SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 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 March 31, 1999
                         Commission file number 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 Identification No.)
 Incorporation or Organization)


7 Ridgedale Avenue, 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 April 30, 1999:

Class                                                 Number of Shares 

Common Stock, $.01 par value                          6,251,414


<PAGE>





                            ALPHANET SOLUTIONS, INC.

                            TABLE OF CONTENTS



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

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

                 Consolidated Balance Sheets
                 as of December 31, 1998
                 and March 31, 1999 (unaudited)............................. 2

                 Consolidated Statement of Operations
                 for the Three Months Ended
                 March 31, 1998 (unaudited) and 1999 (unaudited)............ 3

                 Consolidated Statement of Changes in Shareholders' Equity
                 for the Three Months Ended
                 March 31, 1999 (unaudited) ................................ 4

                 Consolidated Statements of Cash Flows
                 for the Three Months Ended
                 March 31, 1998 (unaudited) and 1999 (unaudited)............ 5

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

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

                 Results of Operations......................................13

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

PART II.         OTHER INFORMATION..........................................15

       Item 6.  Exhibits and Reports on Form 8-K............................15

SIGNATURES..................................................................16



<PAGE>


                                     PART I.

                              FINANCIAL INFORMATION

                          Item 1. Financial Statements



<PAGE>

<TABLE>
<CAPTION>

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


                                                                ASSETS

                                                                                   December 31, 1998        March 31, 1999
                                                                                                              (unaudited)
                                                                                   -----------------        ---------------
<S>                                                                                       <C>                   <C>       
Current assets:       
         Cash and cash  equivalents  . . . . . . . . . . . . . . . . .                   $  13,377              $ 15,079
         Accounts receivable, net  . . . . . . . . . . . . . . . . . .                      33,057                29,489
         Inventories . . . . . . . . . . . . . . . . . . . . . . . . .                       3,505                 4,801
         Deferred income tax asset . . . . . . . . . . . . . . . . . .                       1,761                 1,761
         Prepaid expenses and other current assets . . . . . . . . . .                       2,309                   773
                                                                                          --------              --------
         
                    Total current assets . . . . . . . . . . . . . . .                      54,009                51,903
         
Property and equipment, net  . . . . . . . . . . . . . . . . . . . . .                       5,491                 5,000
Other assets   . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       2,394                 2,348
                                                                                          --------              --------
                    Total assets . . . . . . . . . . . . . . . . . . .                   $  61,894              $ 59,251
                                                                                          ========              ========


                                                 LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
         Current portion of capital lease obligations . . . . . . . . . .                $      17              $     16
         Accounts payable . . . . . . . . . . . . . . . . . . . . . . . .                   11,072                 9,819
         Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . .                    6,730                 6,329
         Billings in excess of costs . . . . . . .  . . . . . . . . . . .                      815                   104
                                                                                          --------              --------

                    Total current liabilities . . . . . . . . . . . . . .                   18,634                16,268

Long term liabilities:
         Advance from principal shareholder . . . . . . . . . . . . . . .                      675                   675
         Capital lease obligations  . . . . . . . . . . . . . . . . . . .                       49                    46
                                                                                          --------              --------

                    Total Liabilities . . . . . . . . . . . . . . . . . .                   19,358                16,989
                                                                                          --------              --------
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,
         6,366,228 and 6,388,214 shares issued and outstanding at
         December 31, 1998 and March 31, 1999, respectively . . . . . . .                       63                    63
         Treasury Stock - at cost; 136,800 shares
         in 1998 and 1999 . . . . . . . . . . . . . . . . . . . . . . . .                     (667)                 (667)
         Additional paid-in capital . . . . . . . . . . . . . . . . . . .                   33,942                34,020
         Retained earnings. . . . . . . . . . . . . . . . . . . . . . . .                    9,198                 8,846

                    Total shareholders' equity  . . . . . . . . . . . . .                   42,536                42,262
                                                                                          --------              --------
                     Total liabilities and shareholders' equity . . . . .                 $ 61,894              $ 59,251
                                                                                          ========              ========

</TABLE>

          See accompanying notes to consolidated financial statements.


<PAGE>


<TABLE>
<CAPTION>

                            ALPHANET SOLUTIONS, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                   (Unaudited)
                    (in thousands, except per share amounts)



                                                                          For the Three Months
                                                                             Ended March 31,
                                                                        -----------------------

                                                                          1998            1999
                                                                          ----            ----
<S>                                                                    <C>             <C>
Net sales:
           Product sales . . . . . . . . . . . . . . . . . . .         $31,297         $ 18,692
           Services and support  . . . . . . . . . . . . . . .          14,194           11,436
                                                                      --------         --------
                                                                        45,491           30,128
                                                                      --------         --------
 
Cost of sales:
           Product sales . . . . . . . . . . . . . . . . . . .          27,377           16,609
           Services and support  . . . . . . . . . . . . . . .           9,395            8,138
                                                                      --------         --------
                                                                        36,772           24,747
                                                                      --------         --------

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . .           8,719            5,381
                                                                      --------         --------

Operating expenses:
           Selling expenses  . . . . . . . . . . . . . . . . .           3,967            2,957
           General and administrative expenses . . . . . . . .           2,595            3,275
                                                                      --------         --------
                                                                         6,562            6,232
                                                                      --------         --------

Operating income . . . . . . . . . . . . . . . . . . . . . . .           2,157            (851)
                                                                      --------         --------

Other income (expense):
           Interest income . . . . . . . . . . . . . . . . . .              99              262
           Interest expense  . . . . . . . . . . . . . . . . .             (26)             (13)
                                                                      --------         --------
                                                                            73              249
                                                                      --------         --------

Income (loss) before income taxes  . . . . . . . . . . . . . .           2,230            (602)
Provision (benefit) for income taxes . . . . . . . . . . . . .             914            (250)
                                                                      --------         --------
Net income (loss)  . . . . . . . . . . . . . . . . . . . . . .        $  1,316         $  (352)
                                                                      ========         ========

Earnings (loss) per share - Basic  . . . . . . . . . . . . . .        $   0.21        $  (0.06)
                                                                      ========        =========
Weighted average shares  . . . . . . . . . . . . . . . . . . .           6,261            6,236
                                                                      ========        =========

Earnings (loss) per share - Diluted. . . . . . . . . . . . . .        $   0.21        $  (0.06)
                                                                      ========        =========
Weighted average shares and share equivalents outstanding. . .           6,397            6,236
                                                                      ========        =========


</TABLE>


          See accompanying notes to consolidated financial statements.


<PAGE>


<TABLE>
<CAPTION>

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

                                                                                       Additional
                                 Common       Common       Treasury       Treasury       Paid-In         Retained        
                                 Shares        Stock        Shares          Stock        Capital         Earnings         Total
                                 ------        -----        ------          -----        -------         --------         -----
<S>                            <C>             <C>           <C>          <C>           <C>               <C>          <C>     
Balance at January 1, 1999        6,366        $  63         (137)        $ (667)       $ 33,942          $9,198       $ 42,536

Exercise of stock options             4           --           --             --              15              --             15

Employee stock purchases             18           --           --             --              63              --             63

Net income (loss)                    --           --           --             --              --            (352)          (352)
                               --------        -----         -----         ------       --------          -------      ---------

Balance at March 31, 1999         6,388        $  63         (137)         $(667)       $ 34,020          $8,846       $ 42,262
                               ========        =====         =====         ======       ========          =======      =========


</TABLE>



          See accompanying notes to consolidated financial statements.


<PAGE>

<TABLE>
<CAPTION>


                            ALPHANET SOLUTIONS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)

                                                                                                  For the Three Months
                                                                                                     Ended March 31,
                                                                                              --------------------------

                                                                                                 1998                1999
                                                                                                 ----                ----
<S>                                                                                          <C>                  <C>
Cash flows from operating activities:
     Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         $  1,316               $ (352)
     Adjustments to reconcile  net  income  to net cash  provided  by
                operating activities:
           Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . .              594                  663
           Increase (decrease) from changes in:
                 Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . .            5,605                3,568
                 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . .             (649)              (1,296)
                 Prepaid expenses and other current assets . . . . . . . . . . . . .            1,135                1,536
                 Other assets  . . . . . . . . . . . . . . . . . . . . . . . . . . .               73                    2
                 Accounts payable  . . . . . . . . . . . . . . . . . . . . . . . . .           (1,298)              (1,253)
                 Accrued expenses  . . . . . . . . . . . . . . . . . . . . . . . . .             (790)                (401)
                 Billings in excess of costs   . . . . . . . . . . . . . . . . . . .               --                 (711)
                                                                                             --------            ---------
           Net cash provided by operating activities . . . . . . . . . . . . . . . .            5,986                1,756

Cash flows from investing activities:
     Property and equipment expenditures . . . . . . . . . . . . . . . . . . . . . .           (1,450)                (128)
                                                                                             --------            ---------
           Net cash used in investing activities . . . . . . . . . . . . . . . . . .           (1,450)                (128)
                                                                                             --------            ---------
Cash flows from financing activities:
     Net proceeds from sales of common stock   . . . . . . . . . . . . . . . . . . .               --                   63
     Exercises of stock options  . . . . . . . . . . . . . . . . . . . . . . . . . .              105                   15
     Repayment of capital lease obligations  . . . . . . . . . . . . . . . . . . . .              (19)                  (4)
                                                                                             --------            ---------
     Net cash provided by financing activities . . . . . . . . . . . . . . . . . . .               86                   74
                                                                                             --------            ---------
Net increase in cash and cash equivalents  . . . . . . . . . . . . . . . . . . . . .            4,622                1,702
Cash and cash equivalents, beginning of period . . . . . . . . . . . . . . . . . . .            2,689               13,377
                                                                                             --------            ---------
Cash and cash equivalents, end of period . . . . . . . . . . . . . . . . . . . . . .         $  7,311            $  15,079
                                                                                             ========            =========

</TABLE>

          See accompanying notes to consolidated financial statements.


<PAGE>


                            ALPHANET SOLUTIONS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                    (in thousands, except per share amounts)


Note 1 - Basis of Presentation:

       The  information  presented  for  March 31,  1998 and  1999,  and for the
three-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 March 31, 1999
and the results of its operations and its cash flows for the three-month periods
ended March 31, 1998 and 1999. 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, 1998,  which were included as part of
the  Company's  Annual  Report on 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.

Note 2 - Net Income Per Share:

       In  February  1997,  the  Financial  Accounting  Standards  Board  issued
Statement  No. 128 "Earnings  per Share" (SFAS No.  128"),  which  specifies the
computation,  presentation  and disclosure  requirements  for earnings per share
("EPS") of entities with  publicly held common stock or potential  common stock.
The statement  defines two earnings per share  calculations,  basic and diluted.
The objective of basic EPS is to measure the  performance  of an entity over the
reporting  period by dividing  income  available to common  stockholders  by the
weighted average shares outstanding.  The objective of diluted EPS is consistent
with that of basic EPS, that is to measure the performance of an entity over the
reporting  period,  while giving effect to all dilutive  potential common shares
that were  outstanding  during the  period.  The  calculation  of diluted EPS is
similar to basic EPS except both the numerator and denominator are increased for
the potential  exercise of stock  options.  In February 1998, the Securities and
Exchange  Commission  staff issued Staff  Accounting  Bulletin No. 98 ("SAB 98")
revising previously issued statements to become consistent with SFAS No. 128 and
No. 130. SAB 98 requires the Company to revise its EPS  computations  to present
historical EPS including pre-IPO periods.  The computations for earnings per 
share contained in this report incorporate SAB 98.

       Net  income per share is computed  using the weighted  average shares and
share equivalents outstanding during the period. 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 shares or equivalents  used
in computing net income per share.


<PAGE>


<TABLE>
<CAPTION>

                        COMPUTATION OF EARNINGS PER SHARE
                                   (Unaudited)
                    (in thousands, except per share amounts)

                                                                                          For the Three Months
                                                                                             Ended March 31,
                                                                                          --------------------

                                                                                         1998               1999
                                                                                         ----               ----
<S>                                                                                   <C>                  <C>
Net income (loss)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 1,316             $  (352)
                                                                                      =======             ========
Weighted average shares and share equivalents outstanding:
     Common shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    6,269               6,236
     Stock Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      128                  --
                                                                                           --                  --
                                                                                        6,397               6,236
                                                                                      =======             ========
Net income (loss) per share  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $  0.21             $ (0.06)
                                                                                      =======             ========
</TABLE>

<PAGE>

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

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.  In the first quarter of 1999,  net product sales were 62.0% and
services and support revenue was 38.0% of the Company's net sales.

      The Company  has  entered  into  distribution  agreements  with Ingram and
Pinacor,  two of the  nation's  largest  aggregators,  to acquire most of its IT
product for resale.  The Company's  relationship  with Pinacor commenced in 1984
and,  as  customer  demand for IT  products  grew,  the  Company  initiated  its
relationship  with Ingram in 1994. The  distribution  agreements with Ingram and
Pinacor 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,  enterprise  computing  products,
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 three months  ended March 31, 1999,  the Company
acquired  approximately  61% and 22% of its  products for resale from Ingram and
Pinacor, respectively.

      Except for the $20.4  million  contract with the MTA-New York City Transit
Authority ("MTA") entered into in December 1997 (see below),  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,  workstation support,  applications
development,  communications installation,  education, help desk, remote network
management,  IT staffing  and  internet-related  services.  Services and support
revenue is  recognized  as such services are  performed.  The Company's  network
consulting,  workstation  support and communications  installation  services are
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  costs which consist of salaries,  benefits and
payroll-related  expenses.  Thus,  the  financial  performance  of the Company's
services business is based primarily upon billing margins (billable hourly rates
less the costs to the Company of such services 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  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  implemented  a  reduction-in-force   in  June  1998  due  to
lower-than-expected  demand for the Company's services from certain clients.  In
addition,   in  January  1999,  the  Company  implemented  a  second  reduction,
eliminating 42 positions  consisting  principally of persons  supporting product
sales.

      The Company may receive  manufacturer  rebates  resulting  from  equipment
sales. In addition,  the Company  receives volume discounts and other incentives
from  certain of its  suppliers.  Except  for  products  in transit or  products
awaiting  configuration at the Company facility,  the Company generally does not
maintain  large  inventory  balances.  In 1998  the  Company's  primary  vendors
announced  or  instituted  changes  in  their  price  protection  and  inventory
management  programs  as  a  direct  result  of  changes  in  such  policies  by
manufacturers.  Specifically,  they  announced  that they  will (i) limit  price
protection to that provided by the  manufacturer,  generally  less than 30 days,
rather than the unlimited  protection  previously  available;  and (ii) restrict
product returns,  other than defective returns,  to a percentage (the percentage
varies  depending  on the  vendor  and when  the  return  is  made)  of  product
purchased,  during a defined  period,  at the lower of the invoiced price or the
current  price,  subject  to  the  specific   manufacturer's   requirements  and
restrictions. At the present time, the Company does not believe these changes in
the vendor  policies  will have a material  impact on its  business.  Other than
changes in such price  protection  and return  policies,  the Company is unaware
that any of its  suppliers  or  manufacturers  has changed or intends to further
change  these  programs.  There  can be no  assurances  that any  such  rebates,
discounts or incentives will continue at historical  levels,  if at all. Further
adverse  modification,  restriction  or reduction in such programs  could have a
material  adverse  effect  on  the  Company's  financial  position,  results  of
operations, or cash flows.

      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  and related  expenses for billable
technical  personnel.  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  and  related  expenses,
depreciation and occupancy costs.

      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.  As such, the Company anticipates that an increasing percentage of its
gross  profits  in the future  will be derived  from the  services  and  support
component of its business.  However, in the near term, the Company believes that
the product  sales will  continue to generate a  significant  percentage  of the
Company's  gross  profit.  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.

      The Company's net sales,  gross  profit,  operating  income and net income
have varied  substantially  from quarter to quarter and are expected to do so in
the future.  Many factors,  some of which are not within the Company's  control,
have  contributed and may in the future  contribute to fluctuations in operating
results.   These  factors  include:  the  short-term  nature  of  the  Company's
customers' commitments;  patterns of capital spending by customers;  the timing,
size, and mix of product and service orders and deliveries;  the timing and size
of new projects;  pricing  changes in response to various  competitive  factors;
market factors  affecting the  availability  of qualified  technical  personnel;
timing and customer acceptance of new product and service offerings;  changes in
trends  affecting  outsourcing of IT services;  disruption in sources of supply;
changes in product,  personnel,  and other  operating  costs;  and  industry and
general economic  conditions.  Operating results have been and may in the future
be affected by the cost, timing and other effects of acquisitions, including the
mix of product and service revenues of acquired companies. The Company believes,
therefore,  that past operating results and period-to-period  comparisons should
not be relied upon as an indication of future operating performance.

      In December  1997,  the Company  entered into a four-year,  $20.4  million
contract  with the MTA to  furnish  and  install  local and  wide-area  computer
network components including network and  telecommunication  hardware,  software
and cabling  throughout  the MTA's over 200  locations to extend the benefits of
automation to the MTA's operations,  including subway stations, electrical power
substations and a diverse group of train car maintenance facilities. The Company
is the prime contractor responsible for project management, systems procurement,
and  installation.  The work is grouped in  contiguous  locations and payment is
predicated upon achieving specific milestone events. In the event of default, in
addition to all other  remedies at law,  the MTA reserves the right to terminate
the services of the Company and complete  the contract  itself at the  Company's
cost.  In the  event of  unexcused  delay by the  Company,  the  Company  may be
obligated  to pay, as  liquidated  damages,  the sum of $100 per day.  While the
Company is currently performing in accordance with the contract terms, there can
be no assurances  that any such events would not occur. In addition the contract
is a fixed unit price contract,  and the quantities are  approximate,  for which
the MTA has expressly reserved the right, for each item, to direct the amount of
equipment  be  increased,  decreased,  or omitted  entirely  on 30 days  notice.
Further,  the MTA has the right to suspend  the work on 10 days notice for up to
90 days and/or terminate the contract,  at any time, on notice,  paying only for
the work  performed  to the date of  termination.  The project is subject to the
prevailing wage rate and classification for telecommunication  workers,  managed
by the New York City Controller's office, over which the Company has no control,
and which is  generally  adjusted in June of each year and may be so adjusted in
the future.

<PAGE>

      The Company has performed  services and supplied products to the MTA since
the  inception  of the MTA  Contract.  The work  performed  to date has required
greater than estimated  labor and other costs to complete.  Such increased labor
and other costs may also be incurred at other  sites.  The Company has  formally
requested the MTA for an equitable  adjustment in the contract amount and terms.
However,  there can be no assurance the MTA will approve,  either in whole or in
part, any equitable  adjustment in the contract amount or terms requested by the
Company.  There can be no  assurance  that the Company can complete the contract
without incurring a loss. Currently, the Company is recording revenues under the
MTA Contract equal to costs incurred. However, if the Company is unsuccessful in
obtaining equitable adjustments, realizing increased performance efficiencies or
otherwise  improving  its margins,  the Company  believes it will sustain a loss
under the contract.

<PAGE>

Year 2000 Readiness Disclosure

      Historically, certain computer programs have been written using two digits
rather than four to define the applicable  year,  which could result in computer
recognizing a date using "00" as the year 1900 rather than the year 2000.  This,
in turn,  could  result in major  system  failures  or  miscalculations,  and is
generally  referred to herein as the "Year 2000 Problem."  Computer systems that
are able to deal  correctly  with  dates  after  1999 are  referred  to as "Year
2000-Compliant." Over the past several years, based upon its business needs, the
Company has purchased and installed  hardware and software  which is represented
by the  manufacturers  to be Year  2000-Compliant.  The Company has reviewed its
state of readiness and has determined  that, with the exception of the Company's
current integrated  accounting  system,  which is not Year  2000-Compliant,  the
Company believes its installed base of computer hardware and software systems to
be Year  2000-Compliant.  With respect to the  Company's  integrated  accounting
system,  in October  1998 the Company  announced  the  purchase of Platinum  SQL
Software,  to replace the current integrated accounting system. The project plan
currently  establishes June 1999 for completion of  implementation.  The Company
believes it is currently on track for timely completion of such  implementation.
Based upon the  representations  of the  manufacturers  of hardware and software
used by the Company, and the provider of the Platinum SQL Software,  the Company
believes upon  implementation  of Platinum SQL, the Company's  internal business
systems, including its computer systems, will be Year 2000-Compliant.  There can
be no assurance,  however,  that the Year 2000 Problem relating to the Company's
systems will not adversely affect its business,  financial position,  results of
operation or cash flows.

      During  the  fourth  quarter  of  1998,  the  Company   initiated   formal
communications  with all of its  significant  suppliers  and large  customers to
determine  the extent to which the Company is vulnerable to the failure of those
third parties to remediate  their own Year 2000 problem.  The Company expects to
be receiving and reviewing the responses to these  communications  and following
up with such  suppliers  and  customers  as needed or  appropriate.  The Company
expects this phase to be substantially completed by approximately June 30, 1999.
However,  there can be no guarantee that the systems of other companies on which
the Company's system rely will be remedied in a timely manner, or that a failure
to remedy by another  company,  will not have a material  adverse  effect on the
Company.

      The  Company  resells IT products of leading  hardware  manufacturers  and
software  developers.  As  a  result,  the  Company  has  no  control  over  the
developments of computer  systems,  software  products or other business systems
developed by such third  parties.  Consequently,  there can be no assurance that
the computer  systems,  software  products or other business systems sold by the
Company will accept input of, store,  manipulate and/or output dates in the year
2000 or thereafter without error or interruption. As a result, the Company, as a
reseller,  may be liable  for such  failures.  Given the  Company's  role in the
distribution of such products,  the Company is not able to accurately  determine
the extent, if any, of such potential liability.

      In  addition,  the  purchasing  patterns of the  Company's  customers  and
potential  customers  may be  affected by issues  associated  with the Year 2000
problem.   As   companies   devote   significant   resources   to  become   Year
2000-Compliant,  these  expenditures  may result in reduced  funds  available to
purchase products or obtain services such as those offered by the Company. There
can be no assurance  that the Year 2000 Problem  will not  adversely  affect the
Company's business, financial position, results of operations or cash flows.

      The total  cost of the  Company's  Year 2000  compliance  is being  funded
through  operating  cash  flows.  The  estimated  cost to  purchase  and install
Platinum SQL is approximately $600,000. Excluding costs associated with Platinum
SQL and the  write-off of the  capitalized  software and  consulting  fees,  the
Company has expended  approximately $2 million on hardware and software upgrades
for its Year 2000 compliance.  The Company does not currently anticipate that it
will incur any additional  material  expenditures for such Year 2000 compliance.
The  aforementioned  costs do not  include any costs  associated  with any third
party  being  Year  2000  non-compliant,  nor do  such  costs  include  internal
personnel costs  (primarily  salaries and benefits),  which the Company does not
separately  track.  Such costs also do not include any contingency plan costs at
this point.

      The Company has not developed a contingency plan in the event the Platinum
SQL  project  is not  completed  in a  timely  manner  or  with  respect  to any
additional  Year  2000  compliance  issues  which  may  arise as a result of the
Company's inquiries of its suppliers and customers.  Such plans may be developed
as and if the need for any such plans arise.

      Statements   included  in  this  Year  2000   Readiness   Disclosure   are
forward-looking   statements  within  the  meaning  of  The  Private  Securities
Litigation Reform Act of 1995. Such forward-looking statements include risks and
uncertainties,  including but not limited to the possibility  that the currently
installed  computer systems,  software products or other business systems of the
Company or its distributors, manufacturers or customers, working either alone or
in conjunction with other software or systems,  will not accept input of, store,
manipulate  and/or output dates in the year 2000 or thereafter  without error or
interruption.  Such  risks and  uncertainties  may cause  the  Company's  actual
results to differ materially from the results  discussed in the  forward-looking
statements contained in this Report.

Forward-Looking Statements

      This Form 10-Q contains forward-looking  statements that involve risks and
uncertainties.  The Company's actual results may differ  significantly  from the
results  discussed  in  the  forward-looking  statements.  Such  forward-looking
statements include risks and uncertainties,  including,  but 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;  (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;  (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.

<PAGE>

Results of Operations

Comparison of Three Months Ended March 31, 1998 and 1999

      Net Sales.  Net sales  decreased by 33.8%,  or $15.4  million,  from $45.5
million for the first  quarter of 1998 to $30.1 million for the first quarter of
1999. Product sales decreased by 40.3%, or $12.6 million, from $31.3 million for
the first quarter of 1998 to $18.7  million for the first quarter of 1999.  This
decline in product sales was primarily  attributable  to increased  competition,
reduced  unit  volumes and lower  average  selling  prices.  This trend has been
accelerated  by the ability of  customers  to  purchase  directly  from  certain
manufacturers  at  discounted  prices and the  Company's  decision not to pursue
low-margin  business.  Services and support  revenue  decreased by 9.4%, or $2.8
million,  from $14.2  million for the first quarter of 1998 to $11.4 million for
the first quarter of 1999. This decline was primarily  attributable to decreased
demand from certain customers.

      During the three  months  ended March 31,  1999,  sales to Summit Bank and
PSE&G, the Company's largest  customers,  accounted for approximately  11.2% and
10.5%, respectively,  of the Company's net sales. There can be no assurance that
such  customers will continue to place product orders with the Company or engage
the Company to perform services and support at existing levels.

      Gross  Profit.  The  Company's  gross  profit  declined by 38.3%,  or $3.3
million, from $8.7 million for the first quarter of 1998 to $5.4 million for the
first quarter of 1999. The Company's  overall gross profit margin decreased from
19.2% of net sales for the first  quarter of 1998 to 17.9% for the first quarter
of 1999. Gross profit margin  attributable to product sales decreased from 12.5%
for the first  quarter  of 1998 to 11.1% for the  first  quarter  of 1999 due to
downward pricing pressure on products. Gross margin attributable to services and
support  revenue  decreased  from 33.8% of services and support  revenue for the
first quarter of 1998 to 28.8% for the first quarter of 1999.  This decrease was
attributable primarily to costs associated with performance of the MTA Contract,
increased  personnel and related costs,  and more long-term  staffing  contracts
which typically carry lower gross profit margins.

      Selling  Expenses.  Selling expenses  decreased by 25.5%, or $1.0 million,
from $3.9  million for the first  quarter of 1998 to $2.9  million for the first
quarter of 1999,  but  increased as a percentage  of net sales from 8.7% for the
first quarter of 1998 to 9.8% for the first  quarter of 1999.  The increase as a
percentage  of net sales was due  primarily  to the decrease in net sales during
the first three months in 1999.

      General and Administrative  Expenses.  General and administrative expenses
increased by 26.2%, or $680,000, from $2.5 million for the first quarter of 1998
to $3.2 million for the first quarter of 1999,  and increased as a percentage of
net sales from 5.7% for the first quarter of 1998 to 10.9% for the first quarter
of 1999. The increase in general and administrative expenses in absolute dollars
was due primarily to personnel  expenses,  training  costs,  professional  fees,
depreciation  charges,  additional leased facilities and their related costs and
insurance  premiums.  The increase in general and  administrative  expenses as a
percentage  of net sales was also due to the  decrease  in net sales  during the
first three months in 1999.


<PAGE>


Liquidity and Capital Resources

      Since its inception,  the Company has funded its operations primarily from
cash generated by operations,  as well as with funds from  borrowings  under the
Company's  credit  facilities  and the net proceeds  from the  Company's  public
offerings of its Common Stock in 1996. The Company's cash provided by operations
was $1.8 million for the first  quarter  1999,  which  consisted  primarily of a
decrease in accounts receivable of $3.6 million offset by a decrease in accounts
payable  and  accrued  expenses  of  $1.7  million.  The  decrease  in  accounts
receivable is primarily  attributable  to the decrease in net sales. As measured
in day sales outstanding,  the Company's accounts  receivable  increased from 78
days at December 31, 1998 to 86 days at March 31, 1999.  The Company's cash flow
from  operations  has  been  and  continues  to be  affected  primarily  by  the
collection of accounts receivable.

      The Company's  working  capital was $35.4 million at December 31, 1998 and
$35.6 million at March 31, 1999.

      The Company  sold 18,426  shares of common stock to employees in the first
quarter.  As of March  31,  1999,  a total of  99,314  shares  had been  sold to
employees  under the 500,000 share  Employee Stock Purchase Plan approved by the
Company's  shareholders  in May 1998.  The Company has  received an aggregate of
$572,101 from such sales.

      The Company  purchases  certain  inventory and equipment through financing
arrangements  with IBM Credit  Corporation  and Finova Capital  Corporation.  At
March 31,  1999,  there  were  outstanding  balances  of $2.1  million  and $5.5
million, respectively, under such arrangements. Obligations under such financing
arrangements  are  collateralized  by  substantially  all of the  assets  of the
Company.  In  connection  with the Loan and Security  Agreement  entered into on
September 30, 1998 with First Union National Bank (the "Bank") (see below),  the
Bank  entered into an  intercreditor  agreement  with respect to their  relative
interests in the aforementioned collateral.

      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 includes a $2.5 million
sublimit  for  letters of credit and a $5.0  million  sublimit  for  acquisition
advances.  Under the  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. On September 30, 1998, the Company
and the Bank  executed a Loan and Security  Agreement  whereby the Bank extended
the Company's credit facility for an additional year through September 30, 1999.

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


<PAGE>


                           PART II. OTHER INFORMATION


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

(a)    Exhibit.

       27 Financial Data Schedule

(b)    Reports on Form 8-K.

      No reports on Form 8-K were filed during the quarter for which this report
on Form 10-Q is filed.




<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: May 13, 1999                   By: /s/ Stan Gang                          
                                        ----------------------------------------
                                        Stan Gang
                                        President and Chief Executive Officer
                                        (Principal Executive Officer) and
                                        Acting Chief Financial Officer
                                        (Principal Financial and Accounting
                                        Officer)