<PAGE>
 
               UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                        

                                   FORM 10-Q/A
                                        
               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                    OF THE SECURITIES EXCHANGE ACT OF 1934
                                        
                For the Quarterly period ended January 31, 1999
                                        
                        Commission File Number 0-27830
                                        

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


           DELAWARE                                        04-3277338
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)




           400-2 Totten Pond Road, Waltham, Massachusetts 02451-2000
         (Address of principal executive offices, including Zip Code)
                                        
                                (781) 370-2700
             (Registrant's telephone number, including area code)



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

[X] YES         [_] NO


  The number of shares outstanding of the registrant's Common Stock as of
February 26, 1999 was 43,192,191.
 
<PAGE>
 
                                  Lycos, Inc.
                                        
                               Table of Contents
<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                        <C>
PART I.  FINANCIAL INFORMATION
 
ITEM 1   Unaudited Condensed Consolidated Financial Statements:
         
         Condensed Consolidated Balance Sheets

         January 31, 1999 (Restated) and July 31, 1998 (Restated).........  3
                                                                             
         Condensed Consolidated Statements of Operations                     
         Three and six months ended January 31, 1999 (Restated) 
         and 1998.........................................................  4
                                                                             
         Condensed Consolidated Statements of Cash Flows                     
         Six months ended January 31, 1999 (Restated) and 1998............  5
                                                                             
         Notes to Condensed Consolidated Financial Statements (Restated)..  7
                                                                      
ITEM 2   Management's Discussion and Analysis of Financial Condition  
         and Results of Operations........................................ 13
                                                                      
PART II  OTHER INFORMATION                                            
                                                                      
ITEM 1   Legal Proceedings................................................ 17
                                                                      
ITEM 2   Change in Securities............................................. 18
                                                                      
ITEM 3   Defaults Upon Senior Securities.................................. 18
                                                                      
ITEM 4   Submission of Matters to a Vote of Securities Holders............ 18
                                                                      
ITEM 5   Other Information................................................ 18
                                                                      
ITEM 6   Exhibits and Reports on Form 8-K................................. 18
                                                                      
         Signature........................................................ 19
</TABLE>
                                        

                                       2
<PAGE>
 
                                  LYCOS, INC.
                                        
                     CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                 January 31,        July 31,
                                                    1999              1998
                                               --------------     -------------
                   Assets                      (Unaudited and       (Restated)
                                                  Restated)
<S>                                          <C>                <C>
Current assets:                                               
  Cash and cash equivalents................    $ 135,167,427      $ 153,728,200
  Accounts receivable, net.................       14,572,378         10,958,470
  License fees receivable..................       32,179,025         30,223,986
  Prepaid expenses.........................       15,561,377          5,559,842
  Other current assets.....................          728,852            326,292
                                               -------------      -------------
     Total current assets..................      198,209,059        200,796,790
                                               -------------      -------------
                                                              
Property and equipment, less accumulated                      
  depreciation.............................        5,733,803          3,960,059
Long-term license fees receivable..........       27,996,234         21,537,371
Investments................................       12,836,593          8,874,568
Intangible assets, net.....................      215,696,730         78,787,554
Other assets...............................        4,442,304          3,278,994
                                               -------------      -------------
     Total assets..........................    $ 464,914,723      $ 317,235,336
                                               =============      =============
                                                              
    Liabilities and Stockholders' Equity                          

Current liabilities:                                          
  Accounts payable.........................    $   1,534,757      $   4,873,302
  Accrued expenses.........................       13,199,130         17,277,168
  Deferred revenues........................       34,234,056         30,730,390
  Billings in excess of revenues...........          251,298            681,849
  Current portion of long-term debt........        1,393,039            171,783
                                               -------------      -------------
     Total current liabilities.............       50,612,280         53,734,492
                                                              
Deferred revenues..........................       27,839,338         26,159,754
Long-term debt, less current portion.......        1,220,357            140,749
Other liabilities..........................           26,667             36,667
                                               -------------      -------------
                                                  29,086,362         26,337,170
                                                              
Commitments and contingencies                             --                 --
                                                              
Stockholders' equity:                                         
  Common stock.............................          438,821            389,916
  Additional paid-in capital...............      440,966,418        278,126,582
  Treasury stock, at cost..................         (984,600)          (984,593)
  Deferred compensation....................          (93,070)          (116,338)
 Accumulated deficit.......................      (57,600,476)       (40,251,893)
  Accumulated other comprehensive income...        2,488,988                 --
                                               -------------      -------------
     Total stockholders' equity............      385,216,081        237,163,674
                                               -------------      -------------
     Total liabilities and stockholders' 
      equity...............................    $ 464,914,723      $ 317,235,336
                                               =============      =============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                       3
<PAGE>
 
                                  LYCOS, INC.
                                        
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                      Three Months Ended                               Six Months Ended
                                                          January 31,                                    January 31,
                                               -----------------------------------             ------------------------------------
                                                  1999                   1998                      1999                    1998
                                               ------------            -----------             ------------             -----------
                                                (Restated)                                      (Restated)
<S>                                            <C>                    <C>                      <C>                      <C>
Revenues:
  Advertising.............................     $ 20,888,289            $ 9,575,267             $ 38,163,129             $15,984,300
  Electronic commerce, license and other..        9,663,892              3,027,451               17,173,171               5,921,570
                                               ------------            -----------             ------------             -----------
     Total revenues.......................       30,552,181             12,602,718               55,336,300              21,905,870
Cost of revenues..........................        6,439,806              2,718,738               11,740,131               4,498,120
                                               ------------            -----------             ------------             -----------
     Gross profit.........................       24,112,375              9,883,980               43,596,169              17,407,750
Operating expenses:
  Research and development................        6,055,358              1,734,063               11,358,924               3,168,599
  Sales and marketing.....................       18,046,230              7,309,968               34,216,531              12,786,713
  General and administrative..............        3,101,519              1,001,589                5,587,745               1,945,002
  Amortization of intangible assets.......       12,277,112                101,788               23,412,997                 203,576
                                               ------------            -----------             ------------             -----------
     Total operating expenses.............       39,480,219             10,147,408               74,576,197              18,103,890
                                               ------------            -----------             ------------             -----------
Operating loss............................      (15,367,844)              (263,428)             (30,980,028)               (696,140)

Interest income, net......................        1,615,194                564,547                3,511,614               1,104,739
Gain on sale of investments...............               --                     --               10,119,831                      --
Income taxes..............................               --                     --                       --                      --
                                               ------------            -----------             ------------             -----------
Net income (loss).........................     $(13,752,650)           $   301,119             $(17,348,583)            $   408,599
                                               ============            ===========             ============             ===========
Basic and diluted net income (loss) per         
 share....................................           $(0.32)                 $0.01                   $(0.41)                  $0.01 
                                               ============            ===========             ============             ===========
Shares used in computing net income
     (loss) per share:
     Basic................................       42,956,406             28,509,500               42,433,178              28,350,122
                                               ============            ===========             ============             ===========
     Diluted..............................       42,956,406             29,638,448               42,433,178              29,415,618
                                               ============            ===========             ============             ===========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                       4
<PAGE>
 
                                  LYCOS, INC.
                                        
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                Six Months Ended
                                                                  January 31,
                                                        -------------------------------
                                                             1999                1998
                                                        ------------        -----------
                                                         (Restated)
<S>                                                    <C>                  <C>
Operating activities                                                   
Net income (loss)..................................     $(17,348,583)       $   408,599
Adjustments to reconcile net income (loss)                             
to net cash used in operating activities:                              
  Amortization of deferred compensation............           23,268             45,830
  Depreciation.....................................        1,735,624            540,762
  Amortization of intangible assets................       23,412,997            203,576
  Allowance for doubtful accounts..................          116,856            243,314
  Gain on sale of investments......................      (10,119,831)                --
Changes in operating assets and liabilities:                           
  Accounts receivable..............................       (1,384,930)          (360,426)
  License fees receivable..........................       (8,413,902)        (8,152,701)
  Prepaid expenses.................................       (8,699,045)         2,165,877
  Other current assets.............................         (402,560)          (110,511)
  Other assets.....................................       (1,137,959)            (1,345)
  Accounts payable.................................       (4,927,254)         2,293,152
  Accrued expenses.................................       (5,739,344)          (903,336)
  Deferred revenues................................        3,237,568          5,065,195
  Billings in excess of revenues...................         (430,551)        (1,605,129)
  Other liabilities................................          (10,000)           (10,000)
  Due to related parties...........................               --              5,612
                                                        ------------        -----------
Net cash used in operating activities..............      (30,087,646)          (171,531)
                                                        ------------        -----------
Investing activities                                                   
Purchase of property and equipment.................         (594,971)          (225,892)
Acquisition costs paid.............................       (1,114,101)                --
Cash proceeds from sale of available-for-sale                          
 investment........................................       12,158,790                 --
Cash acquired through acquisitions.................        1,906,467                 --
Investment in affiliates...........................       (3,511,996)                --
                                                        ------------        -----------
Net cash provided by (used in) investing                               
 activities........................................        8,844,189           (225,892)
                                                        ------------        -----------
                                                                       
Financing activities                                                   
Proceeds from exercise of stock options............        4,861,451            956,921
Proceeds from issuance of common stock                                 
 under ESPP........................................           82,522             24,965
Proceeds from notes receivable.....................          623,438                 --
Payments on notes payable..........................       (2,884,727)                --
                                                        ------------        -----------
                                                                       
Net cash provided by financing activities..........        2,682,684            981,886
                                                        ------------        -----------

Net increase (decrease) in cash and cash                               
 equivalents.......................................      (18,560,773)           584,463
                                                        ------------        -----------
                                                                       
Cash and cash equivalents at beginning of                              
 period............................................      153,728,200         40,766,258
                                                        ------------        -----------
Cash and cash equivalents at end of period.........     $135,167,427        $41,350,721
                                                        ============        ===========
</TABLE>

     See accompanying notes to condensed consolidated financial statements.

                                       5
<PAGE>
 
                                  LYCOS, INC.

          CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                        Six Months Ended
                                                          January 31,
                                                -------------------------------
                                                  1999               1998
                                                -------------  ----------------
<S>                                             <C>            <C>
Schedule of non-cash financing and                            
 investing activities:                                        
Issuance of common stock upon acquisition                     
  of WhoWhere? Inc............................  $157,994,762   $             --
 Assets and liabilities recorded                              
  upon acquisition Of WhoWhere? Inc.;                         
  Accounts receivable.........................     2,345,834                 --
  Prepaids....................................     1,302,490                 --
  Property and equipment......................     2,914,397                 --
  Notes receivable............................       623,438                 --
  Other assets................................        25,351                 --
  Notes payable...............................     5,185,591                 --
  Accounts payable............................     1,588,709                 --
  Accrued expenses............................     1,661,306                 --
  Deferred revenues...........................     1,945,682                 --
</TABLE>                                                      

         See accompanying notes to condensed consolidated statements.
                                                              

                                       6
<PAGE>

                          LYCOS, INC.                
                                                             
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)                 
                                                             
                                                             
1. The Company and Basis of Presentation                      
                                                              
  Lycos, Inc., ("Lycos" or the "Company") is a global Internet navigation
and community network that offers globally branded media properties and
aggregated content distributed primarily through the Web.  Under the "Lycos
Network" brand, Lycos provides guides to online content, aggregated third-party
content, Web search and directory services and community and personalization
features.  Lycos seeks to draw a large number of viewers to its Websites by
providing multiple destinations for identifying, selecting and accessing
resources, services, content and information on the Web.  The Company was formed
in June 1995 by CMG@Ventures L.P., a wholly-owned subsidiary of CMGI, Inc.  The
Company operates in one industry segment, generating revenue from selling
advertising, electronic commerce and licensing its products and services.  The
Company's fiscal year end is July 31.

  The accompanying unaudited consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries and have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions for Form 10-Q and Article 10 of
Regulation S-X.  In the opinion of management, these financial statements
contain all adjustments, consisting only of normal recurring adjustments,
necessary for a fair presentation of the results of these interim periods.
Certain information and related footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted, although the Company believes the
disclosures in these financial statements are adequate to make the information
presented not misleading.  These financial statements should be read in
conjunction with the Company's audited financial statements for the year ended
July 31, 1998, included in the Company's Annual Report on Form 10-K/A filed with
the Securities and Exchange Commission on April 16, 1999. The results of
operations for the interim periods shown are not necessarily indicative of the
results for any future interim period or for the entire fiscal year.

Restatement Related to Acquired In-Process Technology

  The accompanying consolidated financial statements as of and for the year
ended July 31, 1998 have been restated to reflect a change in the original
accounting for the purchase price allocations related to the acquisitions of
Tripod, Wisewire, Guestworld and WhoWhere?. In a letter (the "SEC Letter"),
dated September 9, 1998, to the American Institute of Certified Public
Accountants SEC Regulations Committee, which was made public in October 1998,
the Securities and Exchange Commission (SEC) set forth its views on purchased 
in-process research and development. Subsequent to the issuance of the SEC
Letter the staff of the SEC has reviewed various filings of the Company. As a
part of this review the management of the Company and the staff of the SEC have
had discussions with respect to the methods used to value purchased in-process
research and development that was written off at the date of acquisition. As a
result of these discussions, the Company has modified the methods used to value
purchased in-process research and development in connection with the Company's
acquisitions. This resulted in a reduction in the amount of charges for in-
process research and development from $106,639,000 to $17,280,000 and an
increase in the amounts allocated to intangible assets from $156,121,336 to
$245,480,391. The restatement does not affect previously reported net cash flows
for the periods. The effect of this restatement on previously reported
consolidated financial statements as of and for the three and six months ended
January 31, 1999 is as follows (in thousands except per share amount):

<TABLE> 
<CAPTION> 
                                          Three Months Ended              Six Months Ended    
                                           January 31, 1999               January 31, 1999     
                                           ----------------               ----------------     
Statements of Operations:               As Reported     Restated       As Reported     Restated 
                                        -----------     --------       -----------     --------
<S>                                     <C>             <C>            <C>             <C>      
In-Process research and development      $       -      $      -        $ 15,400       $      -
Amortization of intangibles                  7,809        12,277          14,605         23,413
Loss from operations                       (10,900)      (15,368)        (37,572)       (30,980)
Net Loss                                    (9,285)      (13,753)        (23,941)       (17,349)
Basic and diluted net loss per share         (0.22)        (0.32)          (0.56)         (0.41)

<CAPTION> 
                                            January 31, 1999                July 31, 1998
                                            ----------------                -------------
Balance Sheets:                         As Reported     Restated        As Reported     Restated
                                        -----------     --------        -----------     -------- 
<S>                                     <C>             <C>             <C>             <C>  
Intangible assets                        $ 140,627      $215,697         $  10,310      $ 78,788
Total assets                               389,845       464,915           248,758       317,235 
Accumulated deficit                       (132,670)      (57,600)         (108,729)      (40,252)
Total shareholders' equity                 310,147       385,216           168,687       237,164
</TABLE> 
   
2. Revenue Recognition

  The Company's advertising revenues are derived principally from short-term
advertising contracts in which the Company guarantees a number of impressions
for a fixed fee or on a per impression basis with an established minimum fee.
Revenues from advertising are recognized as the services are performed.

  Electronic commerce revenues are derived principally from "slotting fees" paid
for selective positioning and promotion within the Company's suite of products
as well as from royalties from the sale of goods and services from the Company's
Websites.  The Company's license and product revenues are derived principally
from product licensing fees and fees from maintenance and support of its
products.  Electronic commerce, license and product revenues are generally
recognized upon delivery provided that no significant Company obligations remain
and collection of the receivable is probable. In cases where there are
significant remaining obligations, the Company defers such revenue until those
obligations are satisfied. Fees from maintenance and support of the Company's
products including revenues bundled with the initial licensing fees are deferred
and recognized ratably over the service period.

  Deferred revenues are comprised of license and electronic commerce fees to be
earned in the future on noncancelable agreements at the balance sheet date.

                                       7
<PAGE>
 
                                  LYCOS, INC.
                                        
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

3. Investments

  The Company accounts for marketable securities under Statement of Financial
Accounting Standards No. 115, "Accounting for Certain Investments in Debt and
Equity Securities"(SFAS 115).  SFAS 115 establishes the accounting and reporting
requirements for all debt securities and for investments in equity securities
that have readily determinable fair value.  All affected investments must be
classified as one of the following; held-to-maturity, available-for-sale, or
trading.  All of the Company's investments are classified as available-for-sale
and, as such, are carried at fair value, with unrealized holding gains and
losses reported as a separate component of stockholders' equity.

  The Company's investments include those in which its ownership is less than
20%, and are not majority-owned or controlled, and are recorded at cost.  In
March, 1998, the Company acquired a 9.9% interest in GlobeComm, Inc. (iName), a
leading global provider of free Web-based e-mail products, in exchange for
shares of the Company's Common Stock valued at $4.0 million at the time of the
transaction.  Lycos utilizes GlobeComm's e-mail products to provide free Web
based e-mail to Lycos users.  Additionally, in April 1998, the Company acquired
an approximate 14% ownership stake in Sage Enterprises, Inc. (PlanetAll) which,
at the time, was owned 29% by CMGI, a related party,  in exchange for shares of
the Company's Common Stock valued at $2.5 million at the time of the
transaction.  Launched in November 1997, PlanetAll provides free core contact
management services through the Internet.

  In August 1998, pursuant to an Agreement and Plan of Merger, Amazon.com
acquired all of the outstanding capital stock of PlanetAll for approximately
2,400,000 shares (effected for a three-for-one stock split of Amazon.com in
January 1999) of Amazon.com common stock valued at approximately $87 million.
Of the total 2,400,000 shares issued by Amazon.com, the Company received 322,128
shares valued at approximately $12.8 million at the time of acquisition in
exchange for its shares of PlanetAll, resulting in a gain of $10.1 million in
the quarter ended October 31, 1998.  The Company sold 289,917 shares of
Amazon.com in October 1998, resulting in $12.2 million of cash proceeds.  The
Company has 32,211 shares of Amazon.com remaining at January 31, 1999, which are
subject to escrow restrictions that expire in August 1999.

  In December 1998, the Company invested $2,000,045 in cash for a 16.70%
ownership of Valent Software Corporation (Valent).  Valent is the owner of
software that enables users to create open and gated communities on the Internet
and that facilitates instant messaging among users over the Internet.  The
agreement also grants the Company an option to acquire all of the remaining
outstanding capital shares of Valent.  The option is exercisable in a five day
window one year from the date of the Company's initial investment of $2,000,045.
Valent has the ability to accelerate the period in which the option is
exercisable to a ten day window any time prior to June 30, 1999 if Valent's Web
site achieves certain performance measures with respect to registered users and
member logins.  If the Company elects to exercise the option, the Company would
acquire the remaining 83.3% of Valent in exchange for 403,883 shares of the
Company's common stock.  The Company may only elect to exercise the option in
full, bringing the Company's ownership of Valent from 16.70% to 100%.

4.  Comprehensive Income (Loss)

  The Company adopted Statement of Financial Accounting Standard No. 130 (SFAS
130), "Reporting Comprehensive Income" during the quarter ended October 31,
1998.  SFAS 130 establishes standards for the reporting and display of
comprehensive income and its components in the financial statements.
Comprehensive income as defined includes all changes in equity during a period
from non-owner sources.  Examples of items to be included in comprehensive
income, which are excluded from net income, include foreign currency translation
adjustment and unrealized gains and losses on available-for-sale securities.
Comprehensive loss was $11,343,518 and $14,859,595 for the three and six month
periods ended January 31, 1999, respectively.  The difference between net loss
and comprehensive loss for the three and six months ended January 31, 1999 is
due to $2,409,132 and $2,488,988, respectively of unrealized gains on the
Company's remaining investment in Amazon.com, which is classified as an
available-for-sale investment under SFAS 115.  The Company had no "other
comprehensive income" items in the three and six month periods ended January 31,
1998.

                                       8
<PAGE>
 
                                  LYCOS, INC.
                                        
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                                        
5. Commitments and Contingencies

  The Company leases its facilities and certain other equipment under operating
lease agreements expiring through 2004. Future noncancelable minimum payments
remaining under these leases for each fiscal year end are as follows:

<TABLE>
            <S>                        <C>
            1999                        $ 5,682,940
            2000                          8,568,910
            2001                          4,268,758
            2002                          2,830,415
            2003 and thereafter           1,102,724
                                        -----------
                                        $22,453,747
                                        ===========
</TABLE>

  The Company is subject to legal proceedings and claims which arise in the
ordinary course of its business.  In the opinion of management, the amount of
ultimate liability with respect to these actions will not materially affect the
financial position, results of operations or cash flows of the Company.

6. Stock Split

  In July 1998, the Company's Board of Directors approved a two-for-one common
stock split.  Shareholders of record on August 14, 1998 (the record date)
received one additional share of the Company's common stock for every share held
on August 25, 1998.  All share and per share amounts presented in the condensed
consolidated financial statements have been restated to reflect the stock split.

7. Significant Agreements

  During the quarter ended October 31, 1998, the Company paid approximately $19
million under contracts to provide search and navigation services between June
1998 and September 1999 (the "Premier Provider Agreements").  The Company
recognizes the cost of the Premier Provider Agreements over the one year terms,
with the cost included in sales and marketing expense.

8. Acquisitions

Acquisition of WhoWhere? Inc.

  On August 7, 1998, the Company entered into an Agreement and Plan of Merger
(the "Agreement") by and among the Company, What Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of the Company ("WWAC"), WhoWhere?
Inc., a California  corporation ("WhoWhere?"), and certain shareholders of
WhoWhere? providing for the merger of WWAC with and into WhoWhere?  (the
"Merger").  On August 13, 1998, the Company completed the closing of the Merger
and WhoWhere? became a wholly-owned subsidiary of the Company.  Of the total
purchase price of $159.1 million, $144.9 million was allocated to developed
technology, goodwill and other intangible assets which are amortized over a
period of five years.

  Under the terms of the Agreement and related Escrow Agreement dated August 13,
1998, an aggregate of 377,038 shares of Lycos Common Stock and options and
warrants to purchase an additional 133,540 shares of Lycos Common Stock will be
held in escrow for the purpose of indemnifying the Company against certain
liabilities of WhoWhere? and its stockholders. The escrow will expire on 
August 13, 1999.

                                       9
<PAGE>
 
                                  LYCOS, INC.
                                        
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                                        
8. Acquisitions (continued)

  Pro forma financial information for the six months ended January 31, 1999 is
not materially different than the Company's actual consolidated results as
reported, which do not include the results from operations of WhoWhere for the
twelve days from August 1, 1998 to August 12, 1998. Unaudited combined pro forma
financial information for the three months ended January 31, 1998, assuming the
WhoWhere? acquisition had occurred on August 1, 1997, would have resulted in net
revenues of $13.8 million, net loss of $7.2 million, and basic and diluted net
loss per share of $.21. Unaudited combined pro forma financial information for
the six months ended January 31, 1998, assuming the WhoWhere? acquisition had
occurred on August 1, 1997, would have resulted in net revenues of 
$23.9 million, net loss of $19.2 million, and basic and diluted net loss per
share of $.59. The pro forma net loss includes amortization of developed
technology, goodwill and other intangible assets of $8.1 million and $16.2
million for the three and six months ended January 31, 1998, respectively. The
unaudited pro forma information is for illustrative purposes only and is not
necessarily indicative of the actual results of operations had the acquisition
occurred on August 1, 1997, nor the results of any future period.

Acquisition of Wired Ventures, Inc.

  On October 5, 1998, the Company entered into a definitive merger agreement to
acquire Wired Ventures Inc. ("Wired") in a stock-for-stock transaction.  The
transaction will be accounted for under the purchase method of accounting, and
accordingly, the purchase price will be allocated to assets acquired and
liabilities assumed based on their respective fair values.  Intangible assets
will be amortized over a period of five years.  The merger is subject to several
conditions, including approval of Wired's shareholders and the Federal Trade
Commission.  The Company has filed a Registration Statement on Form S-4, which
is pending the approval of the Securities and Exchange Commission, with respect
to the registration of the shares of Lycos Common Stock to be issued in the
merger.

  The following represents the preliminary allocation of the purchase price over
the historical net book values of the acquired assets and liabilities of Wired
at December 31, 1998, and is presented for illustrative purposes only.  Actual
fair values will be based on financial information as of the acquisition date.
Based on preliminary estimates, approximately $1 million to $5 million of the
purchase price will be allocated to in-process research and development expense
which will be charged to operations during the quarter in which the merger
agreement is consummated.  For the purpose of the following presentation, 
$5 million was used as the amount of acquired in-process research and
development. The following illustration assumes the Company issues approximately
2.2 million shares at $87.625 per share, which represents the closing price of
the Company's common stock on February 26, 1999.

The estimated purchase price is expected to be allocated as follows (in
thousands):
<TABLE>
<S>                                                             <C>
 Developed technology, goodwill and other intangible        
  assets                                                         $216,269
 In-process research and development                                5,000
 Cash                                                              37,254
 Other assets, principally accounts receivable                           
  and equipment                                                    16,489
 Liabilities assumed                                              (15,678)
 Redeemable convertible preferred stock                           (24,558)
                                                                 --------
                                                                 $234,776
                                                                 ========
</TABLE>

Additional information with respect to the proposed transaction is available on
Form S-4 filed with the Securities and Exchange Commission on November 25, 1998
as amended on February 2, 1999.

                                       10
<PAGE>
 
                                  LYCOS, INC.
                                        
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                                        

9.   Reclassifications

  Certain amounts in the three and six months ended January 31, 1998 have been
reclassified to permit comparison to the current periods presented.


10. Subsequent Event

Merger with Home Shopping Network, Ticketmaster and Ticketmaster Online - 
    CitySearch 

  On February 9, 1999, the Company announced the formation of USA/Lycos
Interactive Networks, Inc.("USA/Lycos"), a three way merger between Lycos,
Ticketmaster Online-CitySearch, Inc. ("TMCS") and certain USA Networks, Inc.
("USAi") properties; Home Shopping Network, Ticketmaster and First Auction.
Under the terms of the proposed merger agreement, Lycos shareholders will own
30% of USA/Lycos, USAi will own 61.5% and TMCS shareholders other than USAi will
own 8.5% of USA/Lycos. Additionally, Lycos shareholders can increase their
ownership another 5%, to a total of 35%, and TMCS public shareholders can
increase their ownership by 0.15%, to a total of 8.65%, should the initial
USA/Lycos shares achieve a market value of $45 billion over specified periods.

  The transaction is expected to be completed in the second quarter of calendar
1999 and is subject to Lycos shareholder approval and customary regulatory
approvals.  Additional information with respect to the proposed transaction is
available on Forms 8-K filed with the Securities and Exchange Commission on
February 11, 1999 and February 26, 1999.

Litigation

     The Company is subject to several purported class action lawsuits. The 
compliants allege, among other claims, violations of the United States federal 
securities law through alleged misrepresentations relating to the Company's 
agreement to enter into an announced transaction with USA Networks, Inc. and 
certain affiliated companies. Each compliant seeks an unspecified award of 
damages. The Company believes that the allegations in the compliants are without
merit and intends to contest them vigorously.

                                       11
<PAGE>
 
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

  This quarterly report on Form 10-Q/A amends and supersedes, to the extent set 
forth herein, the Registrant's quarterly report on Form 10-Q for the three and 
six months ended January 31, 1999 previously filed on March 16, 1999. As more 
particularly set forth below, the following financial and related information 
has been updated in connection with the filing of the related financial 
statements included herein.

  The matters discussed in this report contain forward-looking statements that
involve risks and uncertainties. The Company's actual results could differ
materially from those discussed herein. Factors that could cause or contribute
to such differences include, but are not limited to, those discussed in this
section and elsewhere in this Report, and the risks discussed in the "Factors
Affecting the Company's Business, Operating Results and Financial Condition"
section included in the Company's 1998 Annual Report on Form 10-K/A filed with
the Securities and Exchange Commission on April 16, 1999.

Results of Operations

Restatement Related to Acquired In-Process Technology

  The accompanying consolidated financial statements as of and for the year
ended July 31, 1998 have been restated to reflect a change in the original
accounting for the purchase price allocations related to the acquisitions of
Tripod, Wisewire, Guestworld and WhoWhere?. In a letter (the "SEC Letter"),
dated September 9, 1998, to the American Institute of Certified Public
Accountants SEC Regulations Committee, which was made public in October 1998,
the Securities and Exchange Commission (SEC) set forth its views on purchased 
in-process research and development. Subsequent to the issuance of the SEC 
Letter the staff of the SEC has reviewed various filings of the company. As 
part of this review the management of the Company and the staff of the SEC 
have had discussions with respect to the methods used to value purchased 
in-process research and development that was written off at the date of 
acquisition. As a result of these discussions, the Company has modified the
methods used to value purchased in-process research and development in
connection with the Company's acquisitions. This resulted in a reduction in the
amount of charges for in-process research and development from $106,639,000 to
$17,280,000 and an increase in the amounts allocated to intangible assets from
$156,121,336 to $245,480,391. The restatement does not affect previously
reported net cash flows for the periods. The effect of this restatement on
previously reported consolidated financial statements as of and for the three
and six months ended January 31, 1999 is as follows (in thousands except per
share amount):

<TABLE> 
<CAPTION> 
                                          Three Months Ended              Six Months Ended    
                                           January 31, 1999               January 31, 1999     
                                           ----------------               ----------------     
Statements of Operations:               As Reported     Restated       As Reported     Restated 
                                        -----------     --------       -----------     --------
<S>                                     <C>             <C>            <C>             <C>      
In-Process research and development      $       -      $      -        $ 15,400       $      -
Amortization of intangibles                  7,809        12,277          14,605         23,413
Loss from operations                       (10,900)      (15,368)        (37,572)       (30,980)
Net Loss                                    (9,285)      (13,753)        (23,941)       (17,349)
Basic and diluted net loss per share         (0.22)        (0.32)          (0.56)         (0.41)

<CAPTION> 
                                            January 31, 1999                July 31, 1998
                                            ----------------                -------------
Balance Sheets:                         As Reported     Restated        As Reported     Restated
                                        -----------     --------        -----------     -------- 
<S>                                     <C>             <C>             <C>             <C>  
Intangible assets                        $ 140,627      $215,697         $  10,310      $ 78,788
Total assets                               389,845       464,915           248,758       317,235 
Accumulated deficit                       (132,670)      (57,600)         (108,729)      (40,252)
Total shareholders' equity                 310,147       385,216           168,687       237,164
</TABLE> 

  Total Revenues    Total revenues for the three and six months ended 
January 31, 1999 were $30.6 million and $55.3 million versus $12.6 million and
$21.9 million for the three and six months ended January 31, 1998, as a result
of growth in the number of advertisers. As of January 31, 1999, deferred
revenues, including billings in excess of revenues, increased to $62.3 million,
compared to $57.6 million at July 31, 1998, attributable to increases in
advertising contracts and guaranteed commitments under license and electronic
commerce agreements for which there are significant obligations of the Company
remaining.

  Advertising Revenues    Advertising revenues were $20.9 million and 
$38.2 million for the three and six months ending January 31, 1999, representing
68% and 69% of total revenues, as compared to advertising revenues of 
$9.6 million and $16.0 million for the three and six months ended January 31,
1998, which represented 76% and 73% of total revenues. The top ten customers
accounted for 13% of advertising revenues in the quarter ended January 31, 1999
as compared to 30% of advertising revenues in the quarter ended January 31,
1998.

  The Company currently derives a substantial portion of its revenues from the
sale of advertisements on its Websites, primarily through banner advertisements
and sponsorships. Advertising contracts are primarily sold as: (1) a "run of
site" contract under which a customer is guaranteed a number of impressions; (2)
a "key word" contract in which a customer purchases the right to advertise in
connection with specified word searches; or (3) a "targeted" contract where the
customer purchases a specified number of impressions in one of the targeted
categories or on a specified page or service.

  Electronic Commerce, Licensing and Other Revenues    Electronic commerce,
licensing and other revenues were $9.7 million and $17.2 million for the three
and six months ending January 31, 1999, representing 32% and 31% of total
revenues, as compared to electronic commerce, licensing and other revenues of
$3.0 million and $5.9 million for the three and six months ended January 31,
1998, which represented 24% and 27% of total revenues. The increase in
electronic commerce, licensing and other revenues is attributable primarily to
the addition of several new partners including, among others, AT&T and Preview
Travel.

  Electronic commerce revenues are derived principally from "slotting fees" paid
for selective positioning and promotion within the Company's suite of products
as well as from royalties from the sale of goods and services from the Company's
websites.  The Company's license and product revenues are derived principally
from product licensing fees and fees from maintenance and support of its
products. Electronic commerce, license and product revenues are generally
recognized upon delivery provided that no significant Company obligations remain
and collection of the receivable is probable. In cases where there are
significant remaining obligations, the Company defers such revenue until those
obligations are satisfied. Fees from maintenance and support of the Company's
products including revenues bundled with the initial licensing fees are deferred
and recognized ratably over the service period.

  Cost of Revenues    Cost of revenues were $6.4 million and $11.7 million for
the three and six months ending January 31, 1999, representing 21% and 21% of
total revenues, as compared to cost of revenues of $2.7 million and $4.5 million
for the three and six months ended January 31, 1998, which represented 22% and
21% of total revenues. Cost of revenues consist primarily of expenses associated
with the ongoing maintenance and support of the Company's products and services,
including compensation, consulting fees, equipment costs, networking and other
related indirect costs.

                                       12
<PAGE>
 
Operating expenses

  Research and Development    Research and development expenses were $6.1
million and $11.4 million for the three and six months ending January 31, 1999,
representing 20% and 21% of total revenues, as compared to research and
development expenses of $1.7 million and $3.2 million for the three and six
months ended January 31, 1998, which represented 14% and 15% of total revenues.
Research and development expenses consist primarily of equipment and salary
costs. The overall increase in research and development expenses was primarily
due to increased engineering staffing to continue to develop and enhance the
Company's expanded product offerings.

  With the exception of technology acquired in the Tripod, WiseWire and
WhoWhere? acquisitions, all research and development costs have been expensed as
incurred.  The Company believes that significant investments in research and
development are required to remain competitive.  As a consequence, the Company
expects to continue to commit substantial resources to research and development
in the future.
                                                   
                                       13
<PAGE>
 
  Sales and Marketing    Sales and marketing expenses were $18.0 million and
$34.2 million for the three and six months ending January 31, 1999, representing
59% and 62% of total revenues, as compared to sales and marketing expenses of
$7.3 million and $12.8 million for the three and six months ended January 31,
1998, which represented 58% and 58% of total revenues. Sales and marketing
expenses consist primarily of compensation, advertising, public relations, trade
shows, travel and costs of marketing literature. The spending increases were due
to the addition of sales and marketing personnel, increased commissions
associated with higher sales, and expenses pertaining to the Company's expanded
advertising, marketing and public relations campaign. Sales and marketing
expense also includes the cost of the Company's ''Premier Provider'' Agreements,
as further described below.  The Company expects continued increases in sales
and marketing expenses in future periods.

  During the six months ended January 31, 1999, the Company paid approximately
$19 million under Premier Provider Agreements to provide search and navigation
services between June 1998 and September 1999.  The Company recognizes the cost
of the Premier Provider Agreements over the one year terms, with the cost
included in sales and marketing expense.

  General and Administrative    General and administrative expenses were $3.1
million and $5.6 million for the three and six months ending January 31, 1999,
representing 10% and 10% of total revenues, as compared to general and
administrative expenses of $1.0 million and $1.9 million for the three and six
months ended January 31, 1998, which represented 8% and 9% of total revenues.
General and administrative expenses consist primarily of compensation, rent
expenses and fees for professional services. The increases in spending were
primarily due to the expansion of the Company's corporate infrastructure,
including the addition of finance and administrative personnel, installation of
information systems and increased costs for professional services.

  Amortization of Intangible Assets     Amortization of intangible assets was
$12.3 million and $23.4 million for the three and six months ended January 31,
1999 versus $102,000 and $204,000 for the three and six months ended January 31,
1998. The increase is attributable to increased amortization related to
developed technology and goodwill and other intangible assets recorded upon the
acquisitions of WhoWhere?, Tripod, WiseWire and GuestWorld.

  Interest Income, net    Interest income was $1.6 million and $3.5 million for
the three and six months ending January 31, 1999, as compared to interest income
of $565,000 and $1.1 million for the three and six months ended January 31,
1998.  Interest income is generated from investment of the Company's cash
equivalents. The increase in interest income reflects the investment of the net
proceeds of the Company's secondary stock offering in June 1998.  Interest
expense was not significant in any of the periods presented.

  Gain on sale of Investments     In August 1998, pursuant to an Agreement and
Plan of Merger, Amazon.com acquired all of the outstanding capital stock of
PlanetAll for approximately 2,400,000 shares of Amazon.com common stock valued
at approximately $87 million.  Of the total 2,400,000 shares issued by
Amazon.com, the Company received 322,128 shares valued at approximately $12.8
million at the time of acquisition in exchange for its shares of PlanetAll,
resulting in a gain of $10.1 million in the quarter ended October 31, 1998.  The
Company has 32,211 shares of Amazon.com remaining at January 31, 1999, which are
subject to escrow restrictions that expire in August 1999.

Factors which may affect future operations

  There are a number of business factors which singularly or combined may affect
the Company's future operating results.  These factors include, without
limitation, the level of usage of the Internet and traffic to the Company's
Internet site, continued acceptance of the Company's products, demand for
Internet advertising, seasonal trends in advertising sales, the advertising
budgeting cycles of individual advertisers, capital expenditures and other costs
relating to the expansion of operations, the introduction of new products or
services by the Company or its competitors, the mix of the services sold and the
channels through which those services are sold, pricing changes, general
economic conditions and specific economic conditions in the Internet industry
and other risks detailed in the Company's filings with the Securities and
Exchange Commission.

                                       14
<PAGE>
 
  In addition, other risks and uncertainties that could impact the proposed
business combinations with Wired Ventures, Inc., and with certain USA Networks,
Inc. properties and Ticketmaster Online-CitySearch, Inc. discussed below
include, but are not limited to, the satisfaction of conditions to consummation
of the proposed transaction, the risk that the anticipated strategic and
financial benefits of the proposed transaction may not be achieved, or may not
be achieved within the time frame envisioned, general economic conditions and
specific economic conditions in the  Internet and media industries, including
the volatility of capital markets in respect to the securities of Internet and
media companies, and other risks detailed in the filings of the Company,
Ticketmaster Online-CitySearch, Inc. and USA Networks, Inc. with the Securities
and Exchange Commission.

Liquidity and Capital Resources

  At January 31, 1999, the Company had cash and cash equivalents of
approximately $135.2 million. The Company regularly invests excess funds in
short-term money market funds, government securities and commercial paper.

  The Company used cash from operations of approximately $30.2 million during
the six months ended January 31, 1999, due primarily to increases in license
fees receivable and prepaid expenses, and decreases in accrued expenses.  The
increase in prepaid expenses reflects approximately $19 million in payments made
under the Company's Premier Provider Agreements, which provide search and
navigation services through September 1999.

  The Company generated cash from investing activities of approximately $8.8
million during the six months ended January 31, 1999, due primarily to cash
proceeds from the sale of Amazon.com stock in October 1999, net of approximately
$3.5 million of investments, primarily the Company's $2 million investment in
Valent Software Corporation in December 1998.

  The Company generated cash from financing activities of approximately $2.8
million during the six months ended January 31, 1999, due primarily to proceeds
of $4.9 million received by the Company from the exercise of employee stock
options, net of $2.7 million of payments on notes payable assumed upon the
acquisition of WhoWhere?.

  As of January 31, 1999, the Company is committed to noncancelable minimum
payments totaling $22.5 million under operating lease agreements that expire at
various times through 2003.

  As of January 31, 1999, the Company had deferred revenues of $62.1 million
representing primarily license fees to be earned in the future on noncancelable
license agreements.  In addition, the Company had billings in excess of revenues
from advertising contracts of $251,000 at January 31, 1999.

  The Company currently believes that available funds and cash flows expected to
be generated by operations, if any, will be sufficient to fund its working
capital and capital expenditures requirements for at least the next twelve
months. Thereafter, the Company may need to raise additional funds. The Company
may need to raise additional funds sooner in order to fund more rapid expansion,
to develop new or enhanced products and services, to respond to competitive
pressures or to acquire complementary businesses or technologies. If additional
funds are raised through the issuance of equity securities, the percentage
ownership of the stockholders of the Company will be reduced, stockholders may
experience additional dilution, and such equity securities may have rights,
preferences or privileges senior to those of the Company's Common Stock. There
can be no assurance that additional financing will be available when needed on
terms favorable to the Company or at all.  If adequate funds are not available
or are not available on acceptable terms, the Company may be unable to develop
or enhance products or services, take advantage of future opportunities or
respond to competitive pressures, which could have a material adverse effect on
the Company's business, results of operations or financial condition.

                                       15
<PAGE>
 
Proposed Business Combinations

  On October 5, 1998, the Company entered into a definitive merger agreement to
acquire Wired Ventures Inc. ("Wired") in a stock-for-stock transaction.  The
transaction will be accounted for under the purchase method of accounting, and
accordingly, the purchase price will be allocated to assets acquired and
liabilities assumed based on their respective fair values.  Intangible assets
will be amortized over a period of five years.  The merger is subject to several
conditions, including Wired shareholder approval and customary regulatory
approvals.  The Company has filed a Registration Statement on Form S-4, which is
pending the approval of the Securities and Exchange Commission, with respect to
the registration of the shares of Lycos Common Stock to be issued in the merger.
Additional information with respect to this proposed transaction is available on
Form S-4 filed with the Securities and Exchange Commission on November 25, 1998,
and amended on February 2, 1999.

  On February 9, 1999, the Company announced the formation of USA/Lycos
Interactive Networks, Inc.("USA/Lycos"), a three way merger between Lycos,
Ticketmaster Online-CitySearch, Inc. ("TMCS") and certain USA Networks, Inc.
("USAi") properties  Home Shopping Network, Ticketmaster and First Auction.
Under the terms of the proposed merger agreement, Lycos shareholders will own
30% of USA/Lycos, USAi will own 61.5% and TMCS shareholders other than USAi will
own 8.5% of USA/Lycos.  Additionally, Lycos shareholders can increase their
ownership another 5%, to a total of 35%, and TMCS public shareholders can
increase their ownership by 0.15%, to a total of 8.65%, should the initial
USA/Lycos shares achieve a market value of $45 billion over specified periods.
This transaction is expected to be completed in the second quarter of calendar
1999 and is subject to Lycos shareholder and customary regulatory approvals.

  Additional information with respect to the proposed transaction is available
on Forms 8-K filed with the Securities and Exchange Commission on February 11,
1999 and February 26, 1999.

Year 2000 Compliance

  Many currently installed computer systems and software products are coded to
accept only two-digit entries in the date code field and cannot distinguish 21st
century dates from 20th century dates. These date code fields will need to
distinguish 21st century dates from 20th century dates and, as a result, many
companies' software and computer systems may need to be upgraded or replaced in
order to comply with such "Year 2000" requirements.
 
  State of Readiness     The Company has evaluated the year 2000 readiness of
the hardware and software products sold by the Company ("Products"), the
information technology systems used in its operations ("IT Systems"),  and its
non-IT Systems, such as building security, voice mail and other systems.  The
Company's evaluation covered the following phases: (i) identification of all
Products, IT Systems, and non-IT Systems; (ii) assessment of repair or
replacement requirements; (iii) repair or replacement; (iv) testing; 
(v) implementation; and (vi) creation of contingency plans in the event of year
2000 failures. The evaluation was completed in 1998. Based on this evaluation,
the Company believes it is year 2000 compliant.

  However, the assessment of whether a complete system or device in which a
product is embedded will operate correctly for an end-user depends in large part
on the year 2000 compliance of the product or system's other components, many of
which are supplied by parties other than the Company.  The supplier of the
Company's current financial and accounting software has informed the Company
that such software is year 2000 compliant. Further, the Company relies, both
domestically and internationally, upon various vendors, governmental agencies,
utility companies, telecommunications service companies, delivery service
companies and other service providers who are outside of the Company's control.
There is no assurance that such parties will not suffer a year 2000 business
disruption, which could have a material adverse effect on the Company's
financial condition and results of operations.

  Costs     To date, the Company has not incurred any material expenditures in
connection with identifying or evaluating year 2000 compliance issues.  Most of
its expenses have related to the opportunity cost of time spent by employees of
the Company evaluating its software, the current versions of its products, and
year 2000 compliance matters generally.

  Contingency Plan     The Company has not developed a year 2000-specific
contingency plan.  If year 2000 compliance issues are discovered, the Company
then will evaluate the need for contingency plans relating to such issues.

                                       16
<PAGE>
 
                                    PART II

ITEM 1.  Legal Proceedings

          On November 5, 1998, Labrador Software, Inc. filed a lawsuit in the
      United States District Court for the District of Massachusetts against
      Lycos alleging Lycos violated several of Labrador's rights under 15 U.S.C.
      1125, and Massachusetts statutory and common law. More specifically,
      Labrador alleges that Lycos' current advertising campaign featuring a
      black labrador retriever retrieving information on the Internet
      constitutes: (1) both unfair competition and trademark infringement under
      both federal and common law; (2) injury to Labrador's business reputation
      and trademark dilution under Massachusetts statutory and common law; and
      (3) unfair and deceptive trade practices under Massachusetts statutory
      law. Labrador requested that the court issue a temporary restraining order
      restraining Lycos from selling or advertising the Lycos products and
      services under the current advertising campaign, which request the court
      denied. Labrador has appealed the order denying the motion. Lycos is
      vigourously defending against the lawsuit and does not believe the outcome
      would have a material adverse effect on its business, financial condition,
      results of operations or cash flows.

          In January 1999, CIVIX-DDI brought a suit for patent infringement in
      the United States District Court for the District of Colorado 
      (Case No. 99-B-172) against Lycos, Inc.; Microsoft Corporation; The Denver
      Post Corporation; Rand-McNally & Company, Inc.; Delorme Publishing
      Company, Inc.; InfoUSA, Inc.; Geosystems Global Corporation; Vicinity
      Corporation; Etak, Inc.; America Online, Inc.; Yahoo!, Inc.; Ticketmaster
      Online-CitySearch, Inc.; Zip2 Corporation; Infoseek Corporation; Alpine
      Electronics of America, Inc.; Magellan Corporation; Garmin International,
      Inc.; Excite, Inc.; Infospace.com, Inc.; and BellSouth Corporation. CIVIX-
      DDI asserts that Lycos, among others, infringes two patents that generally
      relate to electronic mapping systems. CIVIX-DDI is seeking unspecified
      damages, including attorneys' fees, as well as an injunction. Lycos'
      answer to the complaint is due on March 29, 1999. Discovery has not yet
      begun in this litigation, and as such, it is too early to determine any
      possible effect on the Company's business, financial condition, results of
      operations or cash flows.

          Eight purported class action lawsuits were filed in the Court of
      Chancery for the State of Delaware in and for New Castle County, by
      shareholders of the Company allegedly on behalf of all common stockholders
      of the Company (except defendants and their affiliates), entitled Jacob
      Horowitz v. David S. Wetherell et al., Civil Action No. 16933-NC (filed
      Feb. 9, 1999); Robert Johnson v. Robert J. Davis et al., Civil Action No.
      16937-NC (filed Feb. 9, 1999); Debra Mayer v. David S. Wetherell et al.,
      Civil Action No. 16947-NC (filed Feb. 11, 1999); Ellis Investment Co., Ltd
      v. David S. Wetherell et al., Civil Action No.. 16951-NC (filed Feb. 11,
      1999); Frederick Sheehan v. David S. Wetherell et al., Civil Action No.
      16952-NC (filed Feb. 11, 1999); Yorkshire Group, Inc. v. David S.
      Wetherell et al., Civil Action No. 16955-NC (filed Feb. 12, 1999); Warren
      Ciafardini v. David S. Wetherell et al., Civil Action No. 16956-NC (filed
      Feb. 12, 1999); Martin Lewkowicz, on behalf of himself and all others
      similarly situated v. Lycos, Inc. et al., Civil Action No. 16976-NC (filed
      Feb. 23, 1999). The complaints name as defendants the directors of the
      Company individually, as well as the Company and, in the Horowitz, Mayer,
      Ellis Investment, Sheehan, Yorkshire Group and Ciafardini complaints, USA
      Networks, Inc. The complaints allege that the directors of the Company
      violated their state law fiduciary duties owed to plaintiffs and the
      purported class by agreeing to enter into the announced transaction with
      USA Networks, Inc.  The complaints request that the Court declare them to
      be proper class actions, enjoin the announced transaction, rescind the
      announced transaction if it is consummated prior to a final judgment or
      award rescissionary damages to the purported class, direct the Company to
      make an accounting to plaintiffs and the purported class for all damages
      and for all profits or special benefits obtained by the defendants, and
      award to plaintiffs all costs and fees, including attorneys' fees.  The
      Company believes that the allegations in the complaints are without merit
      and intends to contest them vigorously.

          Between February 22, 1999 and March 10, 1999, a series of purported
      securities class action lawsuits were filed in the United States District
      Court for the District of Massachusetts, entitled Kenneth R. Levine v.
      Lycos, Inc., et al., CA No. 99-10394(EFH), Thomas Lynch v. Lycos, Inc., et
      al., CA No. 99-10426(EFH), Mary Jane Crescente v. Lycos, Inc., et al., CA
      No. 99-10467(EFH), Arnold Silverstein v. Lycos, Inc., et al., CA No. 99-
      10476(EFH), Warren Ciafardini v. Lycos, Inc., et al., CA No. 99-
      10494(EFH), Michelle Penfold v. Lycos, Inc., et al., CA No. 99-10495(EFH),
      Carol Lewkowicz v. Lycos, Inc., et al., CA. No. 99-10501 (EFH), Joel
      Kofsky v. Lycos, Inc., et al., CA No. 99-10502(EFH), Mark Zito v. Lycos,
      Inc., et al., CA No. 99-10518(EFH), Marc Berger v. Lycos, Inc., et al., CA
      No. 99-10519(EFH) and Salvatore Bendetto v. Lycos, Inc., et al., CA No. 
      99-10524(EFH). Each suit names as defendants the Company and Robert J.
      Davis, the Company's Chief Executive Officer and President. The Lewkowicz
      complaint also names as a defendant Edward M. Philip, the Company's Chief
      Operating Officer and Chief Financial Officer. The complaints allege,
      among other claims, violations of United States federal securities law
      through alleged misrepresentations and omissions relating to the Company's
      agreement to enter into an announced transaction with USA Networks, Inc.
      and certain affiliated companies. Each complaint seeks an unspecified
      award of damages. The plaintiffs in the Levine, Lynch, Silverstein, and
      Berger actions purport to represent a class of all persons who purchased
      the Company's common stock between January 25, 1999 and February 9, 1999.
      The plaintiff in the Zito action purports to represent a class of all
      persons who purchased the Company's common stock between January 21, 1999
      and February 9, 1999. The plaintiffs in the Crescente, Ciafardini,
      Penfold, Kofsky and Bendetto actions purport to represent a class of all
      persons who purchased the Company's common stock between January 8, 1999
      and February 9, 1999. The plaintiff in the Lewkowicz action purports to
      represent a class of all persons who purchased the Company's common stock
      between January 7, 1999 and February 9, 1999. The Company believes that
      the allegations in the complaints are without merit and intends to contest
      them vigorously.

                                       17
 
<PAGE>
 
ITEM 2.  Changes in Securities

         None.

ITEM 3.  Defaults Upon Senior Securities

         None.
 
ITEM 4.  Submission of Matters to a Vote of Securities Holders

         The annual meeting of stockholders was held on December 22, 1998. At
         the annual meeting, the following proposals were presented and voted
         upon by the stockholders.

         (a) A proposal to elect two incumbent directors, David S. Wetherell and
         John M. Connors, Jr., to each serve a term of three years was presented
         to the stockholders. 33,774,376 shares were cast in favor of the
         proposal to elect Mr. Wetherell, while 346,002 shares withheld
         authority. 33,776,514 shares were cast in favor of the proposal to
         elect Mr. Connors, while 343,864 shares withheld authority.

         (b) A proposal to ratify, confirm and approve an amendment to Lycos'
         1996 Stock Option Plan to increase the number of shares reserved for
         grant thereunder from 6,400,000 to 12,400,000 was presented to the
         stockholders. 17,105,081 shares were cast in favor of the proposal
         while 7,658,905 shares were cast against the proposal. There were
         98,083 abstentions.

         (c) A proposal to ratify, confirm, and approve the selection of KPMG
         Peat Marwick, LLP as the independent certified public accountants for
         the fiscal year 1999 of Lycos was presented to the stockholders.
         34,006,223 shares voted in favor of the proposal, while 21,636 shares
         voted against the proposal. There were 92,519 abstentions.

ITEM 5.  Other Information

         Mr. David Wetherell resigned from the Lycos Board of Directors
         effective March 9, 1999.

ITEM 6.  Exhibits and Reports on Form 8-K

         (a) Exhibit 11.1: Statement of Computation of Basic and Diluted Net
             Income (Loss) Per Share herein included on page 17.

          Exhibit 27.1:  Financial Data Schedule
  
         (b) No reports on Form 8-K were filed during the quarter ended January
             31, 1999. The Company filed Forms 8-K with the Securities and
             Exchange Commission on February 11, 1999 and February 26, 1999 with
             respect to the proposed transaction with USA Networks, Inc. and
             Ticketmaster Online-CitySearch, Inc..

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<PAGE>
 
                                   SIGNATURE

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


                                  LYCOS, INC.


Date:  April 16, 1999             By: /s/ Edward M. Philip
                                      --------------------
                                      Edward M. Philip
                                      Chief Operating Officer and
                                      Chief Financial Officer
                                      (Principal Financial and Accounting
                                      Officer, Authorized Officer)

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