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 June 30, 1997


__   Transition  report  pursuant  to  Section  13 or  15(d)  of the  Securities
     Exchange Act of 1934.

Commission File Number: 0-26102

                       AMERICAN RADIO SYSTEMS CORPORATION
             (Exact name of registrant as specified in its charter)

                       Delaware                           04-3196245
           (State or other jurisdiction of             (I.R.S. Employer
            incorporation or organization)            Identification No.)


                              116 Huntington Avenue
                           Boston, Massachusetts 02116
                    (Address of principal executive offices)

                         Telephone Number (617)-375-7500
              (Registrant's telephone number, including area code)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days:

         Yes  X                                                        No __


Class of Common Stock                  Outstanding  at July 31, 1997 
Class A Common Stock                    shares 24,194,901  
Class B Common Stock                    shares  3,993,834  
Class C Common Stock                    shares  1,295,518 
Total                                   shares 29,484,253





<PAGE>


                       AMERICAN RADIO SYSTEMS CORPORATION

                                      INDEX

                          PART I. FINANCIAL INFORMATION



Item 1.  Unaudited Condensed Consolidated Financial Statements        Page No.

Condensed Consolidated Balance Sheets
December 31, 1996 and June 30, 1997........................................ 1

Condensed Consolidated Statements of Operations
Three and six months ended June 30, 1996 and 1997.......................... 3

Condensed Consolidated Statements of Cash Flows
Six months ended June 30, 1996 and 1997...................................  4

Notes to Condensed Consolidated Financial Statements......................  5

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations........................................ 24


                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings................................................ 29

Item 2.  Changes in Securities............................................ 29

Item 4.  Submission of Matters to a Vote of Security Holders.............. 29

Item 5.  Other Information................................................ 30

Item 6.  Exhibits and Reports on Form 8-K................................. 31

         Signatures....................................................... 33






<PAGE>





PART I.  FINANCIAL INFORMATION

 ITEM 1.   UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>


               AMERICAN RADIO SYSTEMS CORPORATION AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                        (In thousands, except share data)

                                                      December 31, 1996    June 30, 1997
                                                      -----------------    -------------
<S>                                                     <C>              <C>
ASSETS

CURRENT ASSETS:
Cash and cash equivalents                                $   10,447        $   14,469
Accounts receivable (less allowance for doubtful                          
     accounts of $4,560 and $7,297 in 1996 and 1997, 
     respectively)                                           51,897            82,284
Employee and other related-party receivables                    249               377
Prepaid expenses and other assets                             3,354             4,180
Deferred income taxes                                         3,370             3,370
                                                         ----------        ----------
               Total current assets                          69,317           104,680
                                                         ----------        ----------
PROPERTY AND EQUIPMENT-Net                                   90,247           153,044
                                                         ----------        ----------
OTHER ASSETS:                                                             
     Restricted cash                                                            8,896       
     Station investment note receivable-related party                    
        (less valuation allowance of $500 in 1996)              743       
     Investment notes receivable                             69,177            25,750
     Intangible assets-net:                                              
          Goodwill                                          232,149           374,776
          FCC licenses                                      233,558         1,114,573
          Other intangible assets                            27,553            53,177
     Deposits and other long-term assets                     26,064            12,948
     Deferred income taxes                                                      7,142       
     Net assets held under exchange agreement                47,495       
     Net assets held under trust agreement                                     63,252
                                                         ----------        ----------       
               Total other assets                           636,739         1,660,514
                                                         ----------        ----------
TOTAL                                                    $  796,303        $1,918,238
                                                         ==========        ==========
                                                                     
</TABLE>





       See notes to unaudited condensed consolidated financial statements.


                                       1



<PAGE>

<TABLE>
<CAPTION>


                                    AMERICAN RADIO SYSTEMS CORPORATION AND SUBSIDIARIES

                                           CONDENSED CONSOLIDATED BALANCE SHEETS
                                             (In thousands, except share data)

                                                                             December 31, 1996         June 30, 1997
                                                                             -----------------         -------------
<S>                                                                             <C>                      <C>

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
     Current maturities of long-term debt                                        $    561                  $    587
     Accounts payable                                                               7,085                     7,863
     Accrued compensation                                                           3,027                     3,483
     Accrued expenses                                                              16,355                    24,300
     Accrued interest                                                               7,303                    12,704
                                                                                 --------                ----------
          Total current liabilities                                                34,331                    48,937
                                                                                 --------                ----------
DEFERRED INCOME TAXES                                                              33,205                   204,424
                                                                                 --------                ----------
OTHER LONG-TERM LIABILITIES                                                         2,149                    11,245
                                                                                 --------                ----------
LONG-TERM DEBT                                                                    330,111                   759,976
                                                                                 --------                ----------
MINORITY INTEREST IN SUBSIDIARY                                                       344                       481
                                                                                 --------                ----------
COMMITMENTS AND CONTINGENCIES                                                             
REDEEMABLE STOCK
     Cumulative Exchangeable Preferred Stock, $0.01 par value; 
        10,000,000 shares authorized; 2,047,391 shares issued and
        outstanding; liquidation preference $100 per share                                                  209,478
                                                                                 --------                ----------
STOCKHOLDERS' EQUITY
     Preferred Stock; $0.01 par value; 10,000,000 shares authorized; 
       Convertible Exchangeable Preferred Stock; 137,500 shares issued
       and outstanding (represented by 2,750,000 depositary shares);
       liquidation preference $1,000 per share                                          1                         1
     Class A Common Stock; $.01 par value; 100,000,000 shares authorized;
       15,101,022 and 24,140,137 shares issued and outstanding,
       respectively                                                                   151                       241
     Class B  Common  Stock;  $.01  par  value;  15,000,000  shares  authorized;
        4,658,096 and 4,036,698 shares issued and outstanding,
        respectively                                                                   47                        40
     Class C Common Stock; $.01 par value; 6,000,000 shares authorized;
        1,295,518 shares issued and outstanding                                        13                        13
     Additional paid-in capital                                                   390,731                   684,089
     Unearned compensation                                                           (297)                     (249)
     Retained earnings                                                              5,955                         0
                                                                                 --------                ----------
          Total                                                                   396,601                   683,135
                                                                                 --------                ----------
     Less:
          Treasury stock, at cost, 18,449 shares at December 31, 1996
              and June 30, 1997                                                      (438)                     (438)
                                                                                 --------                ----------
          Total stockholders' equity                                              396,163                   683,697
                                                                                 --------                ----------
TOTAL                                                                            $796,303                $1,918,238
                                                                                 ========                ==========

</TABLE>

       See notes to unaudited condensed consolidated financial statements.


                                       2
<PAGE>


<TABLE>
<CAPTION>
               AMERICAN RADIO SYSTEMS CORPORATION AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except per share data)


                                                       Three Months Ended June 30,       Six Months Ended June 30,
                                                       ---------------------------       -------------------------
                                                             1996         1997               1996         1997 
                                                          ---------    ---------           ---------    ---------
<S>                                                      <C>          <C>                 <C>          <C>    
NET REVENUES                                              $  37,444    $ 100,108           $  61,092    $ 154,345 
                                                          ---------    ---------           ---------    ---------
OPERATING EXPENSES:                                                                       
     Operating expenses excluding depreciation and                                        
        amortization, net local marketing agreement and                                   
        corporate general and administrative expenses        24,650       63,847              42,774      104,731
     Net local marketing agreement (revenues) expenses        2,139         (591)              2,589        1,341
     Depreciation and amortization                            2,639       16,140               4,839       23,564
     Corporate general and administrative                     1,259        2,156               2,340        3,934 
                                                          ---------    ---------           ---------    ---------
          Total expenses                                     30,687       81,552              52,542      133,570 
                                                          ---------    ---------           ---------    ---------
OPERATING INCOME                                              6,757       18,556               8,550       20,775 
                                                          ---------    ---------           ---------    ---------
OTHER INCOME (EXPENSE):                                                                   
     Interest expense                                        (4,261)     (15,732)             (8,964)     (23,236)
     Interest income                                          1,523          489               3,640        1,145
     Gains (losses) on sale of assets and other, net             (1)         420                 (35)         639 
                                                          ---------    ---------           ---------    ---------
          Total other income (expense)                       (2,739)     (14,823)             (5,359)     (21,452) 
                                                          ---------    ---------           ---------    ---------
INCOME (LOSS) FROM OPERATIONS BEFORE                                                      
   INCOME TAXES AND EXTRAORDINARY ITEM                        4,018        3,733               3,191         (677)
INCOME TAX PROVISION (BENEFIT)                                1,807        1,312               1,436         (374) 
                                                          ---------    ---------           ---------    ---------
INCOME (LOSS) BEFORE EXTRAORDINARY LOSS                       2,211        2,421               1,755         (303)
EXTRAORDINARY LOSS ON EXTINGUISHMENT                                                      
   OF DEBT, NET OF INCOME TAX BENEFIT OF                                                  
   $1,013 IN 1997                                                                                          (1,639)  
                                                          ---------    ---------           ---------    ---------
NET INCOME (LOSS)                                             2,211        2,421               1,755       (1,942)
PREFERRED STOCK DIVIDENDS                                      (134)      (8,094)               (134)     (14,292) 
                                                          ---------    ---------           ---------    ---------
NET INCOME (LOSS) APPLICABLE TO COMMON                                             
   STOCKHOLDERS                                           $   2,077    $  (5,673)          $   1,621    $ (16,234) 
                                                          =========    =========           =========    =========
PER COMMON SHARE AMOUNTS:
   Income (loss) before extraordinary loss                $     .10    $    (.20)          $     .09    $    (.58)
   Extraordinary loss                                                                                        (.07) 
                                                          ---------    ---------           ---------    ---------
   Net income (loss)                                      $     .10    $    (.20)          $     .09    $    (.65)
                                                          =========    =========           =========    =========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING         20,142       29,089              19,026       25,080
                                                          =========    =========           =========    =========

</TABLE>


       See notes to unaudited condensed consolidated financial statements.

                                       3

<PAGE>

<TABLE>
<CAPTION>

               AMERICAN RADIO SYSTEMS CORPORATION AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)



                                                                  Six Months Ended June 30,
                                                                  -------------------------
                                                                    1996          1997
                                                                  ---------    ---------
<S>                                                              <C>         <C>
CASH FLOWS USED FOR OPERATING ACTIVITIES:                         $  (5,523)   $ (30,605)
                                                                  ---------    ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Payments for purchase of property, equipment and intangible
    assets                                                           (7,336)     (19,386)
   Proceeds from radio station sales                                 18,000       47,876
   Payments for radio station acquisitions                          (67,777)    (445,719)
   Payments for tower related acquisitions                           (5,045)     (19,277)
   Issuance of station investment notes receivable                  (27,779)        (664)
   Repayment of station investment note receivable                                 1,243
   Deposits and other long-term assets                              (23,706)      13,364
                                                                  ---------    ---------
       Cash used for investing activities                          (113,643)    (422,563)

CASH FLOWS FROM FINANCING ACTIVITIES:
   Borrowings under credit agreements and other                                  533,000
   Repayments under credit agreements                              (151,500)    (257,000)
   Repayments of other obligations                                     (568)        (692)
   Net proceeds from equity offerings and options                   248,198          213
   Net proceeds from exchangeable preferred stock offering                       192,218
   Net proceeds from debt offering - net of discount                168,321
   Additions to deferred financing costs                                          (5,526)
   Distributions to minority interest                                               (210)
   Dividends paid                                                                 (4,813)
                                                                  ---------    ---------
       Cash provided by financing activities                        264,451      457,190

INCREASE IN CASH AND CASH EQUIVALENTS                               145,285        4,022

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                        3,890       10,447
                                                                  ---------    ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD                          $ 149,175    $  14,469
                                                                  =========    =========

</TABLE>


       See notes to unaudited condensed consolidated financial statements.



                                       4


<PAGE>
                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1.   Basis of Presentation - The financial  statements included herein have been
     prepared by American Radio Systems  Corporation  (American or the Company),
     without audit,  pursuant to the rules and regulations of the Securities and
     Exchange Commission.  Although certain information and footnote disclosures
     normally  included in  financial  statements  prepared in  accordance  with
     generally  accepted  accounting  principles  have been condensed or omitted
     pursuant  to such rules and  regulations,  the  Company  believes  that the
     disclosures are adequate to make the  information  presented not misleading
     and  reflect  all  adjustments   (consisting   only  of  normal   recurring
     adjustments)  which are  necessary  for a fair  presentation  of results of
     operations  for  such  periods.  Results  of  interim  periods  may  not be
     indicative of results for the full year. These financial  statements should
     be read in conjunction with the consolidated  financial  statements for the
     year  ended  December  31,  1996  and the  notes  thereto  included  in the
     Company's Annual Report on Form 10-K (Form 10-K).

     Restricted  Cash - Restricted  cash represents cash held in escrow pursuant
     to Internal  Revenue Code like-kind  exchange  agreements which require the
     net proceeds  from the sale of certain  stations to be utilized for pending
     acquisitions. Such agreements may be terminated at the Company's option, in
     which  event such cash held in escrow is  required to be utilized to reduce
     borrowings under the Company's credit agreement.

     Reclassifications - Certain  reclassifications  have been made to the 1996
     financial statements to conform to the 1997 presentation.

2.   Per Share Data - Earnings (loss) per common share is based on the number of
     common shares  outstanding during the period as adjusted for dilutive stock
     options using the provisions of Accounting  Principles Board Opinion No. 15
     "Earnings  Per Share" (APB 15).  Fully  diluted  earnings  (loss) per share
     amounts are not reported separately as the effects are not dilutive.

     In March 1997, the Financial Accounting Standards Board issued Statement of
     Financial  Accounting  Standards  No. 128,  "Earnings per Share," (FAS 128)
     which will be effective during the fourth quarter of 1997. Had FAS 128 been
     effective for the three and six month periods ended June 30, 1997 and 1996,
     reported  earnings  (loss) per share on a pro forma  basis  would have been
     consistent with the per share amounts under APB 15.

3.   Income  Taxes - The Company  provides  for income  taxes at the end of each
     interim  period  based  on the  estimated  effective  tax rate for the full
     fiscal year for each tax reporting corporate entity. Cumulative adjustments
     to the tax provision  (benefit) are recorded in the interim period in which
     a change in the estimated annual effective rate is determined.

4.   Property and Equipment and  Intangible  Assets - Property and equipment and
     intangible assets included  approximately $108.7 million and $120.6 million
     of  assets  related  to radio  stations  held  for  sale or under  exchange
     agreements  as of December  31, 1996 and June 30, 1997,  respectively.  The
     following   summary   presents   the  results  of   operations   (excluding
     depreciation,   amortization  and  corporate  general  and   administrative
     expenses)  relating to these stations that are included in the accompanying
     unaudited condensed  consolidated  financial statements for each respective
     period.
              

     In thousands:

 <TABLE>
<CAPTION>
                           Three Months Ended June 30,        Six Months Ended June 30,
                           ---------------------------        -------------------------
                              1996            1997              1996            1997 
                            -------         -------            -------         -------
<S>                        <C>             <C>                <C>            <C>

Net operating revenues      $ 4,385         $ 6,907            $ 7,312         $11,917
Net operating expenses      $ 2,682         $ 4,556            $ 4,441         $ 8,879
                                                                        
</TABLE>

                                       5

<PAGE>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)



5.   Offerings - In January 1997, the Company  consummated a private offering of
     2,000,000  shares of its 11 3/8%  Cumulative  Exchangeable  Preferred Stock
     (Exchangeable  Preferred  Stock)  to a  group  of  qualified  institutional
     investors. The Company utilized the net proceeds, which approximated $192.2
     million,  initially  to repay  amounts  outstanding  under the 1997  Credit
     Agreement and thereafter to fund acquisitions.   The Exchangeable Preferred
     Stock possesses mandatory  redemption features and is classified as such in
     the Company's condensed consolidated financial statements. Redemption terms
     and  conditions of the  Exchangeable  Preferred  Stock are described in the
     Form 10-K.

     Under  these  terms and  conditions,  the  Company  was  required to file a
     registration  statement  and  offer to  exchange  the  shares  of  Series A
     Exchangeable  Preferred Stock for new Series B Exchangeable Preferred Stock
     within ninety days of January 30, 1997. In April 1997,  the Company filed a
     registration  statement on Form S-4 (No. 333- 26085) and such  registration
     statement,  as amended,  was declared  effective on May 13, 1997. The offer
     expired in June 1997,  and all Series A  Exchangeable  Preferred  Stock was
     exchanged for Series B Exchangeable  Preferred  Stock. The redemption terms
     and  conditions  of the  Series A and the Series B  Exchangeable  Preferred
     Stock are substantially the same.

6.   Credit  Agreements - In January  1997,  the Company  entered  into two  new
     credit  agreements  with a syndicate of banks (the 1997 Credit  Agreement),
     which  replaced  the  previously  existing  credit  agreement.  All amounts
     outstanding under the previous agreement were repaid with proceeds from the
     1997 Credit  Agreement.  Terms and conditions of the 1997 Credit  Agreement
     are described in the Form 10-K. The 1997 Credit  Agreement  consists of two
     separate  lending  agreements,  providing  for  facilities  consisting of a
     $550.0 million reducing revolver credit facility which is available through
     December 31, 2004, a $200.0 million revolving credit facility converting to
     a term loan facility, maturing December 31, 2004, and a $150.0 million term
     loan facility, maturing December 31, 2004, available only to repurchase, if
     required,  certain note obligations of EZ  Communications,  Inc. (EZ) which
     were assumed by the Company in connection  with the EZ Merger discussed  in
     the Form 10-K and in Note 7 . The $150.0  million  term loan  facility  was
     canceled in May 1997, as the Company was not required to repurchase  any of
     the EZ note obligations.

     Following the closing of the 1997 Credit Agreement and repayment of amounts
     outstanding  under  the  previous  agreement,  the  Company  recognized  an
     extraordinary  loss of  approximately  $1,639,000,  net of a tax benefit of
     $1,013,000,   representing   the  write-off  of  deferred   financing  fees
     associated with the previous agreement.


7.   Acquisitions and Dispositions

     General:  The  following  acquisitions  have all been  accounted for by the
     purchase method of accounting,  and, accordingly,  the operating results of
     the acquired entities, to the extent that a local marketing agreement (LMA)
     did not exist,  have been included in consolidated  operating results since
     the date of  acquisition.  The  purchase  price has been  allocated  to the
     assets acquired, principally intangible assets, and the liabilities assumed
     based on their  estimated  fair  values  at the dates of  acquisition.  The
     excess of purchase  price over the  estimated  fair value of the net assets
     acquired has been recorded as goodwill.  The financial  statements  reflect
     the preliminary allocation of certain purchase prices as the appraisals for
     certain  acquisitions  have not yet been  finalized.  The Company  does not
     expect the final  appraisals  will have a material  affect on the financial
     position, results of operations or liquidity of the Company.


                                       6
<PAGE>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


7.   Acquisitions and Dispositions - (Continued)

     During the first six months of 1996 and 1997, the Company  consummated  the
     following  station and tower  related  transactions.  See the Form 10-K for
     additional information on these transactions.

     1997 Acquisitions and Dispositions:

     EZ Merger: On April 4, 1997, the Company  consummated the merger of EZ into
     the  Company  (the EZ  Merger). Pursuant  to which,  the  Company  acquired
     eighteen FM and six AM  stations  in eight  markets:  Seattle,  St.  Louis,
     Pittsburgh,   Sacramento,   Charlotte,   Kansas   City,   New  Orleans  and
     Philadelphia,  assumed  approximately $222.4 million of long-term debt  (of
     which approximately $72.7 was paid at closing),  paid approximately  $108.9
     million in cash and issued approximately 8,344,000 shares of Class A Common
     Stock  to  the EZ  stockholders  valued  at  approximately  $310.8  million
     (excluding  approximately  362,000  shares of  common  stock  reserved  for
     options  held by  former  employees  of EZ valued  at  approximately  $12.5
     million).  The aggregate  purchase price was approximately  $830.0 million,
     including  goodwill,  approximately  $7.0 million in transaction costs, and
     assumed  liabilities  (including  deferred  income taxes) of  approximately
     $428.0  million.  The  merger  has been  accounted  for using an  effective
     closing  date of  April 1,  1997,  as the  difference  between  actual  and
     effective  closing  date  on  the  results  of  operations,  liquidity  and
     financial position was not material.

     As part of the EZ Merger, the Company assumed EZ's obligations with respect
     to $150.0  million  principal  amount of the EZ 9.75%  Senior  Subordinated
     Notes (the 9.75%  Notes)  and  repaid  all  borrowings  under the EZ credit
     facility with borrowings from the 1997 Credit Agreement. As required by the
     closing of the EZ Merger, the Company was required to offer to purchase the
     9.75% Notes at 101% of their  principal  amount.  Such offer  commenced  in
     April 1997 and expired in May 1997,  with no such notes being  tendered for
     purchase.  The 9.75% Notes have semi-annual interest payments due on June 1
     and December 1, have certain  redemption terms at the option of the Company
     and are due in 2005. The 9.75% Notes are general  unsecured  obligations of
     the Company and are guaranteed by the restricted  subsidiaries as described
     in Note 10.

     Austin: In March 1997, the Company acquired KAMX-FM,  KKMJ-FM, and KJCE-AM,
     for approximately $28.7 million.

     Baltimore:  In February 1997, the Company  acquired WWMX-FM and WOCT-FM for
     approximately $90.0 million.

     Boston/Worcester: In January 1997, the Company acquired WAAF-FM and WWTM-AM
     for approximately $24.8 million.

     Charlotte:  In May 1997,  the Company,  as successor to EZ,  consummated an
     asset exchange  agreement  pursuant to which the Company  exchanged WIOQ-FM
     and  WUSL-FM  in  Philadelphia  for  WRFX-FM,   WPEG-FM,  WBAV-FM,  WGIV-AM
     (formerly WBAV-AM) and WFNZ-AM serving  Charlotte,  and also consummated an
     asset  purchase   agreement  to  acquire  WNKS-FM  serving   Charlotte  for
     approximately  $10.0  million.  In February 1997, EZ and the seller entered
     into a consent decree with the Justice  Department  (the Charlotte  Consent
     Decree).  Pursuant to the Charlotte Consent Decree,  and in compliance with
     the FCC's multiple ownership rules, EZ agreed to dispose of WRFX-FM,  which
     was transferred to an independent and insulated  trustee upon  consummation
     of the exchange. The net assets and liabilities of WRFX-FM included in this
     exchange  agreement  are carried on the  consolidated  balance sheet as net
     assets held under trust agreement. (See Note 9).


                                       7
<PAGE>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


7.   Acquisitions and Dispositions - (Continued)

     Cincinnati:  In January  1997,  the  Company  merged  with an  unaffiliated
     corporation  pursuant to which it became a party to an agreement to acquire
     WGRR-FM,  for  approximately  $30.5 million.  Pursuant to such merger,  the
     Company   issued   18,341   shares  of  Class  A  Common  Stock  valued  at
     approximately  $0.5  million.  In May 1997,  the  Company  consummated  the
     acquisition of WGRR-FM.

     Cincinnati and Rochester:  In April 1997,  the Company  exchanged  WVOR-FM,
     WHAM-AM and WHTK-AM  serving  Rochester,  together with $16.0 million,  for
     WKRQ-FM serving Cincinnati. See Rochester below.

     Dayton:  In February 1997, the Company acquired  WXEG-FM for  approximately
     $3.6  million and  acquired  WLQT-FM and  WBBT-FM for  approximately  $12.0
     million.

     Detroit, Philadelphia,  Sacramento: In February 1997, the Company exchanged
     WFLN-FM in Philadelphia for KSFM-FM and KMJI-AM serving Sacramento and sold
     WQRS-FM in Detroit for approximately $20.0 million. See Sacramento below.

     Fresno:  In April  1997,  the  Company  acquired  KOQO-AM  and  KOQO-FM for
     approximately $6.0 million.

     Omaha:  In May 1997,  the Company  sold the assets of KGOR-FM,  KFAB-AM and
     Business Music Service Inc. for  approximately  $38.0 million.  Proceeds of
     the sale were initially held as restricted cash.

     Rochester: In February 1997, the Company acquired WVOR-FM, WPXY-FM, WHAM-AM
     and WHTK-AM for approximately $31.5 million including working capital.  See
     Cincinnati and Rochester above.

     In April 1997, the Company acquired  WZNE-FM  (formerly  WAQB-FM),  a newly
     licensed Class A FM station for approximately $3.5 million.

     Sacramento:  In March 1997, the Company acquired KXOA-FM, KQPT-AM (formerly
     KXOA-AM) and KZZO-FM (formerly KQPT-FM) for approximately $50.0 million. In
     October  1996,  the Company  entered  into an agreement to sell KXOA-FM for
     approximately  $27.5  million.  After the expiration of the HSR Act waiting
     period,  the other party to the agreement  began  programming and marketing
     KXOA-FM  pursuant to an LMA in January 1997. As a condition to consummation
     of the EZ merger,  KXOA-FM was  transferred to an independent and insulated
     trustee  (under a trust for the benefit of the Company) and was held by the
     trustee subject to sale pursuant to the foregoing agreement.  In June 1997,
     the trustee sold KXOA-FM to the ultimate purchaser.

     In April 1997, the Company sold KMJI-AM for approximately $1.5 million.

     Sacramento and West Palm Beach:  In March 1997, the Company  consummated an
     agreement to exchange  KSTE- AM in Sacramento and $33.0 million in cash for
     WEAT-FM, WEAT-AM and WOLL-FM serving West Palm Beach. (See Note 8).

     San Jose:  In  February  1997,  the  Company  acquired  KBAY-FM and KKSJ-AM
     serving San Jose for approximately $31.0 million. (See Note 8).


                                       8
<PAGE>


                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


7.   Acquisitions and Dispositions - (Continued)

     Seattle: In April 1997, the Company exchanged WEZB-FM, WRNO-FM and WBYU-AM,
     serving New Orleans,  and $7.5 million for KBKS-FM  (formerly  KCIN-FM) and
     KRPM-AM.

     In June 1997, the Company sold the assets of KMPS-AM for approximately $1.8
     million.

     Tower  Subsidiary:  In June 1997,  American Tower Systems,  Inc. (the Tower
     Subsidiary  or Tower)  acquired 21 tower sites and a tower site  management
     business in Georgia,  North Carolina and South  Carolina for  approximately
     $5.3 million.  The agreement also provides for additional payments by Tower
     if the seller is able to arrange the purchase or  management of tower sites
     presently owned by an unaffiliated public utility in South Carolina,  which
     payments could aggregate up to approximately $1.2 million.

     In May 1997, the Tower Subsidiary acquired the assets of two companies that
     are  affiliated  with  one  another  and are  engaged  in the  business  of
     acquiring  and  developing  tower sites for  unaffiliated  third parties in
     various locations in the United States for approximately $13.0 million.

     In May 1997,  the Tower  Subsidiary  entered  into an  agreement to own and
     operate  communication towers which will be constructed on over fifty tower
     sites in northern California.  The Tower Subsidiary advanced  approximately
     $0.8 million to this entity and owns a 70% interest in the entity, with the
     remaining  30% owned by an  unaffiliated  party.  The Tower  Subsidiary  is
     obligated to provide additional financing for the construction of these and
     any additional  towers and such obligation is estimated to be approximately
     $5.0 million.

     1996 Acquisitions:

     Hartford:  In May 1996,  the  Company  acquired  WTIC-AM  and  WTIC-FM  for
     approximately $39.0 million.

     Detroit and  Philadelphia:  In May 1996,  the Company  consummated a merger
     agreement  with  Marlin  Broadcasting,  Inc.  pursuant to which it acquired
     WFLN-FM in  Philadelphia  and  WQRS-FM in Detroit for  approximately  $58.5
     million.

     Tower Subsidiary:  In February 1996, the Tower Subsidiary  acquired Skyline
     Communications  and  Skyline  Antenna  Management  for  approximately  $3.3
     million.

     In April 1996, the Tower Subsidiary acquired BDS  Communications,  Inc. and
     BRIDAN Communications Corporation for approximately $9.1 million.


                                       9
<PAGE>


                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


7.   Acquisitions and Dispositions - (Continued)


     The following unaudited pro forma summary presents the consolidated results
     of  operations  as if the  transactions  had occurred as of January 1, 1996
     after giving  effect to certain  adjustments,  including  depreciation  and
     amortization  of assets and interest  expense on any debt  incurred to fund
     the acquisitions.  These unaudited pro forma results have been prepared for
     comparative purposes only and do not purport to be indicative of what would
     have occurred had the transactions actually been made as of January 1, 1996
     or of results which may occur in the future.

     In thousands, except per share data:


                                        Six Months Ended     Six Months Ended
                                       ----------------     ----------------
                                         June 30,1996        June 30, 1997
                                       ----------------     ----------------

     Net  revenues                        $ 141,808             $ 183,842  
     Loss before extraordinary loss         (15,528)              (12,802)
     Net loss                               (15,528)              (14,442)
     Net loss applicable to common                             
       stockholders                         (15,661)              (28,733)
     Net loss per common share            $    (.57)            $    (.98)
  


8.   Pending  Transactions - The Company has numerous pending transactions which
     were  described  in the Form  10-K or have  been  entered  into  subsequent
     thereto. The following transactions are currently pending:

     Dayton and Kansas  City:  In June 1997,  the Company  entered into an asset
     exchange  agreement  pursuant to which it will  acquire  WDAF-AM,  KYYS-FM,
     KMXV-FM and KUDL-FM  serving Kansas City in exchange for WXEG- FM, WBTT-FM,
     WLQT-FM,  WMMX-FM,  WTUE-FM  and  WONE-AM  serving  Dayton.  Subject to the
     receipt of FCC approval (the HSR Act waiting period was terminated  early),
     the transaction is expected to be consummated in the fourth quarter of 1997
     or the first quarter of 1998.

     Lebanon:  In June 1997,  the Company  entered  into an agreement to acquire
     WMMA-FM serving the Lebanon,  Ohio market for  approximately  $3.0 million.
     Subject to the receipt of FCC approval,  the  acquisition is expected to be
     consummated in the fourth quarter.

     Portland,  Sacramento,  San  Francisco  and San Jose:  In April  1997,  the
     Company entered into an asset exchange  agreement pursuant to which it will
     acquire KINK-FM,  serving Portland,  Oregon,  KBRG-FM,  serving Fremont/San
     Francisco,  California,  $2.0 million in cash, and 150,000 shares of common
     stock of Latin Communications,  Inc., in exchange for KBAY-FM,  serving San
     Jose, and KSSJ-FM, serving Sacramento.  The agreement also provides for the
     exchange of KINK-FM for KBAY-FM in the event  regulatory  approval  for the
     exchange  of KBRG-FM  and KSSJ-FM  cannot be  obtained.  Subject to certain
     conditions,   including  the  receipt  of  FCC  approval  and  satisfactory
     resolution of the matters in the subsequent paragraph,  and, in the case of
     the exchange of KSSJ-FM for  KBRG-FM,  Justice  Department  approval of the
     acquisition pursuant to a consent decree, the transaction is expected to be
     consummated in the third or fourth quarter.


                                       10


<PAGE>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)




8.   Pending Transactions -  (Continued)                                      

     In June 1997, the Company and the seller  received  requests for additional
     information  about the acquisition from the Anti Trust Division of the U.S.
     Department of Justice.  Under the HSR Act and the  regulations  thereunder,
     the acquisition  may not be consumated  until 20 days after the Company and
     the seller have  substantially  complied with such  additional  information
     requests.  Although the Company  believes the  acquisition  and divestiture
     hereunder  complied with the anti-trust  laws, the Department of Justice or
     others  could take action under the  antitrust  laws to enjoin or otherwise
     challenge such acquisition/divestiture.

     Portsmouth:  In May 1997, the Company  entered into an agreement to acquire
     WSRI-FM, WZNN-AM, WMYF- AM and WEZR-FM, serving Portsmouth,  New Hampshire,
     for approximately $6.0 million. The Company began programming and marketing
     the  stations  pursuant to an LMA  agreement  in July 1997.  Subject to the
     receipt of FCC approval,  the  acquisition is expected to be consummated in
     the third quarter.

     Riverside/San  Bernardino and Sun City: In March 1997, the Company  entered
     into an agreement to acquire KFRG-FM,  serving the Riverside/San Bernardino
     market, and KXFG-FM, serving Sun City, California,  for approximately $60.0
     million.  The Company began programming and marketing the stations pursuant
     to an LMA agreement in August 1997.  FCC approval has been received and the
     HSR Act waiting period was terminated early. The acquisition is expected to
     be consummated in the first quarter of 1998.

     San Jose and  Monteray:  In March 1997,  the Company  entered into a merger
     agreement  pursuant to which the Company will acquire the assets of KEZR-FM
     and KLUE-FM  serving  Monteray,  California  in exchange for  approximately
     723,000  shares  of Class A Common  Stock  valued  at  approximately  $20.0
     million and $4.0 million in cash.  Subject to the receipt of FCC  approval,
     the  acquisition is expected to be consummated  in the fourth  quarter.  In
     June 1997,  the Company and the seller each received a Civil  Investigative
     Demand from the Anti Trust Division of the Department of Justice requesting
     certain documentary materials regarding the merger and the purchase,  sale,
     or trade or other transfer of radio stations in San Jose, California.

     In May 1997,  the Company  entered  into an  agreement  to sell KKSJ-AM for
     approximately  $3.2 million.  The acquirer began  programming and marketing
     the  stations  pursuant to an LMA  agreement  in June 1997.  Subject to the
     receipt of FCC approval,  the  transaction is expected to be consummated in
     the fourth quarter.

     Temple: In May 1997, the Company entered into an agreement to acquire radio
     station KKIK-FM,  licensed to Temple, Texas for approximately $3.7 million.
     Subject to the  approval  of the FCC,  the  transaction  is  expected to be
     consummated in the fourth quarter.

     West Palm Beach:  In May 1997 the Company entered into an agreement to sell
     WKGR-FM,  WOLL-FM,  WBZT- AM, and WEAT-AM for approximately  $33.0 million.
     Subject to the  receipt of FCC  approval  (the HSR Act  waiting  period has
     expired),  the  transaction  is  expected  to be  consummated  in the third
     quarter.

9.   Subsequent  Events - Subsequent to June 30, 1997,  the Company  consummated
     the following transactions:

     Boston:  In July 1997,  the  Company  acquired  the  assets of WNFT-AM  for
     approximately $4.5 million. The Company began programming and marketing the
     station pursuant to an LMA agreement in June 1997.

                                       11
<PAGE>
                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


9.   Subsequent Events - (Continued)

     Charlotte  and  Pittsburgh:  In August  1997,  in order to comply  with the
     Charlotte  Consent  Decree  described  in  Note 7 and  the  FCC's  multiple
     ownership  rules,  the  Company  consummated  an asset  exchange  agreement
     pursuant to which it exchanged  WRFX-FM,  serving  Charlotte,  for WDSY-FM,
     serving Pittsburgh, and $20.0 million.

     Kansas City,  Sacramento and St. Louis:  In July 1997, the Company  entered
     into an agreement to acquire  KLOU- FM in St. Louis in exchange for KUDL-FM
     and WDAF-AM in Kansas City and approximately $7.0 million. The Company also
     entered into a related agreement with the same party, pursuant to which the
     Company  will  sell  KCTC-AM  serving  Sacramento  for  approximately  $4.0
     million.  Subject to the receipt of FCC approval and  expiration or earlier
     termination of the HSR Act waiting period, the transactions are expected to
     be consummated in the fourth quarter.

     Rochester:  In July  1997,  the  Company  sold the  assets of  WCMF-AM  for
     approximately $0.7 million.
         
     St. Louis:  In July 1997, the Company sold the assets of KTRS-AM  (formerly
     KSD-AM) for approximately $10.0 million.

     West Palm Beach:  In July 1997,  the Company  entered  into an agreement to
     acquire  WTPX-FM  for  approximately  $11.0  million.   The  Company  began
     programming and marketing the stations pursuant to an LMA agreement in June
     1997.  Subject to the receipt of FCC  approval  and  expiration  or earlier
     termination of the HSR Act waiting  period,  the acquisition is expected to
     be consummated in the fourth quarter.

     Tower  Subsidiary:   In  July  1997,  the  Tower  Subsidiary  acquired  the
     following:

          (i) the assets of three entities which are affiliated with one another
     which own and  operate  towers  and a tower  site  management  business  in
     southern  California for an aggregate purchase price of approximately $32.1
     million;
          (ii)  the  assets  of  one  tower  site  in   Washington,   D.C.   for
     approximately $0.9 million;
          (iii) the assets of six tower sites in Pennsylvania for  approximately
     $0.3 million and
          (iv) the  permit  rights to build  five tower  sites in  Maryland  for
     approximately $0.5 million.

     In July 1997, the Tower Subsidiary entered into an asset purchase agreement
     with two entities  affiliated with one another to acquire tower sites and a
     tower  site  management   business  located  in  northern   California  for
     approximately $45.0 million. In connection therewith,  the Tower Subsidiary
     also  agreed to loan up to $1.35  million to the  sellers  on an  unsecured
     basis, of which approximately $0.25 million has been advanced. Consummation
     of the  transaction is dependent on, among other things,  the expiration or
     earlier  termination  of the HSR Act waiting  period.  The  transaction  is
     expected to be consummated in the third quarter.

     In July 1997, the Tower Subsidiary entered into an asset purchase agreement
     to  acquire  tower  sites  and  certain  video  transport   operations  for
     approximately  $70.25 million.  The seller owns or leases approximately 125
     towers,  principally  in the  Mid-Atlantic  region,  with the  remainder in
     California  and Texas.  Consummation  of the  transaction  is dependent on,
     among other things,  the  expiration or earlier  termination of the HSR Act
     waiting period. The acquisition is expected to be consummated in the fourth
     quarter of 1997 or the first quarter of 1998.

     In  August  1997,  the  Tower  Subsidiary  acquired  six  tower  sites  for
     approximately $1.5 million.

     The Company is also  pursuing  the  acquisitions  of tower  properties  and
     additional radio stations in new and existing  markets,  none of which have
     definitive purchase agreements.

                                       12
<PAGE>
                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)


10.  Subsidiary Guarantees:

     The Company's payment obligations under the 9.00% Senior Subordinated Notes
     (9% Notes) and the 9.75% Senior  Subordinated Notes (9.75% Notes) are fully
     and unconditionally  guaranteed on a joint and several basis (collectively,
     the Subsidiary Guarantees), on a senior basis (in the case of the 9% Notes)
     and a senior  subordinated basis (in the case of the 9.75% Notes) by all of
     its present and any future Restricted Subsidiaries (collectively Restricted
     Guarantors).   The  Restricted   Subsidiaries  have  also   unconditionally
     guaranteed,  and any future  Restricted  Subsidiaries  will be  required to
     guarantee,  on  a  joint  and  several  basis  (collectively,   the  Senior
     Subsidiary  Guarantees),  all  obligations  of the  Company  under the 1997
     Credit Agreement. The Tower Subsidiary has not guaranteed obligations under
     the Credit Agreements or either series of the Senior Subordinated Notes.

     The 9.75%  Notes and the  Subsidiary  Guarantees  are  subordinated  to all
     Senior Debt (as defined) of the Company  including  indebtedness  under the
     1997 Credit Agreement and the Senior Subsidiary  Guarantees.  The indenture
     governing each series of the Senior Subordinated Notes contains limitations
     on the amount of indebtedness (including Senior Debt) which the Company may
     incur.

     With the intent that the Subsidiary  Guarantees  not constitute  fraudulent
     transfers  or  conveyances  under  applicable  state or  federal  law,  the
     obligation of each guarantor under its Subsidiary Guarantee is also limited
     to the  maximum  amount  as will,  after  giving  effect  to any  rights to
     contribution of such guarantor  pursuant to any agreement  providing for an
     equitable  contribution  among such  guarantor and other  affiliates of the
     Company of  payments  made by  guarantees  by such  parties,  result in the
     obligations  of such  guarantor  in  respect  of such  maximum  amount  not
     constituting a fraudulent conveyance.

     The following unaudited condensed  consolidating financial data illustrates
     the  composition  of the combined  guarantors.  The Company  believes  that
     separate complete financial  statements of the respective  guarantors would
     not  provide  additional  material  information  which  would be  useful in
     assessing the financial composition of the guarantors.  No single guarantor
     has any  significant  legal  restrictions  on the ability of  investors  or
     creditors  to  obtain  access  to its  assets  in event of  default  on the
     Subsidiary  Guarantee, other  than  in the  case  of the  9.75%  Notes  its
     subordination to Senior Debt described above.

     Investments in  subsidiaries  are accounted for by the parent on the equity
     method  for   purposes   of  the   unaudited   supplemental   consolidating
     presentation.  Earnings (losses) of subsidiaries are therefore reflected in
     the parent's  investment accounts and earnings.  The principal  elimination
     entries eliminate investments in subsidiaries and intercompany balances and
     transactions.

                                       13

<PAGE>




<TABLE>
<CAPTION>
                              Unaudited Condensed Consolidating Balance Sheet
                                              June 30, 1997
                                          (Dollars in thousands)

   
                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>


ASSETS
CURRENT ASSETS:
   Cash and cash equivalents                     $    8,095       $    4,503      $    1,871                        $   14,469
   Accounts receivable, net                          51,612           29,834             838                            82,284
   Prepaid expenses and other current assets          3,374            1,081             102                             4,557
   Deferred income taxes                              3,201              169                                             3,370
                                                 ----------       ----------     -----------       -----------      ---------- 
      Total current assets                           66,282           35,587           2,811                           104,680

PROPERTY AND EQUIPMENT, NET                          81,202           47,798          24,044                           153,044
OTHER ASSETS:

   Restricted cash                                    8,896                                                              8,896
   Investment in and advances to subsidiaries     1,288,346                                         (1,288,346)              0 
   Investment notes receivable                       25,496                              254                            25,750
   Goodwill - net                                   342,379           20,198          12,199                           374,776
   FCC licenses - net                                              1,114,573                                         1,114,573
   Other intangible assets - net                     31,672            1,938          19,567                            53,177
   Deposits and other long-term assets               12,502                              446                            12,948
   Deferred income taxes                              7,142                                                              7,142
   Net assets held under trust agreement                              63,252                                            63,252
                                                 ----------       ----------     -----------       -----------      ---------- 
      Total other assets                         $1,716,433        1,199,961          32,466        (1,288,346)      1,660,514
                                                 ----------       ----------     -----------       -----------      ----------
TOTAL ASSETS                                     $1,863,917       $1,283,346     $    59,321       $(1,288,346)     $1,918,238
                                                 ==========       ==========     ===========       ===========      ========== 



                                       14

<PAGE>

<CAPTION>

                                 AMERICAN RADIO SYSTEMS CORPORATION

                   NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                             (Continued)


10.      Subsidiary Guarantees - (continued):


                              Unaudited Condensed Consolidating Balance Sheet
                                              June 30, 1997
                                          (Dollars in thousands)

   
                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

LIABILITIES AND STOCKHOLDERS'
   EQUITY
CURRENT LIABILITIES:
   Current maturities of long-term debt          $      480                      $       107                        $      587
   Accounts payable and accrued expenses             39,549       $    6,959           1,842                            48,350
                                                 ----------       ----------     -----------       -----------      ----------
      Total current liabilities                      40,029            6,959           1,949                            48,937


NON-CURRENT LIABILITIES:
   Deferred income taxes                            182,623           21,522             279                           204,424
   Other long-term liabilities                       11,236                                9                            11,245
   Long-term debt                                   736,854                           23,122                           759,976
                                                 ----------       ----------     -----------       -----------      ----------
      Total non-current liabilities                 930,713           21,522          23,410                           975,645

MINORITY INTEREST IN SUBSIDIARY                                                          481                               481
REDEEMABLE EXCHANGEABLE
   PREFERRED STOCK                                  209,478                                                            209,478

STOCKHOLDERS'  EQUITY:
   Preferred Stock                                        1                                                                  1
   Common Stock                                         294                              500      $       (500)            294
   Additional paid-in capital                       684,089        1,249,394          33,970        (1,283,364)        684,089   
   Unearned compensation                               (249)                                                              (249)
   Retained earnings                                      0            5,471            (989)           (4,482)              0
   Treasury stock                                      (438)                                                              (438)
                                                 ----------       ----------     -----------       -----------      ----------
      Total stockholders' equity                    683,697        1,254,865          33,481        (1,288,346)        683,697
                                                 ----------       ----------     -----------       -----------      ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
   EQUITY                                        $1,863,917       $1,283,346     $    59,321      $ (1,288,346)    $ 1,918,238
                                                 ==========       ==========     ===========      ============     ===========





                                       15

<PAGE>
<CAPTION>

                                 AMERICAN RADIO SYSTEMS CORPORATION

                   NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                             (Continued)


10.      Subsidiary Guarantees - (continued):


                    Unaudited Condensed Consolidating Statement of Operations
                             For the Six Months Ended June 30, 1997
                                     (Dollars in thousands)

                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Net broadcast revenues                            $ 105,885       $   45,258                      $        (22)    $   151,121
Tower revenues                                                                   $     3,381              (157)          3,224
License fees charged to Parent                       (8,428)           8,428                                                 0
                                                  ---------       ----------     -----------      ------------     -----------
Total net revenues                                   97,457           53,686           3,381              (179)        154,345

Operating expenses excluding
    depreciation and amortization, net
    local marketing agreement and
    corporate general and administrative             74,325           28,736           1,849              (179)        104,731
    expenses
Net local marketing agreement expense                   993              348                                             1,341
Depreciation and amortization                         7,830           14,411           1,323                            23,564
Corporate general and administrative                  3,934                                                              3,934
                                                  ---------       ----------     -----------      ------------     -----------
Operating income                                     10,375           10,191             209                            20,775

Other income (expense):
  Interest expense                                  (22,918)                            (318)                          (23,236)
  Interest income                                     1,088                               57                             1,145
  Gain (loss) on sale of assets and other, net          803               (3)           (161)                              639
  Equity in (loss) of subsidiaries, net of
    income taxes recorded at the
    subsidiary level                                  4,465                                             (4,465)              0
                                                  ---------       ----------     -----------      ------------     -----------
Income (loss) before income taxes and
    extraordinary item                               (6,187)          10,188            (213)           (4,465)           (677)
Benefit (provision) for income taxes                  5,884           (5,324)           (186)                              374
                                                  ---------       ----------     -----------      ------------     -----------
Income (loss) before extraordinary loss                (303)           4,864            (399)           (4,465)           (303)
Extraordinary loss on extinguishment of
    debt - net of tax benefit                        (1,639)                                                            (1,639)
                                                  ---------       ----------     -----------      ------------     -----------
Net income (loss)                                 $  (1,942)      $    4,864     $      (399)     $     (4,465)    $    (1,942)
                                                  =========       ==========     ===========      ============     ===========



                                       16

<PAGE>
<CAPTION>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

10.      Subsidiary Guarantees - (continued):


                     Unaudited Condensed Consolidating Statement of Operations
                             For the Three Months Ended June 30, 1997
                                       (Dollars in thousands)

                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Net broadcast revenues                            $  54,704       $   43,486                      $        (13)    $    98,177
Tower revenues                                                                   $     2,015               (84)          1,931
License fees charged to Parent                       (3,274)           3,274                                                 0
                                                  ---------       ----------     -----------      ------------     -----------
Total net revenues                                   51,430           46,760           2,105               (97)        100,108

Operating expenses excluding
    depreciation and amortization, net
    local marketing agreement and
    corporate general and administrative             35,628           27,284           1,032               (97)         63,847
    expenses
Net local marketing agreement (revenues) expenses    (1,606)           1,015                                              (591)
Depreciation and amortization                         4,406           10,916             818                            16,140
Corporate general and administrative                  2,156                                                              2,156
                                                  ---------       ----------     -----------      ------------     -----------
Operating income                                     10,846            7,545             165                            18,556

Other income (expense):
  Interest expense                                  (15,510)                            (222)                          (15,732)
  Interest income                                       457                               32                               489
  Gain (loss) on sale of assets and other, net          504               (3)            (81)                              420
  Equity in (loss) of subsidiaries, net of
    income taxes recorded at the
    subsidiary level                                  4,567                                             (4,567)              0
                                                  ---------       ----------     -----------      ------------     -----------
Income (loss) before income taxes and
    extraordinary item                                  864            7,542            (106)           (4,567)          3,733
Benefit (provision) for income taxes                  1,557           (2,633)           (236)                           (1,312)
                                                  ---------       ----------     -----------      ------------     -----------
Net income (loss)                                 $   2,421       $    4,909     $      (342)     $     (4,567)    $     2,421
                                                  =========       ==========     ===========      ============     ===========



                                       17
<PAGE>


<CAPTION>

  
                   Unaudited Condensed Consolidating Statement of Cash Flows
                            For the Six Months Ended June 30, 1997
                                     (Dollars in thousands)


                                                    Parent and     Guarantor     Non-guarantor                     Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Cash flows from operating activities              $ (28,073)      $   (3,043)    $       511                       $   (30,605)
                                                  ---------       ----------     -----------      ------------     -----------
Investing Activities:
  Payments for purchase of property and
        equipment and intangible assets             (14,497)                          (4,889)                          (19,386)
  Proceeds from radio station sales                  27,876           20,000                                            47,876
  Payments for radio station acquisitions          (445,719)                                                          (445,719)
  Payments for tower related acquisitions           (19,277)                                                           (19,277)
  Repayment for station investment notes
     receivable                                       1,243                                                              1,243
  Issuance of station investment notes
     receivable                                        (410)                            (254)                             (664)
  Deposits and other long-term assets                13,431              (48)            (19)                           13,364
                                                  ---------       ----------     -----------                       -----------
Cash flows used by investing activities            (437,353)          19,952          (5,162)                         (422,563)
                                                  ---------       ----------     -----------                       -----------


Financing Activities:
  Borrowings under Credit Agreements and
     other                                          514,000                           19,000                           533,000
  Repayment of Credit Agreements                   (257,000)                                                          (257,000)
  Repayment of other obligations                       (385)                            (307)                             (692)
  Net proceeds from equity offerings and
     options                                            213                                                                213
  Net proceeds from exchangeable preferred
     stock                                          192,218                                                            192,218
  Additions to deferred financing costs              (5,526)                                                            (5,526)
  Distributions to minority interest                                                    (210)                             (210)
  Dividends paid                                     (4,813)                                                            (4,813)
  Investment in and advances to subsidiaries         26,740          (12,406)        (14,334)                                0
                                                  ---------       ----------     -----------                       -----------
Cash flows from financing activities                465,447          (12,406)          4,149                           457,190
                                                  ---------       ----------     -----------      ------------     -----------    

Increase (decrease) in cash and cash equivalents         21            4,503            (502)                            4,022

Cash and cash equivalents at beginning
       of period                                      8,074                            2,373                            10,447 
                                                  ---------       ----------     -----------      ------------     -----------
Cash and cash equivalents at end of period        $   8,095       $    4,503     $     1,871                       $    14,469
                                                  =========       ==========     ===========      ============     ===========




                                       18

<PAGE>
<CAPTION>

                                 AMERICAN RADIO SYSTEMS CORPORATION

                   NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                             (Continued)


10.      Subsidiary Guarantees - (continued):


                                  Condensed Consolidating Balance Sheet
                                            December 31, 1996
                                          (Dollars in thousands)

                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>


ASSETS
CURRENT ASSETS:
   Cash and cash equivalents                      $   8,074                       $    2,373                       $    10,447
   Accounts receivable, net                          49,565       $    2,095             237                            51,897
   Prepaid expenses and other current assets          3,509               14              80                             3,603
   Deferred income taxes                              3,202              168                                             3,370
                                                  ---------       ----------     -----------      ------------     -----------
      Total current assets                           64,350            2,277           2,690                            69,317

PROPERTY AND EQUIPMENT, NET                          67,267            3,271          19,709                            90,247
OTHER ASSETS:
   Investment in and advances to subsidiaries       314,983                                       $   (314,983)              0
   Station investment notes receivable               69,920                                                             69,920
   Goodwill - net                                   200,449           20,457          11,243                           232,149
   FCC licenses - net                                                233,558                                           233,558
   Other intangible assets - net                     24,178              327           3,048                            27,553
   Deposits and other long-term assets               25,589               48             427                            26,064
   Net assets held under exchange agreement                           47,495                                            47,495
                                                  ---------       ----------     -----------      ------------     -----------
      Total other assets                            635,119          301,885          14,718          (314,983)        636,739
                                                  ---------       ----------     -----------      ------------     -----------
TOTAL ASSETS                                      $ 766,736       $  307,433     $    37,117      $   (314,983)    $   796,303
                                                  ---------       ----------     -----------      ------------     -----------


                                       19

<PAGE>

<CAPTION>

                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

10.      Subsidiary Guarantees - (continued):


                             Unaudited Condensed Consolidating Balance Sheet
                                            December 31, 1996
                                          (Dollars in thousands)

  
                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

LIABILITIES AND STOCKHOLDERS'
   EQUITY
CURRENT LIABILITIES:
   Current maturities of long-term debt           $     444                      $       117                       $       561
   Accounts payable and accrued expenses             31,087              656           2,027                            33,770
                                                  ---------       ----------     -----------      ------------     -----------
     Total current liabilities                       31,531              656           2,144                            34,331

NON-CURRENT LIABILITIES:
   Deferred income taxes                             11,405           21,521             279                            33,205
   Other long-term liabilities                        2,129                               20                             2,149
   Long-term debt                                   325,693                            4,418                           330,111
                                                  ---------       ----------     -----------      ------------     -----------
      Total non-current liabilities                 339,227           21,521           4,717                           365,465

MINORITY INTEREST  IN SUBSIDIARY                       (185)                             529                               344

STOCKHOLDERS'  EQUITY:
   Preferred Stock                                        1                                                                  1
   Common Stock                                         211                              500      $       (500)            211
   Additional paid-in capital                       390,731          284,649          29,817          (314,466)        390,731
   Unearned compensation                               (297)                                                              (297)
   Retained earnings                                  5,955              607            (590)              (17)          5,955
   Treasury stock                                      (438)                                                              (438)
                                                  ---------       ----------     -----------      ------------     -----------
      Total stockholders' equity                    396,163          285,256          29,727          (314,983)        396,163
                                                  ---------       ----------     -----------      ------------     -----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY                                            $ 766,736       $  307,433     $    37,117      $   (314,983)    $   796,303
                                                  =========       ==========     ===========      ============     ===========

                                       20

<PAGE>
<CAPTION>


                       AMERICAN RADIO SYSTEMS CORPORATION

         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

10.      Subsidiary Guarantees - (continued):


                     Unaudited Condensed Consolidating Statement of Operations
                             For the Six Months Ended June 30, 1996
                                      (Dollars in thousands)


                                                   Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Net broadcast revenues                            $  59,873                                                        $    59,873
Tower revenues                                          400                      $       820                             1,220
License fees                                         (1,030)      $    1,030                                               
                                                  ---------       ----------     -----------      ------------     -----------
Total net revenues                                   59,243            1,030             820                            61,092


Operating expenses excluding depreciation and
     amortization, net local marketing agreement
     corporate general and administrative
     expenses                                        42,077                4             693                            42,774   
Net local marketing agreement expenses                2,589                                                              2,589     
Depreciation and amortization                         3,490            1,026             323                             4,839
Corporate general and administrative                  2,340                                                              2,340 
                                                  ---------       ----------     -----------      ------------     -----------
Operating income                                      8,747                             (196)                            8,550

Other income (expense):
  Interest income                                     3,638                                2                             3,640
  Interest expense                                   (8,953)                             (11)                           (8,964)
  Gain (loss) on sale of assets and other               (36)                                                               (36)
  Equity in (loss) of subsidiaries, net of income
     taxes recorded at the subsidiary level       $    (113)                                      $        113              
                                                  ---------       ----------     -----------      ------------     -----------
Income (loss) before income taxes                     3,283                             (205)              113           3,191
Provision (benefit) for income taxes                  1,528                              (92)                            1,436
                                                  ---------       ----------     -----------      ------------     -----------
Net income                                        $   1,755       $        0     $      (113)     $        113     $     1,755
                                                  =========       ==========     ===========      ============     ===========




                                       21

<PAGE>

<CAPTION>

                                 AMERICAN RADIO SYSTEMS CORPORATION

                   NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                             (Continued)

10.      Subsidiary Guarantees - (continued):

                   Unaudited Condensed Consolidating Statement of Operations
                             For the Three Months Ended June 30, 1996
                                      (Dollars in thousands)


                                                  Parent and     Guarantor      Non-guarantor                    Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Net broadcast revenues                            $  36,704                                                        $    37,250
Tower revenues                                          194                      $       546                               194
License fees                                           (527)      $      527                                                
                                                  ---------       ----------     -----------      ------------     -----------
Total net revenues                                   36,371              527             546                            37,444


Operating expenses excluding depreciation and
     amortization, net local marketing agreement
     corporate general and administrative
     expenses                                        24,209                2             439                            24,650   
Net local marketing agreement expenses                2,139                                                              2,139     
Depreciation and amortization                         1,902              525             212                             2,639
Corporate general and administrative                  1,259                                                              1,259 
                                                  ---------       ----------     -----------      ------------     -----------
Operating income                                      6,862                             (105)                            6,757

Other income (expense):
  Interest income                                     1,523                                                              1,523
  Interest expense                                   (4,252)                              (9)                           (4,261)
  Gain (loss) on sale of assets and other                (1)                                                                (1)
  Equity in (loss) of subsidiaries, net of income
     taxes recorded at the subsidiary level       $     (63)                                      $         63              
                                                  ---------       ----------     -----------      ------------     -----------
Income (loss) before income taxes                     4,069                             (114)               63           4,018
Provision (benefit) for income taxes                  1,858                              (51)                            1,807
                                                  ---------       ----------     -----------      ------------     -----------
Net income                                        $   2,211       $        0     $       (63)     $         63     $     2,211
                                                  =========       ==========     ===========      ============     ===========




                                      22

<PAGE>


<CAPTION>


                               AMERICAN RADIO SYSTEMS CORPORATION

                   NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                             (Continued)


10.      Subsidiary Guarantees - (continued):


                    Unaudited Condensed Consolidating Statement of Cash Flows
                             For the Six Months Ended June 30, 1996
                                     (Dollars in thousands)


                                                    Parent and     Guarantor     Non-guarantor                     Consolidated  
                                                  its Divisions   Subsidiaries   Subsidiaries     Eliminations       Totals
                                                  -------------   ------------   -------------    ------------     ------------
<S>                                              <C>             <C>             <C>             <C>               <C>

Cash flows from operating activities              $  (6,184)                     $       661                       $    (5,523)
                                                  ---------       ----------     -----------      ------------     -----------
Investing Activities:
  Payments for purchase of property and
        equipment and intangible assets              (4,542)                          (2,795)                           (7,337)
  Proceeds from radio station sales                  18,000                                                             18,000
  Payments for radio station acquisitions           (67,777)                                                           (67,777)
  Payments for tower related acquisitions                                             (5,045)                           (5,045)
  Payment for station investment notes
     receivable                                     (27,779)                                                           (27,779)
  Deposits and other long-term assets               (23,651)                             (54)                          (23,705)
                                                  ---------       ----------     -----------      ------------     -----------
Cash flows used by investing activities            (105,749)                          (7,894)                         (113,643)
                                                  ---------       ----------     -----------      ------------     -----------


Financing Activities:
  Repayment of Credit Agreements                   (151,500)                                                          (151,500)
  Repayment of other obligations                       (561)                              (7)                             (568)
  Net proceeds from equity offerings and
     options                                        248,198                                                            248,198
  Net proceeds from exchangeable preferred
     stock                                          168,321                                                            168,321
  Investment in and advances to subsidiaries                                           7,292            (7,292)             
                                                  ---------       ----------     -----------      ------------     -----------
Cash flows from financing activities                264,458                            7,285            (7,292)        264,451
                                                  ---------       ----------     -----------      ------------     -----------    
Decrease in cash and cash equivalents               152,525                               52            (7,292)        145,285

Cash and cash equivalents at beginning
    of period                                         3,890                                                              3,890
                                                  ---------       ----------     -----------      ------------     -----------
Cash and cash equivalents at end of period        $ 156,415       $        0     $        52      $     (7,292)    $   149,175
                                                  =========       ==========     ===========      ============     ===========


                                       23
</TABLE>

<PAGE>


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

This  report  contains   "forward-looking   statements"   including   statements
concerning  projections,  plans,  objectives,  future events or performance  and
underlying  assumptions and other  statements which are other than statements of
historical  fact. The Company wishes to caution  readers that certain  important
factors may have affected and could in the future  affect the  Company's  actual
results and could cause the Company's  actual results for subsequent  periods to
differ materially from those expressed in any forward-looking  statement made by
or on behalf of the Company.  These important factors include among others,  the
following:  (i)  any  adverse  change  in the  laws,  regulations  and  policies
governing the operation, ownership and acquisition of radio stations, including,
but not limited to, those  established by Congress,  the Federal  Communications
Commission and the Antitrust Division of the U.S. Justice  Department;  and (ii)
the Company's financial leverage as a result of borrowings under the 1997 Credit
Agreement,  which  bears  interest at variable  rates,  and the  issuance of the
Senior  Subordinated  Notes could make it  vulnerable to an increase in interest
rates or a downturn  in the  operating  performance  of its radio  stations or a
downturn in economic conditions.

As of June 30, 1997, the Company owned and/or operated  approximately  100 radio
stations.  See the Form 10-K and the unaudited condensed  consolidated financial
statements   for  a  description   of  the  1997  and  1996  station  and  tower
acquisitions.   As  of  June  30,  1996,  the  Company  owned  and/or   operated
approximately  fifty  radio  stations.  These  transactions  have  significantly
affected operations for the three and six months ended June 30, 1997 as compared
to the three and six months ended June 30, 1996.

Three months ended June 30, 1997 and 1996

Net  revenues  were  $100.1  million  for the three  months  ended June 30, 1997
compared  to $37.4  million  for the same three  months in 1996,  an increase of
$62.7 million or 167.6%.  This increase was  attributable  to revenue  growth in
some of the Company's  existing markets and, to a more substantial  extent,  the
impact of the EZ Merger and other  acquisitions that occurred in the latter half
of 1996 and first half of 1997.

Station operating  expenses  excluding net local marketing  agreement  expenses,
depreciation and amortization and corporate general and administrative  expenses
were $63.8  million for the three months  ended June 30, 1997  compared to $24.7
million  for the same period in 1996,  an  increase of $39.1  million or 158.3%.
This  increase  was due to the impact of  increased  costs  associated  with the
Company's revenue growth.

Net local  marketing  agreement  revenues were $0.6 million for the three months
ended June 30, 1997 compared to net local marketing  agreement  expenses of $2.1
million for the same three months in 1996.  Local marketing  agreement  revenues
for the three months ended June 30, 1997 are presented net of approximately $0.2
million of expenses incurred under such agreements and local marketing agreement
expenses for the same period in 1996 are  presented  net of  approximately  $0.3
million of revenues earned under such agreements. The change in the balances for
each  period  are  based on the  timing  of  pending  station  acquisitions  and
dispositions.

Depreciation  and  amortization was $16.1 million and $2.6 million for the three
months ended June 30, 1997 and June 30, 1996, respectively, an increase of $13.5
million.  This  increase was primarily  attributable  to the impact of increased
expenses  associated  with the increase in depreciable  and  amortizable  assets
resulting from the 1996 and 1997 station  acquisitions  and, to a lesser extent,
the impact of increased  values  being  ascribed to FCC licenses in the purchase
price allocation of 1997 station acquisitions.



                                       24

<PAGE>


Results of Operations - (continued):

Corporate general and administrative  expenses increased to $2.2 million for the
three months  ended June 30, 1997,  from $1.3 million for the three months ended
June 30, 1996, an increase of $0.9 million or 69.2%. This increase was primarily
attributable  to the higher  personnel  costs  associated  with  supporting  the
Company's greater number of stations.

Interest  expense  was $15.7  million for the three  months  ended June 30, 1997
compared to $4.3 million for the 1996 period, an increase of $11.4 million.  The
increase  is related  to higher  borrowing  levels  under the  Company's  credit
agreements  in 1997 as  compared to 1996 which  resulted  from the 1996 and 1997
acquisitions.

Interest  income was $0.5  million  for the three  months  ended  June 30,  1997
compared to $1.5 million for the three months ended June 30, 1996, a decrease of
$1.0 million.  The decrease is attributable to lower investable cash balances in
1997 and higher interest income earned on certain  station  investment  notes in
1996 as compared to 1997.

The income  tax  provision  for the three  months  ended June 30,  1997 was $1.3
million as compared to $1.8 million for three  months  ended June 30, 1996.  The
effective  tax rate for the three months  ended June 30, 1997 was  approximately
35.2%  compared to 45.0% in 1996.  The  effective  tax rate for the three months
ended June 30,  1997 is  reflective  of the  cumulative  adjustment  required to
adjust to the estimated annual effective rate of 55%. The effective rate in 1996
is reflective of the impact of permanent differences,  principally  amortization
of non-deductible goodwill on certain stock acquisitions.

Preferred  stock  dividends  for the three  months ended June 30, 1997 were $8.1
million  compared to $0.1  million in 1996.  The  dividends  for the 1997 period
include $2.4  million of dividends  attributable  to the  Convertible  Preferred
Stock issued in late June 1996 and $5.7 million of dividends attributable to the
Cumulative  Exchangeable  Preferred  Stock  issued  in late  January  1997.  The
dividends for the 1996 period include $0.1 million of dividends  attributable to
the Convertible Preferred Stock.

Net loss applicable to common stockholders was $5.7 million for the three months
ended June 30, 1997 compared to a net income  applicable to common  stockholders
of $2.1 million for the three  months  ended June 30,  1996,  as a result of the
factors discussed above.

Six months ended June 30, 1997 and 1996

Net revenues were $154.3 million for the six months ended June 30, 1997 compared
to $61.1  million for the same six months in 1996,  an increase of $93.2 million
or 152.5%.  This  increase  was  attributable  to revenue  growth in some of the
Company's existing markets and, to a more substantial  extent, the impact of the
EZ Merger in 1997 and acquisitions  that occurred in the latter half of 1996 and
first half of 1997.

Station operating  expenses  excluding net local marketing  agreement  expenses,
depreciation and amortization and corporate general and administrative  expenses
were  $104.7  million for the six months  ended June 30, 1997  compared to $42.8
million  for the same period in 1996,  an  increase of $61.9  million or 144.6%.
This  increase  was due to the impact of  increased  costs  associated  with the
Company's revenue growth.

Net local  marketing  agreement  expenses  were $1.3  million for the six months
ended June 30, 1997 compared to $2.6 million for the same six months in 1996, an
increase of $1.3 million.  Local marketing agreement expenses for the six months
ended June 30, 1997 and 1996 are presented net of approximately $2.0 million and
$0.3 million,  respectively of revenues earned under such agreements. The change
in the  balances  for each  period are based on the  timing of  pending  station
acquisitions and dispositions.


                                       25

<PAGE>

Results of Operations - (continued):

Depreciation  and  amortization  was $23.6  million and $4.8 million for the six
months ended June 30, 1997 and June 30, 1997, respectively, an increase of $18.8
million.  This  increase was primarily  attributable  to the impact of increased
expenses  associated  with the increase in depreciable  and  amortizable  assets
resulting from the 1996 and 1997 station  acquisitions  and, to a lesser extent,
the impact of increased  values  being  ascribed to FCC licenses in the purchase
price allocation of 1997 station acquisitions.

Corporate general and administrative  expenses increased to $3.9 million for the
six months  ended June 30, 1997 from $2.3  million for the six months ended June
30, 1996,  an increase of $1.6  million or 69.6%.  This  increase was  primarily
attributable  to the higher  personnel  costs  associated  with  supporting  the
Company's greater number of stations.

Interest  expense  was $23.2  million  for the six months  ended  June 30,  1997
compared to $9.0  million for the 1996 period,  an increase of $14.2  million or
157.8%.  The increase is related to higher  borrowing levels under the Company's
credit  agreements in 1997 as compared to 1996 which  resulted from the 1996 and
1997 acquisitions.

Interest income was $1.1 million for the six months ended June 30, 1997 compared
to $3.6  million  for the six months  ended June 30,  1996,  a decrease  of $2.5
million.  The decrease is attributable to lower investable cash balances in 1997
and higher interest income earned on certain station investment notes in 1996 as
compared to 1997.

The income tax benefit for the six months  ended June 30, 1997 was $0.4  million
as compared to a provision  of $1.4  million for six months ended June 30, 1996.
The effective tax rate for the six months ended June 30, 1997 was  approximately
55.2% compared to 45.0% in 1996. The higher effective rate in 1997 is due to the
effect of permanent  differences,  principally  amortization  of  non-deductible
goodwill on the EZ merger.  The effective tax rate for the six months ended June
30, 1997  includes the  cumulative  adjustment  required to adjust the estimated
annual effective rate.

The extraordinary  loss for the six months ended June 30, 1997 was $1.6 million,
net of a $1.0  million  tax  benefit.  The  extraordinary  loss was a result  of
certain  deferred  financing  costs  written off in January 1997 pursuant to the
extinguishment of debt under the Company's previous credit agreement.

Preferred  stock  dividends  for the six months  ended June 30,  1997 were $14.3
million compared to $0.1 milion for the 1996 period.  The dividends for the 1997
period  include  $4.8  million  of  dividends  attributable  to the  Convertible
Preferred  Stock  issued  in late  June  1996  and  $9.5  million  of  dividends
attributable  to the  Cumulative  Exchangeable  Preferred  Stock  issued in late
January  1997.  The  dividends  for the 1996  period  include  $0.1  million  of
dividends attributable to the Convertible Preferred Stock.

Net loss applicable to common  stockholders was $16.2 million for the six months
ended June 30, 1997 compared to net income applicable to common  stockholders of
$1.6 million for the six months ended June 30, 1996,  as a result of the factors
discussed above.

Liquidity and Capital Resources

The Company's  liquidity  needs arise from its  acquisition-related  activities,
debt service,  working  capital,  capital  expenditures  and dividend  payments.
Historically,   the  Company  has  met  its  operational  liquidity  needs  with
internally   generated   funds  and  has  financed  the   acquisition  of  radio
broadcasting properties and tower related properties,  including related working
capital needs,  with a combination of bank borrowings and proceeds from the sale
of the Company's equity and debt  securities.  For the six months ended June 30,
1997, cash flows used from operating  activities was $30.6 million,  as compared
to $5.5 million for the six months ended June 30, 1996.  The change is primarily
attributable to working capital  investments  related to station acquisition and
growth.

                                       26


<PAGE>


Liquidity and Capital Resources - (continued)

Cash flows used for investing  activities were $422.6 million for the six months
ended June 30, 1997 as compared to $113.6  million for the six months ended June
30, 1996. The increase is attributable to the increased  acquisition activity in
1997 as compared to 1996.

Cash  provided by  financing  activities  was $457.2  million for the six months
ended June 30, 1997 as compared to $264.5  million for the six months ended June
30, 1996.  The  increase  in 1997  is due to the  exchangeable  preferred  stock
offering described below and the impact of borrowings under the Company's credit
agreements.

Offering:  In January  1997,  the  Company  consummated  a private  offering  of
2,000,000  shares  of 11 3/8%  Cumulative  Exchangeable  Preferred  Stock,  $100
liquidation preference per share (Exchangeable Preferred Stock). Net proceeds to
the Company from the offering were approximately $192.2 million. Proceeds of the
offering  were used  initially  to repay  indebtedness  and  thereafter  to fund
acquisitions. Dividends on the Exchangeable Preferred Stock are cumulative at an
annual  rate of 11 3/8%  (equivalent  to  $11.375  per  share)  and are  payable
quarterly in cash,  or, at the  Company's  election,  on or prior to January 15,
2002, with the issuance of additional shares.  The Exchangeable  Preferred Stock
possesses mandatory  redemption features and has been classified  accordingly in
the  financial  statements.   See  the  Form  10-K  for  a  description  of  the
Exchangeable Preferred Stock.

Credit  Agreements:  As of June 30, 1997, the Company had  approximately  $760.6
million  of  total  long-term  debt  (including  the  current  portion  thereof)
outstanding.   This  included   approximately   $430.0   million  of  borrowings
outstanding under the Company's and the Tower Subsidiary's credit agreements and
$325.0 million outstanding under Senior Subordinated Notes. In January 1997, the
Company  entered into new credit  agreements with a syndicate of banks (the 1997
Credit Agreement) which replaced the $300.0 million 1995 Credit  Agreement.  The
1997 Credit Agreement consists of two separate lending agreements, providing for
facilities  consisting of a $550.0 million reducing revolver credit facility,  a
$200.0 million  revolving credit converting to a term loan facility and a $150.0
million term loan facility, which was available only to repurchase, if required,
certain note  obligations  of EZ which were assumed by the Company in connection
with the EZ  Merger.  As  described  below,  the  Company  was not  required  to
repurchase any of the 9.75% Notes,  and therefore such agreement was canceled in
May 1997. The terms of the 1997 Credit Agreement are described in the Form 10-K.

In November 1996, the Tower  Subsidiary  entered into a credit  agreement (Tower
Credit  Agreement) that provides the Tower  Subsidiary with a $70.0 million loan
commitment  and  an  incremental  $20.0  million  loan,  contingent  upon  Tower
obtaining  additional equity. As of June 30, 1997 approximately $21.5 million of
borrowings were outstanding under the Tower Credit  Agreement.  The terms of the
Tower Credit  Agreement are described in the Form 10-K. The Tower  Subsidiary is
in the  process of  negotiating  the terms of a new credit  facility  which will
increase the amount of available  borrowings to $250.0 million.  While the Tower
Subsidiary  expects to execute a credit agreement in the third or fourth quarter
of 1997, there can be no assurance that such an agreement will be executed.

In order to finance acquisitions of radio stations, tower related properties and
for general corporate purposes, the Company has borrowed and expects to continue
to borrow  under its credit  agreements.  As part of the EZ Merger,  the Company
assumed EZ's obligations with respect to $150.0 million  principal amount of the
9.75%  Notes  and  repaid  all  borrowings  under the EZ  credit  facility  with
borrowings from the 1997 Credit Agreement.  As required by the closing of the EZ
Merger, the Company was required to offer to purchase the 9.75% Notes at 101% of
their principal  amount.  Such offer expired in May 1997 and, no such notes were
tendered for repurchase.

A substantial portion of the Company's cash flow from operations is required for
debt  service.  However,  the Company's  leverage  could make it vulnerable to a
downturn in the operating performance of its radio stations, tower properties or
a downturn in economic conditions.


                                       27

<PAGE>


Liquidity and Capital Resources - (continued):

The Company  believes that its cash flows from  operations will be sufficient to
meet  its  quarterly  dividends, debt  service  requirements  for  interest  and
scheduled  payments of principal  under the 1997 Credit  Agreement and its other
debt obligations.  If such cash flow is not sufficient to meet such debt service
requirements,  the Company may be required to sell equity securities,  refinance
its  obligations  or dispose of one or more of its  properties  in order to make
such  scheduled  payments.  There can be no assurance  that the Company would be
able to effect any of such transactions on favorable terms.

The  Company's  working  capital  needs  fluctuate  throughout  the  year due to
industry-wide  seasonality  and its  broadcast  of sporting  events at different
times during the year. The Company historically has had sufficient cash from its
operations  to meet its working  capital  needs,  apart from needs  generated by
newly  acquired  properties,  and  believes  that  it has  sufficient  financial
resources available to it, including  borrowing under the credit agreements,  to
finance operations for the foreseeable future.

The Company has entered into numerous station and tower  acquisition and related
agreements  (see the  Form  10-K and the  Notes  to the  Condensed  Consolidated
Financial  Statements).  The consummation of each of these agreements is subject
to, among other  things,  FCC approval and in some cases  expiration  or earlier
termination  of the HSR Act waiting  period and the  negotiation  of  definitive
agreements.  Unless  otherwise  noted,  the Company intends to effect all of the
transactions  as soon as the  necessary  approvals  are  obtained.  The  Company
intends to finance the  acquisitions  with available cash,  borrowings under the
credit agreements, and, in certain cases, issuance of equity securities.

The Company made approximately $17.1 million in capital  expenditures in the six
months ended June 30, 1997, principally related to tower construction and office
consolidations.   The  Company  expects  capital  expenditures  in  1997  to  be
approximately  $30.0  million,  consisting  principally  of tower  construction,
office  consolidations  and ongoing technical  improvements.  To the extent that
funds generated from operations,  or available cash, are insufficient to finance
non-recurring  capital  expenditures,  the  Company  would  seek to  borrow  the
necessary funds under the credit agreements.

Inflation

The impact of inflation on the Company's  operations has not been significant to
date.  However,  there can be no assurance  that a high rate of inflation in the
future  would  not have  material  adverse  effect  on the  Company's  operating
results.

Recent Accounting Pronouncements

In  March  1997,  the  Financial  Accounting  Standards  Board  (FASB)  released
Statement of Financial Accounting Standards (FAS) No. 128, "Earnings Per Share",
(FAS 128) which the Company  will adopt in the fourth  quarter of 1997.  FAS 128
will require the Company to restate all previously  reported  earnings per share
information to conform with the new pronouncement's requirements.

In June 1997,  the FASB released FAS No. 130  "Reporting  Comprehensive  Income"
(FAS No. 130), and FAS No. 131 "Disclosures about Segments of and Enterprise and
Related Information", (FAS 131). These pronouncements will be effective in 1998.
FAS 130 establishes standards for reporting  comprehensive income items and will
require that the Company provide a separate  statement of comprehensive  income;
reported financial statement amounts will not be affected by this adoption.  FAS
131 established standards for reporting information about the operating segments
in its annual report and interim reports.


                                       28

<PAGE>


PART II.   OTHER INFORMATION


Item 1. - Legal Proceedings

In the normal  course of business,  the Company is subject to certain  suits and
other matters.  Management  believes that the eventual resolution of any pending
matters,  either  individually  or in the  aggregate,  will not have a  material
effect on financial position, liquidity or results of operations.

Item 2. - Changes in Securities

On June 24, 1997,  the Company  issued 100 shares of Class A Common Stock shares
to Kelly  Maguire as  consideration,  in part for the  services  rendered by her
father, John Maguire, a Vice President and General  Manager, through March 1997.
The Company  issued such shares  pursuant  to the  exemption  from  registration
provided by Section 4(2) of the Securities Act.

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

The 1996 Annual Meeting of Stockholders  was held on Thursday,  May 29, 1997, to
consider  and act upon the  following  matters.  The results of the  stockholder
voting were as follows:

     1.  To elect ten  Directors,  including two  "independent"  directors to be
         elected by the holders of Class A Common Stock,  voting separately as a
         class,  for the ensuing year or until their  successors are elected and
         qualified;

                                              Votes              Votes
                                            Cast For           Withheld
                                           ----------          --------
Steven B. Dodge                            56,658,419            98,345
Thomas H. Stoner                           56,658,419            98,345
Alan L. Box                                56,658,419            98,345
Joseph L. Winn                             56,658,419            98,345
Charlton H. Buckley                        56,658,419            98,345
Arnold L. Chavkin                          56,658,419            98,345
James H. Duncan, Jr.*                      13,265,409            98,345
Arthur C. Kellar                           56,658,419            98,345
Charles D. Peebler, Jr.*                   13,265,409            98,345
Lance R. Primis                            56,658,419            98,345


         * In  accordance  with the  Company's  Articles of  Incorporation,  the
           holders of Class A Common Stock, exclusive of all other stockholders,
           are  entitled to elect two of the  Company's  independent  directors.
           Messrs.   Duncan  and  Peebler  were  nominated  as  the  independent
           directors and elected by the holders of the Class A Common Stock.

                                       29

<PAGE>


Item 4. - Submission of Matters to a Vote of Security Holders - (continued).

         2.  To approve an amendment to the Company's Amended and Restated Stock
             Option Plan to increase the  aggregate  number of shares of Class A
             and Class B Common Stock  authorized for issuance  thereunder  from
             2,000,000 to 3,000,000;

                  For                Against              Abstain
              51,086,860            4,221,909            1,447,995
           
    
         3.  To ratify the selection by the Board of Directors of Deloitte & 
             Touche LLP as the Company's independent   auditors for 1997;

                  For                 Against             Abstain
              56,677,927               20,729             58,108
             
     


Item 5. - Other Information.

         On July 21, 1997, the Company and American Radio Systems License Corp.,
entered into an Asset Exchange agreement with Entertainment Communications, Inc.
(Entercom) and ECI License Company L.P. (ECI) pursuant to which the Company will
acquire  substantially  all the  assets of  KLOU-FM in St.  Louis,  Missouri  in
exchange for substantially all the assets of KUDL-FM and WDAF-AM in Kansas City,
Missouri  and $7.0  million.  In  addition,  the Company  entered  into an Asset
Purchase agreement with Entercom to sell substantially all the assets of KCTC-AM
for  approximately  $4.0 million.  Consummation of both transactions are subject
to, among other things, the approval of the FCC.  For more  information  see the
Company's  press  release,  dated July 21,  1997 which is  attached  herewith as
Exhibit 99.1



                                       30


<PAGE>


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


(a)             Exhibits

          Listed  below  are the  exhibits  which are filed as part of this Form
10-Q (according to the number  assigned to them in Item 601 of Regulation  S-K).
Each exhibit market by a (*) is incorporated  by reference to American's  Report
on Form 10-Q for the three  months  ended  March 31,  1997.  Exhibit  numbers in
parenthesis refer to the exhibit number in the applicable filing.

<TABLE>
<CAPTION>

Exhibit
  No.                              Description of Document

<S>              <C>                                                               <C>
10.1a              Asset Purchase Agreement by and between American Tower
                       Systems, Inc. ("American Tower") and Communication
                       Systems Development, Inc., dated as of May 27, 1997          Filed herewith as Exhibit 10.1a       
10.1b              Agreement of Limited Liability Company of Communication
                       Systems Development, LLC, by and among American Tower
                       and Communication Development Corporation, Inc., 
                       dated as of May 30, 1997                                     Filed herewith as Exhibit 10.1b      
10.2               Asset Purchase Agreement by and between American Tower
                       and B & E Associates, Inc., dated as of May 27, 1997         Filed herewith as Exhibit 10.2
10.3               Asset Purchase Agreement by and between American Tower
                       and Towers L.L.C., dated as of May 13, 1997                  Filed herewith as Exhibit 10.3      
10.4a              Asset Purchase Agreement by and between American Tower
                       and Diablo Communications, Inc. ("Diablo"),
                       dated as of July 8, 1997                                     Filed herewith as Exhibit 10.4a
10.4b              Securities Purchase Agreement by and between American
                       Tower and Diablo, dated as of March 20, 1997 
                       relating to Notes due 2000 of Diablo                         Filed herewith as Exhibit 10.4b  
10.4c              Asset Purchase Agreement by and between American Tower
                       and Diablo Communications of Southern California, Inc. 
                       ("DCSC"), dated as of July 8, 1997                           Filed herewith as Exhibit 10.4c
10.4d              Securities Purchase Agreement by and between American
                       Tower and DCSC, dated as of March 20, 1997
                       relating to Notes due 2000 of DCSC                           Filed herewith as Exhibit 10.4d
10.4e              Amendment dated August 7, 1997, to Securities Purchase 
                      Agreement by and between American Tower, Diablo 
                      and DCSC, dated July 8, 1997                                  Filed herewith as Exhibit 10.4e
10.5               Asset Purchase Agreement dated as May 27, 1997 between 
                       the Company, Precision Media Corporation, a Delaware 
                       corporation ("Precision Media")                              Filed herewith as Exhibit 10.5   
10.6               Time Brokerage Agreement, dated as July 1, 1997 by and
                       between the Company and Precision Media                      Filed herewith as Exhibit 10.6   
10.7               Asset Purchase Agreement, dated as June 6, 1997, by and
                       between the Company and Michael A. McMurray and
                       Marilyn A. McMurray, d/b/a McMurray Communications,
                       an Ohio general partnership                                  Filed herewith as Exhibit 10.7   
10.8               Time Brokerage Agreement, dated as June 1, 1997 by and
                       between the Company and Jupiter Radio Partners               Filed herewith as Exhibit 10.8
10.9               Asset Purchase Agreement, dated May 14, 1997 by and
                       between the Company and Greater Boston Radio, Inc.           Filed herewith as Exhibit 10.9   
10.10              Time Brokerage Agreement, dated as May 14, 1997 between
                       Greater Boston Radio, Inc. and the Company                   Filed herewith as Exhibit 10.10  
10.11              Asset Purchase Agreement, dated as May __, 1997 by and
                       between Paxson Communications of West Palm Beach, Inc.
                       and the Company                                              Filed herewith as Exhibit 10.11 
10.12              Asset Exchange Agreement, dated June 19, 1997, by and
                       among the Company, American Radio Systems License
                       Corp ("License Corp.") Citicasters Co., Regent
                       Broadcasting of Kansas City, Inc., and Regent Licensee of
                       Kansas City, Inc.                                            Filed herewith as Exhibit 10.12  
10.13              Asset Exchange Agreement, dated July 18, 1997 by and
                       among the Company, License Corp., Entertainment
                       Communications, Inc. and ECI License Company, L.P.           Filed herewith as Exhibit 10.13  
10.14              Asset Purchase Agreement by and among the Company,
                      License Corp. and Entertainment Communications, Inc.          Filed herewith as Exhibit 10.14



                                       31

<PAGE>


 <CAPTION>

 Exhibit
   No.                              Description of Document

<S>              <C>                                                               <C>

10.15              Asset  Purchase  Agreement,  dated as July 8, 1997 by and
                       between American Tower and Suburban Cable TV Co. Inc.        Filed herewith as Exhibit 10.15         
10.16              Asset Purchase Agreement, dated as May 21, 1997, by and          
                       between American Tower and DB Consultants, Inc.              Filed herewith as Exhibit 10.16 
10.17              Asset Purchase Agreement, dated as May 7, 1997, by and
                       between the Company, American Radio Systems License
                       Corp., KKSJ, Inc. and KKSJ License, Inc.                     * (10.18)
10.18              Asset Exchange Agreement, dated April 17, 1997 by and
                       among the Company, American Radio Systems License
                       Corp., Latin Communications, Group, Inc., EXCL
                       Communications, Inc., Radio Exito, Inc. and Portland
                       Radio, Inc.                                                  * (10.20)
10.19              Asset Purchase Agreement, dated May 6, 1997 between the
                       and Stellar Communications, Inc.                             * (10.22)
11                 Statement Re Computation of Per Share Earnings                   Filed herewith as Exhibit 11    
12                 Statement Re Computation of Ratio of Earnings to Combined
                       Fixed Charges and Preferred Stock Dividends                  Filed herewith as Exhibit 12  
27                 Financial Data Schedule                                          Filed herewith as Exhibit 27
99.1               Press Release, dated July 21, 1997                               Filed herewith as Exhibit 99.1

</TABLE>


(b)      Reports on Form 8-K

   1.    Form 8-K/A (Item 7) on April 17, 1997.
   2.    Form 8-K (Items 2, 5 and 7) on April 18, 1997.
   3.    Form 8-K (Items 5 and 7) on May 30, 1997.
   4.    Form 8-K/A (Items 5 and 7) on June 12, 1997.
                                             
                                       32


<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.



                                   AMERICAN RADIO SYSTEMS CORPORATION


Date: August 14, 1997              BY: /s/ Joseph L. Winn
                                        Joseph L. Winn
                                        Treasurer & Chief Financial Officer
                                        (Duly Authorized Officer)




Date: August 14, 1997              BY: /s/ Justin D. Benincasa
                                        Justin D. Benincasa
                                        Vice President & Corporate Controller
                                        (Duly Authorized Officer)


                                       33