United States

                        SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q
             [ X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the thirteen-week period ended:  December 24, 1999

                                       OR

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

For the transition period from __________________ to __________________________


                               C-COR.net Corp.
     --------------------------------------------------------------------
              (Exact Name of Registrant as Specified in Charter)

<TABLE>
<CAPTION>
<S>                               <C>                    <C>
        Pennsylvania                   0-10726              24-0811591
------------------------------------------------------------------------------
    (State or Other Juris-         (Commission File          (IRS Employer
     diction of Incorporation)         Number)             Identification No.)
</TABLE>


                60 Decibel Road
                State College, PA                               16801
--------------------------------------------------------------------------------
              (Address of Principal                          (Zip Code)
                Executive Offices)


                                 (814) 238-2461
      --------------------------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)



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

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

                      APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

Common Stock, $.05 Par Value - 32,057,341 shares as of January 26, 2000.



<PAGE>


                                      INDEX

                                 C-COR.net Corp.



PART I.  FINANCIAL INFORMATION


Item 1. Financial Statements (unaudited).

              Condensed  consolidated  balance  sheets  -- June  25,  1999,  and
              December 24, 1999.

              Condensed consolidated  statements of operations -- thirteen weeks
              ended December 24, 1999, and December 25, 1998;  twenty-six  weeks
              ended December 24, 1999, and December 25, 1998.

              Condensed  consolidated  statements  of cash  flows --  twenty-six
              weeks ended December 24, 1999, and December 25, 1998.

              Notes to condensed  consolidated  financial statements -- December
              24, 1999.



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

Item 3. Quantitative and Qualitative Disclosures About Market Risk

PART II.  OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

Item 4.  Submission of matters to a vote of shareholders.

Item 6.  Exhibits and Reports on Form  8-K.
<PAGE>
PART I  FINANCIAL INFORMATION
<TABLE>
Item 1.  Financial Statements
<CAPTION>
                             C-COR.net Corp.
                      CONDENSED CONSOLIDATED BALANCE SHEETS




                                                                          December 24,      June 25,
                                  ASSETS                                      1999            1999
                                                                          -----------      ----------
                                                                          (Unaudited)
                                                                                  (000's omitted)
<S>                                                                       <C>              <C>
CURRENT ASSETS
  Cash and cash equivalents                                               $   110,979      $   4,695
  Marketable securities and other short-trm investments                        15,217            445
  Accounts receivable                                                          40,322         31,314
                                                                          -----------      ----------
                                                                              166,518         36,454
                                                                          -----------      ----------
  Inventories:
    Raw materials                                                              20,325         17,240
    Work-in-process                                                             3,549          3,038
    Finished goods                                                              6,966          3,287
                                                                          -----------      ----------
      Total inventories                                                        30,840         23,565
                                                                          -----------      ----------
  Deferred taxes                                                                6,801          6,335
  Property held for sale, net                                                   1,100          1,281
  Other current assets                                                          2,509          2,176
  Net current assets of discontinued operations                                   379            433
                                                                          -----------      ----------
TOTAL CURRENT ASSETS                                                          208,147         70,244
                                                                          -----------      ----------
PROPERTY, PLANT, AND EQUIPMENT, NET                                            28,150         27,792
INTANGIBLE ASSETS AND OTHER LONG-TERM ASSETS, NET                               4,869          4,913
                                                                          -----------      ----------
TOTAL ASSETS                                                              $   241,166      $ 102,949
                                                                          ===========      ==========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                                                        $    17,641      $  16,286
  Accrued liabilities                                                          12,301         16,242
  Line-of-credit and short-term credit obligations                                  0          4,638
  Current portion of long-term debt                                               203            832
                                                                          -----------      ----------
TOTAL CURRENT LIABILITIES                                                      30,145         37,998
                                                                          -----------      ----------
LONG-TERM DEBT, less current portion                                            1,618          3,708
OTHER LONG-TERM LIABILITIES                                                     2,723          1,329
                                                                          -----------      ----------
TOTAL LIABILITIES                                                              34,486         43,035
                                                                          -----------      ----------
SHAREHOLDERS' EQUITY
  Common Stock, $.05 par; authorized shares
   100,000,000; issued shares of 33,090,770 on December 24, 1999
   and 25,522,970 on June 25, 1999                                              1,654          1,276
  Additional paid-in capital                                                  187,060         44,649
  Retained earnings                                                            25,069         21,065
  Accumulated other comprehensive loss                                           (107)           (96)
  Unearned compensation                                                           (16)             0
  Treasury stock                                                               (6,980)        (6,980)
                                                                          -----------      ----------
TOTAL SHAREHOLDERS' EQUITY                                                    206,680         59,914
                                                                          -----------      ----------
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY                                  $   241,166      $ 102,949
                                                                          ===========      ==========
<FN>
Note: The balance sheet at June 25, 1999,  has been  derived  from  supplemental
      restated financial statements at that date which give effect to the merger
      transactions with Convergence.com and Silicon Valley Communications,  Inc.

Note: Shares issued have been  adjusted to reflect a 2-for-1 stock split for all
      shares of record as of December  22,  1999.  The  additional  shares  were
      distributed on January 6, 2000.

See notes to condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>

<TABLE>
                             C-COR.net Corp.
             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<CAPTION>

                                                    Thirteen Weeks Ended                     Twenty-six Weeks Ended
                                                December 24,         December 25,        December 24,         December 25,
                                                    1999                1998                 1999                1998
                                                -----------          -----------         -----------          -----------
                                                                   (000's omitted, except per share data)
<S>                                             <C>                 <C>                  <C>                 <C>
 NET SALES                                      $   62,391          $   39,651           $  126,894          $   74,305
                                                -----------          -----------         -----------          -----------

 COSTS AND EXPENSES:
   Cost of sales                                    47,092              30,052               95,370              57,180
   Selling, general and administrative
     expenses                                        6,221               6,484               13,330              11,839
   Research and product development costs            3,508               3,172                6,683               5,961
   Merger-related costs                                  0                   0                3,673                   0
   Interest expense                                    140                 104                  761                 161
   Investment income                                  (844)                (51)                (891)                (99)
   Other expense (income)                              (38)                191                  316                 209
                                                -----------          -----------         -----------          -----------
                                                    56,079              39,952              119,242              75,251
                                                -----------          -----------         -----------          -----------

 INCOME (LOSS) FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES                               6,312                (301)               7,652                (946)

 INCOME TAX EXPENSE                                  2,369                 691                3,690               1,162
                                                -----------          -----------         -----------          -----------

 INCOME (LOSS) FROM CONTINUING OPERATIONS            3,943                (992)               3,962              (2,108)

 DISCONTINUED OPERATIONS:
 Gain on disposal of discontinued
   business segment, less applicable
   income tax expense                                    6                  16                   42                 304
                                                -----------          -----------         -----------          -----------

 NET INCOME (LOSS)                              $    3,949           $    (976)          $    4,004           $  (1,804)
                                                ===========          ===========         ===========          ===========

 NET INCOME (LOSS) PER SHARE - BASIC:

   Continuing operations                        $     0.14           $   (0.04)          $     0.15           $   (0.09)
   Discontinued operations                            0.00                0.00                 0.00                0.01
                                                -----------          -----------         -----------          -----------
 NET INCOME (LOSS) PER SHARE                    $     0.14           $   (0.04)          $     0.15           $   (0.08)
                                                ===========          ===========         ===========          ===========

 NET INCOME (LOSS) PER SHARE - DILUTED:

   Continuing operations                        $     0.13           $   (0.04)          $     0.14           $   (0.09)
   Discontinued operations                            0.00                0.00                 0.00                0.01
                                                -----------          -----------         -----------          -----------
 NET INCOME (LOSS) PER SHARE                    $     0.13           $   (0.04)          $     0.14           $   (0.08)
                                                ===========          ===========         ===========          ===========


<FN>
Note: Net income per share amounts have been adjusted to reflect a 2-for-1 stock
      split for all shares of record as of December  22,  1999.  The  additional
      shares were distributed on January 6, 2000.

 See notes to condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                             C-COR.net Corp.
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)



                                                                                    Twenty-six Weeks Ended
                                                                                December 24,      December 25,
                                                                                    1999              1998
                                                                                -----------       -----------
                                                                                        (000's omitted)

 <S>                                                                            <C>              <C>
 OPERATING ACTIVITIES
 Net income (loss)                                                              $   4,004        $    (1,804)
   Adjustments to reconcile net income (loss) to net cash
     and cash equivalents provided by operating
     activities:
   Depreciation and amortization                                                    4,648              4,062
   Amortization of debt discount                                                      381                  0
   Amortization of unearned compensation                                                5                  0
   Gain on disposal of discontinued operations,
     net of tax benefit                                                               (42)              (304)
   Provision for deferred retirement salary plan                                      301                239
   Loss on sale and write-down of property, plant,
     and equipment                                                                    333                 62
   Changes in operating assets and liabilities:
     Accounts receivable                                                           (9,008)            (5,576)
     Inventories                                                                   (7,275)            (1,694)
     Other assets                                                                      63              1,640
     Accounts payable                                                               1,355              4,004
     Accrued liabilities                                                           (3,694)               532
     Deferred income taxes                                                            600               (886)
     Discontinued operations - working capital changes
       and noncash charges                                                             96               (218)
                                                                                -----------       -----------
 NET CASH AND CASH EQUIVALENTS (USED IN) PROVIDED BY OPERATING ACTIVITIES          (8,233)                57
                                                                                -----------       -----------
 INVESTING ACTIVITIES
   Purchase of property, plant and equipment                                       (4,995)            (2,805)
   Purchase of marketable securities and other short-term investments             (14,772)               (50)
   Investment                                                                        (501)                 0
   Proceeds from sale of property, plant, and equipment                                 2                  0
   Issuance of notes receivable, net                                                    0                  2
   Change in other assets                                                               0                 83
 NET CASH AND CASH EQUIVALENTS                                                  -----------       -----------
   USED IN  INVESTING ACTIVITIES                                                  (20,266)            (2,770)
                                                                                -----------       -----------
 FINANCING ACTIVITIES
   Payment of debt and capital lease obligations                                   (2,719)            (4,659)
   Proceeds from long-term debt borrowing                                               0              3,109
   Proceeds from (payment on) short-term credit
      facilities, net                                                              (5,019)             6,852
   Tax benefit deriving from exercise and sale of stock option shares               2,775                  0
   Payment for issuance of convertible preferred stock                                  0                (45)
   Proceeds from issuance of common stock to employee stock purchase plan              45                 34
   Proceeds from exercise of stock option shares                                    4,072                249
   Proceeds from exercise of stock warrants                                         2,259                  0
   Proceeds from issuance of common stock, net                                    133,370                  0
   Purchase of treasury stock                                                           0             (1,084)
 NET CASH AND CASH EQUIVALENTS PROVIDED BY                                      -----------       -----------
   FINANCING ACTIVITIES                                                           134,783              4,456
                                                                                -----------       -----------
 INCREASE IN CASH AND CASH EQUIVALENTS                                            106,284              1,743
 Cash and cash equivalents at beginning of period                                   4,695              3,030
                                                                                -----------       -----------
 CASH AND CASH EQUIVALENTS AT END OF PERIOD                                     $ 110,979        $     4,773
                                                                                ===========       ===========
<FN>
 See notes to condensed consolidated financial statements.
</FN>
</TABLE>
<PAGE>
                            C-COR.net Corp.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. The accompanying, unaudited, condensed consolidated financial statements have
been prepared in accordance with generally  accepted  accounting  principles for
interim  financial  information,  and in the opinion of management,  contain all
adjustments  (consisting  only of normal,  recurring  adjustments)  necessary to
fairly present the Company's financial position as of December 24, 1999, and the
results of its operations for the thirteen-week and twenty-six week periods then
ended.  Operating  results for the  thirteen-week and twenty-six week period are
not  necessarily  indicative  of the results  that may be expected  for the year
ending June 30, 2000. For further information, refer to financial statements and
footnotes  thereto  included in the Company's annual report on Form 10-K for the
year ended June 25, 1999.

2. DESCRIPTION OF BUSINESS

The Company designs and manufactures network distribution  products and provides
technical  services in support of two-way hybrid fiber coax (HFC) networks.  The
Company has  predominately  operated  in the  Electronic  Distribution  Products
segment,  which  provides HFC  equipment  for signal  distribution  applications
primarily  to the  cable  television  (CATV)  market.  In  order to  expand  the
Company's product offering in the Electronics  Distribution Products segment, on
September  17,  1999,  the  Company  completed  a  merger  with  Silicon  Valley
Communications,  Inc. ("SVCI"), whereby SVCI became a wholly owned subsidiary of
the Company.  In addition,  on July 9, 1999, the Company completed a merger with
Convergence.com Corporation ("Convergence.com"),  whereby Convergence.com became
a wholly owned subsidiary of the Company.  These transactions were accounted for
under  the  pooling-of-interest  method  of  accounting  and,  accordingly,  the
accompanying  financial  statements  have been  retroactively  restated  to give
effect to the Convergence.com  and SVCI mergers for all periods presented.  As a
result of the merger with  Convergence.com,  the Company now operates a separate
business segment called Broadband  Management  Services,  which provides design,
activation,  network  management and optimization  services,  as well as ongoing
support, repair and maintenance to broadband operators in the United States.

3. BUSINESS COMBINATIONS

On July 9, 1999, the Company consummated a merger with Convergence.com a Georgia
corporation,  whereby  Convergence.com  became a wholly owned  subsidiary of the
Company.  As consideration in the merger, each outstanding share of common stock
of  Convergence.com  was converted into one share of the Company's  common stock
for an aggregate of 1,433,323 shares (2,866,646 shares on a post-split basis) of
the Company's common stock. Each outstanding warrant to acquire  Convergence.com
common stock was converted into a warrant to acquire the Company's  common stock
for an  aggregate of warrants to acquire  366,930  shares  (733,860  shares on a
post-split  basis) of the Company's  common stock.  The merger was accounted for
under the pooling-of-interests method of accounting.

On September 17, 1999,  the Company  consummated a merger with SVCI a California
corporation,  whereby SVCI became a wholly owned  subsidiary of the Company.  As
consideration in the merger,  each outstanding share of common stock of SVCI was
converted into 0.094534 shares of the Company's  common stock,  resulting in the
issuance of 1,545,081  shares  (3,090,162  shares on a post-split  basis) of the
Company's  common  stock  (subject  to  reduction  pursuant  to  certain  escrow
arrangements).  Outstanding  stock  options and  warrants to acquire SVCI common
stock were  converted  into stock  options and warrants to acquire the Company's
common stock using the same conversion ratio (with appropriate adjustment to the
exercise  price) for an  aggregate  of stock  options  and  warrants  to acquire
383,844 shares  (767,688 shares on a post-split  basis) of the Company's  common
stock.  The merger was  accounted for under the  pooling-of-interests  method of
accounting.

The Company recorded a one-time charge of $3,673,000,  ($3,113,000,  net of tax)
related to the business combinations in the thirteen-week period ended September
24, 1999. The one-time charge includes the merger  transaction costs, as well as
restructuring  costs which  included  severance  payments for  approximately  40
employees  affected by consolidation of positions and  administrative  functions
resulting  from the mergers,  and write-off of assets  related to existing fiber
optic products that became redundant as a result of the acquisition of SVCI.

Both of these mergers were accounted for using the  pooling-of-interests  method
of accounting.  This method  requires that historical  financial  results of the
merged  companies  be combined  and  presented  as if the  companies  had always
operated as one entity.  Accordingly,  the Company's  financial  statements  are
presented on a restated combined basis for all periods presented.

4. PUBLIC OFFERING

On November 12, 1999, the Company completed a follow-on  public  offering of its
common stock, whereby 3,220,000 shares of common stock were issued and sold at a
price of $44.00 per share (this equates to 6,440,000  shares at $22.00 per share
on a post-split basis).  This offering resulted in net proceeds (after deducting
issuance  costs) to the Company of  $133,370,000.  The  proceeds of the offering
were  used  for  repayment  of  debt,  and  will  also  be  used  for  strategic
investments, capital expenditures,  working capital, and other general corporate
purposes.

5. STOCK SPLIT

On December 7, 1999 the  Company's  board of  directors  declared a  two-for-one
stock split of the Company's common stock. The stock split was effective for all
shares  of  record  as of the  close of  business  on  December  22,  1999.  The
additional  shares were  distributed on January 6, 2000. In connection  with the
stock  split,  the par value per share of common  stock was reduced from $.10 to
$.05 and the  authorized  number of shares of common  stock was  proportionately
increased from 50,000,000 to 100,000,000.

6. ACCRUED LIABILITIES

<TABLE>
Accrued liabilities consisted of:
<CAPTION>

                                                  December 24,            June 25,
                                                      1999                  1999
                                                ----------------       ----------------
                                                           (000's omitted)
<S>                                             <C>                    <C>
Accrued incentive plan expense                          $ 1,747                $ 2,285
Accrued vacation expense                                  1,713                  2,000
Accrued salary expense                                      859                  1,297
Accrued payroll and sales tax                             1,535                  1,519
Accrued warranty expense                                  1,891                  1,742
Accrued workers compensation
  self-insurance expense                                  1,908                  1,724
Accrued merger-related costs                                706                      0
Accrued sales commissions and rebates payable               578                    951
Accrued income taxes                                        299                  3,304
Accrued other                                             1,065                  1,420
                                                ----------------       ----------------
                                                        $12,301                $16,242
                                                ================       ================
</TABLE>

7. COMPREHENSIVE INCOME (LOSS)

The  components of  accumulated  other  comprehensive  loss,  net of tax, of the
Company are as follows:
<TABLE>
<CAPTION>
                                                        December 24,             June 25,
                                                            1999                    1999
                                                         -----------             ----------
                                                                  (000's omitted)
<S>                                                        <C>                      <C>
Foreign currency translation loss                          $  (101)                 $  (92)
Unrealized holding loss on marketable securities                (6)                     (4)
                                                         ----------              ----------
Accumulated other comprehensive loss                       $  (107)                 $  (96)
                                                         ==========              ==========
</TABLE>
The  components  of   comprehensive   income  (loss)  of  the  Company  for  the
thirteen-week, and twenty-six week periods ended December 24, 1999, and December
25, 1998, are as follows:
<TABLE>
<CAPTION>
                                                                  Thirteen Weeks Ended                 Twenty-six Weeks Ended
                                                             -------------------------------      -------------------------------
                                                              December 24,      December 25,       December 24,      December 25,
                                                                  1999              1998               1999              1998
                                                             -------------      ------------      -------------      ------------
                                                                       (000's omitted)                      (000's omitted)
<S>                                                               <C>               <C>                <C>               <C>
Net income (loss)                                                 $ 3,949           $  (976)           $ 4,004           $(1,804)
Other comprehensive income (loss), net of tax:
    Unrealized gain (loss) on equity securities                         2                (5)                (2)               (5)
    Foreign currency translation gain (loss)                           (9)                2                 (9)               26
                                                                  --------         --------            --------         --------
Other comprehensive income (loss)                                      (7)               (3)               (11)               21
                                                                  --------         --------            --------         --------
Comprehensive income (loss)                                       $ 3,942           $  (979)           $ 3,993           $(1,783)
                                                                  ========         ========            ========         ========
</TABLE>

8. NET INCOME (LOSS) PER SHARE

Basic  earnings per share are computed  based on the weighted  average number of
common  shares  outstanding,  excluding  any  dilutive  options,  and  warrants.
Dilutive earnings per share are computed based on the weighted average number of
common shares outstanding plus the dilutive effect of options and warrants.  The
dilutive  effect of options and warrants is calculated  under the treasury stock
method  using the average  market  price for the period.  Net income  (loss) per
share is calculated for the periods presented as follows:
<TABLE>
<CAPTION>
                                                     Thirteen Weeks Ended                   Twenty-six Weeks Ended
                                                December 24,          December 25,     December 24,          December 25,
                                                   1999                 1998              1999                 1998
                                                ------------         -------------     ------------         -------------
                                                                    (000's omitted, except per share data)
<S>                                             <C>                  <C>               <C>                  <C>
Basic:

Weighted average shares outstanding                 28,117               24,133            26,284               24,194
                                              ------------         ------------       -----------         ------------
Total                                               28,117               24,133            26,284               24,194


Income (loss) from continuing operations         $   3,943            $    (992)        $   3,962            $  (2,108)
Gain from discontinued operations                        6                   16                42                  304
                                              ------------         ------------       -----------         ------------
Net income (loss)                                $   3,949            $    (976)        $   4,004            $  (1,804)
                                              ------------         ------------       -----------         ------------

Net income (loss) per share:
  Continuing operations                          $    0.14            $   (0.04)        $    0.15            $   (0.09)
  Discontinued operations                             0.00                 0.00              0.00                 0.01
                                              ------------         ------------       -----------         ------------
Net income (loss) per share                      $    0.14            $   (0.04)        $    0.15            $   (0.08)
                                              ============         ============       ===========         ============


Diluted:

Weighted average shares outstanding                 28,117               24,133            26,284               24,194
Weighted average common stock
  equivalents                                        3,144                    0             2,392                    0
                                              ------------         ------------       -----------         ------------
Total                                               31,261               24,133            28,676               24,194

Income (loss) from continuing operations         $   3,943            $    (992)        $   3,962            $  (2,108)
Gain from discontinued operations                        6                   16                42                  304
                                              ------------         ------------       -----------         ------------
Net income (loss)                                $   3,949            $    (976)        $   4,004            $  (1,804)
                                              ------------         ------------       -----------         ------------

Net income (loss) per share:
  Continuing operations                          $    0.13            $   (0.04)        $    0.14            $   (0.09)
  Discontinued operations                             0.00                 0.00              0.00                 0.01
                                              ------------         ------------       -----------         ------------
Net income (loss) per share                      $    0.13            $   (0.04)        $    0.14            $   (0.08)
                                              ============         ============       ===========         ============
</TABLE>
<PAGE>
9. SEGMENT INFORMATION

The Company  adopted the  Statement of Financial  Accounting  Standards No. 131,
"Disclosures About Segments of an Enterprise and Related Information" (Statement
131), in fiscal year 1999. For the  thirteen-week  and  twenty-six-week  periods
ended  December 24, 1999,  the Company  operated in two industry  segments;  the
Electronic  Distribution  Products  segment,  which  provides HFC  equipment for
signal  distribution  applications,  primarily  to  the  CATV  market,  and  the
Broadband Management Services segment, which provides HFC technical services and
Internet enabling technical  services and support to broadband  operators in the
United States. For the thirteen-week and twenty-six-week  periods ended December
25, 1998,  the Company also operated in two industry  segments;  the  Electronic
Distribution Product segment, which at that time included HFC technical services
and the Broadband  Management  Services  segment.  For the fiscal year 2000, the
Company  elected to change the  reporting of its Broadband  Management  Services
segment,  to include HFC technical  services which were  previously  reported as
part of the Electronic Distribution Product segment during the thirteen-week and
twenty-six-week  periods  ended  December 25, 1998.  The Company  believes it is
impracticable  to disclose the impact of this change on a restated segment basis
for prior periods presented and does not believe the change to be significant.

Information  about industry  segments for the  thirteen-week  and the twenty-six
week periods ended December 24, 1999, and December 25, 1998, are as follows:
<TABLE>
<CAPTION>
                                                                                                        Discontinued
                                                                         Continuing     Operations      Operations
                                                                   --------------------------------------------------------------
                                                                                                        Digital
                                                                         Electronic     Broadband       Fiber Optics
                                                                         Distribution   Management      Transmission
                                                                         Products       Services        Products         Total
                                                                   --------------------------------------------------------------

13 week period ended December 24, 1999
<S>                                                                      <C>               <C>                          <C>
Total revenue                                                             $58,447          $3,944               --       $62,391
Operating income                                                            5,380             190               --         5,570
Interest income                                                                                                              844
Interest expense                                                                                                             140
Income tax expense                                                                                                         2,369
Identifiable assets at December 24, 1999                                  236,054           5,112            1,001       242,167
Capital expenditures                                                        1,327             478               --         1,805
Depreciation and amortization                                               2,176             308               --         2,484

13 week period ended December 25, 1998
Total revenue                                                             $39,393            $258               --       $39,651
Operating income (loss)                                                     1,109          (1,166)              --           (57)
Interest income                                                                                                               51
Interest expense                                                                                                             104
Income tax expense                                                                                                           691
Identifiable assets at December 25, 1998                                   90,187             815            1,069        92,071
Capital expenditures                                                        1,496             235               --         1,731
Depreciation and amortization                                               1,990             (13)              --         1,977

26 week period ended December 24, 1999
Total revenue                                                            $118,908          $7,986               --      $126,894
Operating income (loss) (A)                                                12,552          (1,041)              --        11,511
Interest income                                                                                                              891
Interest expense                                                                                                             761
Income tax expense (A)                                                                                                    3,690
Identifiable assets at December 24, 1999                                  236,054           5,112            1,001       242,167
Capital expenditures                                                        4,010             985               --         4,995
Depreciation and amortization                                               4,152             496               --         4,648

26 week period ended December 25, 1998
Total revenue                                                             $73,151          $1,154               --       $74,305
Operating income (loss)                                                       997          (1,672)              --          (675)
Interest income                                                                                                               99
Interest expense                                                                                                             161
Income tax expense                                                                                                         1,162
Identifiable assets at December 25, 1998                                   90,187             815            1,069        92,071
Capital expenditures                                                        2,550             255               --         2,805
Depreciation and amortization                                               4,000              62               --         4,062



<FN>
(A)  Operating income and income tax expense excludes the impact of the one time
     merger-related cost related to the Convergence.com  Corporation and Silicon
     Valley  Communications,  Inc.  mergers.(See  Note 3 -  Notes  to  Condensed
     Consolidated Financial Statements.)
</FN>
</TABLE>
The Company and subsidiaries operate in various geographic areas as indicated by
the following:
<TABLE>
<CAPTION>
                                                    U.S.              Canada                Europe        Eliminations   Total
                                               ----------------------------------------------------------------------------------

13 week period ended December 24, 1999
Sales to unaffiliated customers:
<S>                                                <C>                  <C>                    <C>              <C>      <C>
Domestic                                            $54,240              $0                    $134              --      $54,374
Export                                                8,017              --                      --              --        8,017
Transfers between geographic areas                       20              --                      --             (20)           0
Total revenue                                        62,277               0                     134             (20)      62,391
Operating income (loss)                               6,125             (76)                   (479)             --        5,570
Interest income                                                                                                              844
Interest expense                                                                                                             140
Income tax expense                                                                                                         2,369
Identifiable assets at December 24, 1999            240,639             409                     118              --      241,166
Capital expenditures                                  1,805               0                       0              --        1,805
Depreciation and amortization                         2,479               0                       5              --        2,484

13 week period ended December 25, 1998
Sales to unaffiliated customers:
Domestic                                            $33,643            $116                     $91              --      $33,850
Export                                                5,801              --                      --              --        5,801
Transfers between geographic areas                        2              --                      --              (2)           0
Total revenue                                        39,446             116                      91              (2)      39,651
Operating income (loss)                                  18             (74)                     (1)             --          (57)
Interest income                                                                                                               51
Interest expense                                                                                                             104
Income tax expense                                                                                                           691
Identifiable assets at December 25, 1998             89,782             865                     355              --       91,002
Capital expenditures                                  1,731              --                      --              --        1,731
Depreciation and amortization                         1,969               3                       5              --        1,977

26 week period ended December 24, 1999
Sales to unaffiliated customers:

Domestic                                           $112,113             $42                    $177              --     $112,332
Export                                               14,562              --                      --              --       14,562
Transfers between geographic areas                       32              --                      --             (32)           0
Total revenue                                       126,707              42                     177             (32)     126,894
Operating income (loss)(A)                           12,323            (142)                   (670)             --       11,511
Interest income                                                                                                              891
Interest expense                                                                                                             761
Income tax expense (A)                                                                                                     3,690
Identifiable assets at December 24, 1999            240,639             409                     118              --      241,166
Capital expenditures                                  4,994               0                       1              --        4,995
Depreciation and amortization                         4,638               0                      10              --        4,648

26 week period ended December 25, 1998
Sales to unaffiliated customers:
Domestic                                            $65,060            $316                    $131              --      $65,507
Export                                                8,798              --                      --              --        8,798
Transfers between geographic areas                       54              --                      --             (54)           0
Total revenue                                        73,912             316                     131             (54)      74,305
Operating income (loss)                                (606)            (97)                     28              --         (675)
Interest income                                                                                                               99
Interest expense                                                                                                             161
Income tax expense                                                                                                          1162
Identifiable assets at December 25, 1998             89,782             865                     355              --       91,002
Capital expenditures                                  2,805              --                      --              --        2,805
Depreciation and amortization                         4,046               6                      10              --        4,062



<FN>
(A)  Operating income and income tax expense excludes the impact of the one time
     merger-related cost related to the Convergence.com  Corporation and Silicon
     Valley  Communications,  Inc.  mergers.(See  Note 3 -  Notes  to  Condensed
     Consolidated Financial Statements.)
</FN>
</TABLE>
<PAGE>

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

General

The following  discussion addresses the financial condition of the Company as of
December 24,  1999,  and the results of  operations  for the  thirteen-week  and
twenty-six-week  periods ended December 24, 1999, compared with the same periods
of the  prior  year.  This  discussion  should be read in  conjunction  with the
Management's  Discussion and Analysis section for the fiscal year ended June 25,
1999, included in the Company's Annual Report on Form 10-K.

Disclosure Regarding Forward-Looking Statements

Some of the information presented in this report,  including, but not limited to
continuation of increased  domestic spending for network upgrades,  expectations
regarding   international   sales  volume  and   investment  in  development  of
international  distribution channels,  anticipated increased spending on product
development, the continued availability of capital resources, customer's demands
for network  reliabilility,  the Company's  expectations  in connection with the
mergers with Convergence.com Corporation  ("Convergence.com") and Silicon Valley
Communications,  Inc.  ("SVCI"),  continued delivery of fiber optic equipment to
AT&T  Broadband  and  Internet  Services,  the  company's  ability to expand its
capacity for providing  network design and other technical  services as a result
of the asset purchase of Advanced  Communications  Services,  Inc.  ("ACSI") and
pending merger with Worldbridge Broadband Services,  Inc.  ("Worldbridge"),  and
the  Company's  ability  to  continue  successful  implementation  of Year  2000
measures,  constitute  forward-looking  statements  within  the  meaning  of the
Private Securities  Litigation Reform Act of 1995. Although the Company believes
that its expectations are based on reasonable  assumptions  within the bounds of
its  knowledge of its business and  operations,  there can be no assurance  that
actual results will not differ materially from its  expectations.  Factors which
could cause actual results to differ from  expectations  include,  among others,
the ability to integrate assets purchased from Advanced Communications Services,
Inc., the ability to consummate the merger with Worldbridge  Broadband Services,
Inc., the ability to integrate both Convergence.com's and SVCI's businesses, the
timing  of  orders  received  from  customers,  the gain or loss of  significant
customers,   changes  in  the  mix  of   products   sold,   continued   industry
consolidation,  the development of competing technology, changes in the cost and
availability of parts and supplies,  fluctuations in warranty costs, new product
development  activities,  the Company's  ability to  successfully  implement new
products and  services and enhance  existing  products  and  services,  economic
conditions  affecting  domestic and international  markets,  regulatory  changes
affecting  the  telecommunications  industry,  in  general,  and  the  Company's
operations, in particular, competition and changes in domestic and international
demand for the Company's  products and other factors which may impact operations
and  manufacturing.  For  additional  information  concerning  these  and  other
important  factors  which may  cause  the  Company's  actual  results  to differ
materially from  expectations  and underlying  assumptions,  please refer to the
Company's  reports filed on Form 10-K and other reports and materials filed with
the Securities and Exchange Commission.

Results of Operations

Net  sales  for  the   thirteen-week   period  ended  December  24,  1999,  were
$62,391,000,  an increase of 57% from the prior year's sales of $39,651,000  for
the same period.  Net sales for the  twenty-six-week  period ended  December 24,
1999,  were  $126,894,000,  an  increase of 71% from the prior  year's  sales of
$74,305,000 for the same period.  The increased sales for the  thirteen-week and
twenty-six-week   periods  were  primarily  attributable  to  increased  capital
spending for cable network  transmission  equipment by domestic cable  operators
and from increased sales of technical services related to design, activation and
support of cable  networks.  In  addition,  the Company has also  broadened  its
hybrid/fiber coax (HFC) network product lines to capture additional  investments
being made by cable  operators.  These  product line  expansions  include a full
range of fiber optics equipment  including the Company's  Navicor(TM)  family of
node  products,  as well as a broad  complement of advanced  fiber optic headend
equipment and optical  transmitters  and receivers,  acquired in its merger with
SVCI  in  September  1999.

Domestic sales, as a percentage of total  consolidated  sales,  were 87% and 88%
for the  thirteen-week  and  twenty-six-week  periods  ended  December 24, 1999,
respectively.  This  compares to 85% and 88% for same  respective  period of the
prior year. Sales to domestic  customers  increased 61% during the thirteen-week
period ended December 24, 1999, and 72% for the twenty-six-week period, compared
to the same periods of the prior year.  The  increase  resulted  from  increased
sales of HFC  transmission  equipment  and related  services  caused by domestic
cable operators continuing to upgrade and rebuild their systems,  principally to
offer new services including two-way internet access. These upgrades to existing
cable networks to provide two-way,  interactive  broadband  services allow cable
operators to compete against other broadband communications technologies.

International  sales, as a percentage of total consolidated  sales, were 13% and
12% for the thirteen-week and  twenty-six-week  periods ended December 24, 1999,
respectively.  This  compares to 15% and 12% for same periods of the prior year.
Although a lower percentage of total consolidated  sales, sales to international
customers increased 36% during the thirteen-week period ended December 24, 1999,
and 60% for the  twenty-six-week  period,  compared  to the same  periods of the
prior year.  The increase for the  thirteen-week  and  twenty-six-week  periods,
resulted from increased demand primarily from a customer in Canada.  The Company
believes  further  investment will be necessary in developing its  international
distribution  channels and to provide  localized  versions of its  products,  in
order  to  supply  comprehensive  network  solutions  to  operators  in  various
international  markets. The Company expects international markets will represent
a substantial portion of its sales base, but believes demand will continue to be
highly variable.

The Company's  backlog of sales orders at December 24, 1999,  was  approximately
$37.5 million,  consisting of backlog from domestic and international  customers
of 90% and 10%,  respectively.  The Company's  backlog was  approximately  $43.4
million at the end of the prior  thirteen-week  period ended September 24, 1999,
which consisted of backlog from domestic and international  customers of 86% and
14%,  respectively.  The Company booked approximately $56.4 million of new sales
orders  during  the  thirteen-week  ended  December  24,  1999,  resulting  in a
book-to-bill  ratio for the  thirteen-weeks of .90. As a result of consolidation
of ownership of domestic cable systems,  the Company's bookings and sales levels
are dependent  upon the timing of orders from a limited number of large customer
accounts.  The Company believes  bookings from these customers can be influenced
by a variety of factors,  including  overall  demand for cable  services and the
acceptance of new broadband services,  competitive  pressures,  cable operators'
access to financing and cable operators' annual budget cycles. Variations in the
timing of bookings and sales can cause significant fluctuations in thirteen-week
operating results.

Gross profit  percentage for the  thirteen-week  period ended December 24, 1999,
was 24.5%  versus  24.2% for the same  period of the prior  year.  Gross  profit
percentage  for the  twenty-six-week  period ended  December 24, 1999, was 24.8%
versus  23.0% for the same  period of the prior  year.  Changes in product  mix,
efficiencies  resulting  from higher  production  volume and ongoing  efforts to
improve manufacturing  automation initiatives contributed to the increase in the
gross profit percentage,  while at the same time this contribution was offset by
the  Company's  strategic  investment  for  expansion  of its Network  Operating
Center, as part of the Company's Broadband  Management Services segment,  during
the thirteen-week  and twenty-six week periods,  compared to the same periods of
the prior year.

Selling,  general and administrative expenses for the thirteen-week period ended
December 24, 1999, were $6,221,000, a decrease of 4% over the prior year's total
of $6,484,000  for the same period.  The decrease  resulted  from  reductions in
various selling and administrative costs,  including lower personnel costs after
consolidating certain positions and administrative functions, as a result of the
mergers  with  Convergence.com  and SVCI.  Selling,  general and  administrative
expenses  for  the   twenty-six-week   period  ended  December  24,  1999,  were
$13,330,000,  an increase of 13% over the prior year's total of $11,839,000  for
the same  period.  The increase  was due to various  selling and  administrative
costs,  including  personnel  costs  associated  with higher  sales  volumes and
expansion  of the  Company's  technical  customer  services  business  unit  and
domestic sales force during the prior year, resulting in increased expenditures,
compared to the same period of the prior year.

Research  and  product  development  costs for the  thirteen-week  period  ended
December 24,  1999,  were  $3,508,000,  an increase of 11% over the prior year's
total of $3,172,000 for the same period.  Research and product development costs
for the  twenty-six-week  period ended December 24, 1999,  were  $6,683,000,  an
increase of 12% over the prior year's total of  $5,961,000  for the same period.
The increased  expenditures  resulted from higher personnel costs and additional
expenses  primarily  for  development  of  fiber  optic  transmission  products,
including transmitters, receivers and Erbium-Doped Fiber Amplifiers (EDFAs), for
advanced HFC networks. These products include the Company's new mini-fiber nodes
and  multiplexing  nodes,  which  currently  are being used in a field  trial of
AT&T's LightWire(TM)  Neighborhood Broadband System in Salt Lake City, Utah. The
Company  continues  to  develop  network  management  products,   including  the
Company's  CNM System 2 software.  The Company  believes  the  increasing  size,
complexity,  and  traffic  over cable  networks  requires  consistent,  reliable
network  performance to meet customer demands. As a result, the Company believes
network  operators will need to increase their investment in network  management
services  and  software  to address the various  types of  equipment  and unique
characteristics  of the different  information types that will be delivered over
future HFC networks.  The Company  anticipates  research and product development
expenses to increase in future periods, related to ongoing initiatives, although
these expenses may vary as a percentage of sales.

Interest  expense for the  thirteen-week  period ended  December  24, 1999,  was
$140,000,  compared to $104,000, for the same period of the prior year. Interest
expense for the  twenty-six-week  period ended  December 24, 1999, was $761,000,
compared to $161,000,  for the same period of the prior year.  Interest  expense
increased for the  thirteen-week  and twenty-six  week periods as a result of an
increase in  short-term  borrowings on the  Company's  revolving  line-of-credit
agreement and other short-term credit facilities during the periods. Included in
interest  expense for the  year-to-date  period ended  December  24,  1999,  was
$381,000 of additional amortization related to the fair market value of warrants
issued  in  fiscal  year  1999  in  connection   with  certain  debt   financing
arrangements.

Investment  income for the  thirteen-week  period ended  December 24, 1999,  was
$844,000,  compared to $51,000 for the same period of the prior year. Investment
income for the  twenty-six-week  period ended  December 24, 1999,  was $891,000,
compared  to $99,000  for the same  period of the prior  year.  The  increase in
investment  income  for  the  quarter  and  year-to-date   periods  result  from
short-term  investments  of funds  received in the  Company's  follow-on  public
offering of 3,220,000  shares of common  stock,  completed on November 12, 1999.
(See Note 4).

Other income for the thirteen-week  period ended December 24, 1999, was $38,000,
compared  to other  expense of  $191,000  for the same period of the prior year.
Other expense for the thirteen-week  period ended December 25, 1998,  included a
loss on disposal of certain leasehold  improvements and foreign exchange losses.
Other  expense  for the  twenty-six-week  period  ended  December  24,  1999 was
$316,000, compared to other expense of $209,000 for the same period of the prior
year.  The increase in other  expense for the  twenty-six-week  period  resulted
primarily from adjustment of the carrying value of property  held-for-sale,  and
losses on disposal  of  property,  plant,  and  equipment  incurred in the first
quarter of fiscal year 2000.

The effective  income tax rate for the  thirteen-week  period ended December 24,
1999,  was 37.5%,  compared to 229.6% for the same period of the prior year. The
higher  effective  tax rate for the  thirteen-weeks  ended  December  25,  1998,
resulted from limited tax benefit related to operating  losses for both SVCI and
Convergence.com.  The effective income tax rate for the  twenty-six-week  period
ended  December 24, 1999,  was 48.2%,  compared to 122.8% for the same period of
the prior year.  The higher  effective tax rate for the  twenty-six  weeks ended
December  24,  1999,  is a result of permanent  differences  for  non-deductible
business   combination   costs   incurred  in  relation  to  the  mergers   with
Convergence.com  and SVCI, in the first quarter of fiscal year 2000.  The higher
effective tax rate for the  twenty-six-weeks  ended December 25, 1998,  resulted
from  limited  tax  benefit  related  to  operating  losses  at  both  SVCI  and
Convergence.com.

Liquidity and Capital Resources

As of December 24, 1999,  cash and cash  equivalents  totaled $ 110,979,000,  up
from  $4,695,000  at June 25, 1999.  The  increase in cash and cash  equivalents
resulted from net proceeds received from the follow-on public offering of common
stock  completed  on November 12, 1999.  Net cash and cash  equivalents  used in
operating  activities  was  $8,233,000  for  the  twenty-six-week  period  ended
December 24, 1999. This compares to cash and cash  equivalents used in operating
activities  of $57,000, for the same period of the prior year.  The  increase in
cash and cash equivalents used in operating  activities for the  twenty-six-week
period ended  December  24, 1999  compared to the same period of the prior year,
was primarily due to business  combination  costs associated with the mergers of
Convergence.com  and  SVCI,  and  increased  inventory  purchases  and  accounts
receivables  resulting from a higher level of production and sales volume during
the twenty-six-week period.

Net cash and cash equivalents  used in investing  activities was $20,266,000 for
the  twenty-six-week  period ended December 24, 1999, compared to $2,770,000 for
the same period of the prior  year.  The  increase in cash and cash  equivalents
used in investing  activities  was  primarily  due to  purchases  of  marketable
securities and other short-term  investments,  as well as increased purchases of
property, plant and equipment to expand and automate the Company's manufacturing
operations.  In addition,  on October 6, 1999, the Company made an investment of
$501,000 in Fortress  Technologies,  Inc.  ("Fortress"),  a security  networking
company.  The  investment is included in other  long-term  assets on the balance
sheet as of  December  24,  1999,  and is being  carried at cost,  as  ownership
interest is less than 20%, and does not fall within the  guidelines of Financial
Accounting  Standards No. 115,  Accounting  for Certain  Investments in Debt and
Equity Securities" (Statement 115).

Net  cash  and  cash  equivalents   provided  by  financing  activities  totaled
$134,783,000  for the  twenty-six  week period ended  December  24,  1999.  This
compares to net cash and cash  equivalents  provided by financing  activities of
$4,456,000  for the same period of the prior year. The increase in cash provided
by financing  activities resulted from net proceeds received through a follow-on
public  offering of the Company's  common stock.  The Company's  other financing
activities  consisted  primarily of borrowings  and payments on  short-term  and
long-term  debt,  proceeds and tax benefits  deriving from exercise and sales of
employee stock options, and proceeds from the exercise of warrants.

In December  1999, the Company  amended its credit  agreement  established  with
three banks under which it may borrow up to  $70,000,000.  The agreement has two
parts. First, $20,000,000 is available as a revolving line-of-credit, subject to
an aggregate sub-limit of $2,000,000 for issuance of letters of credit, which is
committed  through  November 30, 2000. The second part is a standby  acquisition
facility,  which enables the Company to borrow up to $50,000,000,  for strategic
acquisitions  and/or  investments,  which is also committed through November 30,
2000.  A pricing  matrix has  been  established  for  credit  pricing  on  these
facilities  which is a function of the Company's  total funded  indebtedness  to
earnings before interest,  taxes,  depreciation and amortization (EBITDA) ratio.
Borrowings  under this credit  agreement bear interest at various rates,  at the
Company's  option.  Borrowings on these  facilities are unsecured,  subject to a
negative pledge on all business assets,  and the Company is required to maintain
certain  financial ratios and  indebtedness  tests. As of December 24, 1999, the
Company had no borrowings outstanding under this credit agreement.

On November 12, 1999, the Company  completed a follow-on  public offering of its
common stock, whereby 3,220,000 shares of common stock were issued and sold at a
price of $ 44.00 per share (this equates to 6,440,000 shares at $22.00 per share
on a post-split basis).  This offering resulted in net proceeds (after deducting
issuance  costs) to the Company of  $133,371,000.  The  proceeds of the offering
were  used  for  repayment  of  debt,  and  will  also  be  used  for  strategic
investments, capital expenditures,  working capital, and other general corporate
purposes.

On November 12, 1999, the Company paid off the remaining  balance of a term-loan
facility with a bank. The original principal balance of the loan was $3,000,000,
and required monthly principal payments of $50,000,  plus interest through 2003.
The principal balance of the loan payoff on November 8, 1999 was $1,350,000.

Management  believes  that  operating  cash  flow,  proceeds  received  from the
follow-on public offering, as well as the aforementioned credit agreement,  will
be adequate to provide for all cash  requirements  for the  foreseeable  future,
subject to requirements  that additional  growth or strategic  development might
dictate.

Year 2000 Readiness Disclosure

With the  changeover  to the year  2000,  the  Company  did not  experience  any
disruption  to its  operations,  as a result of the issues  associated  with the
limitations of the programming code in many existing computer  systems,  whereby
the  computer  systems  may not  properly  recognize  or process  date-sensitive
information.  The  Company's  date-sensitive  systems  include  test  equipment,
computer systems embedded in production equipment,  products containing computer
systems,  business data processing systems,  production  management and planning
systems,  and personal  computers.  Systems that do not properly  recognize such
information  could generate  erroneous data or cause a system to fail. There can
be no assurance  that there will not be future  complications  arising from Year
2000 issues.

The Company's program for addressing Year 2000 concerns,  included an assessment
and evaluation of internal  systems,  which resulted in testing and  remediation
efforts  for Year 2000  compliance.  In  addition,  the  Company  evaluated  its
customers,  vendors and service  providers to determine  the extent to which the
Company was  vulnerable  to any failure by these  third-party  providers  and to
ascertain their readiness for the Year 2000.

The total estimated cost of assessing Year 2000 issues is difficult to determine
with  accuracy,  but its total costs did not exceed  $500,000 and did not have a
material  adverse  impact  on its  operating  results  or  financial  condition.
Although the Company believes that it has successfully addressed any significant
disruption from Year 2000, it will continue to monitor all critical  systems for
the appearance of delayed  complications or disruptions,  as well as continue to
monitor its suppliers and customers.

Subsequent Events

On  January  11,  2000,  the  Company   increased  its  investment  in  Fortress
Technologies,  Inc.  ("Fortress  Technologies"),  a security networking company,
from $501,000 to $3,500,000. The investment in Fortress represents approximately
a 5 percent ownership interest.  In connection with the investment,  the Company
and  Fortress  Technologies  have  agreed on key terms of a reseller  agreement,
under which the companies will jointly offer a network-based  security solution
for residential  and business cable modem  customers.  In addition,  the Company
will become the exclusive  provider of this  security  solution to the domestic
broadband  cable-operator market. The investment in Fortress is being carried at
cost,  as  ownership  interest  is less than 20%,  and does not fall  within the
guidelines of Financial  Accounting  Standards No. 115,  "Accounting for Certain
Investments in Debt and Equity Securities" (Statement 115).

On  January  28,  2000,  a wholly  owned  subsidiary  of the  Company  purchased
substantially all the assets of Advanced Communications Services, Inc. ("ACSI"),
a provider of advanced network engineering services, for $3,640,000. The Company
did not assume any material liabilities of ACSI in the transaction.  The Company
believes  this  purchase  will enable it to expand its  capacity  for  providing
network design, and field engineering services to broadband cable operators.

On January 19, 2000,  the Company  entered into a  definitive  merger  agreement
under which Worldbridge Broadband Services, Inc. ("Worldbridge"),  will become a
wholly-owned subsidiary of the Company. Under the merger agreement,  the Company
will issue  approximately  1,603,584  shares of its common stock to  Worldbridge
Broadband Services, Inc. shareholders and convert options to acquire Worldbridge
stock into options to acquire  approximately  196,416 shares of C-COR.net common
stock.  The merger will be accounted for under the pooling of interest method of
accounting.  The Company  believes  the merger will enable the Company to expand
its  customer  and  geographic  base for  providing  engineering  and  technical
services  to cable  operators  in several  locations  in the United  States.  In
addition,  the Company  believes  the merger  will  fulfill a key element of the
Company's  business  strategy to offer total network solutions to its customers,
and  thereby  improve  its  competitive  position.  The merger is expected to be
completed in the third quarter of fiscal year 2000.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

          (Not Applicable)

PART II. OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

On December 7, 1999 the  Company's  board of  directors  declared a  two-for-one
stock split of the Company's common stock. The stock split was effective for all
shares  of  record  as of the  close of  business  on  December  22,  1999.  The
additional  shares were  distributed on January 6, 2000. In connection  with the
stock  split,  the par value per share of common  stock was reduced from $.10 to
$.05 and the  authorized  number of shares of common  stock was  proportionately
increased from 50,000,000 to 100,000,000.

Item 4.  Submission of matters to a vote of shareholders

The  following  share  information  related  to matters  submitted  to a vote of
shareholders are represented on a pre-split basis.

The Company's  annual meeting of shareholders  was held on October 19, 1999. The
record  date was  September  7,  1999,  on which  there were  10,688,356  shares
outstanding  and entitled to vote at such annual  meeting.  The following  items
were submitted to a vote by shareholders.

     1.  The election of three directors for a term of three years.

     2.  The election of a director for a term of one year.

     3.  The approval of a proposed amendment to the Company's Amended and
         Restated Articles of Incorporation, as amended, to increase the number
         of authorized shares of common stock from 24,000,000 to 50,000,000
         shares.

     4.  The approval of a proposed amendment to the Company's Amended and
         Restated Articles of Incorporation, as amended, to eliminate the right
         of shareholders to cumulate votes in the election of directors.

Mr. David A. Woodle,  Mr. I.N. Rendall Harper,  Jr., and Dr. Frank Rusinko,  Jr.
were re-elected as directors of the Company until the year 2002, and Mr. Michael
J. Farrell was elected as a director until the year 2000.

The voting results for the for matters noted above are set forth as follows:

     1.  The election of three directors for a term of three years.
<TABLE>
         <S>                        <C>                   <C>
         Name of Nominee            Votes For             Votes Withheld
         -----------------------    ---------             --------------
         David A. Woodle            8,769,938             264,174
         I.N. Rendall Harper, Jr.   8,774,338             259,774
         Dr. Frank Rusinko, Jr.     8,774,338             259,774
</TABLE>
     2.  The election of a directors for a term of one year.
<TABLE>
         <S>                        <C>                   <C>
         Name of Nominee            Votes For             Votes Withheld
         -----------------------    ---------             --------------
         Michael J. Farrell         8,772,338             261,774
</TABLE>
     3.  The approval of a proposed amendment to the Company's Amended and
         Restated Articles of Incorporation, as amended, to increase the number
         of authorized shares of common stock from 24,000,000 to 50,000,000
         shares.
<TABLE>
         <S>                       <C>                      <C>
         Votes For                 Votes Against            Abstained
         --------------            -------------            ---------
          7,214,917                  1,789,577               29,618
</TABLE>
     4.  The approval of a proposed amendment to the Company's Amended and
         Restated Articles of Incorporation, as amended, to eliminate the right
         of shareholders to cumulate votes in the election of directors.

<TABLE>
         <S>                       <C>                      <C>            <C>
         Votes For                 Votes Against            Abstained      Non-Voting
         --------------            -------------            ---------      ----------
          3,755,372                  1,638,776               560,078       3,124,288
</TABLE>

Item 6.   Exhibits and Reports on Form 8-K

The following exhibits are included herein:

   (3) (a)   Amended and Restated Articles of Incorporation of Registrant (the
             "Articles of Incorporation") filed with the Secretary of State of
             the Commonwealth of Pennsylvania on February 19, 1981.

   (3) (b)   Amendment to the Articles of Incorporation of Registrant filed with
             the Secretary of State of the Commonwealth of Pennsylvania on
             November 14, 1986.

   (3) (c)   Amendment to the Articles of Incorporation filed with the Secretary
             of State of the Commonwealth of Pennsylvania on September 21, 1995.

   (3) (d)   Amendment to the Articles of Incorporation filed with the Secretary
             of State of the Commonwealth of Pennsylvania on July 9, 1999.

   (3) (e)   Statement with Respect to Shares of Series A Junior Participating
             Preferred Stock filed with the Secretary of State of the
             Commonwealth of Pennsylvania on August 30, 1999.

   (3) (f)   Amendment to the Articles of Incorporation filed with the Secretary
             of State of the Commonwealth of Pennsylvania on October 20, 1999.

   (3) (g)   Amendment to the Articles of Incorporation filed with the Secretary
             of State of the Commonwealth of Pennsylvania on December 22, 1999.

   (27) Financial Data Schedule

Reports on Form 8-K

On October 13,  1999,  the  Registrant,  filed a Form 8-K/A to amemd the Current
Report filed on September 24, 1999,  reporting  Pro-forma  financial  statements
associated  with the  acquisitions  of  Convergence.com  Corporation and Silicon
Valley Communications, Inc.

On December 16, 1999, the  Registrant,  filed a Form 8-K dated December 8, 1999,
which included press releases  reporting that its Board of Directors  approved a
2-for-1 stock split of its common stock.

<PAGE>

                                   SIGNATURES

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


                                               C-COR.net Corp.
                                                     (Registrant)

Date: February 7, 2000                        /s/ William T. Hanelly
                                              ----------------------------------
                                               Vice President-Finance,
                                               Secretary & Treasurer
                                               (Principal Financial Officer)

Date: February 7, 2000                        /s/ Joseph E. Zavacky
                                              ----------------------------------
                                               Controller & Assistant
                                               Secretary
                                               (Principal Accounting Officer)