 4, 1997 between the Company and United States
      National Bank of Oregon                                                13

10.2  Amendment to Promissory Note dated February 3, 1997 from the           16
      Company to United States National Bank of Oregon.

27     Financial Data Schedule                                               17