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                                                   Total Number of Pages is 13
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                                       OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                      For the Quarter ended March 31, 1997
                         Commission File Number 0-27692

                                   OrCAD, INC.
                                  (Registrant)

                      Incorporated in the State of Delaware

                I.R.S. Employer Identification Number 93-1062832

                   9300 S.W. Nimbus Avenue Beaverton, OR 97008

                            Telephone: (503) 671-9500




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
                                      ---- -------

            On March 31, 1997, 6,689,468 shares of the registrant's common
     stock were issued and outstanding.

                                       1
<PAGE>
 
                                   OrCAD, INC.

                                      INDEX



PART I.    FINANCIAL INFORMATION                                       PAGE NO.
--------------------------------------------   ---------------------------------

Item 1.    Financial Statements

              Consolidated Balance Sheets - March 31, 1997            
              and December 31, 1996                                           3

              Consolidated Statements of Operations -- Three months
              ended March 31, 1997 and 1996                                   4

              Consolidated Statements of Cash Flows -- Three months
              ended March 31, 1997 and 1996                                   5

           Notes to consolidated financial statements                         6

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



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

Item 2.    Changes in Securities                                             12

Item 6.    Exhibits and Reports on Form 8-K                                  12

           SIGNATURES                                                        13

                                       2
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                                  OrCAD, Inc.
                          CONSOLIDATED BALANCE SHEETS
                                (In thousands)
 
<TABLE> 
<CAPTION> 

                                                                                        March 31,           
                                                                                         1997           December 31,
                                                                                      (Unaudited)          1996
                                                                              --------------------    --------------------
<S>                                                                                   <C>               <C> 

Assets
Current assets:
      Cash and cash equivalents                                                       $ 20,628          $ 20,308
      Short-term investments                                                             8,900             8,964
      Trade accounts receivable, net of doubtful accounts
          and sales return allowances of $612 and $637                                   3,717             3,081
      Inventory, net                                                                       429               504
      Royalty receivable                                                                   122               193
      Other                                                                                917               911
                                                                                      --------          --------
           Total current assets                                                         34,713            33,961
                                                                                      --------          --------


Fixed assets, net                                                                        1,652             1,018
Purchased software technology, net                                                         385               429
Goodwill and intangible assets, net                                                      2,591             2,704
Other assets                                                                               133               138
                                                                                      ========          ========
           Total assets                                                               $ 39,474          $ 38,250
                                                                                      ========          ========

Liabilities and Shareholders' Equity
Current liabilities:
      Accounts payable                                                                $    538          $    484
      Accrued payroll and related liabilities                                              912               936
      Accrued liabilities                                                                  839               857
      Accrued income taxes                                                               1,042               607
      Deferred revenue                                                                   1,325             1,432
                                                                                      --------          --------
           Total current liabilities                                                     4,656             4,316
                                                                                      --------          --------
Shareholders' equity:
      Preferred stock                                                                       --                --
      Common stock                                                                          67                67
      Additional paid-in capital                                                        35,996            35,992
      Accumulated deficit                                                               (1,180)           (2,091)
      Net unrealized gain on investments                                                     2                 9
      Foreign currency translation adjustment                                              (67)              (43)
                                                                                      --------          --------
           Total shareholders' equity                                                   34,818            33,934
                                                                                      --------          --------
           Total liabilities and shareholders' equity                                 $ 39,474          $ 38,250
                                                                                      ========          ========
</TABLE> 
See notes to Consolidated Financial Statements. 

                                       3
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                                  OrCAD, Inc.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (In thousands, except per share data)
                                  (Unaudited)
<TABLE> 
<CAPTION> 


                                                                                      Three Months Ended
                                                                         --------------------------------------------
                                                                           March 31,                      March 31,
                                                                            1997                            1996
                                                                         --------------------     -------------------
<S>                                                                       <C>                           <C>  
Revenue:
      Product Revenue                                                     $ 4,967                        $ 4,248
      Service Revenue                                                         935                            677
                                                                          -------                        -------
           Total revenue                                                    5,902                          4,925
Cost and expenses:
      Cost of revenue -- product                                              615                            447
      Cost of revenue -- service                                              171                            165
      Research and development                                              1,284                          1,005
      Marketing and sales                                                   2,032                          1,695
      General and administrative                                              765                            756
                                                                          -------                        -------
           Total cost and expenses                                          4,867                          4,068
                                                                          -------                        -------
Income from operations                                                      1,035                            857
                                                                          -------                        -------
Other income (expense):
      Interest income                                                         370                             86
      Other, net                                                               (3)                            24
                                                                          -------                        -------
                                                                              367                            110
                                                                          -------                        -------
Income before income taxes                                                  1,402                            967
      Income taxes                                                            491                            184
                                                                           ------                        -------
Net income                                                                $   911                        $   783
                                                                          =======                        =======
Net income per share                                                      $  0.13                        $  0.14
                                                                          =======                        =======
Weighted average common and common
      equivalent shares outstanding                                         6,950                          5,414
                                                                          =======                        =======
</TABLE> 
See notes to Consolidated Financial Statements. 

                                       4
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                                  OrCAD, Inc.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

<TABLE> 
<CAPTION> 



                                                                                         Three Months Ended
                                                                            --------------------------------------------
                                                                                 March 31,               March 31,
                                                                                   1997                    1996
                                                                            --------------------    --------------------
<S>                                                                          <C>                     <C> 

Cash flows from operating activities:
      Net income                                                              $    911                 $    783
      Adjustments to reconcile net income to
       net cash provided by operating activities:
               Depreciation and amortization                                       316                      256
               Provision for losses on trade accounts receivable                    (1)                     159
               Provision for inventory reserves                                     10                        5
               Deferred income taxes                                                 2                      111
               Changes in assets and liabilities:
                    Trade accounts receivable                                     (665)                    (107)
                    Inventory                                                       59                       57
                    Royalty receivable                                              71                       46
                    Other current assets                                           (19)                      44
                    Accounts payable                                                68                      165
                    Accrued payroll and related liabilities                        (22)                      10
                    Accrued liabilities                                             (3)                    (131)
                    Accrued income taxes                                           444                      102
                    Deferred revenue                                              (104)                    (124)
                                                                              --------                 --------
                       Total adjustments                                           156                      593
                                                                              --------                 --------
           Net cash provided by operating activities                             1,067                    1,376
                                                                              --------                 --------

Cash flows from investing activities:
      Acquisition of fixed assets                                                 (795)                    (260)
      Proceeds from maturity (purchase) of investments, net                         56                   (3,991)
                                                                               --------                --------
           Net cash used in investing activities                                  (739)                  (4,251)

Cash flows from financing activities:
      Payments on capital leases                                                    --                      (33)
      Issuance of common stock, net                                                  4                   19,399
                                                                              --------                 --------
           Net cash provided by financing activities                                 4                   19,366
                                                                              --------                 --------

           Effects of exchange rate on cash                                        (12)                     (13)
                                                                              --------                 --------

               Net increase in cash and cash equivalents                           320                   16,478

Cash and cash equivalents at the beginning of period                            20,308                    2,080
                                                                              --------                 --------

Cash and cash equivalents at the end of period                                $ 20,628                 $ 18,558
                                                                              ========                 ========

Supplemental Disclosures of Cash Flow Information:
      Income taxes paid                                                       $     45                 $     --
      Noncash investing activities
           Exchange of royalty receivable for
              software technology                                             $     --                 $    210

</TABLE> 
See notes to Consolidated Financial Statements. 

                                       5
<PAGE>
 
                                  OrCAD, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       (In thousands except share amounts)
                                   (Unaudited)

1.       Basis of Presentation
         ---------------------
         The accompanying financial statements have been prepared in conformity
         with generally accepted accounting principles. However, certain
         information or footnote disclosures normally included in financial
         statements prepared in accordance with generally accepted accounting
         principles have been condensed, or omitted, pursuant to the rules and
         regulations of the Securities and Exchange Commission. In the opinion
         of management, the statements include all adjustments necessary (which
         are of a normal and recurring nature) for the fair presentation of the
         results of the interim periods presented. These financial statements
         should be read in conjunction with the Company's audited consolidated
         financial statements for the year ended December 31, 1996, as included
         in the Company's Annual Report on Form 10-KSB filed with the Securities
         and Exchange Commission.

2.       Net Income Per Common and Common Equivalent Share
         -------------------------------------------------
         Net income per common and common equivalent share is computed using the
         weighted average number of common and dilutive common equivalent shares
         assumed to be outstanding during the period. Common equivalent shares
         consist of options to purchase common stock.

3.       Use of Estimates
         ----------------
         Generally accepted accounting principles require management to make
         estimates and assumptions that affect the reported amount of assets,
         liabilities and contingencies at the date of the financial statements
         and the reported amounts of revenues and expenses during the reporting
         periods. Actual results could differ from those estimates.

4.       Revenue Recognition
         -------------------
         Revenue primarily includes revenue from software product shipments and
         revenue from training related services and extended support agreements.
         The Company recognizes revenue from software licenses after shipment of
         product and when no significant contractual obligations remain
         outstanding. When the Company receives payment prior to shipment or
         fulfillment of a significant obligation to the customer, such payments
         are recorded as deferred revenue and recognized as revenue upon
         shipment or fulfillment of such obligation. A portion of revenue from
         product sales is deferred and recognized ratably over the maintenance
         period, generally three months to one year. Revenue from customer
         training, support and other services is recognized as services are
         performed.

5.       Software Development Costs
         --------------------------
         Under Statement of Financial Accounting Standards No. 86 (SFAS 86),
         software development costs are to be capitalized beginning when a
         product's technological feasibility has been established and ending
         when a product is made available for general release to customers. To
         date, the establishment of technological feasibility of the Company's
         products has occurred shortly before general release, and accordingly
         no costs have been capitalized.

                                       6
<PAGE>
 
6.       Income Taxes
         ------------
         The provision for income taxes has been recorded based on the Company's
         current estimate of the Company's annual effective tax rate. This rate
         differs from the combined federal and state statutory rate of
         approximately 38.5% primarily due to the utilization of net operating
         loss carryforwards, the utilization of research and experimentation tax
         credits, and the benefit of the Company's foreign sales corporation.

7.       Reclassifications
         -----------------
         Certain reclassifications have been made to prior periods data to
         conform with the March 31, 1997 presentation.

8.       Cash Equivalents and Short-Term Investments
         -------------------------------------------
         Cash equivalents consist of highly liquid investments with original
         maturities of three months or less. Cash equivalents are stated at cost
         and consist primarily of money market funds, commercial paper,
         municipal bonds and municipal auction preferred stock. The carrying
         amount approximates fair value due to the short-term nature of these
         investments. Those instruments with original maturities greater than
         three months and less than one year from the balance sheet date are
         considered to be short-term investments. Short-term investments, which
         primarily consist of debt securities and U.S. Treasury Notes, are
         reported at fair value, and are classified as available-for-sale
         securities. The cost of securities sold is determined using the
         specific identification method when computing realized gains and
         losses. Fair value is determined using available market information.

                                       7
<PAGE>
 
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

INTRODUCTION

         OrCAD develops, markets, and supports software products that assist
electronics designers in developing field-programmable gate arrays, including
complex programmable logic devices, and printed circuit boards. The Company
operates primarily in one business segement, comprising the elecronic design
automation industry.

         The accompanying consolidated financial statements include the accounts
of the Company and its subsidiaries, Massteck Ltd. and OrCAD Japan KK, from the
dates of acquisition. All intercompany balances have been eliminated in
consolidation.


RESULTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 1997 AND 1996

TOTAL REVENUES

         The Company derives revenue from the licensing of its software products
and from the provision of maintenance and training services to customers. The
Company recognizes revenue from software licenses after shipment of product and
when no significant contractual obligations remain outstanding. Service revenue
is derived primarily from extended support agreements that provide customers
access to product enhancements, technical support, bulletin board services and a
subscription to OrCAD Design Desktop Quarterly, a newsletter produced by the
Company. Revenue from each extended support agreement is deferred and recognized
ratably over the term of the support agreement. Revenue from customer training
is recognized as services are performed.

         Total revenue increased 20% from $4.9 million in the first quarter of
1996 to $5.9 million in the first quarter of 1997. The increase in total revenue
was due to growth in both product revenue and service revenue. As a percentage
of total revenue, product revenue decreased from 86% in the first quarter of
1996 to 84% in the first quarter of 1997. Conversely, service revenue increased
as a percentage of total revenue from 14% in the first quarter of 1996 to 16% in
the first quarter of 1997.

         Product revenue increased 17% from $4.2 million in the first quarter of
1996 to $5.0 million in the first quarter of 1997. The increase in product
revenue was primarily attributable to first customer shipments of OrCAD Express
and Capture Enterprise Edition and strong sales of Capture in the first quarter
of 1997.

         Service revenue increased 38% from $677,000 in the first quarter of
1996 to $935,000 in the first quarter of 1997. The increase in service revenue
from the first quarter of 1996 to the first quarter of 1997 was primarily
attributable to increased sales of customer training and extended support
agreements.

         Total North American revenue increased 43% from $2.8 million in the
first quarter of 1996 to $3.9 million in the first quarter of 1997. Total
revenue generated outside of North America decreased 10% from $2.2 million in
the first quarter of 1996 to $2.0 million in the first quarter of 1997. As a
percentage of the Company's total revenue, North American revenue increased from
56% in the first quarter of 1996 to 67% in the first quarter of 1997. The
increase in the proportion of revenue generated 

                                       8
<PAGE>
 
in North America was principally attributable to first customer shipments of
OrCAD Express and Capture Enterprise Edition. Conversely, the decrease in the
proportion of revenue generated outside of North America was due in part to the
typical slower initial adoption rate of new products in Europe and Asia.

COST OF REVENUE


         The cost of product revenue represents the costs associated with the
licensing of the Company's products, such as expenses of reproducing product
documentation, disks and packaging, hardware locks, shipping costs and royalties
paid to external developers. The cost of product revenue increased 38% from
$447,000 in the first quarter of 1996 to $615,000 in the first quarter of 1997.
The increase was primarily attributable to an increased level of product sales,
increased royalty costs associated with Capture Enterprise Edition, and
non-recurring commissions payable to a North American reseller. As a percentage
of product revenue, cost of product revenue increased from 11% in the first
quarter of 1996 to 12% in the first quarter of 1997. This increase was primarily
the result of the associated royalty costs for Capture Enterprise Edition and
commissions payable to a North American reseller.

         The cost of service revenue includes the costs of providing software
maintenance, such as technical support, software revision releases and updated
user documentation, and the costs of providing training. The cost of service
revenue increased 4% from $165,000 in the first quarter of 1996 to $171,000 in
the first quarter of 1997. This increase was primarily attributable to increased
training services and personnel costs relating to technical support, including
costs associated with increased headcount and compensation expenses as a result
of increased product, upgrade, and extended support agreement sales. As a
percentage of service revenue, the cost of service revenue decreased from 24% in
the first quarter of 1996 to 18% in the first quarter of 1997. This decrease
reflects the absorption of a relatively small increase in cost of service
revenue in the first quarter of 1997 as compared to the first quarter of 1996
over a higher service revenue base.


RESEARCH AND DEVELOPMENT

         Research and development expenses include the costs of developing new
products and enhancements to existing products. Software development costs are
generally expensed as incurred, in that technological feasibility is generally
not established until shortly before the release of a new product and no
material development costs are incurred after establishment of technological
feasibility. Research and development expenses increased 28% from $1.0 million
in the first quarter of 1996 to $1.3 million in the first quarter of 1997. The
increase in research and development expenses was attributable to increased
personnel costs, including costs associated with increased headcount,
recruiting, relocation and the engagement of contract engineers. As a percentage
of total revenue, research and development expenses increased from 20% in the
first quarter of 1996 to 22% in the first quarter of 1997. The Company expects
research and development expenses to continue to increase in absolute terms.


MARKETING AND SALES

         Marketing and sales expenses include salaries, commissions and related
personnel costs, and other sales and promotional expenses. Marketing and sales
expenses increased 20% from $1.7 million in the first quarter of 1996 to $2.0
million in the first quarter of 1997. The increase was principally
attributable to increased compensation expenses related to growth in the direct
telesales organization, increased headcount 

                                       9
<PAGE>
 
for marketing personnel, and increased promotional expenses primarily associated
with two new product offerings during the quarter. As a percentage of total
revenue, marketing and sales expenses remained constant at 34% from the first
quarter of 1996 to the first quarter of 1997. The Company expects marketing and
sales expenses to continue to increase in absolute terms.


GENERAL AND ADMINISTRATIVE

         General and administrative expenses include the costs associated with
the Company's executive office, human resources, finance, information systems
and operations functions. General and administrative expenses increased 1% from
$756,000 in the first quarter of 1996 to $765,000 in the first quarter of 1997.
As a percentage of total revenue, general and administrative expenses decreased
from 15% in the first quarter of 1996 to 13% in the first quarter of 1997.

OTHER INCOME, NET

         Other income increased to $367,000 in the first quarter of 1997, as
compared to $110,000 in the first quarter of 1996. This improvement resulted
primarily from higher interest income earned on increased cash and cash
equivalents and short-term investment balances resulting from the proceeds of
the Company's initial public offering completed in March 1996.

INCOME TAX EXPENSE

         The effective tax rate for the first quarter of 1997 was 35.0%, which
differs from the combined federal and state statutory rate of approximately
38.5% because of the utilization of net operating loss carryforwards, the
utilization of research and experimentation tax credits, and the benefit of the
Company's foreign sales corporation. Income tax expense for the first quarter of
1997 was $491,000 as compared to $184,000 for the first quarter of 1996. The
increase in income tax expense is due to higher income before income taxes and a
higher estimated effective tax rate in the first quarter of 1997 as compared to
the same period in 1996. The increase in the estimated effective tax rate in the
first quarter of 1997 is primarily due to the utilization of net operating loss
carryforwards in 1996.

ACQUISITIONS

         In April 1997, the Company acquired certain technology and sales
personnel from TEAM Corporation for approximately $2.0 million. The cost of the
acquisition is being allocated on the basis of the fair value of the assets
acquired. This allocation is expected to result in a charge for in-process
research and development of approximately $1.8 million in the second quarter of
1997. The charge for in-process research and development will result from
allocating a portion of the acquisition cost to TEAM's in-process product
development that has not reached technological feasibility. In addition, there
are certain contingent amounts payable annually over the next three years based
on the achievement of specific revenue milestones.

                                       10
<PAGE>
 
LIQUIDITY AND CAPITAL RESOURCES

         Total cash and cash equivalents were $20.6 million at March 31, 1997 as
compared to $20.3 million at December 31, 1996. Cash provided by operations was
$1.1 million for the first quarter of 1997 as compared to $1.4 million for the
first quarter of 1996. The decrease in cash provided by operations from the
first quarter of 1996 to the first quarter of 1997 was primarily due to an
increase in trade accounts receivable. Cash used in investing activities was
$739,000 for the first quarter of 1997 as compared to $4.3 million for the first
quarter of 1996. Purchases of investment securities with the proceeds of the
initial public offering in March 1996 accounted for a substantial portion of
cash used in investing activities in the first quarter of 1996. Cash used in
investing activities in the first quarter of 1997 was primarily comprised of
acquisitions of fixed assets.

         The Company has available borrowing capacity consisting of a commitment
for a $3.0 million line of credit from a commercial bank. The Company believes
that current cash and investment balances, cash flows from operations and the
unused line of credit are sufficient to meet current and anticipated future
capital requirements for at least the next twelve months. The Company currently
does not have any material commitments for capital expenditures.

NEW ACCOUNTING PRONOUNCEMENTS

         In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standard (SFAS) No. 128, "Earnings per Share".
This Statement establishes a different method of computing net income per share
than is currently required under the provisions of Accounting Principles Board
Opinion No. 15. Under SFAS No. 128, the Company will be required to present both
basic net income per share and diluted net income per share. Basic net income
per share is expected to be comparable or slightly higher than the currently
presented net income per share as the effect of dilutive stock options will not
be considered in computing basic net income per share. Diluted net income per
share is expected to be comparable or slightly lower than the currently
presented net income per share.

         The Company plans to adopt SFAS No. 128 in the fourth quarter of 1997
and at that time all historical net income per share data presented will be
restated to conform to the provisions of this Statement.


VARIABILITY OF OPERATING RESULTS

         The Company's quarterly operating results may vary significantly in the
future depending on factors such as increased competition, timing of new product
announcements, releases and pricing changes by the Company or its competitors,
length of sales cycles, market acceptance or delays in the introduction of new
or enhanced versions of the Company's products, timing of significant orders,
seasonal factors, mix of direct and indirect sales, product mix, and economic
conditions generally and in the EDA industry specifically.

         A substantial portion of the Company's revenue in each quarter results
from orders booked in that quarter. The Company's expense levels are based, in
part, on its expectations as to future revenue. If revenue levels are below
expectations, operating results are likely to be adversely affected. In
particular, net income may be disproportionately affected by a reduction in
revenue because only a certain portion of the Company's expenses varies with its
revenue.

                                       11
<PAGE>
 
PART II - OTHER INFORMATION

ITEM 2:  CHANGES IN SECURITIES

         During the first quarter of 1997, the Company sold securities without
registration under the Securities Act of 1933 (the "Securities Act") upon the
exercise of stock options granted under the Company's stock option plans. An
aggregate of 7,566 shares of Common Stock were issued at exercise prices ranging
from $.35 to $3.50. These transactions were effected in reliance upon Rule 701
promulgated pursuant to the authority of the Securities and Exchange Commission
under Section 3(b) of the Securities Act.

ITEM 6:  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits:  27.1 Financial Data Schedule

         (b) No reports were filed on Form 8-K during the three months ended
March 31, 1997.

                                       12
<PAGE>
 
SIGNATURES

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

                                   OrCAD, Inc.



             Dated: May 14, 1997   P. David Bundy
                                   --------------

                                   Vice President, Finance and Secretary
                                   (Principal Financial and Accounting Officer)

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