SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 10-Q

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 1997
                           Commission File No. 0-27042


                            AlphaNet Solutions, Inc.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)


              New Jersey                                 22-2554535
      -------------------------------                -------------------
      (State or Other Jurisdiction of                 (I.R.S. Employer
      Incorporation or Organization)                 Identification No.)


7 Ridgedale Ave., Cedar Knolls, New Jersey                              07927
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                            (Zip Code)


                                 (973) 267-0088
                         -------------------------------
                         (Registrant's Telephone Number,
                              Including Area Code)


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

              Yes:    X                               No:
                   ------                                 ------


      Indicate  the  number of shares  outstanding  of each of the  Registrant's
classes of common stock, as of September 30, 1997:

          Class                                           Number of Shares
          -----                                           ----------------

  Common Stock, $.01 par value                                6,256,240


<PAGE>


                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY

                                TABLE OF CONTENTS
                                -----------------



PART I.  FINANCIAL INFORMATION...............................................1

      Item 1. Financial Statements...........................................1

            Consolidated Balance Sheets
            as of December 31, 1996
            and September 30, 1997 (unaudited)...............................2

            Consolidated Statements of Income
            for the Three Months and Nine Months Ended
            September 30, 1996 and 1997 (unaudited) .........................3

            Consolidated Statement of Changes in Shareholders'
            Equity for the Nine Months Ended
            September 30, 1997 (unaudited)...................................4

            Consolidated Statements of Cash Flows
            for the Nine Months Ended
            September 30, 1996 and 1997 (unaudited) .........................5

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

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

            Results of Operations...........................................11

            Liquidity and Capital Resources.................................14

PART II.  OTHER INFORMATION.................................................16

      Item 5. Other Information.............................................16

      Item 6. Exhibits and Reports on Form 8-K..............................17


SIGNATURES..................................................................18


                                     - i -
<PAGE>










                          PART I. FINANCIAL INFORMATION

                          Item 1. Financial Statements











                                     - 1 -
<PAGE>


<TABLE>

                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                        (in thousands, except share data)

<CAPTION>

                                                        December 31,  September 30,
                                                            1996           1997
                                                        ------------  -------------
                                                                       (unaudited)

                        ASSETS
<S>                                                       <C>            <C>      
Current assets:
   Cash and cash equivalents.........................     $   1,610      $   8,350
   Accounts receivable, net..........................        29,848         42,030
   Inventories.......................................         4,809          7,121
   Deferred income tax asset.........................           445            850
   Prepaid expenses and other current assets.........         1,705          2,819
                                                          ---------      ---------
     Total current assets............................        38,417         61,170
Property and equipment, net..........................         3,856          6,274
Other assets.........................................         1,374          2,433
                                                          ---------      ---------
     Total assets....................................     $  43,647      $  69,877
                                                          =========      =========

         LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Current portion of capital lease obligations......     $     103      $      71
   Accounts payable..................................        17,923         18,911
   Accrued expenses..................................         5,984         10,379
                                                          ---------      ---------
     Total current liabilities ......................        24,010         29,361
Advance from principal shareholder...................           675            675
Capital lease obligations............................            41             --
                                                          ---------      ---------
     Total liabilities...............................        24,726         30,036
                                                          ---------      ---------
Shareholders' equity:
   Preferred stock -- $0.01 par value; authorized
     3,000,000 shares, none issued...................            --             --
   Common stock -- $0.01 par value; authorized
     15,000,000 shares, 5,102,900 and 6,256,240
     shares issued and outstanding...................            51             63
   Additional paid-in capital........................        15,904         33,133
   Retained earnings.................................         2,966          6,645
                                                          ---------      ---------
     Total shareholders' equity......................        18,921         39,841
                                                          ---------      ---------
     Total liabilities and shareholders' equity......     $  43,647      $  69,877
                                                          =========      =========


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


                                     - 2 -
<PAGE>


<TABLE>

                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)
                    (In thousands, except per share amounts)

<CAPTION>

                                       For the Three Months       For the Nine Months
                                       Ended September 30,        Ended September 30,
                                      ---------------------     -----------------------
                                        1996        1997           1996          1997
                                      -------     --------      ---------     ---------

<S>                                   <C>         <C>           <C>           <C>      
Net sales:
   Product sales.................     $25,466     $ 34,590      $  60,334     $ 104,967
   Services and support..........       5,113       11,902         13,786        29,836
                                      -------       ------      ---------     ---------
                                       30,579       46,492         74,120       134,803
                                      -------       ------      ---------     ---------
Cost of sales:
   Product sales.................      22,482       30,477         53,389        92,973
   Services and support..........       3,227        7,962          8,922        19,726
                                      -------       ------      ---------       -------
                                       25,709       38,439         62,311       112,699
                                      -------       ------      ---------       -------
Gross profit.....................       4,870        8,053         11,809        22,104
                                      -------       ------      ---------       -------

Operating expenses:
   Selling expenses..............       1,919        3,547          4,681         9,408
   General and administrative
    expenses.....................       1,367        2,242          3,780         6,475
                                      -------       ------      ---------     ---------
                                        3,286        5,789          8,461        15,883
                                      -------       ------      ---------       -------

Operating income.................       1,584        2,264          3,348         6,221
                                      -------       ------      ---------       -------

Other income (expense):
   Interest income...............          74          143            194           164
   Interest expense..............         (15)          (3)           (70)         (149)
                                      -------       ------      ---------       -------
                                           59          140            124            15
                                      -------       ------      ---------       -------
Income before income taxes.......       1,643        2,404          3,472         6,236
Provision for income taxes.......         674          986            994         2,557
                                      -------       ------      ---------       -------
Net income.......................     $   969     $  1,418      $   2,478     $   3,679
                                      =======     ========      =========     =========

Pro forma data (Note 2):
   Income before income taxes....                               $   3,472
   Provision for income taxes....                                   1,415
                                                                ---------
   Net income....................                               $   2,057
                                                                =========
Net income per share.............     $  0.19    $    0.22     $     0.43    $     0.64
                                      =======    =========     ==========    ==========
Weighted average number
   of common shares and
   common shares equivalent......       5,100        6,460          4,739         5,743
                                      =======     ========      =========     =========


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


                                     - 3 -
<PAGE>


<TABLE>

                           ALPHANET SOLUTIONS, INC. AND SUBSIDIARY
                  CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                                         (Unaudited)
                                       (in thousands)

<CAPTION>

                                                           Additional
                                       Common     Common    Paid-In     Retained
                                       Shares     Stock     Capital     Earnings     Total
                                       ------     -----    ----------   --------     -----

<S>                                     <C>      <C>       <C>          <C>        <C>     
Balance at January 1, 1997........      5,103    $    51   $ 15,904     $  2,966   $ 18,921

Sale of Common Stock..............      1,150         12     17,199           --     17,211

Exercises of stock options........          3         --         30           --         30

Net income........................         --         --         --        3,679      3,679
                                      -------    -------   --------       ------   --------
Balance at September 30, 1997.....      6,256    $    63   $ 33,133     $  6,645   $ 39,841
                                      =======    =======   ========     ========   ========


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


                                      - 4 -
<PAGE>


<TABLE>

                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)

<CAPTION>

                                                             For the Nine Months
                                                             Ended September 30,
                                                          -------------------------
                                                               1996          1997
                                                          -----------     ---------

<S>                                                       <C>             <C>      
Cash flows from operating activities:
  Net income............................................  $     2,478     $   3,679
  Adjustments to reconcile net income to net cash
   provided by (used in) operating activities:
    Depreciation and amortization.......................          383         1,193
    Deferred income taxes...............................           --          (405)
    Increase (decrease) from changes in:
      Accounts receivable, net..........................       (8,634)       (8,620)
      Inventories.......................................       (2,333)       (2,145)
      Prepaid expenses and other current assets.........         (802)         (873)
      Other assets......................................          391            36
      Accounts payable and accrued expenses.............        6,441           512
                                                          -----------     ---------

    Net cash used in operating activities...............       (2,076)       (6,623)
                                                          -----------     ----------

Cash flows from investing activities:
  Property and equipment expenditures...................       (1,412)       (3,194)
  Receipt of loan repayments - shareholder..............          413            --
  Acquisition of businesses (net of cash acquired)......         (971)         (611)
                                                          -----------     ----------

    Net cash used in investing activities...............       (1,970)       (3,805)
                                                          -----------     ----------

Cash flows from financing activities:
  Net proceeds from sales of common stock...............       15,739        17,211
  Exercises of stock options............................           --            30
  Repayment of long-term debt...........................         (736)           --
  Repayment of capital lease obligations................          (60)          (73)
  Payment of dividends..................................       (1,147)           --
  Distribution of S Corporation earnings................       (6,155)           --
                                                          -----------     ---------

    Net cash provided by financing activities...........        7,641        17,168
                                                          -----------     ---------

Net increase in cash and cash equivalents...............        3,595         6,740

Cash and cash equivalents, beginning of period..........        1,223         1,610
                                                          -----------     ---------

Cash and cash equivalents, end of period................  $     4,818     $   8,350
                                                          ===========     =========


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


                                     - 5 -
<PAGE>


                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                        (in thousands, except share data)



Note 1 -- Basis of Presentation:
--------------------------------

      The  information  presented for  September 30, 1996 and 1997,  and for the
three-month and nine-month periods then ended, is unaudited, but, in the opinion
of the management of AlphaNet Solutions, Inc. (the "Company"),  the accompanying
unaudited consolidated financial statements contain all adjustments  (consisting
only of normal recurring  adjustments) which the Company considers necessary for
the fair  presentation of the Company's  financial  position as of September 30,
1997, the results of its operations for the three-month  and nine-month  periods
ended September 30, 1996 and 1997 and its cash flows for the nine-month  periods
ended  September  30,  1996 and  1997.  The  consolidated  financial  statements
included  herein  have been  prepared  in  accordance  with  generally  accepted
accounting  principles  and the  instructions  to Form  10-Q and  Rule  10-01 of
Regulation  S-X.  Accordingly,  certain  information  and  footnote  disclosures
normally included in financial  statements prepared in accordance with generally
accepted   accounting   principles   have  been  condensed  or  omitted.   These
consolidated  financial  statements  should  be read  in  conjunction  with  the
Company's  audited  financial  statements  for the year ended December 31, 1996,
which  were  included  as part of the  Company's  Form  10-K,  as filed with the
Securities and Exchange Commission.

      Results for the interim period are not  necessarily  indicative of results
that may be expected for the entire year.

      Certain  indirect  costs,  totaling  $769  and  $2,204,  relating  to  the
three-month and nine-month periods ended September 30, 1996, respectively, which
previously  were  classified  as  costs  of  services  and  support,  have  been
reclassified  to general and  administrative  expenses to conform with  industry
practices.



Note 2 -- Income Taxes:
-----------------------

      Prior  to  March  19,  1996,   the  Company,   with  the  consent  of  its
shareholders, had elected to be taxed under Subchapter S of the Internal Revenue
Code as an S Corporation  for federal income tax purposes.  In lieu of corporate
income  taxes,  the  shareholders  of  an  S  Corporation  are  taxed  on  their
proportionate  share of the Company's taxable income.  As a result,  the Company
was not subject to federal income taxes prior to March 19, 1996. The Company had
also elected S Corporation  status in the State of New Jersey.  The accompanying
financial statements include provisions for certain state and local income taxes
which were imposed at the corporate level.

      On March 19, 1996,  the Company  terminated its status as an S Corporation
and became subject to federal and state income taxes  thereafter at applicable C
Corporation income tax rates.

      For informational  purposes, the accompanying statements of income for the
nine-month  period ended  September 30, 1996 include a pro forma  adjustment for
income  taxes  which  would have been  recorded if the Company had not been an S
Corporation, based on the tax laws in effect during such period.


                                     - 6 -
<PAGE>


                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                        (in thousands, except share data)



Note 3 -- Net Income Per Share:
-------------------------------

      Net income per share (pro forma for the nine months  ended  September  30,
1996) is computed using the weighted  average number of common shares and common
shares  equivalent  outstanding  during the  period.  Common  shares  equivalent
consists of the  Company's  common  shares  issuable  upon the exercise of stock
options. Pursuant to the requirements of the Securities and Exchange Commission,
stock  options  issued by the  Company  during  the  twelve  months  immediately
preceding  the  Company's  initial  public  offering  have been  included in the
weighted  average number of common shares and common shares  equivalent  used in
computing pro forma net income per share as if they were outstanding for periods
prior to the Company's initial public offering using the treasury stock method.

      In  February  1997,  the  Financial   Accounting  Standards  Board  issued
Statement of Financial  Accounting  Standard No. 128,  "Earnings per Share." The
Statement  is  effective  for  financial  statements  for periods  ending  after
December  15, 1997,  and changes the method in which  earnings per share will be
determined.  Adoption of this Statement by the Company is not expected to have a
material impact on earnings per share.



Note 4 -- Public Offering of Common Stock:
------------------------------------------

      On June 18, 1997, the Company  consummated a follow-on  public offering of
2,000,000  shares of its  Common  Stock at a price to the  public of $16.50  per
share, of which 1,150,000 shares were issued and sold by the Company and 850,000
shares were sold by certain selling  shareholders.  The Company  received $15.51
per share, before offering expenses,  resulting in net proceeds of approximately
$17,211. The Company did not receive any proceeds from the sale of shares by the
selling shareholders.



Note 5 -- New Credit Facility:
------------------------------

      On June 30, 1997,  the Company and First Union  National Bank (the "Bank")
executed a Loan and Security  Agreement  whereby the Bank expanded the Company's
credit  facility to enable the Company to borrow,  based upon eligible  accounts
receivable,  up  to  $15,000  for  short-term  working  capital  purposes.  Such
facility, which matures on June 30, 1998, includes a $2,500 sublimit for letters
of credit and a $5,000 sublimit for acquisition advances. Under the new facility
the Company may borrow, subject to certain post-closing conditions and covenants
by the Company,  (i) for working capital  purposes at the Bank's prime rate less
0.50% or LIBOR plus  1.25% and (ii) for  acquisitions  at the Bank's  prime rate
less 0.25% or LIBOR plus 1.50%.  The Company's  obligations  under such facility
are collateralized by a first priority lien on the Company's accounts receivable
and  inventory,  except  for  inventory  for  which  the Bank  has or will  have
subordinated  its position to certain  other lenders  pursuant to  intercreditor
agreements.


                                     - 7 -
<PAGE>


                     ALPHANET SOLUTIONS, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                        (in thousands, except share data)



Note 6 --Acquisition:
---------------------

      On August 13, 1997,  the Company  consummated  the  acquisition of certain
assets and assumed certain  liabilities of The Lande Group,  Inc.  ("Lande"),  a
computer equipment reseller and provider of systems integration services located
in New York City. The Company purchased, among other assets, the entire customer
list, accounts receivable and inventory of Lande for an aggregate purchase price
of up to $1,100,  of which  $750 was paid at closing  and $250 is held in escrow
pending certain post-closing adjustments.  An additional $50 is payable to Lande
by the Company on each of the first and second  anniversary of the closing date.
The Company also assumed certain  liabilities,  including  certain trade debt of
$2,943,  which was paid by the Company at closing,  accounts payable and accrued
expenses of $1,828 and  obligations  under a lease which  expires in April 2008,
for New York City  office  space  which  will  serve as the  Company's  New York
headquarters.  The value of the assets purchased was  approximately  the same as
the liabilities assumed.  Intangible assets, which are included in other assets,
of approximately $1,193 resulted  from this transaction and  are being amortized
over their useful life.


                                     - 8 -
<PAGE>


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


General
-------

      The Company is a single-source  provider of information  technology ("IT")
products,  services  and support to Fortune  1000 and other large and  mid-sized
companies  located  primarily  in the  New  York-to-Philadelphia  corridor.  The
Company was formed in 1984 as an  authorized  reseller of computer  hardware and
software  products,  and since 1990, has been developing and offering related IT
services.  To date,  most of the  Company's  net sales have been derived from IT
product  sales.  For the first  nine  months of 1997,  net  product  sales  were
approximately  78% and services and support revenue was approximately 22% of the
Company's net sales.

      The Company has distribution  agreements with MicroAge  Computer  Centers,
Inc.  ("MicroAge")  and Ingram Micro  ("Ingram"),  two of the  nation's  largest
aggregators of computer products, to acquire most of its IT products for resale.
The  Company's  relationship  with MicroAge  commenced in 1984,  and as customer
demand for IT products grew, the Company  initiated its relationship with Ingram
in 1994. The  distribution  agreements with MicroAge and Ingram give the Company
access to such aggregators'  extensive  inventories and provide the Company with
electronic ordering capability,  product configuration and testing,  warehousing
and  delivery.   In  general,   the  Company   orders  IT  products,   including
workstations, servers, microcomputers,  networking and communications equipment,
and applications  software from such aggregators on an as-needed basis,  thereby
reducing the Company's  need to carry large  inventories.  During the first nine
months of 1997, the Company acquired  approximately  35% and 45% of its products
for resale from MicroAge and Ingram, respectively.

      In general,  there are no ongoing  written  commitments  by  customers  to
purchase  products from the Company and all product sales are made on a purchase
order  basis.  Furthermore,  as the market for IT products  has  matured,  price
competition  has  intensified  and is  likely  to  continue  to  intensify.  The
Company's  gross profits,  margins and results of operations  could be adversely
affected by such continued product pricing pressure, a significant  reduction in
product  purchase  orders from the Company's  customers,  or a disruption in the
Company's sources of product supply.

      The Company offers network  consulting  (including  systems  integration),
workstation  support,  education,  communications  installation  and IT staffing
services.  Services  and support  revenue is  recognized  as such  services  are
performed.   The  Company's   network   consulting,   workstation   support  and
communications  installation  services  are  generally  billed  on  a  time  and
materials basis. The Company's  education and IT staffing services are fee-based
on a per-course and per-placement basis, respectively.  Generally, the Company's
service arrangements with its customers may be terminated by such customers with
limited advance notice and without  significant  penalty.  The most  significant
cost relating to the services  component of the Company's  business is personnel
expenses which consist of salaries, benefits and payroll-related


                                     - 9 -
<PAGE>


expenses.  Thus, the financial  performance of the Company's service business is
based  primarily upon billing margins  (billable  hourly rates less the costs to
the Company of such service  personnel on an hourly basis) and utilization rates
(billable  hours  divided by paid  hours).  The future  success of the  services
component of the  Company's  business will depend in large part upon its ability
to maintain high utilization rates at profitable billing margins.  The Company's
utilization rates for service personnel likely will be adversely affected during
periods of rapid and concentrated hiring.  During the first nine months of 1997,
the Company's staff of service personnel increased from 242 at December 31, 1996
to 503 at September 30, 1997. In addition, the competition for quality technical
personnel has continued to intensify, resulting in increased personnel costs for
the Company and many other IT service  providers,  which has adversely  affected
the Company's billing margins.

      The Company's  cost of sales  includes  primarily,  in the case of product
sales, the cost to the Company of products acquired for resale,  and in the case
of services and support  revenue,  salaries,  benefits and related  expenses for
billable technical personnel.  The Company,  like many IT service companies,  is
experiencing  increased  demand  for  qualified  technical  personnel  which has
resulted in higher salaries for such personnel.  The Company  believes that such
salaries  are  increasing  faster than  related  billable  rates,  resulting  in
downward  pressure on margins.  The Company's selling expenses consist primarily
of personnel costs,  including sales commissions earned by employees involved in
the sales of IT products,  services and support.  These personnel include direct
sales, sales support and marketing personnel.  Sales commissions are recorded as
revenue is recognized.  General and administrative expenses consist of all other
operating expenses, including primarily salaries, benefits and related expenses,
and occupancy  costs for  administrative,  executive and finance  personnel.  In
addition,  the Company believes that its costs for health insurance benefits for
its employees may increase  substantially  commencing with the fourth quarter of
1997. The Company is currently  negotiating with its insurance carrier and is in
the process of reviewing its health  insurance  alternatives.  Certain  indirect
costs, totaling $769,000 and $2.2 million, relating to the three months and nine
months ended September 30, 1996, respectively,  which previously were classified
as costs of  services  and  support,  have  been  reclassified  to  general  and
administrative expenses to conform with current industry practices.

      The  Company  believes  that  its  ability  to  provide  a broad  range of
technical  services,  coupled with its  traditional  strength in satisfying  its
clients' IT product  requirements  and its  long-term  relationships  with large
clients, positions the Company to continue to grow the services component of its
business,  while further  strengthening  its product sales. As such, the Company
anticipates that an increasing  percentage of its gross profits in the long term
will be derived  from the services and support  component of its  business.  For
example,  in the third  quarter of 1997,  the  Company's  services  and  support
business  represented  26% of net sales and 49% of gross  profit.  The Company's
services and support  revenue as a percentage  of net sales and gross profit may
vary from quarter to quarter primarily as a result of fluctuations in the volume
of product sales.  The Company  believes that its ability to be a  single-source
provider of IT products,  services and support enables it to earn margins higher
than it would earn if it sold products only.


                                     - 10 -
<PAGE>


      This Form 10-Q contains  forward-looking  statements within the meaning of
Section 21E of the  Securities  Exchange Act of 1934, as amended.  The Company's
forward-looking  statements,  including,  but not limited to,  those  statements
relating to the anticipated  growth in the services and support component of the
Company's   business,   include   risks  and   uncertainties.   Such  risks  and
uncertainties  include, but are not limited to: (i) the substantial  variability
of the Company's  quarterly  operating  results  caused by a variety of factors,
some of which are not within the Company's control, including (a) the short-term
nature of the Company's customers' commitments, (b) patterns of capital spending
by  customers,  (c) the timing,  size and mix of product and service  orders and
deliveries,  (d) the timing and size of new  projects,  (e)  pricing  changes in
response  to various  competitive  factors,  (f) market  factors  affecting  the
availability  of  qualified  technical  personnel,  (g) the timing and  customer
acceptance of new product and service offerings, (h) changes in trends affecting
outsourcing of IT services,  (i) disruption in sources of supply, (j) changes in
product,  personnel  and other  operating  costs,  and (k)  industry and general
economic conditions; (ii) changes in technical personnel billing and utilization
rates  which are likely to be  adversely  affected  during  periods of rapid and
concentrated  hiring;  (iii) the  intense  competition  in the  markets  for the
Company's products and services; (iv) the Company's ability to manage its growth
effectively which will require the Company to continue  developing and improving
its operational, financial and other internal systems, including a major upgrade
of the Company's internal management information systems ("MIS") infrastructure;
(v) the  Company's  ability to develop,  market,  provide,  and  achieve  market
acceptance  of, new service  offerings  to new and  existing  clients;  (vi) the
Company's  ability  to  attract,  hire,  train and  retain  qualified  technical
personnel in an increasingly competitive market; (vii) the Company's substantial
reliance  on a  concentrated  number  of  key  customers;  (viii)  uncertainties
relating to potential  acquisitions,  if any,  made by the Company,  such as its
ability  to  integrate  acquired  operations  and to retain  key  customers  and
personnel of the acquired  business;  (ix) the  Company's  dependence  on vendor
authorizations  to resell  certain  computer  products  and to  provide  related
services;  (x) the Company's dependence on certain aggregators for a substantial
portion of its products acquired for resale;  and (xi) the Company's reliance on
the continued  services of key executive  officers and salespersons.  Such risks
and  uncertainties  may cause the Company's actual results to differ  materially
from the results discussed in the forward-looking statements contained herein.



Results of Operations
---------------------


Three Months Ended  September 30, 1996 Compared to Three Months Ended  September
30, 1997

      Net sales.  Net sales  increased by 52.0%,  or $15.9  million,  from $30.6
million in the third  quarter of 1996 to $46.5  million in the third  quarter of
1997.  Product sales  increased by 35.8% or $9.1 million,  from $25.5 million in
the third  quarter of 1996 to $34.6  million in the third  quarter of 1997.  The
increase was  attributable  primarily  to very high  product  sales to KPMG Peat
Marwick,  which was the Company's  largest  customer during the third quarter of
1997.  Services and support revenue increased by 132.8%,  or $6.8 million,  from
$5.1 million in the 


                                     - 11 -
<PAGE>


third  quarter  of 1996 to $11.9  million  in the third  quarter  of 1997.  This
increase  was  attributable  primarily  to  increased  demand for the  Company's
service and support offerings,  particularly its network consulting services, an
increase in the number and size of client projects,  and the addition of several
long-term  staffing  contracts.  In the third quarter of 1997, sales to Nabisco,
the  Company's  largest  customer for the nine months ended  September 30, 1997,
accounted for  approximately  12% of the Company's net sales.  KPMG Peat Marwick
accounted for  approximately  21% of net sales during the third quarter of 1997.
There can be no assurance that such customers will continue to place orders with
the  Company or engage the  Company to perform  services  and support at current
levels.


      Gross  profit.  The  Company's  gross profit  increased by 65.4%,  or $3.2
million,  from $4.9 million in the third  quarter of 1996 to $8.1 million in the
third quarter of 1997. The Company's  overall gross profit margin  increased due
to the improved  sales mix resulting from higher  services and support  revenue.
Total gross margins  increased  from 15.9% in the third quarter of 1996 to 17.3%
in the third quarter of 1997. Gross profit margin  attributable to product sales
increased  from 11.7% in the third quarter of 1996 to 11.9% in the third quarter
of 1997.  Gross  profit  margin  attributable  to services  and support  revenue
decreased  from 36.9% of services  and support  revenue in the third  quarter of
1996 to 33.1% in the third quarter of 1997. This decrease in service and support
gross  margin was  primarily  attributed  to the  addition of several  long-term
staffing  contracts,  which  typically  yield lower gross margins than projects.
Additionally,  higher salary costs for technical  personnel  have not been fully
passed on to customers.


      Selling  expenses.  Selling expenses  increased by 84.8%, or $1.6 million,
from $1.9  million  in the third  quarter  of 1996 to $3.5  million in the third
quarter of 1997, and increased from 6.3% to 7.6% of net sales, respectively. The
increases  in  selling  expenses  were   attributable   primarily  to  increased
salesperson  commissions  and other  support  costs due to the  increase  in net
sales, the increase in sales and marketing efforts associated with the Company's
service and support  offerings,  the costs  associated  with the  Company's  new
service offerings, the costs incurred in connection with the Company's expansion
into the  Philadelphia  market and costs  associated  with the Lande  operations
after August 1, 1997.


      General and administrative  expenses.  General and administrative expenses
increased by 64.0%, or $875,000,  from $1.4 million in the third quarter of 1996
to $2.2 million in the third quarter of 1997, and increased from 4.5% to 4.8% of
net sales,  respectively.  The increases in general and administrative  expenses
were due  primarily  to  increases in  personnel  expenses,  training  costs and
depreciation charges.



Nine Months Ended September 30, 1996 Compared to Nine Months Ended September 
30, 1997

      Net sales.  Net sales  increased by 81.9%,  or $60.7  million,  from $74.1
million  in the first  nine  months of 1996 to $134.8  million in the first nine
months of 1997.  Product sales increased by 74.0%, or $44.6 million,  from $60.3
million  in the first  nine  months of 1996 to $105.0  million in the first nine
months of 1997.  This increase was  attributable  primarily to


                                     - 12 -
<PAGE>


increased  demand from the  Company's  established  customer base and to product
sales  resulting from the Company's July 1996  acquisition of certain assets and
the business of Lior. Services and support revenue increased by 116.4%, or $16.1
million, from $13.8 million in the first nine months of 1996 to $29.8 million in
the first nine months of 1997.  This  increase  was  attributable  primarily  to
increased demand for the Company's service and support  offerings,  particularly
its network  consulting  services,  an increase in the number and size of client
projects and the addition of several long-term staffing contracts.  In the first
nine months of 1997, sales to Nabisco, the Company's largest customer, accounted
for approximately 17% of the Company's net sales. In addition, KPMG Peat Marwick
accounted  for  approximately  14% of net sales  during the first nine months of
1997.  There can be no  assurance  that such  customers  will  continue to place
orders with the Company or engage the Company to perform services and support at
existing levels.


      Gross profit.  The  Company's  gross profit  increased by 87.2%,  or $10.3
million, from $11.8 million in the first nine months of 1996 to $22.1 million in
the first  nine  months of 1997.  The  Company's  overall  gross  profit  margin
increased due to the improved  sales mix as a result of the increase in services
and support revenue.  Total gross margins increased from 15.9% in the first nine
months of 1996 to 16.4% in the first nine months of 1997.  Gross  profit  margin
attributable to product sales remained relatively constant,  decreasing slightly
from 11.5% in the first nine months of 1996 to 11.4% in the first nine months of
1997. Gross profit margin attributable to services and support revenue decreased
from 35.3% of services  and support  revenue in the first nine months of 1996 to
33.9% in the first nine  months of 1997.  This  decrease  in service and support
gross  margins was  primarily  attributed  to the addition of several  long-term
staffing  contracts,  which  typically  yield lower gross margins than projects.
Additionally,  higher salary costs for technical  personnel  have not been fully
passed on to customers.  The Company increased its staff of technical  personnel
from 242 at December 31, 1996 to 503 at September 30, 1997.


      Selling expenses.  Selling expenses  increased by 101.0%, or $4.7 million,
from $4.7  million in the first nine months of 1996 to $9.4 million in the first
nine months of 1997, and increased from 6.3% to 7.0% of net sales, respectively.
The  increases in selling  expenses  were  primarily  attributable  to increased
salesperson  commissions  and other  support  costs due to the  increase  in net
sales, the increase in sales and marketing efforts associated with the Company's
service and support  offerings,  the costs  associated  with the  Company's  new
service offerings, the costs incurred in connection with the Company's expansion
into the  Philadelphia  market,  and costs  associated with the Lande operations
after August 1, 1997.


      General and administrative  expenses.  General and administrative expenses
increased by 71.3%, or $2.7 million,  from $3.8 million in the first nine months
of 1996 to $6.5  million in the first nine months of 1997,  but  decreased  from
5.1%  to  4.8%  of  net  sales,  respectively.   The  increase  in  general  and
administrative  expenses in absolute  dollars was due  primarily to increases


                                     - 13 -
<PAGE>


in  personnel  expenses,  training  costs,  professional  fees and  depreciation
charges.  The  decrease as a  percentage  of net sales was due  primarily to the
substantial increase in net sales.



Liquidity and Capital Resources
-------------------------------

      In March and  April  1996,  the  Company  consummated  an  initial  public
offering  of  2,200,000  shares of its Common  Stock at a price to the public of
$10.50 per share.  Of the 2,200,000  shares sold,  1,700,000  shares  (including
100,000  shares  issued  and  sold  by the  Company  upon  the  exercise  of the
underwriters'  over-allotment  option)  were  issued and sold by the Company and
500,000 shares were sold by The Gang Annuity Trust.  The Company did not receive
any of the proceeds from the sale of shares by such selling shareholder. The net
proceeds to the Company were $15.7 million.

      On June 18, 1997, the Company  consummated a follow-on  public offering of
2,000,000  shares of its  Common  Stock at a price to the  public of $16.50  per
share.  Of such  shares,  1,150,000  were  issued and sold by the Company and an
aggregate  of 850,000  shares  were sold by Stan Gang,  the  Company's  founder,
Chairman, President and Chief Executive Officer, and The Gang Annuity Trust. The
Company received $15.51 per share,  before offering  expenses,  resulting in net
proceeds  of  approximately  $17.2  million.  The  Company  did not  receive any
proceeds from the sale of shares by such selling shareholders.  The Company used
approximately  $3.7  million  of the net  proceeds  to repay  all  amounts  then
outstanding under its credit facility with the Bank.  Amounts  outstanding under
such  facility  were  utilized  by the Company for  short-term  working  capital
purposes and carried an interest  rate equal to the Bank's prime rate less 0.25%
or LIBOR  plus  1.50%.  See  below for a  discussion  of the  Company's  current
financing terms with the Bank.

      Since its inception,  the Company has funded its operations primarily from
cash  generated  by  operations  and,  to a lesser  extent,  such  cash has been
augmented with funds from borrowings under the Company's  credit  facilities and
the net  proceeds  from the  Company's  public  offerings  of its  Common  Stock
referenced above. The Company's cash used in operations was $6.6 million for the
nine months ended  September 30, 1997 and consisted  primarily of an increase in
accounts  receivable  of $8.6  million and an increase  in  inventories  of $2.1
million  partially  offset by net income of $3.7  million.  As  measured in days
sales outstanding,  the Company's accounts receivable  increased from 58 days at
December  31, 1996 to 76 days at September  30,  1997.  The increase in accounts
receivable in absolute  dollars and in days sales  outstanding in the first nine
months of 1997 was primarily  attributable to temporary  delays in cash receipts
from a few large  customers and increased  services and support  revenues  which
typically  yield  slower cash  receipts  than  product  sales.  The  increase in
inventories  was  attributable  primarily to the purchase of computer  equipment
subject to firm  purchase  orders with  expected  delivery to  customers  in the
fourth  quarter of 1997.  The Company's  cash flow from  operations has been and
continues  to be  affected  primarily  by the timing of  collection  of accounts
receivable,   which  accounts  receivable  have  increased  as  net  sales  have
increased.


                                     - 14 -
<PAGE>


      The  Company's  working  capital was $31.8  million at September  30, 1997
compared to $14.4 million at December 31, 1996.

      The Company  invested  $3.2 million in property and equipment in the first
nine months of 1997,  primarily  related to  purchases  and upgrades of computer
equipment  and  software  utilized  in-house,  and  development  of the services
component  of the  Company's  business.  Although  there  are no other  material
commitments for capital expenditures currently outstanding,  the Company intends
to make  additional  capital  expenditures  to  continue  the  expansion  of the
services  component  of  its  business  and  for  the  enhancement  of  its  MIS
infrastructure.

      The Company  purchases  certain  inventory and equipment through financing
arrangements  with IBM Credit  Corporation  and Finova Capital  Corporation.  At
September  30, 1997,  there were  outstanding  balances of $5.4 million and $9.1
million, respectively, under such arrangements. Obligations under such financing
arrangements  are  collateralized  by  substantially  all of the  assets  of the
Company.   Finova  Capital  Corporation  and  the  Bank  have  entered  into  an
intercreditor  agreement with respect to their relative  interests.  The Company
terminated and paid all amounts outstanding under its financing arrangement with
Deutsche Financial Services during the second quarter of 1997.

      On June 30,  1997,  the Company and the Bank  executed a Loan and Security
Agreement  whereby the Bank expanded the Company's credit facility to enable the
Company to borrow, based upon eligible accounts receivable,  up to $15.0 million
for short-term  working capital purposes.  Such facility,  which matures on June
30,  1998,  includes a $2.5  million  sublimit  for letters of credit and a $5.0
million  sublimit for acquisition  advances.  Under the new facility the Company
may borrow,  subject to certain  post-closing  conditions  and  covenants by the
Company, (i) for working capital purposes at the Bank's prime rate less 0.50% or
LIBOR plus 1.25% and (ii) for  acquisitions  at the bank's prime rate less 0.25%
or  LIBOR  plus  1.50%.  The  Company's  obligations  under  such  facility  are
collateralized by a first priority lien on the Company's accounts receivable and
inventory, except for inventory for which the Bank has or will have subordinated
its position to certain other lenders pursuant to intercreditor  agreements.  As
of September 30, 1997, the Company had no outstanding  balance under such credit
facility.

      The Company has entered  into a master  lease  agreement  with First Union
Leasing  Group,  Inc.  under  which  the  Company  may lease up to  $500,000  of
equipment.  Such  agreement  provides for equipment to be leased for  three-year
terms with  transfer of ownership of the  equipment to the Company at the end of
the  applicable  equipment  lease term.  At September  30, 1997,  capital  lease
obligations  outstanding  under  the  equipment  leases,  which  expire in 1998,
aggregated $71,000.

      The Company  believes  that its  available  funds,  together with existing
credit  facilities and the cash flow expected to be generated  from  operations,
will be adequate to satisfy its current and planned  operations for at least the
next 24 months.


                                     - 15 -
<PAGE>


                           PART II. OTHER INFORMATION


Item 5.     Other Information.


Management Changes
------------------

      On July 30, 1997 Sophien  Bennaceur and the Company mutually agreed to Mr.
Bennaceur's  resignation  as the Company's  Executive  Vice  President and Chief
Operating  Officer.  Mr.  Bennaceur  served  as  the  Company's  Executive  Vice
President and Chief Operating Officer since October 14, 1996.

      In addition,  in October 1997,  the Company  appointed  John  Centinaro to
Senior Vice President,  Operations and appointed Dennis Samuelson to Senior Vice
President, Professional Development Services. Mr. Centinaro previously served as
the Company's Vice President,  Sales and Mr. Samuelson  previously served as the
Company's Vice President, Education Services.

      In conjunction with these appointments, the Company added three members to
its  management  team. In October 1997,  the Company hired John Warren to be its
Vice  President  of Human  Resources  and Robert Lang to be its Vice  President,
Sales and Marketing for the  Company's New Jersey  operations,  reporting to Mr.
Centinaro.  On October 20, 1997, Gary Gann, Esq. was elected to the positions of
Vice President, General Counsel and Secretary to the Company.



Acquisition of The Lande Group, Inc.
------------------------------------

      On August 13, 1997,  the Company  consummated  the  acquisition of certain
assets and assumed certain  liabilities of The Lande Group,  Inc.  ("Lande"),  a
computer equipment reseller and provider of systems integration services located
in New York City. The Company purchased, among other assets, the entire customer
list, accounts receivable and inventory of Lande for an aggregate purchase price
of up to $1.1  million,  of which  $750,000  was paid at closing and $250,000 is
held in escrow pending certain post-closing  adjustments.  An additional $50,000
is payable to Lande by the  Company on each of the first and second  anniversary
of the closing date.  The Company also assumed  certain  liabilities,  including
certain trade debt of approximately $2.9 million,  which was paid by the Company
at closing,  accounts payable and accrued expenses of approximately $1.8 million
and  obligations  under a lease,  which expires in April 2008, for New York City
office space which will serve as the Company's New York headquarters.  The value
of the assets purchased was approximately  the same as the liabilities  assumed.
In addition, six former Lande salespersons and 29 former Lande technical service
personnel currently work for the Company.  Among such personnel,  Stewart Lande,
the former President of Lande, joined the Company as a General Manager.


                                     - 16 -
<PAGE>


      The Company  funded the purchase  price from a portion of the net proceeds
of the follow-on  public offering of its Common Stock  consummated in June 1997.
In determining the purchase price, the Company considered,  among other factors,
the past and projected  revenues and earnings generated from the Lande business,
the value of the Lande  technical  personnel  to the Company  and the  strategic
value of an enhanced New York City presence. Transactional costs associated with
the Lande acquisition were approximately $93,000.



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

      (a)   Exhibits.

            11    Statement re: Computation of Per Share Earnings.

            27    Financial Data Schedule.

      (b) Reports on Form 8-K.

            None.


                                     - 17 -
<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.




                                       AlphaNet Solutions, Inc.




DATE:  November 13, 1997               By: /s/ Stan Gang
                                           -----------------------
                                           Stan Gang,
                                           President and Chief
                                           Executive Officer
                                           (Principal Executive
                                           Officer)



DATE:  November 13, 1997               By: /s/ Gary S. Finkel
                                           -----------------------
                                           Gary S. Finkel,
                                           Vice President and
                                           Chief Financial Officer
                                           (Principal Financial and
                                           Accounting Officer)


                                     - 18 -