SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                                    FORM 10-Q


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

         For the quarterly period ended December 31, 1999

                                       OR

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

         For the transition period from ___________ to __________



Commission File Number  0-27266


                           WESTELL TECHNOLOGIES, INC.
             (Exact name of registrant as specified in its charter)

                     DELAWARE                              36-3154957
          (State or other jurisdiction of                (I.R.S. Employer
          incorporation or organization)              Identification Number)

     750 N. COMMONS DRIVE, AURORA, IL                        60504
    (Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code   (630) 898-2500

                                 NOT APPLICABLE
              (Former name, former address and former fiscal year,
                         if changed since last report)


Indicate  by check or mark  whether  the  registrant  (1) has filed all  reports
required to be filed by Sections 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  issuer's  classes of
common stock, as of the latest practicable date.


Class A Common Stock,  $0.01 Par Value - 17,605,561  shares at February 08, 2000
Class B Common Stock, $0.01 Par Value - 19,124,869 shares at February 08, 2000


<PAGE>



                   WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
                                    FORM 10-Q
                                      INDEX

<TABLE>

<S>                                                                                                         <C>
PART  I  FINANCIAL INFORMATION:                                                                         Page No.
                                                                                                        --------


         Item 1. Financial Statements

                  Condensed Consolidated Balance Sheets                                                        3
                  - As of March 31, 1999 and December 31, 1999 (unaudited)

                  Condensed Consolidated Statements of Operations (unaudited)                                  4
                  - Three months ended December 31, 1998 and 1999
                  - Nine months ended December 31, 1998 and 1999

                  Condensed Consolidated  Statements of Cash Flows (unaudited) 5
                  - Nine months ended December 31, 1998 and 1999

                  Notes to the Condensed Consolidated Financial Statements (unaudited)                         6

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

         Item 3. Quantitative and Qualitative disclosures about market risks                                  14

PART II  OTHER INFORMATION

         Item 5. Other events                                                                                 15

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

</TABLE>

SAFE HARBOR STATEMENT
Certain  statements  contained  under  "Management's  Discussion and Analysis of
Financial  Condition  and  Results of  Operations"  in this 10-Q,  which are not
historical facts  (including,  without  limitation,  statements about future DSL
pricing,  our expected cost  savings,  our  confidence  and  strategies  and our
expectations  about new and  existing  products,  our  ability  to meet our cash
requirements  for the next twelve months,  technologies,  opportunities,  market
growth, demand and acceptance of new and existing products and future commercial
deployment  of the  Company's  products  such as its DSL  systems)  are  forward
looking  statements that involve risks and  uncertainties.  These risks include,
but are not limited to, product demand and market  acceptance  risks  (including
the future  commercial  acceptance  of the  Company's  DSL systems by  telephone
companies  and  other  customers),   the  impact  of  competitive  products  and
technologies (such as cable modems and fiber optic cable),  competitive  pricing
pressures, product development, excess and obsolete inventory due to new product
development,   commercialization   and  technological   delays  or  difficulties
(including delays or difficulties in developing,  producing, testing and selling
new products and technologies), the effect of the Company's accounting policies,
the effect of economic conditions and trade,  legal,  social, and economic risks
(such as import,  licensing and trade  restrictions)  and other risks more fully
described in the Company's  Annual Report on Form 10-K for the fiscal year ended
March 31, 1999 under the section  "Risk  Factors".  The  Company  undertakes  no
obligation  to release  publicly the result of any  revisions  to these  forward
looking statements that may be made to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.



<PAGE>


<TABLE>

                                  WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
                                     CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>

                                                    ASSETS
                                                                                 March 31,          December 31,
                                                                                   1999                 1999
                                                                              ----------------     ---------------
                                                                                                    (unaudited)
                                                                                        (in thousands)
<S>                                                                                   <C>                <C>
 Current assets:
   Cash and cash equivalents..............................................            $ 6,715            $ 10,621
   Accounts receivable (net of allowance of $703,000 and $945,000,                     14,132              18,886
   respectively)..........................................................
   Inventories............................................................             10,376              13,912
   Prepaid expenses and other current assets..............................              1,108               1,773
   Refundable income taxes................................................                 60                  55
   Deferred income tax asset..............................................              1,000                 700
                                                                              ----------------     ---------------
       Total current assets...............................................             33,391              45,947
                                                                              ----------------     ---------------
 Property and equipment:
   Machinery and equipment................................................             18,561              21,718
   Office, computer and research equipment................................             18,230              18,499
   Leasehold improvements.................................................              2,091               2,162
                                                                              ----------------     ---------------
                                                                                       38,882              42,379
   Less accumulated depreciation and amortization.........................             25,531              29,577
                                                                              ----------------
                                                                                                   ---------------
    Property and equipment, net...........................................             13,351              12,802
                                                                              ----------------     ---------------
 Deferred income tax asset and other assets...............................             17,665              19,175
                                                                                                   ---------------
                                                                              ================
       Total assets.......................................................          $  64,407           $  77,924
                                                                              ================     ===============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

 Current liabilities:
   Accounts payable.......................................................            $ 7,616             $ 9,168
   Accrued expenses.......................................................              6,655               6,844
   Accrued compensation...................................................              4,305               4,042
   Current portion of long-term debt......................................              2,189               1,619
   Deferred revenue.......................................................                413                 413
                                                                              ----------------     ---------------
    Total current liabilities.............................................             21,178              22,086
                                                                              ----------------     ---------------
 Long-term debt...........................................................              2,625               1,549
                                                                              ----------------     ---------------
 Other long-term liabilities..............................................              1,480               1,732
                                                                              ----------------     ---------------
                                                                              ----------------     ---------------
 Commitments and contingencies
 Convertible debt (net of debt discount of $1,696,000 as of December 31,                    -              18,304
 1999)....................................................................
 Stockholders' equity:
 Class A common stock, par $0.01..........................................                169                 176
   Authorized - 43,500,000 shares
   Issued and  outstanding - 16,928,650  shares at March 31, 1999 and 17,561,221
   shares at December 31, 1999
 Class B common stock, par $0.01..........................................                195                 191
   Authorized - 25,000,000 shares
   Issued and  outstanding - 19,527,569  shares at March 31, 1999 and 19,124,869
   shares at December 31, 1999
 Preferred stock, par $0.01...............................................                  -                   -
   Authorized - 1,000,000 shares
   Issued and outstanding - none
 Additional paid-in capital...............................................             97,561             100,850
 Cumulative translation adjustment........................................                455                  78
 Accumulated deficit......................................................           (59,256)            (67,042)
                                                                              ----------------     ---------------
       Total stockholders' equity.........................................             39,124              34,253
                                                                              ================     ===============
         Total liabilities and stockholders' equity.......................          $  64,407           $  77,924
                                                                              ================     ===============

         The accompanying notes are an integral part of these Condensed
                       Consolidated Financial Statements.

</TABLE>

<PAGE>


<TABLE>

                                        WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>


                                                     Three Months Ended                 Nine Months Ended
                                                        December 31,                      December 31,
                                                 ----------------------------      ----------------------------
                                                    1998            1999              1998            1999
                                                 ------------    ------------      ------------    ------------
                                                                          (unaudited)
                                                             (in thousands, except per share data)

<S>                                                 <C>             <C>               <C>             <C>
Equipment sales...............................      $ 18,140        $ 21,964          $ 54,468        $ 56,478
Services......................................         5,245           8,053            14,590          22,702
                                                 ------------    ------------      ------------    ------------
  Total revenues..............................        23,385          30,017            69,058          79,180

Cost of equipment sales.......................        13,922          16,755            42,740          43,002
Cost of services..............................         3,372           4,998             8,715          14,783
                                                 ------------    ------------      ------------    ------------
  Total cost of goods sold....................        17,294          21,753            51,455          57,785
                                                 ------------    ------------      ------------    ------------

   Gross margin...............................         6,091           8,264            17,603          21,395
Operating expenses:
  Sales and marketing.........................         5,376           3,854            15,406          10,966
  Research and development....................         6,975           2,967            19,683           8,183
  General and administrative..................         3,420           2,902             9,693           9,519
                                                 ------------    ------------      ------------    ------------
    Total operating expenses..................        15,771           9,723            44,782          28,668
                                                 ------------    ------------      ------------    ------------
Operating loss................................       (9,680)         (1,459)          (27,179)         (7,273)

Other (income) expense, net...................         (142)           (854)             (925)           (905)
Interest expense..............................           115             690               271           1,418
                                                 ------------    ------------      ------------    ------------
Loss before taxes.............................       (9,653)         (1,295)          (26,525)         (7,786)
Benefit for income taxes......................            --              --                --              --
                                                 ------------    ------------      ------------    ------------
                                                 ============    ============      ============    ============
Net loss......................................     $ (9,653)       $ (1,295)        $ (26,525)       $ (7,786)
                                                 ============    ============      ============    ============

Net loss per basic and diluted common share...      $ (0.26)        $ (0.04)          $ (0.73)        $ (0.21)
                                                 ============    ============      ============    ============
  Average number of basic and diluted
  common shares outstanding...................        36,432          36,643            36,422          36,561
                                                 ============    ============      ============    ============





             The accompanying notes are an integral part of these Condensed Consolidated Financial Statements

</TABLE>

<PAGE>

<TABLE>

                                        WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
                                      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>


                                                                                 Nine Months Ended
                                                                                    December 31,
                                                                       ----------------------------------------
                                                                            1998                    1999
                                                                       -----------------       ----------------

                                                                                    (unaudited)
                                                                                   (in thousands)

<S>                                                                    <C>                     <C>
 Cash flows from operating activities:
 Net loss...........................................................   $      (26,525)         $       (7,786)
 Reconciliation of net income to net cash
   used in operating activities:
   Depreciation and amortization....................................             5,501                   5,480
   Foreign currency gain on liquidation of Westell Europe, Ltd......             --                      (426)
 Changes in assets and liabilities:
   Increase in accounts receivable..................................             (565)                 (4,707)
   Decrease (increase) in inventory.................................           (1,392)                 (3,536)
   (Increase) decrease in prepaid expenses and deposits.............             (349)                 (666)
   Decrease in refundable income taxes..............................                 9                       5
   Increase (decrease) in accounts payable and accrued expenses.....               371                   1,993
   Decrease in accrued compensation.................................           (1,075)                   (263)
   Decrease in deferred revenues....................................               (1)                    --
                                                                       -----------------       ----------------
      Net cash used in operating activities.........................          (24,026)                 (9,906)
                                                                       -----------------       ----------------

 Cash flows from investing activities:
   Purchases of property and equipment..............................           (5,580)                 (4,980)
   Proceeds from sale of equipment..................................             --                      432
   (Increase) decrease in other assets..............................              (13)                      32
   Increase in short term investments...............................           (4,766)                     -
                                                                       -----------------       ----------------
      Net cash used in investing activities.........................          (10,359)                 (4,516)
                                                                       -----------------       ----------------

 Cash flows from financing activities:
   Repayment of long-term debt and leases payable...................               194                 (1,645)
   Proceeds from issuance of convertible debt.......................             --                     18,542
   Proceeds from the issuance of common stock.......................               254                 1,428
                                                                       -----------------       ----------------
      Net cash provided by financing activities.....................               448                18,325
                                                                       -----------------       ----------------

 Effect of exchange rate changes on cash............................               9                       3
      Net (decrease) increase in cash...............................          (33,928)                 3,906
 Cash and cash equivalents, beginning of period.....................          43,515                   6,715
                                                                       =================       ================
 Cash and cash equivalents, end of period...........................   $       9,587           $      10,621
                                                                       =================       ================




             The accompanying notes are an integral part of these Condensed Consolidated Financial Statements

</TABLE>

<PAGE>


                   WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE 1.  BASIS OF PRESENTATION

         The accompanying  unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted  accounting  principles
for interim  financial  information  and with the  instructions to Form 10-Q and
Rule  10-01 of  Regulation  S-X.  Accordingly,  they do not  include  all of the
information and footnotes required by generally accepted  accounting  principles
for  complete  financial  statements.  It  is  suggested  that  these  condensed
consolidated  financial  statements be read in conjunction with the consolidated
financial  statements and notes thereto  included in the Company's Annual Report
on Form 10-K for the year ended March 31, 1999.

         In  the  opinion  of  management,   the  unaudited   interim  financial
statements  included  herein  reflect  all  adjustments,  consisting  of  normal
recurring  adjustments,  necessary to present fairly the Company's  consolidated
financial  position and the results of operations and cash flows at December 31,
1999, and for all periods presented. The results of operations for the three and
nine month periods ended December 31, 1999 are not necessarily indicative of the
results that may be expected for the fiscal year ending March 31, 2000.

         Effective  April 1, 1999,  in an effort to  associate  the  transfer of
title of forward priced DSL products to the customer with the recognition of the
loss, the Company began recording losses due to forward pricing upon shipment to
the  customer.  Prior to March 31,  1999,  the  Company  recorded  losses due to
forward pricing of DSL products based upon orders received. As of April 1, 1999,
the Company did not record any  cumulative  effect of this change in  accounting
method, as the effects were immaterial.

         As of December 31, 1999, the Company has committed to binding  purchase
orders for ADSL products from customers priced below current  production  costs.
The Company  anticipates that it may incur losses upon delivery of these forward
priced DSL products during subsequent periods. The amount of these losses during
subsequent  periods  will be  dependent  upon  various  items  including  actual
production  volumes and the Company's ability to achieve  reductions in the cost
of DSL components and efficiencies in the production of DSL products.

NOTE 2. COMPUTATION OF NET LOSS PER SHARE

         The Company  follows the  provisions  of SFAS No. 128,  which  requires
companies to present basic and diluted  earnings per share.  The  computation of
basic earnings per share is computed using the weighted average number of common
shares  outstanding  during the period.  Diluted earnings per share includes the
number of  additional  common  shares  that would have been  outstanding  if the
dilutive potential common shares had been issued. The effect of this computation
on the  number of  outstanding  shares is  antidilutive  for the  periods  ended
December 31, 1998,  and 1999,  and  therefore the net loss per basic and diluted
earnings per share are the same.

NOTE 3. RESTRUCTURING CHARGE

         The Company  recognized a  restructuring  charge of $1.4 million in the
three  months  ended  December  31, 1997 and  $800,000 in the three months ended
March  31,  1999.  These  charges  included  personnel,  facility,  and  certain
development  contract costs related to restructuring  global  operations.  As of
December  31,  1999,  the Company  has paid  approximately  $1.2  million of the
restructuring  costs  charged  in  fiscal  1998  and  $839,000  related  to  the
restructuring  costs  charged in fiscal  1999.  During the three  months  ending
December 31, 1999,  management  determined that  essentially  all  restructuring
payments  have been  completed  therefore the  remaining  restructuring  accrual
balance of approximately $170,000 was reversed into income.

         The fiscal 1998 restructuring plan was to decrease costs and streamline
operations  related to DSL products.  The fiscal 1999  restructuring plan was to
further  decrease  costs,  primarily by reducing the workforce by  approximately
11%, and focus DSL sales efforts on indirect sales to the major phone  companies
through licensing and OEM arrangements with strategic partners.  The Company has
realized  approximately  $3.7 million in the first three quarters of fiscal 2000
and expects cost savings of approximately  $1.3 million in the fourth quarter of
fiscal 2000 related to this restructuring.



<PAGE>

<TABLE>

                   WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
<CAPTION>

The restructuring charges and their utilization are summarized as follows:

                            Charge  Utilized     Balance   Charge  Utilized     Balance   Utilized     Balance
                            fiscal    fiscal   March 31,   fiscal    fiscal   March 31,     fiscal    Dec. 31,
 (in thousands)               1998      1998        1998     1999      1999        1999       2000        1999
---------------------------------------------------------------------------------------------------------------
<S>                         <C>       <C>         <C>      <C>       <C>         <C>        <C>        <C>
Employee costs...........   $  561    $  287      $  274   $  690    $  363      $  601     $  547     $    54
Contract costs...........      736       647          89       --        --          89         --          89
Legal & other costs......       86        23          63      110        17         156        130          26
Charge reversal                                                                                169       (169)
---------------------------------------------------------------------------------------------------------------
Total....................  $ 1,383    $  957      $  426   $  800    $  380      $  846     $  846    $     --
===============================================================================================================

</TABLE>


NOTE 4. INTERIM SEGMENT INFORMATION

         Westell's  reportable  segments are strategic business units that offer
different  products  and  services.  They are managed  separately  because  each
business requires different technology and market strategy. They consist of:

               1)   A  telecommunications  equipment  manufacturer of local loop
                    access products, and

               2)   A multi-point telecommunications service bureau specializing
                    in audio  teleconferencing,  multi-point video conferencing,
                    broadcast fax and multimedia teleconference services.

         Performance  of  these  segments  is  evaluated   utilizing,   revenue,
operating income and total asset  measurements.  The accounting  policies of the
segments  are  the  same  as  those  for  Westell  Technologies,   Inc.  Segment
information  for the three and nine month  periods  ended  December 31, 1998 and
1999, are as follows:

<TABLE>

                                              Telecom               Telecom
                                             Equipment             Services                Total
                                             ---------             --------                -----
<S>                                          <C>                    <C>                  <C>
Three months ended December 31, 1998
      Revenues..........................     $ 18,140               $ 5,245              $ 23,385
      Operating income (loss)...........     (10,173)                   493               (9,680)
      Depreciation and amortization.....        1,400                   431                 1,831
      Total assets......................       61,133                10,636                71,769

Three months ended December 31, 1999
      Revenues..........................     $ 21,964               $ 8,053              $ 30,017
      Operating income (loss)...........      (2,907)                 1,448               (1,459)
      Depreciation and amortization.....        1,308                   610                 1,918
      Total assets......................       59,477                18,447                77,924

Nine months ended December 31, 1998
      Revenues..........................     $ 54,468              $ 14,590              $ 69,058
      Operating income (loss)...........     (29,347)                 2,168              (27,179)
      Depreciation and amortization.....        4,615                   886                 5,501
      Total assets......................       61,133                10,636                71,769

Nine months ended December 31, 1999
      Revenues..........................     $ 56,478              $ 22,702              $ 79,180
      Operating income (loss)...........     (10,556)                 3,283               (7,273)
      Depreciation and amortization.....        3,777                 1,703                 5,480
      Total assets......................       59,477                18,447                77,924


</TABLE>

<PAGE>



                   WESTELL TECHNOLOGIES, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

Reconciliation  of Operating loss from continuing  operations for the reportable
segments to Loss from continuing operations before income taxes:

<TABLE>

                                                              Three months ended          Nine months ended
                                                                 December 31,               December 31,
                                                              1998         1999           1998         1999
                                                           ----------   ----------     ----------   -------

<S>                                                         <C>         <C>           <C>           <C>
Operating loss ........................................     $ (9,680)   $ (1,459)     $ (27,179)    $ (7,273)
Other (income) expense, net............................        (142)        (854)         (925)         (905)
Interest expense.......................................         115          690           271          1,418
                                                            ---------    ---------   -----------    ---------
Loss before income taxes...............................     $ (9,653)   $ (1,295)     $ (26,525)    $ (7,786)
                                                              =======     =======       ========      =======
</TABLE>

NOTE 5. MERGER AGREEMENT

On December 13, 1999 the Company  announced the proposed  merger with  Teltrend,
Inc.  whereby the Company will acquire all of the  outstanding  shares of common
stock of Teltrend,  Inc. The merger is subject to closing  conditions  which are
customary for  transactions  similar in nature  including,  without  limitation,
approval of the Merger  Agreement by Teltrend's  stockholders;  the approval and
related transactions by the Company's shareholders; and the receipt of antitrust
clearances.  On February 3, 2000 the waiting period under the  Hart-Scott-Rodino
Antitrust  Improvements  Act applicable to Westell's offer to acquire all of the
outstanding shares of Common Stock of Teltrend, Inc expired. The Company expects
to have a shareholder vote on the matter during March 2000.

NOTE 6. SUBSEQUENT EVENT

During February 2000, under the terms of the Company's  convertible  debentures,
the debenture  holders  converted an aggregate $6.0 million  principal amount of
convertible debentures into 947,785 Class A Common Shares.


NOTE 7.  EBITDA INFORMATION

The following is the Company's income from operations  before interest  expense,
income taxes,  depreciation and  amortization  ("EBITDA") for the three and nine
month periods ended December 31, 1998 and 1999:


<TABLE>

                                             Three months ended       Nine months ended
                                                  December 31,             December 31,
                                             1998       1999          1998        1999
                                             ----       ----          ----        ----


<S>                                         <C>        <C>            <C>        <C>
EBITDA .................................    $(7,707)   $1,313         $(20,753)  $(888)


</TABLE>


EBITDA represents income from operations before interest expense,  income taxes,
depreciation and amortization.  EBITDA is not a calculation based upon generally
accepted accounting principles.  The amounts included in the EBITDA calculation,
however,  are  derived  from  amounts  included in the  consolidated  historical
statements of income data.  EBITDA should not be construed as an alternative for
operating  income or net income (as  determined  in  accordance  with  generally
accepted accounting principles) as an indicator of operating performance,  or as
an alternative  for cash flows  generated by operating,  investing and financing
activities  as an indicator of cash flow or a measure of  liquidity.  Management
believes  EBITDA  assists  investors in comparing a company's  performance  on a
consistent basis without regard to depreciation and amortization, which can vary
significantly   depending  upon  accounting  methods  or  nonoperating  factors.
However,  the  EBITDA  measure  presented  in this  document  may not  always be
comparable  to similarly  titled  measures  reported by other  companies  due to
differences in the components of the calculation.


<PAGE>



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

OVERVIEW
         Westell Technologies, Inc. ("Westell" or the "Company") derives most of
its equipment revenue from the sale of telecommunications  equipment that enable
telecommunications  services over copper  telephone  wires. The Company offers a
broad range of products that facilitate the  transmission of high-speed  digital
and analog  data  between a  telephone  company's  central  office and  end-user
customers.  The Company's  service  revenues are derived from audio,  multi port
video and multi  media  teleconferencing  services by the  Company's  Conference
Plus, Inc.
subsidiary.

         The  Company  has   historically   used  the  following  three  product
categories in its discussion of equipment revenue:

o    DSL PRODUCTS:  products based on DSL technologies;
o    T-1 OR DS1  PRODUCTS:  products  used  by  telephone  companies  to  enable
     digital T-1 transmission at  approximately  1.5 megabits per second and E-1
     transmission at approximately 2.0 megabits per second; and
o    TRADITIONAL  OR  DS0  PRODUCTS:  products  used by  telephone  companies to
     deliver  digital  services at speeds ranging from  approximately  2.4 to 64
     kilobits  per second  and  traditional  analog  services  with 4  kilohertz
     bandwidth.

Below is a table that  compares  equipment  revenue for the three and nine month
periods  ended  December 31, 1998 with the three and  nine-month  periods  ended
December 31, 1999 by product type:

<TABLE>

                                          Three months ended:                   Nine months ended:
                                   ----------------------------------   ------------------------------------
                                      December 31,      December 31,        December 31,       December 31,
(in thousands)                                1998              1999                1998               1999
                                   ----------------  ------------------------------------  -----------------

<S>                                      <C>               <C>                 <C>               <C>
DSL products....................         $   2,763         $   9,033           $   9,095         $   14,406
T-1 or DS1 products.............            13,477            10,861              40,216             37,034
Traditional or DS0 products.....             1,216             1,211               3,043              2,656
Other equipment.................               684               859               2,114              2,382
                                   ================  ================   =================  =================
Total equipment.................            18,140         $  21,964           $  54,468          $  56,478
                                   ================  ================   =================  =================
</TABLE>

To better reflect the current  business model,  beginning with the quarter ended
June 30, 1999, management has decided to use the following new product groupings
in its discussion of its equipment revenue:

o    HIGH  CAPACITY  ("HiCAP"):  Products  that  maintain,  repair and  monitor
     circuits  used over  copper  telephone  wires in the  portion  of the phone
     companies'  network  connecting  the  central  office  with the  customers'
     locations (the "Local Loop"). Products include all of Westell's traditional
     or DS0  products  such as its analog  products  and a portion of  Westell's
     products that enable digital T-1 transmission such as its Network Interface
     Units ("NIU") products.
o    TRANSPORT SYSTEMS:  Products that contain components that are located both
     in the phone companies' central offices and customers' locations,  creating
     integrated   systems.   Products  include   Westell's  DSL  product  called
     Supervision,  a system  comprised of modems and central  office shelves and
     electronics  that enable  high-speed  transmission  over  copper  telephone
     lines. The Transport Systems business unit also provides  SmartLink(TM),  a
     back-up system for wireless or cellular  providers,  and  LinkReach(TM),  a
     joint  effort with Lucent to enable  high-speed  transmission  over certain
     Lucent products.
o    CUSTOMER PREMISE EQUIPMENT ("CPE"): High-speed DSL modems that are located
     at the customers' premises.  These products include Westell's WireSpeed(TM)
     modems  which are  designed  to  hook up to  single  or  multiple  personal
     computers and to provide high-speed access.

Below is a table that compares  equipment and service revenues for the three and
nine month periods ended December 31, 1998 with the three and nine month periods
ended December 31, 1999 by new product groupings:


<PAGE>


<TABLE>

                                          Three months ended:                   Nine months ended:
                                   ----------------------------------   ------------------------------------
                                      December 31,      December 31,        December 31,       December 31,
(in thousands)                                1998              1999                1998               1999
                                                     ------------------------------------  -----------------
                                   ----------------

<S>                                      <C>               <C>                <C>                <C>
HiCAP...........................         $  14,668         $  11,865          $   43,611         $   38,369
Transport Systems...............             2,225             3,748               7,222              8,573
CPE.............................             1,247             6,351               3,635              9,536
                                   ----------------  ----------------   -----------------  -----------------
Total equipment.................            18,140            21,964              54,468             56,478
                                   ----------------  ----------------   -----------------  -----------------

Services........................             5,245             8,053              14,590             22,702
                                   ================  ================   =================  =================
Total revenues..................         $  23,385         $  30,017           $  69,058          $  79,180
                                   ================  ================   =================  =================
</TABLE>

         Westell's  net  revenues  increased  28.4% in the  three  months  ended
December 31, 1999 when compared to the same period last year due to increases in
equipment  revenue  of  409.3%  and  68.4%  from the CPE and  Transport  Systems
business units,  respectively,  and a 53.5% increase in services revenue.  These
increases  were  partially  offset by a 19.1% decrease in revenue from the HiCAP
business unit.

         The  Company's  net revenues  increased  14.7% in the nine months ended
December 31, 1999 when compared to the same period last year due to increases in
equipment  revenue  of  162.3%  and  18.7%  from the CPE and  Transport  Systems
business units,  respectively,  and a 55.6% increase in services revenue.  These
increases were  partially  offset by a decrease of 12.0% from the HiCAP business
unit.

         The Company  expects to continue to evaluate new product  opportunities
and engage in extensive research and development  activities.  This will require
the Company to continue to invest heavily in research and  development and sales
and marketing,  which could adversely affect  short-term  results of operations.
Due to the  Company's  significant  ongoing  investment in DSL  technology,  the
Company  anticipates  losses in at least the remaining fiscal 2000 quarter.  The
Company  believes  that  its  future  revenue  growth  and  profitability   will
principally  depend on its  success  in  increasing  sales of DSL  products  and
developing new and enhanced  products  enabling T-1  transmission  and other DSL
products. The market for DSL products continues to be increasingly  competitive.
This has caused the Company to offer its DSL  products at prices  below  current
production  costs (i.e.,  forward  pricing of DSL products).  Prior to March 31,
1999, the Company  recorded  losses due to forward pricing of DSL products based
upon orders  received.  Subsequent  to March 31, 1999, in an effort to associate
the transfer of title of the DSL product to the customer with the recognition of
the loss,  the  Company  began  recording  losses due to forward  pricing on DSL
products upon shipment to the customer. As of April 1, 1999, the Company did not
record any cumulative effect of this change in accounting method, as the effects
were  immaterial.  During  July 1999,  the Company  received  DSL orders from an
international   customer  and  a  domestic  customer  priced  below  anticipated
production  costs.  The Company  recognized a loss with respect to these forward
priced  orders  of  $855,000  in  the  quarter  ended  September  30,  1999  and
approximately  $140,000 in the  quarter  ended  December  31,  1999.  Management
believes that  manufacturing  costs will  decrease when (i) more  cost-effective
chipsets are available, (ii) product design efficiencies are obtained, and (iii)
economies of scale are obtained related to increased  volume.  The Company could
continue to record losses on DSL product sales prior to achieving cost-effective
chipsets, product design efficiencies and economies related to volume production
that would have a material adverse effect on the Company's  business and results
of operations.

         In the current  fiscal  year,  the majority of the DSL revenue has been
generated  by  shipments  of DSL  systems  used in trials for data  applications
(i.e.,  Internet  access and work at home) due to the growth in users  accessing
the World Wide Web through the  Internet  and the need to increase  transmission
speed when accessing local area networks and downloading large text graphics and
video files.  In view of the  Company's  reliance on the emerging DSL market for
growth and the unpredictability of orders and subsequent  revenues,  the Company
believes  that period to period  comparisons  of its  financial  results are not
necessarily  meaningful and should not be relied upon as an indication of future
performance.  Revenues from the Company's  analog  products,  traditional or DSO
products have declined in recent years as telephone  companies  continue to move
from analog to digital  transmission  services.  The Company  also  expects that
revenues from Network  Interface Unit ("NIU")  products,  a T-1 product,  in its
HiCAP  product  group may decline as  telephone  companies  increase  the use of
alternative  technologies  such as HDSL.  Failure to increase  revenues from new
products,  whether  due to  lack  of  market  acceptance,  competition,  pricing
pressures,  technological  change or  otherwise,  would have a material  adverse
effect on the Company's business and results of operations.


<PAGE>


RESULTS OF  OPERATIONS - Periods  ended  December  31, 1999  compared to periods
ended December 31, 1998

Revenues. The Company's revenues increased 28.4% from $23.4 million in the three
months  ended  December  31,  1998 to $30.0  million in the three  months  ended
December 31, 1999. The revenue  increase in the three month period was primarily
due to increased  equipment revenue from the Company's CPE business unit of $5.1
million and increased  service revenue from the Company's  Conference Plus, Inc.
subsidiary of $2.8 million when compared with the same period of the prior year.
Equipment  revenue  from the  Company's  Transport  Systems  business  unit also
increased by $1.5 million when  compared with the same three month period of the
prior year. The increased teleconference service revenue reflects an increase in
call minutes at the Company's  Conference Plus, Inc.  subsidiary.  The increased
CPE and  Transport  Systems  equipment  revenue  was due to overall  unit volume
increases offset in part by lower average system sale prices resulting primarily
from changes in product mix.  These  increases were offset in part by a decrease
of $2.8 million from the HiCAP  business unit. The decrease in HiCAP revenue was
due primarily to lower unit shipments of products  enabling T-1  transmission as
local service  providers  transition  to high speed  digital based  products for
providing service.

The  Company's  revenues  increased  14.7% from $69.1 million in the nine months
ended  December 31, 1998 to $79.2 million in the nine months ended  December 31,
1999.  The  revenue  increase  in the nine  month  period was  primarily  due to
increased equipment revenue from the Company's CPE business unit of $5.9 million
and  increased  service  revenue  from  the  Company's   Conference  Plus,  Inc.
subsidiary of $8.1 million when compared with the same period of the prior year.
Equipment  revenue from the Company's  Transport Systems business unit increased
by $1.4 million when compared with the same nine month period of the prior year.
The  increased  teleconference  service  revenue  reflects  an  increase in call
minutes at the Company's Conference Plus, Inc. subsidiary. The increased CPE and
Transport  systems  equipment  revenue was due to overall unit volume  increases
offset in part by lower  average  system sale prices  resulting  primarily  from
changes in product  mix.  These  increases  were offset in part by a decrease of
$5.2 million from the HiCAP business unit. The decrease in HiCAP revenue was due
primarily to lower unit shipments of products enabling T-1 transmission as local
service providers  transition to high speed digital based products for providing
service.

         Gross Margin.  Gross margin as a percentage of revenue  increased  from
26.0% in the three months  ended  December 31, 1998 to 27.5% in the three months
ended  December  31,  1999 and  increased  from 25.5% in the nine  months  ended
December  31, 1998 to 27.0% in the nine months ended  December  31, 1999.  Gross
profit margin for the three and nine month  periods ended  December 31, 1998 was
effected by  recording  losses due to forward  pricing on DSL orders of $800,000
and $2.5 million, respectively. Gross profit margin for the three and nine month
periods ended December 31, 1999 was effected by recording  losses due to forward
pricing on DSL  shipments  during  the  periods of  $140,000  and $1.0  million,
respectively.  To a lesser extent  continued  pricing  pressures and product mix
changes for  products  enabling  T-1 and analog  transmission  also  contributed
downward  pressure on gross profit  margin.  During the quarter,  the  Company's
Conference  Plus,  Inc.   subsidiary   invested  in  additional   infrastructure
enhancements to handle increased call minutes which also impacted gross margins.

Sales and  Marketing.  Sales and marketing  expenses  decreased  28.3%,  or $1.5
million,  to $3.9  million  in the three  months  ended  December  31,  1999 and
decreased  28.8%,  or $4.4  million,  to $11.0  million in the nine months ended
December  31,  1999  when  compared  to the same  period  last  year.  Sales and
marketing expenses decreased as a percentage of revenues from 23.0% in the three
months ended  December 31, 1998 to 12.8% in the three months ended  December 31,
1999 and  decreased  as a percentage  of revenues  from 22.3% in the nine months
ended December 31, 1998 to 13.8% in the nine months ended December 31, 1999. The
decrease in sales and marketing expenses during the three and nine month periods
was primarily due to cost  reductions  resulting from  management's  initiatives
undertaken late last fiscal year to streamline DSL sales and marketing  efforts.
The Company  believes that  continued  investment in sales and marketing will be
required to expand its product  lines,  bring new products to market and service
customers.


<PAGE>


RESULTS OF OPERATIONS - continued

Research and Development.  Research and development expenses decreased 57.5%, or
$4.0  million,  to $3.0 million in the three months ended  December 31, 1999 and
decreased  58.4%,  or $11.5  million,  to $8.2  million in the nine months ended
December  31, 1999 when  compared to the same  period  last year.  Research  and
development  expenses  decreased as a percentage  of revenues  from 29.8% in the
three months ended  December 31, 1998 to 9.9% in the three months ended December
31, 1999 and decreased as a percentage of revenues from 28.5% in the nine months
ended  December  31, 1998 to 10.3% in the nine months  ended  December 31, 1999.
This  decrease in research and  development  expenses was  primarily  due to the
Company  receiving $1.5 million and $4.6 million during the three and nine month
periods ended December 31, 1999,  respectively,  from customers to fund on-going
engineering  projects,   which  was  offset  against  research  and  development
expenses.  Additional  cost  savings in the current  fiscal year are due to cost
reductions resulting from management's restructuring initiatives undertaken late
last fiscal year.  Additionally,  cost savings have resulted from the absence of
costs related to the Company's European operation, Westell Europe Limited, which
was eliminated  earlier in the current fiscal year. The Company  believes that a
continued  commitment  to research  and  development  will be  required  for the
Company to remain competitive.

General and Administrative. General and administrative expenses decreased 15.1%,
from $3.4 million in the three months ended December 31, 1998 to $2.9 million in
the three months ended December 31, 1999 and decreased  1.8%,  from $9.7 million
in the nine months  ended  December  31, 1998 to $9.5 million in the nine months
ended  December 31, 1999.  General and  administrative  expenses  decreased as a
percentage of revenues from 14.6% in the three months ended December 31, 1998 to
9.7% in the three months ended  December 31, 1999 and  decreased as a percentage
of revenues  from 14.0% in the nine months  ended  December 31, 1998 to 12.0% in
the nine months ended December 31, 1999. The general and administrative  expense
decrease in the three month period ended  December 31, 1999 was primarily due to
a change in estimate of previously established  restructuring accruals and other
accruals in the amount of  approximately  $400,000.  This decrease was partially
offset by increases due to information systems enhancements during the three and
nine month periods.

Other (income) expense, net. Other (income) expense, net increased from $142,000
in the three  months  ended  December  31, 1998 to $854,000 in the three  months
ended  December 31, 1999 and  decreased  from  $925,000 in the nine months ended
December  31, 1998 to $905,000 in the nine months ended  December 31, 1999.  The
increase in the three month period ended December 31, 1999 is primarily due to a
$650,000  foreign  currency gain from the  liquidation of Westell  Europe,  Ltd.
Other income is primarily  comprised of interest income earned on temporary cash
investments, the elimination of minority interest and unrealized gains of losses
on intercompany balances denominated in foreign currency.

Interest  expense.  Interest expense increased from $115,000 in the three months
ended  December 31, 1998 to $690,000 in the three months ended December 31, 1999
and increased  from $271,000 in the nine months ended  December 31, 1998 to $1.4
million in the nine months ended December 31, 1999.  Interest expense during the
current  period is a result of interest  incurred on the Company's  subordinated
secured  convertible  debentures,  warrants to purchase Class A Common Stock and
net  obligations  outstanding  during  the  period  under  promissory  notes and
equipment borrowings.

Benefit for income  taxes.  There was no benefit for income  taxes  recorded for
both three and nine month periods  ended  December 31, 1998 and 1999. As in each
quarter of fiscal 1999, the Company provided  valuation  reserves for the entire
benefit  generated  during the three and nine month periods of $600,000 and $3.3
million,  respectively,  since the resulting gross deferred tax asset would have
exceeded the value of tax  planning  strategies  available  to the Company.  The
Company will  evaluate on a quarterly  basis its ability to record a benefit for
income taxes in relation to the value of tax planning strategies available based
upon the resulting gross deferred asset.

LIQUIDITY AND CAPITAL RESOURCES

As of  December  31,  1999,  the  Company  had  $10.6  million  in cash and cash
equivalents,  which is being  invested  in the  highest  rated  grade  corporate
commercial paper. The Company's operating  activities used cash of approximately
$9.9  million in the nine months  ended  December  31,  1999.  This use resulted
primarily  from a loss from  continuing  operations  before income taxes of $2.3
million (net of depreciation),  increases in accounts receivable,  inventory and
prepaid expenses and a decrease in accrued  compensation  offset partially by an
increase in accounts payable and accrued expenses.


<PAGE>



RESULTS OF OPERATIONS - continued


Capital expenditures for the nine month period ended December 31, 1999 were $5.0
million, all of which was funded by available cash. The Company expects to spend
approximately  $8.0  million for the  remainder  of fiscal year 2000  related to
capital equipment expenditures.

At December 31, 1999,  the Company's  principle  sources of liquidity were $10.6
million of cash and cash equivalents and a secured credit facility, which allows
the Company to borrow up to $16.0 million based upon  receivables  and inventory
levels and up to an additional  $4.1 million under a secured  equipment  line of
credit. Cash and cash equivalents, anticipated funds from operations, along with
available  credit lines and other  resources,  are expected to be  sufficient to
meet cash  requirements for the next twelve months.  Cash in excess of operating
requirements  will  continue  to be  invested  on a short  term basis in federal
government agency instruments and the highest rated grade commercial paper.

The Company has  committed to binding  purchase  orders for ADSL  products  from
customers priced below current production costs. The Company anticipates that it
may incur  losses upon  delivery of these  forward  priced DSL  products  during
subsequent  periods.  The Company could continue to record losses on DSL product
sales if management  enters into similar sales  arrangements  prior to achieving
manufacturing  cost  reductions of DSL products  through (i) obtaining more cost
effective DSL chipsets,  (ii) product design  efficiencies  and (iii)  economies
related to volume  production.  The  Company  can not  estimate  the  amounts of
possible future forward priced orders or their subsequent effect on liquidity.

The Company has  approximately  $4.7 million in income tax credit  carryforwards
and a tax benefit of $30.3 million related to a net operating loss  carryforward
that is  available  to offset  taxable  income  in the  future.  The tax  credit
carryforwards begin to expire in 2008 and net operating loss carryforwards begin
to expire in 2012.

Realization  of  deferred  tax  assets  associated  with  the  Company's  future
deductible  temporary  differences,  net operating  loss  carryforwards  and tax
credit  carryforwards  is dependent upon  generating  sufficient  taxable income
prior to their expiration. Although realization of the deferred tax asset is not
assured and the Company has incurred  operating losses for the 1996, 1997, 1998,
and 1999 fiscal years,  management believes that it is more likely than not that
it will generate  taxable income  sufficient to realize the recorded tax benefit
associated with future temporary  differences,  NOL carryforwards and tax credit
carryforwards  prior  to  their  expiration  through  a  tax  planning  strategy
available to the Company.  Management  has  determined  that the strategy is not
sufficient  to realize all of the deferred  tax assets  available to the Company
and as such, has recorded a valuation allowance of $18.5 million. On a quarterly
basis,  management  will assess whether it remains more likely than not that the
recorded  deferred tax asset will be realized.  If the tax planning  strategy is
not  sufficient to generate  taxable  income to recover the deferred tax benefit
recorded,  an increase in the  valuation  allowance  will be required  through a
charge to the income tax provision.  However, if the Company achieves sufficient
profitability or has available  additional tax planning  strategies to utilize a
greater  portion of the  deferred  tax asset,  an income  tax  benefit  would be
recorded to decrease the valuation allowance.

YEAR 2000 COMPLIANCE

         Prior to December 31, 1999 the Company  determined that portions of its
software  systems needed to be modified and/or  replaced so to properly  utilize
dates beyond December 31, 1999 ("year 2000  compliance").  The implementation of
the plan to remediate the Company's Information Technology ("IT") systems, which
included  efforts to  mitigate  the impact  that the year 2000 could have on the
Company, was substantially completed as of March 31, 1999 (the "Project").

         The Project included upgrading system software,  hardware and processes
that are not exclusively  related to year 2000 compliance.  The Company utilized
both internal and external  resources and had a full-time  manager  dedicated to
the Project as well as addressing other year 2000 compliance issues. The Project
cost for the Company was approximately  $1.8 million.  These costs were expensed
as incurred, except for approximately $800,000 that was capitalized unrelated to
year 2000 compliance.  The Company had expensed  approximately  $300,000 related
this Project,  as of March 31, 1999 with the  remaining  $700,000 to be expensed
over the next two years as operating  lease  payments come due. The upgrading of
system  software,  hardware and processes was essentially  completed as of March
31, 1999, as planned and within previous cost estimates.

         The Company has not experienced significant disruptions related to year
2000 nor does the Company


<PAGE>


RESULTS OF OPERATIONS - continued


expect to incur  significant  disruptions  in the  future  related  to year 2000
compliance.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS.
---------------------------------------------------------------------

         Westell is subject to certain market risks,  including foreign currency
and interest rates.  The Company has a foreign  subsidiary in Ireland that sells
teleconferencing  services. The Company is exposed to potential gains and losses
from  foreign  currency  fluctuation  affecting  net  investments  and  earnings
denominated  in  foreign  currencies.  After  the  sale  of  Westell's  European
subsidiary in June 1999, the Company's  future primary exposure is to changes in
exchange rates for the U.S. Dollar versus the Irish pound.  The Company also has
a sales order and accounts  receivable  denominated in Great British pounds. The
Company uses foreign  currency  hedging to manage the exposure to changes in the
exchange rate on accounts receivable.

         As of  December  31,  1999,  the net change in the  cumulative  foreign
currency translation  adjustment account,  which is a component of stockholders'
equity, was an unrealized gain of $78,000.  The Company also recorded a $650,000
foreign  currency  gain from the  liquidation  of Westell  Europe  Ltd. in Other
(income)  expense in the three months ended December 31, 1999. This was recorded
as  cumulative  foreign  currency  translation  adjustment,  as part of retained
earnings, until Westell Europe, Ltd. was substantially liquidated.

         The Company does not have  significant  exposure to interest  rate risk
related to its debt  obligations,  which are primarily U.S. Dollar  denominated.
The Company's  market risk is the potential loss arising from adverse changes in
interest  rates.  As further  described in Note 2 of the Company's  10-K for the
period ended March 31, 1999, the Company's debt includes of a floating-rate bank
line-of  credit.  Market risk is estimated as the  potential  decrease in pretax
earnings  resulting from a hypothetical  increase in interest rates of 10% (i.e.
from  approximately  8% to  approximately  18%)  average  interest  rate  on the
Company's  debt.  If  such  an  increase  occurred,   the  Company  would  incur
approximately  $315,000 per annum in  additional  interest  expense based on the
average debt borrowed during the twelve months ended March 31, 1999. The Company
does not feel such additional expense is significant.

The Company does not currently use any derivative financial instruments relating
to the risk associated with changes in interest rates.




<PAGE>



PART II. OTHER INFORMATION
--------------------------

ITEM 5. OTHER EVENTS
--------------------

         None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
----------------------------------------

   a)    The following documents are furnished as an exhibit and numbered
         pursuant to Item 601 of regulation S-K:

         Exhibit 3.2: Bylaws, as amended  (incorporated by reference to  Exhibit
                      4.2 in Westell Technologies, Inc.'s registration statement
                      on Form S-4 (SEC No. 333-95539).

         Exhibit 27:  Financial Data Schedule

   b) The following Form 8-K's were filed by the Company:

        1.    On December 13, 1999  the Company  announced  the proposed  merger
              with  Teltrend,  Inc.  and an  agreement  with the  holders of its
              convertible  debentures  and related  warrant   to  waive  certain
              rights  which  could  arise   in  connection   with  the  proposed
              transaction and in connection  therewith  Westell agreed  to amend
              the exercise price of the warrants to $5.9208 per share.
        2.    On February 3, 2000,  the Company  announced the expiration of the
              waiting period unde the Hart-Scott-Rodino  Antitrust  Improvements
              Act  applicable  to  Westell's  offer,  pursuant  to the  proposed
              merger,  to acquire all of the outstanding  shares of Common Stock
              of Teltrend, Inc.


                                   SIGNATURES
                                   ----------


Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant has caused this report to be signed on its behalf by the  undersigned
thereunto duly authorized.


                                              WESTELL TECHNOLOGIES, INC.
                                              --------------------------
                                                 (Registrant)

DATE: February 14, 2000
                                              By: MARC J. ZIONTS
                                                 ------------------
                                                 MARC J. ZIONTS
                                                 Chief Executive Officer


                                              By: NICHOLAS C. HINDMAN
                                                 -----------------------
                                                 NICHOLAS C. HINDMAN
                                                 Interim Chief Financial Officer