<PAGE>

================================================================================

                                 UNITED STATES
                       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 period ended June 30, 2000

                                       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: 001-11747


                       THE ASHTON TECHNOLOGY GROUP, INC.



               Delaware                                 22-6650372
      (State of incorporation)                       (I.R.S. Employer
                                                    Identification No.)

                         1835 MARKET STREET, SUITE 420
                        PHILADELPHIA, PENNSYLVANIA 19103

                                 (215) 789-3300


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
                                                     -----


                     APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practical date:

          Common Stock $.01 par value                  28,234,194
              (Title of Class)                    (No. of shares as
                                                   of July 31, 2000)
<PAGE>

                       THE ASHTON TECHNOLOGY GROUP, INC.

                                     INDEX






<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION                                               PAGE
<S>      <C>                                                                 <C>
Item 1.  Financial Statements (Unaudited)
           Consolidated Balance Sheets - June 30, 2000 and March 31, 2000..   4

           Consolidated Statements of Operations -
           For the Three Months Ended June 30, 2000 and 1999...............   5

           Consolidated Statements of Cash Flows -
           For the Three Months Ended June 30, 2000 and 1999...............   6

           Notes to Consolidated Financial Statements......................   7

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.............................................  15

Item 3.  Quantitative and Qualitative Disclosure of Market Risk............  19

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.................................................  19

Item 2.  Changes in Securities and Use of Proceeds.........................  19

Item 3.  Defaults Upon Senior Securities...................................  19

Item 4.  Submission of Matters to a Vote of Security Holders...............  19

Item 5.  Other Information.................................................  19

Item 6.  Exhibits and Reports on Form 8-K..................................  19

Signatures.................................................................  20
</TABLE>

                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION

FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q constitute "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") and the Private Securities Litigation Reform Act of
1995.  Such forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual results,
performance or achievements of the Company to differ materially from any future
results, performance or achievements expressed or implied by such forward-
looking statements.  Such risks, uncertainties and other important factors
include, among others: dependence on arrangements with self-regulatory
organizations; dependence on proprietary technology; ability to successfully
operate the Company's volume-weighted average price trading system
("eVWAP(TM)"); technological changes and costs of technology; industry trends;
competition; ability to develop markets; changes in business strategy or
development plans; availability, terms and deployment of capital; availability
of qualified personnel; changes in government regulation; general economic and
business conditions; and other factors referenced in this Form 10-Q.  For
discussion of the factors that might cause performance of the Company to differ
from expected results, see Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations and the Company's other periodic
reports and registration statements filed with the Securities Exchange
Commission (the "SEC" or "Commission").

                                       3
<PAGE>

ITEM 1.                       FINANCIAL STATEMENTS
              THE ASHTON TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                               June 30, 2000         March 31, 2000
                                                                                (Unaudited)            (Audited)
                                                                            -----------------     -----------------
<S>                                                                           <C>                   <C>
Assets

Cash and cash equivalents...................................................      $12,562,525           $15,365,439
Securities available-for-sale...............................................        9,923,820             9,906,220
Accounts receivable and other current assets................................          396,177               446,066
Due from broker-dealer......................................................        1,646,649             2,000,000
Current portion of notes receivable.........................................          503,824               121,845
                                                                                  -----------           -----------
     Total current assets ..................................................       25,032,995            27,839,570
Notes receivable, net of current portion....................................          193,795               605,172
Property and equipment, net of accumulated depreciation.....................        1,020,477               944,292
Exchange memberships........................................................          266,652               266,652
Investments in affiliates...................................................          885,521             1,090,508
Intangible assets, net of accumulated amortization..........................            9,761                19,521
Other assets................................................................          391,613               258,196
                                                                                  -----------           -----------
         Total Assets.......................................................      $27,800,814           $31,023,911
                                                                                  ===========           ===========
Liabilities and Stockholders' Equity

Accounts payable and accrued expenses.......................................      $   697,280               861,304

Minority Interest...........................................................        5,000,000             5,000,000
Commitments and contingencies
Stockholders' equity:
Preferred stock - shares authorized: 3,000,000
 590,000 shares designated as Series B - (liquidation preference $10 per
  share); shares issued and outstanding; 64,200.............................          642,000               642,000

 20,000 shares designated as Series F $.01 par value - (liquidation
  preference equals stated value of $1,000 per share); shares issued and
  outstanding; 8,000........................................................        8,000,000             8,000,000

Common stock - par value: $.01; shares authorized: 60,000,000;
 Shares issued and outstanding;  28,194,194 and 28,118,594..................          281,941               281,186
Additional paid-in capital..................................................       64,696,560            64,294,258
Accumulated deficit.........................................................      (51,448,819)          (47,981,286)
Accumulated other comprehensive loss........................................          (68,148)              (73,551)
                                                                                  -----------           -----------
Total stockholders' equity..................................................       22,103,534            25,162,607
                                                                                  -----------           -----------
         Total Liabilities and Stockholders' Equity.........................      $27,800,814           $31,023,911
                                                                                  ===========           ===========
</TABLE>

          See accompanying notes to consolidated financial statements

                                       4
<PAGE>

              THE ASHTON TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

<TABLE>
<CAPTION>
                                                                           Three Months Ended June 30,
                                                                      ------------------------------------
                                                                          2000                     1999
                                                                      -----------              -----------
<S>                                                                   <C>                      <C>
Revenues.......................................................       $    46,117              $   794,101
                                                                      -----------              -----------
Expenses:
 Costs of revenues.............................................                --                   31,250
 Development costs.............................................                --                   47,677
 Depreciation and amortization.................................           118,666                  137,669
 Non-cash compensation charges.................................            10,027                  149,219
 Loss on trading activities....................................           364,615                       --
 Selling, general and administrative...........................         2,854,343                3,289,254
                                                                      -----------              -----------
     Total costs and expenses..................................         3,347,651                3,655,069
                                                                      -----------              -----------

Loss from operations...........................................        (3,301,534)              (2,860,968)
                                                                      -----------              -----------
 Interest income...............................................           399,481                   87,930
 Interest expense..............................................            (7,122)                      --
 Equity in loss of affiliates..................................          (204,987)                      --
                                                                      -----------              -----------
Net loss.......................................................       $(3,114,162)             $(2,773,038)
                                                                      ===========              ===========
Dividends in arrears on preferred stock........................          (353,371)                (109,537)
                                                                      -----------              -----------
Net loss applicable to common stock............................       $(3,467,533)             $(2,882,575)
                                                                      ===========              ===========
Net loss per common share - basic and diluted..................       $     (0.12)             $      (.13)
                                                                      ===========              ===========
Weighted average number of common shares outstanding...........        28,172,767               22,141,287
                                                                      ===========              ===========
</TABLE>

          See accompanying notes to consolidated financial statements

                                       5
<PAGE>

              THE ASHTON TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

<TABLE>
<CAPTION>
                                                                                 Three Months Ended June 30,
                                                                             -----------------------------------
                                                                                2000                    1999
                                                                            ------------            ------------
<S>                                                                         <C>                     <C>
Cash Flows from Operating Activities
Net loss................................................................     (3,114,162)             (2,773,038)
Adjustments to reconcile net loss to net cash used in operating
 activities:
 Depreciation and amortization..........................................        113,486                 185,346
 Non-cash compensation charge for stock options.........................         10,027                      --
 Common stock issued for consulting services............................             --                 149,219
 Equity in loss of affiliates...........................................        204,987                      --
Changes in operating assets and liabilities
 Decrease/ (increase) in accounts receivable and prepayments............         49,889                (718,134)
 Decrease in due from broker-dealer.....................................        353,351                      --
 (Increase)/ decrease in other assets...................................       (133,420)                221,497
 Decrease in accounts payable and accrued expenses   expenses                  (185,738)                (50,624)
 Increase in other liabilities   expenses                                            --                 180,027
                                                                            -----------             -----------
   Net cash used in operating activities................................     (2,701,580)             (2,805,707)
                                                                            -----------             -----------
Cash Flows from Investing Activities
 Purchase of fixed assets...............................................       (185,090)               (776,065)
 Cash received from notes receivable....................................         29,398                  18,113
                                                                            -----------             -----------
   Net cash used in investing activities................................       (155,692)               (757,952)
                                                                            -----------             -----------
Cash Flows from Financing Activities
 Line of credit borrowings..............................................      2,081,702                      --
 Line of credit repayments..............................................     (2,081,702)                     --
 Issuance costs for common stock........................................             --                (300,000)
 Proceeds from issuance of common stock.................................             --               3,000,000
 Proceeds from exercise of stock options and warrants to purchase
  common stock..........................................................         46,875               1,729,272
 Proceeds from issuance of eMC common stock                                      14,500                      --
 Proceeds from issuance of Gomez preferred stock........................             --               5,500,000
 Issuance costs for Gomez preferred stock...............................             --                (606,918)
 Proceeds from issuance of UTTC preferred stock.........................             --               2,000,000
                                                                            -----------             -----------
   Net cash provided by financing activities............................         61,375              11,322,354
                                                                            -----------             -----------
Foreign currency translation adjustment.................................         (7,017)                     --
                                                                            -----------             -----------
Net (decrease)/ increase in cash and cash equivalents                        (2,802,914)              7,758,695
Cash and cash equivalents, beginning of period..........................     15,365,439               2,667,347
                                                                            -----------             -----------
Cash and cash equivalents, end of period................................    $12,562,525              10,426,042
                                                                            ===========             ===========

Supplemental disclosure of cash flow information:
    Cash paid during the period for interest............................    $     7,122             $        --
    Cash paid during the period for taxes...............................    $     1,824             $    15,235
</TABLE>

          See accompanying notes to consolidated financial statements

                                       6
<PAGE>

THE ASHTON TECHNOLOGY GROUP, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The consolidated financial statements included herein have been prepared without
audit pursuant to the rules and regulations of the Securities and Exchange
Commission.  Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations.  The accompanying consolidated financial statements reflect all
adjustments that are, in the opinion of management, necessary to a fair
statement of the results for the interim periods presented.  Such adjustments
are of a normal recurring nature.  Certain amounts in prior periods have been
reclassified for comparative purposes.

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported amounts of revenues and
expenses during the period.  Actual results could differ from those estimates.

These consolidated financial statements should be read in conjunction with the
audited financial statements and the notes thereto included in the registrant's
Annual Report on Form 10-K for the year ended March 31, 2000.  The results for
the three months ended June 30, 2000 are not necessarily indicative of the
results that may be expected for the year ended March 31, 2001.

The consolidated financial statements include the accounts of The Ashton
Technology Group, Inc. ("Ashton") (collectively with its subsidiaries and
affiliated companies, the "Company") and its majority-owned subsidiaries, which
at June 30, 2000 and March 31, 2000 included:

        .  Universal Trading Technologies Corporation ("UTTC") and its wholly-
           owned subsidiaries:
           .  REB Securities, Inc. ("REB")
           .  Croix Securities, Inc. ("Croix")
           .  NextExchange, Inc. ("NextExchange").
        .  Electronic Market Center, Inc. ("eMC") and its wholly-owned
           subsidiary:
           .  E-Trustco.com Inc. and its wholly-owned subsidiary:
              .  The Manhattan Trust Company.
        .  Ashton Technology Canada, Inc. ("Ashton Canada").
        .  ATG International, Inc. ("International").

The accounts of all majority-owned subsidiaries are consolidated with those of
Ashton. All significant intercompany accounts and transactions have been
eliminated in consolidation.

The Company accounts for investments in businesses which it owns between 20% and
50% using the equity method.  Ashton accounts for its investments in Kingsway-
ATG Asia, Ltd. ("KAA") and Gomez Advisors, Inc. ("Gomez") using the equity
method at June 30, 2000.  Gomez was a majority-owned subsidiary of Ashton
through December 31, 1999, and was Ashton's primary source of revenues from
Gomez's inception in May 1997 through December 31, 1999. In periods ending on or
prior to December 31, 1999, the operating results of Gomez were consolidated in
Ashton's statement of operations, and the assets and liabilities of Gomez were
consolidated in Ashton's balance sheet.

UTTC Common Stock Reverse Split

On April 7, 2000, the Board of Directors of UTTC approved a three-for-four
reverse stock split, effective April 10, 2000.  All references in the unaudited
consolidated financial statements to UTTC common shares and common stock options
have been adjusted retroactively for the split.

                                       7
<PAGE>

eMC Common Stock Reverse Split

On April 13, 2000 the Board of Directors of eMC approved a 0.65-for-one reverse
stock split, effective April 17, 2000.  All references in the unaudited
consolidated financial statements to eMC common shares have been adjusted
retroactively for the split.

2.  INVESTMENTS IN SUBSIDIARIES AND AFFILIATED COMPANIES

E-Trustco.com Inc.

On April 18, 2000, eMC acquired all of the outstanding capital stock of E-
Trustco.com Inc. and its wholly-owned subsidiary, The Manhattan Trust Company,
in exchange for 2,000,000 shares of eMC's common stock. E-Trustco is a wholly-
owned subsidiary of eMC, and is headquartered in Hartford, CT. As of March 31,
2000, Ashton and Ashton's management owned 100% of the voting equity of eMC. As
a result of the acquisition of E-Trustco, Ashton and its management own
approximately 78% of the voting equity of eMC. There were no assets or
liabilities of E-Trustco or The Manhattan Trust Company at the date of
acquisition or at June 30, 2000.

Gomez Advisors, Inc.

In September 1999, Gomez commenced a private placement of its Series C
Convertible Preferred Stock.  As a result of Gomez's sale of a portion of its
Series C Preferred Stock on December 30, 1999, Ashton's ownership percentage in
Gomez was reduced to below 50%, and Ashton began accounting for its investment
in Gomez under the equity method of accounting.  Pursuant to the equity method
of accounting, the carrying amount of Ashton's remaining investment in Gomez was
increased to zero, and the increase of $5,568,475 was reported as a gain in
December 1999. Ashton will not report any future losses of Gomez which would
reduce the carrying amount of the investment in Gomez to below zero.  In the
event Gomez has future earnings, Ashton will recognize its share of those
earnings only after the earnings exceed Ashton's share of net losses not
recognized.

On April 20, 2000, Gomez filed a registration statement for an initial public
offering of its common stock.  As of June 30, 2000, Ashton's investment in Gomez
consisted of 4,405 shares of Series A Preferred Stock, which will automatically
be converted into 4,405,000 shares of Gomez common stock upon completion of
Gomez's initial public offering.  The registration statement has not yet become
effective.


3.  STOCKHOLDERS' EQUITY

Series F Convertible Preferred Stock

On August 18, 1999 (the "Issue Date"), Ashton completed a private placement for
the sale of 20,000 shares of its Series F Convertible Preferred Stock (the
"Series F Preferred") with a par value of $.01 and a stated value of $1,000 per
share, and warrants to purchase an aggregate of 200,000 shares of Ashton's
common stock, for gross proceeds of $20,000,000. Each share of the Series F
Preferred is convertible into a number of shares of Ashton's common stock equal
to the stated value plus a premium of up to 9% per annum, divided by a
conversion price.  The conversion price of the Series F Preferred is the lesser
of $10.79 or the average of the five lowest closing bid prices during the 22
trading days preceding conversion. Prior to February 17, 2000, the conversion
price was $7.85 (the "Floor Price") for all conversions that took place on days
where the common stock traded below the Floor Price. Beginning on February 18,
2000, the Series F Preferred is subject to redemption at Ashton's option if the
market price of the common stock is below $7.35 on the conversion date.  During
the year ended March 31, 2000, 12,000 shares of the Series F Preferred were
converted into 2,192,412 shares of Ashton common stock, including 70,884 shares
deemed as dividends.  The Company has accrued dividends in arrears of $628,274
to reflect the 9% premium on the remaining 8,000 Series F Preferred shares from
the Issue Date through June 30, 2000.

The warrants are immediately exercisable for a period of five years, ending
August 18, 2004, at an exercise price of $12.26 per share.  The fair value of
the warrants, or $645,000, was recorded as a dividend to the holders of the
Series F Preferred on the Issue Date.

                                       8
<PAGE>

On January 1, 2000, Ashton imposed a "blackout" on sales of Ashton common stock
by the Series F Preferred investors pursuant to a registration rights agreement
dated August 18, 1999 between Ashton and the Series F Preferred investors.  As a
result of the blackout, which was effective for the period from January 10, 2000
through February 28, 2000, the Series F Preferred investors agreed not to make
sales of Ashton common stock issued upon conversion of the Series F Preferred
stock and exercise of the warrants.  Additionally, as a result of the blackout,
the conversion price on subsequent conversions of 6,000 shares of the Series F
Preferred stock was adjusted to equal the lesser of $5.6563 and the conversion
price that would otherwise be in effect on the date of any such conversions.

UTTC Series TK Convertible Preferred Stock

On June 4, 1999, UTTC completed a private placement of 145,700 shares of Series
TK Convertible Preferred Stock ("UTTC Series TK Preferred Stock") and warrants
to purchase 200,000 shares of Ashton common stock at $10.00 per share ("Series T
Warrants"). The fair value of the Series T Warrants is being recorded as a
dividend to the holders of the UTTC Series TK Preferred Stock on the vesting
dates of the warrants. During the three months ended June 30, 2000, Ashton
recorded a dividend of $152,150 upon vesting of 25,000 of the Series T warrants.
Gross proceeds received by UTTC from the sale of the Series TK Preferred Stock
and the warrants amounted to $2,000,000. Between May 2001 and April 2004, each
share of UTTC Series TK Preferred Stock is convertible into 7.5 shares of UTTC
common stock. Additionally, between May 1, 2001 and June 1, 2001, holders of the
UTTC Series TK Preferred Stock may exchange each share of Series TK Preferred
for 1.83 shares of Ashton common stock. The UTTC Series TK Preferred Stock is
presented as a minority interest on the consolidated balance sheets at its
liquidation preference of $2,000,000. As a result of the UTTC Series TK
Preferred stock liquidation preference, the balance has not been reduced by any
portion of the net losses of UTTC.

In connection with the agreement with Ashton Canada on December 20, 1999, the
Company issued warrants to purchase 500,000 shares of Ashton common stock at
$2.50 per share ("Series K Warrants") to holders of the UTTC Series TK
Convertible Preferred Stock.  The Series K Warrants are exercisable for a period
of two years beginning on June 4, 2000.  The fair value of the Series K Warrants
will be recorded as a dividend to the holders of the Series TK Preferred on the
vesting dates of the warrants, beginning in December 2000.

UTTC Series KW Convertible Preferred Stock

On January 12, 2000, UTTC completed a private placement of 123,240 shares of its
Series KW Convertible Preferred Stock ("Series KW Preferred"), resulting in
gross proceeds of $3,000,000.  The Series KW Preferred has a liquidation value
of $24.34275 per share, or $3,000,000.  Upon the completion of an initial public
offering of the common stock of UTTC or upon a change in control, and until
December 2004, each share of Series KW Preferred is convertible into 7.5 shares
of UTTC common stock.  If UTTC has not completed an initial public offering by
December 31, 2001, holders of the Series KW Preferred may exchange up to 41,080
shares of Series KW Preferred, each for 3.477 shares of Ashton common stock, and
up to 41,080 shares of Series KW Preferred at an exchange ratio equal to the
liquidation value per share divided by the average closing price of the Ashton
common stock for the twenty trading days preceding such conversion.
Additionally, Ashton, UTTC, and the holders of the Series KW Preferred agreed
that if, within thirty days of KAA completing an initial public offering of its
securities, UTTC has not filed to register UTTC's common stock to engage in an
underwritten initial public offering, the holders of the Series KW Preferred may
then, and at any time thereafter for so long as UTTC has not filed to register
UTTC's common stock to engage in an underwritten initial public offering of its
securities, exchange up to 41,080 shares of Series KW Preferred for shares of
Ashton common stock at an exchange ratio equal to the liquidation value per
share of the Series KW Preferred divided by the average closing price of the
Ashton common stock for the twenty trading days preceding such conversion. The
UTTC Series KW Preferred Stock is presented as a minority interest on the
consolidated balance sheets at its liquidation preference of $3,000,000. As a
result of the UTTC Series KW Preferred stock liquidation preference, the balance
has not been reduced by any portion of the net losses of UTTC.

Private Equity Agreement, Series D and E Preferred Stock

On April 3, 1998 (the "Subscription Date"), the Company entered into the Private
Equity Line of Credit Agreement (the "Private Equity Agreement") with a group of
accredited investors (the "Private Equity Investors") which provided for an
aggregate commitment of $18,000,000 to the Company.  On the Subscription Date,
the

                                       9
<PAGE>

Private Equity Investors purchased shares of Ashton's Series D Convertible
Preferred Stock, and on July 15, 1998, the Private Equity Investors also
purchased shares of Ashton's Series E Convertible Preferred Stock.  All of the
outstanding shares of the Series D and Series E Preferred Stock were converted
into Ashton common stock during the year ended March 31, 1999.  Also on the
Subscription Date, the Private Equity Investors received warrants to purchase up
to an aggregate of 250,000 shares of Ashton common stock, and on July 15, 1998,
received additional warrants to purchase up to an aggregate of 100,000 shares of
Ashton common stock.  The warrants, which were exercisable for a period of five
years, were exercised in May 1999.  As a result of the exercise, Ashton received
gross proceeds of $1,601,450 and issued 350,000 shares of common stock.

Following the purchase of the Series E Preferred and subject to the satisfaction
of certain other conditions, Ashton was entitled to put to the Private Equity
Investors shares of Ashton common stock for an aggregate put price of
$13,000,000.  The put price per share was equal to 85% of the average of the
lowest bid prices of such common stock over the seven-day period beginning three
days before and ending three days after Ashton gave notice of a put.  During the
three months ended June 30, 1999, Ashton exercised two puts to the Private
Equity Investors in the aggregate amount of $3,000,000, and issued 393,810
shares of common stock.  The Private Equity Investors fulfilled their remaining
commitment to Ashton under the Private Equity Agreement during the year ended
March 31, 2000.

On the Subscription Date, Ashton issued a warrant to the placement agent on the
same terms as the warrants that were issued to the Private Equity Investors to
purchase up to 190,000 shares of Ashton common stock.  On July 15, 1998, Ashton
issued a warrant to the placement agent to purchase up to 60,000 shares of
common stock, on the same terms as the warrant issued on the Subscription Date.
In addition, pursuant to the Private Equity Agreement, Ashton paid the placement
agent $150,000, or 5% of the proceeds of the puts during the three months ended
June 30, 1999.

Series C Preferred Stock

On January 27, 1998, Ashton completed the sale of 100,000 shares of its Series C
Convertible Preferred Stock and issued warrants to the Series C Preferred
investors which were exercisable into an aggregate of 100,000 shares of Ashton
common stock at an average exercise price of $1.71.   During the three months
ended June 30, 1999, the 100,000 warrants were exercised, resulting in proceeds
of $171,282 to Ashton and the issuance of 100,000 shares of common stock.

Series A and B Preferred Stock

On September 18, 1997, Ashton commenced a private offering and exchange offer
pursuant to which it offered to certain investors (i) shares of its Series A
Convertible PIK Preferred Stock (with a liquidation preference of $10.00 per
share) (the "Series A Preferred"); (ii) shares of its Series B Convertible
Preferred Stock (with a liquidation preference of $10.00 per share) (the "Series
B Preferred"); and (iii) the opportunity to exchange up to $3,000,000 of
convertible and non-convertible notes previously issued by UTTC for up to
300,000 shares of its Series B Preferred (the "Exchange Offer").  The Series A
Preferred paid cumulative dividends semi-annually at an annual rate of $0.50 per
share and was payable in cash or additional shares of Series A Preferred until
February 15, 2000.  Each holder of shares of Series A Preferred had the right to
convert each share of Series A Preferred into:  (i) ten shares of Ashton common
stock; and (ii) one warrant to purchase 2.25 shares of the common stock of UTTC,
par value $0.01 per share, with an exercise price of $1.00 per share, subject to
adjustment.  The Series B Preferred pays cumulative dividends semi-annually at
an annual rate of $0.90 per share.  Each holder of shares of Series B Preferred
has the right to convert each share of Series B Preferred into:  (i) six shares
of Ashton common stock; and (ii) one warrant to purchase 1.5 shares of UTTC
common stock, at an exercise price of $1.00 per share, subject to adjustment.

During the three months ended June 30, 1999, 61,056 shares of the Series A
Preferred and 249,800 shares of the Series B Preferred were converted into a
total of 2,100,358 shares of Ashton common stock.  By August 1999, all shares of
the Series A Preferred Stock had been converted into common stock.  At June 30,
2000, there are 64,200 shares of the Series B Preferred outstanding.

                                       10
<PAGE>

Deferred Consulting Expense

In February 1998, Ashton entered into a consulting agreement with Continental
Capital & Equity Corporation ("Continental") whereby Ashton issued 300,000
shares of common stock, with a fair value of $475,125, in exchange for
promotional services through February 1999.  In August 1998, Ashton amended the
consulting agreement with Continental and issued 250,000 additional shares of
common stock, with a fair market value of $416,657, in exchange for additional
promotional services and a reduction in cash payments required pursuant to a
previous consulting agreement.  During the year ended March 31, 1999, Ashton
recorded a deferred consulting expense of $416,657 as a reduction to
stockholders' equity as a result of amending the consulting agreement.  The
consulting cost was amortized over the revised one-year term of the agreement.
For the three months ended June 30, 1999, Ashton charged $149,219 to operations
for the amortization of deferred consulting expenses related to the original and
amended consulting agreements.

Underwriters' Warrants

Warrants that were issued to the underwriters of Ashton's initial public
offering in May 1996 were exercised on a cashless basis during June 1999, and
100,555 shares of common stock were issued.

Public Warrants

Ashton has registered an aggregate of 3,232,500 publicly tradable warrants. The
holders of each of these warrants are entitled, upon payment of the exercise
price of $5.85, to purchase one share of common stock.  Unless previously
redeemed, the warrants are exercisable at any time during the five-year period
ending May 2, 2002, provided that a current prospectus relating to the
underlying common stock is in effect and the shares are qualified for sale or
exempt from qualification under applicable securities laws.

Commencing May 2, 1997, the warrants may be redeemed by the Company at a price
of $.25 per warrant, if the trading price for the common stock on The Nasdaq
National Market is equal to or exceeds $6.75 per share for twenty 20 consecutive
trading days.  The Company must give each warrant holder thirty days notice if
it intends to redeem any or all of the warrants.  If Ashton gives notice of its
intention to redeem any of the warrants, the warrant holders' right to exercise
their warrants will be forfeited unless they exercise their warrants prior to
the date on the notice of redemption.  The decision to redeem the warrants is at
the discretion of Ashton's Board of Directors.   During the three months ended
June 30, 1999, 5,200 of the public warrants were exercised for proceeds of
$30,420.


4.  RELATED PARTY TRANSACTIONS

The Dover Group, Inc.

The Company utilizes The Dover Group, Inc. for consulting services related to
the Company's financings and product development efforts.  Fredric W.
Rittereiser, the Company's Chairman and Chief Executive Officer, is the sole
shareholder, director and officer of Dover.  The Company paid consulting fees to
Dover amounting to $45,000 in each of the three-month periods ended June 30,
2000 and 1999.

On January 14, 1998, the Company entered into an agreement with Dover and Mr.
Rittereiser, whereby Dover and Mr. Rittereiser agreed to reimburse the Company
for $413,980 in legal costs associated with a lawsuit brought by David N.
Rosensaft against the Company (the "Rosensaft lawsuit"), to the extent such
costs were not covered by the Company's directors' and officers' liability
insurance carrier. Dover and Mr. Rittereiser pledged 250,001 shares of UTTC
stock as collateral in support of their agreement to pay the legal costs
("Agreement to Pay Legal Costs").  The Company has submitted a claim to its
insurance carrier in the full amount of such legal costs.  To date, the Company
and its insurance carrier have not reached agreement as to whether the legal
costs of the Rosensaft lawsuit are covered by the Company's directors and
officers' liability insurance policy.

On March 4, 1998, the U.S. District Court for the Southern District of New York
entered an order awarding damages against Dover and Mr. Rittereiser in the
Rosensaft lawsuit in the amount of $1.2 million.  The Company and its
subsidiary, UTTC, had previously been dismissed as parties to the Rosensaft
lawsuit.  On April 7, 1998, the

                                       11
<PAGE>

Company's Board of Directors, after due deliberation, concluded that the Company
and UTTC derived mutual benefit from the Rosensaft settlement entered into by
Dover and Mr. Rittereiser. The Board resolved to fund one-third of the $1.2
million settlement amount. Separately, UTTC agreed to fund one-third of the
Rosensaft settlement. On April 8, 1998, pursuant to a Repayment Agreement, the
Company loaned $380,000 to Dover and Mr. Rittereiser at an annual interest rate
of 9% for thirty months to satisfy their portion of the Rosensaft settlement. In
exchange for the loan to satisfy the Rosensaft settlement, Dover initially
pledged 300,000 shares of Ashton common stock under its control to the Company.
On March 20, 2000, the Company, Dover and Mr. Rittereiser amended the agreement
and reduced the number of shares of Ashton common stock subject to the pledge
from 300,000 shares to 63,500 shares. The loan is included in the current
portion of notes receivable on the consolidated balance sheet at June 30, 2000.

On April 3, 2000, the Board of Directors of the Company resolved to accept from
Dover and Mr. Rittereiser shares of common stock of Gomez owned by Dover
equivalent in value to the amounts due the Company under the Repayment Agreement
and the Agreement to Pay Legal Costs as full and complete satisfaction of the
debts. The amounts due the Company under those agreements include the $380,000
note to Ashton plus $76,900 in accrued interest, as well as settlement costs of
$413,000 which were paid by Ashton, but have not yet been reimbursed by the
Company's directors and officers' liability insurance policy. The number of
shares of Gomez stock to be transferred to the Company will be determined at the
time of the completion of the initial public offering of common stock of Gomez
and will be valued at the initial public offering price of such shares, or such
other price as determined by Ashton's Board of Directors.

In April 2000, Mr. Rittereiser entered into an agreement with Morgan Stanley
Dean Witter, whereby he pledged certain shares of his Ashton common stock in
exchange for a loan in the amount of $500,000 (the "Rittereiser Loan").  Morgan
Stanley requested the Company provide additional credit enhancements to secure
the Rittereiser Loan, in the form of a guarantee of the loan by the Company.
The Company agreed to guarantee the Rittereiser Loan up to $500,000, on the
condition that Mr. Rittereiser secure the Company's guarantee with sufficient
personal collateral pledged to the Company and on the condition that the
guarantee shall only extend until such time that Mr. Rittereiser repays the
Rittereiser Loan or locates other collateral to substitute for the Company's
guarantee.  Mr. Rittereiser agreed to secure the Company's guarantee of the
Rittereiser Loan with a first lien on his residential real estate, which is
valued in excess of $500,000, and has agreed to repay the Rittereiser Loan
and/or locate substitute collateral for the Company's guarantee within a
reasonable period of time.

Adirondack Capital, LLC

In 1997, the Company retained Adirondack Capital, LLC to provide investment
banking and financial advisory services.  K. Ivan F. Gothner, a member of the
Company's Board of Directors, is the Managing Director of Adirondack.  The
Company paid consulting fees to Adirondack amounting to $30,000 in each of the
three-month periods ended June 30, 2000 and 1999.  In April 1999, Gomez paid a
fee of $50,000 to Adirondack for its assistance in structuring the private
placement of the Gomez Series B Preferred Stock.  The Company also paid
Adirondack $150,000 in the three months ended June 30, 1999 pursuant to the
Private Equity Line of Credit Agreement.

Wyndham Capital Corporation

In 1997, the Company retained Wyndham Capital Corporation to provide investment
banking and financial advisory services.  Thomas G. Brown, a member of the
Company's Board of Directors, is the President and Managing Director of Wyndham.
The Company paid $15,000 in consulting fees to Wyndham during the three months
ended June 30, 1999.  Effective September 1, 1999, Wyndham's consulting fees
were terminated and Mr. Brown began receiving a monthly board retainer upon his
election to the Board.

Kronish, Lieb, Weiner & Hellman LLP

Kronish, Lieb, Weiner & Hellman LLP, the law firm of which Herbert Kronish, a
director of the Company, is a Senior Partner, acted as counsel to the Company in
various matters since 1998.  Ashton paid aggregate fees of $7,344 and $41,977
during the three-month periods ended June 30, 2000 and 1999, respectively, to
Kronish, Lieb, Weiner & Hellman LLP for legal services.

                                       12
<PAGE>

5.  SEGMENT INFORMATION

At June 30, 2000, the Company operates in one business segment: matching
systems.  The matching systems segment includes the development and operation of
the electronic volume-weighted average price trading system ("eVWAP(TM)") and
other intelligent matching systems.  At June 30, 1999, the results of operations
of Gomez were reported as a second segment.  Since Gomez's results of operations
are no longer consolidated with those of Ashton, the Company is no longer
operating in that segment.  Selected financial information for the Company's
segments is presented in the tables below.



<TABLE>
<CAPTION>
                                                         Three Months Ended June 30,
                                                       -------------------------------
                                                           2000              1999
                                                       -------------     -------------
<S>                                                    <C>               <C>
Revenues:
    Gomez............................................   $       --         $  794,101
    Matching systems.................................       46,117                 --
                                                       -------------     -------------
                                                            46,117            794,101
Depreciation and amortization:
    Gomez............................................           --             22,000
    Matching systems.................................      118,666            163,346
                                                       -------------     -------------
                                                           118,666            185,346
Non-cash compensation charges
    Gomez............................................           --                 --
    Matching systems.................................       10,027            149,219
                                                       -------------     -------------
                                                            10,027            149,219
Loss on trading activities:
    Gomez............................................           --                 --
    Matching systems.................................      364,615                 --
                                                       -------------     -------------
                                                           364,615                 --
Loss from operations:
    Gomez............................................           --            823,419
    Matching systems.................................    3,301,534          2,037,549
                                                       -------------     -------------
                                                         3,301,534          2,860,968
Interest income:
    Gomez............................................           --             26,379
    Matching systems.................................      399,481             61,551
                                                       -------------     -------------
                                                           399,481             87,930
</TABLE>

<TABLE>
<CAPTION>
                                                          June 30,           March 31,
                                                            2000               2000
                                                       --------------     ---------------
<S>                                                    <C>                <C>
    Total assets:
       Gomez.........................................   $        --         $        --
       Matching systems..............................    27,800,814          31,023,911
                                                       --------------     ---------------
                                                         27,800,814          31,023,911
</TABLE>

6.  RECENT ACCOUNTING PRONOUNCEMENTS

In November 1999, the SEC issued Staff Accounting Bulletin (SAB) No. 100
Restructuring and Impairment Charges.  In December 1999, the SEC issued SAB No.
101 Revenue Recognition in Financial Statements.  SAB No. 100 expresses the
views of the SEC staff regarding the accounting for and disclosure of certain
expenses not commonly reported in connection with exit activities and business
combinations.  This includes the accrual of exit

                                       13
<PAGE>

and employee termination costs and the recognition of impairment charges. SAB
No. 101 expresses the views of the SEC staff in applying generally accepted
accounting principles to certain revenue recognition issues. SAB No. 100 became
effective in November 1999 and SAB No. 101 is effective for periods beginning
after March 15, 2000. The adoption of the guidance provided in SAB No. 100 and
SAB No.101 have not had a material impact on the Company's consolidated
financial position or results of operations.

7.    NET LOSS PER SHARE

Net loss per share is computed in accordance with SFAS No 128, Earnings per
Share. SFAS 128 requires companies to present basic and diluted earnings per
share. Basic earnings per share excludes the dilutive effect of outstanding
stock options, warrants and convertible securities, whereas diluted earnings per
share includes the effect of such items. The effect of potential common stock is
not included in diluted earnings per share for the three months ended June 30,
2000 or the three months ended June 30, 1999 because the Company has incurred
net losses; therefore, the effect of the Company's dilutive securities is anti-
dilutive in those periods.

8.  COMPREHENSIVE LOSS

Total comprehensive loss, which includes net loss, unrealized gains and losses
on the Company's available-for-sale securities, and foreign currency translation
adjustments, amounted to $3,108,759 and $2,773,038, respectively, for the three
months ended June 30, 2000 and 1999.

9.  SUBSEQUENT EVENTS

On March 31, 2000, Ashton entered into an agreement to purchase the assets of a
broker-dealer, Hudson Knights Securities, LLC ("Hudson").  Hudson is a
proprietary trading firm and member of the Philadelphia Stock Exchange (PHLX).
As part of the agreement, Ashton agreed to advance $2,000,000 to Hudson under a
revolving subordinated loan agreement.  The proceeds of the loan were utilized
to fund a segregated trading account controlled by Ashton to provide contra-side
liquidity on a neutral basis to Ashton's eVWAP trading activity.  The loan is
payable on March 31, 2001, and interest, payable at a rate of 15%, is due at
maturity, less any trading losses and related costs incurred by Ashton on the
trading account.  The loan balance of $1,646,649 and $2,000,000, respectively,
is reported as due from broker-dealer on the June 30, 2000 and March 31, 2000
consolidated balance sheets.

On July 25, 2000, Ashton completed the purchase of Hudson's assets and renamed
the operation ATG Trading, LLC.  In order to effect the acquisition, Ashton
issued 30,000 shares of its common stock and paid $90,000 in cash.  ATG Trading
will provide clearing through ABN AMRO Sage Corporation, a wholly owned
subsidiary of ABN AMRO, Inc., a clearing member of all national securities
exchanges.  ATG Trading is expected to provide liquidity on a neutral basis to
all of Ashton's intelligent matching systems, including the eVWAP trading
system.  As a result of the purchase, Ashton will consolidate ATG Trading's
operating results, assets, and liabilities commencing on July 25, 2000.

                                       14
<PAGE>

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

Overview

Ashton is an evolving network of affiliated companies that develop and market
technology-based products and services which provide businesses and consumers
unique execution of financial transactions within global electronic
marketplaces. Ashton utilizes advanced telecommunication, computing, data and
information security, and Internet technologies to develop electronic
transaction and distribution systems and products for the global financial
services industry.  As of June 30, 2000, Ashton's subsidiaries and affiliated
companies include:

   1)  Universal Trading Technologies Corporation ("UTTC") and its three
       subsidiaries:
         . REB Securities, Inc. ("REB")
         . Croix Securities, Inc. ("Croix")
         . NextExchange, Inc. ("NextExchange").
   2)  Electronic Market Center, Inc. ("eMC"(TM)) and its subsidiary
         . E-Trustco.com Inc. and its subsidiary
           . The Manhattan Trust Company, Inc.
   3)  Ashton Technology Canada, Inc. ("Ashton Canada").
   4)  ATG International, Inc. ("International").
   5)  Kingsway ATG Asia, Ltd. ("KAA").
   6)  Gomez Advisors, Inc. ("Gomez").

Ashton's operating strategy is to maximize the value of each of the companies
within its network.  Ashton provides the initial strategic investment capital,
recruits or forms the management team, develops technology for the network
companies, and employs innovative financial strategies to unlock stockholder
value.  This strategy enables Ashton to leverage the collective knowledge of the
network companies and create a critical mass from which to enhance the value of
its individual businesses.

Ashton expects to generate revenues through licensing payments from its
affiliated companies for the use of Ashton-developed technology.  Each of
Ashton's majority-owned subsidiaries is expected to generate revenues based upon
a transaction-pricing model whereby users pay a transaction fee for use of the
Company's products and services.  Ashton will also seek opportunities to realize
gains through the selective sale of investments in its subsidiaries or
affiliated companies, or through the sale of minority interests to outside
investors by its subsidiaries or affiliated companies.  Management believes this
approach enhances stockholder value and provides capital to support the growth
of the Company.

Since its inception, Ashton has not realized an operating profit and has
generated a significant accumulated deficit as a result of its reported losses.
Since the inception of Gomez in May 1997, Gomez has generated substantially all
of the Company's revenues. In September 1999, Gomez commenced a private
placement of its Series C Convertible Preferred Stock.  As a result of Gomez's
sale of a portion of its Series C Preferred Stock on December 30, 1999, Ashton's
ownership percentage in Gomez was reduced to below 50%, and Ashton began
accounting for its investment in Gomez under the equity method of accounting
rather than consolidating Gomez's results of operations within the results of
the Company.  As a result, Gomez has not provided any revenues to the Company
since December 31, 1999.

The Company's limited operating history and dependence upon the operation of its
electronic volume-weighted average price trading system ("eVWAP"(TM)) make the
prediction of future operating results difficult.  Although the Company has
activated eVWAP and attempted to develop additional sources of revenue, there
can be no assurance that the Company will generate the anticipated revenues from
the operation of eVWAP or other sources.

The Company continues to invest in the development of new products, services and
affiliated companies in order to remain competitive and meet the demands of the
rapidly changing securities and financial services industries. A significant
portion of the Company's research and development efforts includes enhancements
of existing software and systems including eVWAP. The Company is also investing
in the deployment of eVWAP and other intelligent matching systems in the Asian
and Canadian markets.

                                       15
<PAGE>

The Company intends to continue to increase its investments in research and
development, sales and marketing and related infrastructure. Such increases will
be dependent upon factors including, but not limited to, operation of eVWAP,
success in hiring the appropriate personnel, successful development of new
products and services, regulatory approval of its new products and services,
market acceptance of the Company's products and services, and development of a
revenue stream from the Company's products, services and affiliated companies.
Due to such anticipated increases in the Company's operating expenses, the
Company's operating results may be materially and adversely affected.

Results of Operations

The net loss applicable to common stock totaled $3,467,533 or $0.12 per share
for the three months ended June 30, 2000, and $2,882,575 or $0.13 per share for
the three months ended June 30, 1999.  The Company incurred a net loss of
$3,114,162 or $0.11 per share for the three months ended June 30, 2000, compared
to $2,773,038, or $0.13 per share for the three months ended June 30, 1999.

The Company's revenues totaled $46,117 for the three months ended June 30, 2000,
and $794,101 for the three months ended June 30, 1999.  The revenues in the
current three-month period were generated entirely by UTTC from the operation of
the eVWAP, and the revenues in the three-month period last year were generated
entirely by Gomez.  In the three months ended June 30, 1999, $345,000, or 43% of
Gomez's revenues were from consulting and advisory engagements with clients
seeking to improve the quality of their Internet service offerings. Gomez also
generated $276,500 from advertising, sponsorship, and transaction-based
revenues, and $136,800 in revenues from subscriptions and related data and
analysis services from its GomezPro web site during the three months ended June
30, 1999.

The costs of revenues during the three months ended June 30, 1999 represent
costs associated with the delivery of Gomez's consulting and advisory services,
including the salaries for personnel providing those services.

During the three months ended June 30, 1999, the Company amortized capitalized
system development costs related to eVWAP totaling $47,677. The Company has not
capitalized computer software costs related to eVWAP since fiscal 1999 when the
application development stage was completed.

Depreciation and amortization expense consists primarily of depreciation of
property and equipment, mainly computer equipment.  Depreciation for the three
months ended June 30, 2000 decreased to $118,666 from $137,669 for the three
months ended June 30, 1999 due to the inclusion of $22,000 of depreciation
expense on Gomez property and equipment in the three months ended June 30, 1999.
Capital expenditures decreased to $185,090 for the three months ended June 30,
2000 compared to $776,065 in the same period last year.  The decrease is
primarily due to Gomez's purchase of computer equipment and software last year
to accommodate additional staff and to support the increased traffic on their
website and network servers.  Due to Ashton's decrease in ownership of Gomez in
December 1999, the results of Gomez operations are not included in the
consolidated financial statements for the three months ended June 30, 2000.

Ashton recorded a non-cash compensation charge of $10,027 in the three months
ended June 30, 2000 related to the issuance of non-employee stock options to
consultants and professional advisors. In February 1998, the Company entered
into a consulting agreement with Continental Capital & Equity Corporation
("Continental") whereby the Company issued 300,000 shares of Common Stock, with
a fair value of $475,125, in exchange for promotional services through February
1999.  During August 1998, the Company amended the consulting agreement with
Continental and the Company issued 250,000 additional shares of common stock
with a fair market value of $416,657, in exchange for additional promotional
services and a reduction in cash payments required pursuant to the previous
consulting agreement. The Company recorded the deferred consulting expenses in
1998 and 1999 as a reduction to stockholders' equity.  During the three months
ended June 30, 1999, $149,219 was reflected as a non-cash compensation charge
for the amortization of deferred consulting expenses.  The deferred consulting
expense related to the agreement with Continental was fully amortized during the
year ended March 31, 2000.

Ashton recorded a loss on trading activities of $364,615 relating to Ashton's
trading account with Hudson Knights Securities, LLC ("Hudson").  The trading
account is used by Ashton to provide contra-side liquidity on a neutral

                                       16
<PAGE>

basis to Ashton's eVWAP trading activity. The loss on trading activities
represents realized gains and losses on trades, related broker commissions and
clearing charges.

Selling, general and administrative expenses ("SG&A") totaled $2,854,343 and
$3,289,254 for the three-month periods ended June 30, 2000 and 1999,
respectively.  For the period ended June 30, 1999, Gomez's SG&A totaled
$1,570,270, or 48% of the Company's total SG&A.  Excluding Gomez, the Company's
SG&A for the three months ended June 30, 1999 totaled $1,718,984 compared to
$2,854,343 during the three months ended June 30, 2000.  The increase in SG&A is
primarily a result of the growth in staff at Ashton, UTTC and eMC.  As of June
30, 2000, Ashton and its subsidiaries employed a total of 53 employees compared
to 29 employees at June 30, 1999.

Interest income increased to $399,481 for the three months ended June 30, 2000
from $87,930 for the three months ended June 30, 1999, as a result of the higher
cash and cash equivalents and investments available for sale balances.  (see
"Liquidity and Capital Resources").

Equity in loss of affiliates for the three months ended June 30, 2000 amounted
to $204,987.  This amount represents Ashton's portion of the net loss of KAA,
which was primarily a result of unrealized losses on KAA's trading securities
portfolio.

Liquidity and Capital Resources

At June 30, 2000, the Company's consolidated total assets were $27,800,814
compared to $31,023,911 at March 31, 2000.  Current assets at June 30, 2000
totaled $25,032,995 and current liabilities were $697,280.  Stockholders' equity
at June 30, 2000 decreased to $22,103,534 from $25,162,607 at March 31, 2000 due
primarily to the net loss applicable to common stock of $3,467,533.

At June 30, 2000, the Company's principal sources of liquidity consisted of cash
and cash equivalents of $12,562,525 and securities available for sale of
$9,923,820, compared to cash and cash equivalents of $15,365,439 and securities
available for sale of $9,906,220 at March 31, 2000.  The decrease in cash and
cash equivalents and securities available for sale is primarily a result of the
net loss for the three months ended June 30, 2000 of $3,114,162.

Gomez generated substantially all of the Company's revenues for the three months
ended March 31, 2000.  As of December 31, 1999, the Company began accounting for
its remaining investment in Gomez under the equity method of accounting rather
than consolidating Gomez's results of operations with the results of the
Company.  As a result, Gomez will no longer provide any revenues to the Company.

The Company's future revenues will be dependent upon the Company's ability to
deploy its eVWAP and customer utilization of the eVWAP. The level and timing of
such revenue is dependent upon, among other factors, the Company's assumptions
regarding (i) the ramp-up of eVWAP implementation; (ii) the trading volume
experienced by eVWAP; and (iii) the pricing the Company is able to obtain for
eVWAP trade execution. Until adequate revenue is derived from eVWAP, the
Company's cash and cash equivalents, investments and cash flow from operations
will be sufficient to meet the presently anticipated cash requirements of the
Company for a period of approximately fourteen to sixteen months.

The Company believes, on a forward-looking basis, it will begin to generate more
significant revenues during its fiscal year ending March 31, 2001. On August 7,
2000, Ashton announced an increase in the number of securities available to be
traded on its eVWAP from 50 to 100. The Company recognizes that increased
liquidity is necessary to enhance the match efficiency of the eVWAP and to
attract active participation in the system. The Company's objective is to ensure
that a sufficient number of institutions indicate they are ready to actively
participate in the eVWAP. When such critical mass is obtained, the Company will
then orchestrate a "ramp-up" in system transactions.

The Company's future capital requirements will depend on many factors, including
the timing for the ramp-up of eVWAP, market acceptance of the Company's
products, the timing and extent of spending to support new products and
affiliated company development efforts and the timing of introductions of new
products and enhancements to existing products. Ashton and its subsidiaries will
require additional financing to fund development of their products and services
and launch the Canadian and Asian joint ventures. Such financing may be raised
through spin-offs, additional equity offerings, borrowings, or other
collaborative relationships, which may require Ashton to share ownership of its
subsidiaries, joint ventures, and/or revenue from products and services. The
Company may need additional financing in the future if (i) the Company
experiences unexpected costs, (ii) there are continued delays in expanding
eVWAP, or (iii) the Company fails to successfully develop markets for its
products. There can be no assurance that additional equity or debt financing, if
required, will be available on acceptable terms or at all.

                                       17
<PAGE>

Year 2000 Readiness

The "Year 2000" or "Y2K" issue is the result of the failure of certain
information systems and automated equipment to properly recognize and process
dates containing the year 2000 and beyond.  There were concerns that computer
programs and automated equipment with time sensitive software might recognize a
date using "00" as the year 1900 rather than the year 2000.  In preparation
for such possibilities, during fiscal 1999 and 2000, the Company reviewed its
potential Y2K risks arising from three primary sources: (i) internal software,
hardware and equipment utilized in the operations of the Company; (ii)
applications the Company has developed or was developing for use by its
customers; and (iii) third parties with which the Company had material
relationships.  The Company determined that none of its mission critical systems
and equipment and none of the applications it developed for customers presented
Y2K compliance issues.  None of the third party vendors with whom the Company
has material agreements experienced any Y2K compliance issues.

To date, the Company has not observed any instances that would indicate that the
Company's efforts in addressing the Year 2000 issue were not successful.  The
Year 2000 issue has not had a material impact on the Company's financial
condition, results of operations or cash flows. The possibility still exists
that interruptions to the Company and/or key customer and supplier operations or
business activities could occur as a result of lingering Y2K issues.  Such
interruptions, if they were to occur, could have a material adverse impact on
the Company's consolidated results of operations or financial condition.

                                       18
<PAGE>

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Ashton uses various management tools to monitor its exposure to market risks.
For a further discussion of the Company's market risks and risk management
policy, refer to Item 7A Quantitative and Qualitative Disclosure About Market
Risk of the Company's Annual Report on Form 10-K for the fiscal year ended March
31, 2000.


                          PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

None.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5.  OTHER INFORMATION

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(A) Exhibits

10.1    Employment Agreement, effective as of September 1, 2000, by and between
        The Ashton Technology Group, Inc., Universal Trading Technologies
        Corporation and Fredric W. Rittereiser.

27      Financial Data Schedule

(B) Reports on Form 8-K

    None

                                       19
<PAGE>

                                   SIGNATURES


In accordance with the requirements of the Securities Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.




                                        The Ashton Technology Group, Inc.
                                        ---------------------------------
                                               (Registrant)




Date:  August 14, 2000                     By:  /s/ Jennifer L. Andrews
     -----------------------                  ----------------------------
                                               Jennifer L. Andrews
                                               Vice President
                                               Chief Financial Officer

                                       20