<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                For the Quarterly Period Ended September 30, 1997

                                       OR

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

                        For the transition period from    to
                                                      ----   ----

                         Commission file number 0-27890
                                                -------

                          MINDSPRING ENTERPRISES, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                  Delaware                                58-2113290
--------------------------------------------------------------------------------
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                            Identification Number)

1430 West Peachtree St. NW, Suite 400, Atlanta, GA                30309
--------------------------------------------------------------------------------
(Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, including area code:        (404) 815-0770
                                                   ----------------------------


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
                                      ----------    ----------

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

                                       Outstanding at November 11, 1997
                                       --------------------------------

Common Stock at $.01 par value               7,530,731 Shares


<PAGE>   2


Part I - Financial Information

Item 1 - Financial Statements

                          MINDSPRING ENTERPRISES, INC.
                                 BALANCE SHEETS
                 AS OF SEPTEMBER 30, 1997 AND DECEMBER 31, 1996

<TABLE>
<CAPTION>
                                                                                SEPTEMBER 30,1997    DECEMBER 31, 1996
                                                                                -----------------    -----------------
                                                                                   (UNAUDITED)
<S>                                                                             <C>                  <C>        
                                     ASSETS

CURRENT ASSETS:
   Cash and cash equivalents....................................................    $  7,317,440        $  9,653,234
   Trade receivables, net ......................................................       2,052,007           1,996,613
   Prepaids and other current assets ...........................................         798,408             853,122
   Inventory ...................................................................          81,499             116,545
                                                                                    ------------        ------------
       Total current assets ....................................................      10,249,354          12,619,514
                                                                                    ------------        ------------

PROPERTY AND EQUIPMENT;
   Computer and telecommunications equipment ...................................      14,737,413          11,509,165
   Assets under capital lease ..................................................       7,589,060           1,472,885
   Other .......................................................................       1,750,714             565,503
                                                                                    ------------        ------------
                                                                                      24,077,187          13,547,553
   Less:accumulated depreciation ...............................................      (4,973,327)         (1,964,231)
                                                                                    ------------        ------------
       Property and equipment, net .............................................      19,103,860          11,583,322
                                                                                    ------------        ------------
OTHER ASSETS:
   Acquired customer base, net .................................................       8,234,698          10,727,268
   Other .......................................................................         231,548             302,273
                                                                                    ------------        ------------
       Total other assets ......................................................       8,466,246          11,029,541
                                                                                    ------------        ------------

                                                                                    $ 37,819,460        $ 35,232,377
                                                                                    ============        ============



                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
   Trade accounts payable.......................................................    $  2,568,487        $  4,119,302
   Other accrued expenses ......................................................       4,262,459           1,284,626
   Current portion of capital lease obligations ................................       1,900,823             656,252
   Current portion of notes payable ............................................       1,687,970             623,922
   Deferred revenue ............................................................       1,609,972             415,881
                                                                                    ------------        ------------

       Current liabilities .....................................................      12,029,711           7,099,983
                                                                                    ------------        ------------

LONG-TERM LIABILITIES:
   Notes payable ...............................................................         592,841           2,042,742
   Capital lease obligations ...................................................       4,292,727             682,571
                                                                                    ------------        ------------
       Total long-term liabilities .............................................       4,885,568           2,725,313
                                                                                    ------------        ------------

       Total liabilities .......................................................      16,915,279           9,825,296
                                                                                    ------------        ------------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value; 15,000,000 shares authorized
     and 7,530,531 and 7,477,084 issued and outstanding at
     September 30, 1997 and December 31, 1996, respectively ....................          75,305              74,771
   Additional paid-in-capital ..................................................      35,055,880          34,978,225
   Accumulated deficit .........................................................     (14,227,004)         (9,645,915)
                                                                                    ------------        ------------
     Total stockholders' equity ................................................      20,904,181          25,407,081
                                                                                    ------------        ------------
                                                                                    $ 37,819,460        $ 35,232,377
                                                                                    ============        ============
</TABLE>

  The accompanying condensed notes to financial statements are an integral part
  of these balance sheets.


                                        2


<PAGE>   3


Financial Statements - Continued

                          MINDSPRING ENTERPRISES, INC.
                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                               THREE MONTHS                    NINE MONTHS
                                                  ENDED                           ENDED
                                               SEPTEMBER 30,                   SEPTEMBER 30,
                                           1997            1996           1997             1996
                                      -------------   ------------    ------------    ------------
<S>                                   <C>             <C>             <C>             <C>         
REVENUE
   Access ..........................   $ 10,857,739    $ 3,911,055    $ 27,266,968    $  6,700,655
   Subscriber start-up fees ........      1,024,888        734,948       2,831,811       1,580,716
   Business services ...............      2,084,655        655,357       5,248,880       1,326,512
                                       ------------    -----------    ------------    ------------
     Total revenue .................     13,967,282      5,301,360      35,347,659       9,607,883
                                       ------------    -----------    ------------    ------------
COSTS AND EXPENSES
   Costs of revenue-recurring ......   $  3,948,466    $ 1,905,802    $ 10,642,041    $  3,202,005
   Costs of subscriber start-up fees        440,058        941,376       1,100,037       1,557,496
   General and administrative ......      5,621,178      2,920,303      15,867,217       5,690,845
   Selling .........................      2,150,222      1,122,686       5,968,692       2,693,097
   Depreciation and amortization ...      2,272,722      1,011,563       6,160,843       1,607,906
                                       ------------    -----------    ------------    ------------
     Total cost and expenses .......     14,432,646      7,901,730      39,738,830      14,751,349

OPERATING LOSS .....................   $   (465,364)   $(2,600,370)   $ (4,391,171)   $ (5,143,466)
INTEREST EXPENSE, NET ..............       (161,160)      (101,330)       (189,918)        (57,447)
                                       ------------    -----------    ------------    ------------

NET LOSS ...........................   $   (626,524)   $(2,701,700)   $ (4,581,089)   $ (5,200,913)
                                       ------------    -----------    ------------    ------------

NET LOSS PER SHARE .................   $      (0.08)   $     (0.53)   $      (0.61)   $      (1.13)
                                       ------------    -----------    ------------    ------------
WEIGHTED AVERAGE
COMMON
 SHARES OUTSTANDING ................      7,528,102      5,138,836       7,508,200       4,588,202
                                       ------------    -----------    ------------    ------------
</TABLE>



            The accompanying condensed notes to financial statements
                   are an integral part of these statements.



                                        3

<PAGE>   4


Financial Statements - Continued

                          MINDSPRING ENTERPRISES, INC.
                            STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                          1997               1996
                                                                    ---------------    -------------
<S>                                                                 <C>                <C>          
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net loss........................................................   $(4,581,089)   $ (5,200,913)
     Adjustments to reconcile net loss to net cash provided by
       (used in) operating activities:
     Depreciation and amortization ...................................    6,160,843       1,607,906
     Changes in operating assets and liabilities:
         Trade receivables ...........................................      (55,394)     (2,485,297)
         Other current assets ........................................       89,760      (1,285,164)
         Trade accounts payable ......................................   (1,550,815)      1,246,190
         Other accrued expenses ......................................    2,977,832       1,870,301
         Deferred revenue ............................................    1,194,091       1,497,964
                                                                        -----------    ------------
           Total adjustments .........................................    2,655,474         843,994
                                                                        -----------    ------------
           Net Cash Provided by (Used in) Operating Activities .......    4,235,228      (2,749,013)
                                                                        -----------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of property and equipment .............................   (4,415,030)     (7,366,647)
     Purchase of customer base .......................................     (620,249)    (12,473,998)
     Other ...........................................................       33,369        (139,638)
                                                                        -----------    ------------
         Net Cash Used in Investing Activities........................   (5,001,910)    (19,980,283)
                                                                        -----------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds of loan from preferred stockholder .....................            -       1,000,000
     Payments of loan from preferred stockholder .....................            -      (3,500,000)
     Proceeds of notes payable .......................................            -      12,029,000
     Payments of notes payable .......................................     (385,853)              -
     Payments of capital lease obligations ...........................   (1,261,448)              -
     Issuance of common stock ........................................       78,189      14,149,689
                                                                        -----------    ------------
         Net Cash (Used in) Provided by Financing Activities .........   (1,569,112)     23,678,689
                                                                        -----------    ------------
NET (DECREASE) INCREASE IN CASH AND CASH
     EQUIVALENTS .....................................................   (2,335,794)        949,393
CASH AND CASH EQUIVALENTS, beginning of period .......................    9,653,234         424,834
                                                                        -----------    ------------

CASH AND CASH EQUIVALENTS, end of period.............................   $ 7,317,440    $  1,374,227
                                                                        ===========    ============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
     Cash paid for interest..........................................   $   493,809    $    136,127
                                                                        ===========    ============
     Cash paid for income taxes......................................   $         -    $          -
                                                                        ===========    ============
SUPPLEMENTAL NON-CASH DISCLOSURES:
     Assets acquired under capital leases............................   $ 6,116,175    $          -
                                                                        ===========    ============
</TABLE>



                 The accompanying condensed notes to financial
                    statements are an integral part of these
                                  statements.


                                        4

<PAGE>   5



Financial Statements - Continued

                          MINDSPRING ENTERPRISES, INC.
                     CONDENSED NOTES TO FINANCIAL STATEMENTS
                           SEPTEMBER 30, 1997 AND 1996

1.       Certain information and footnote disclosures normally included in 
         financial statements prepared in accordance with generally accepted
         accounting principles have been condensed or omitted pursuant to
         Article 10 of Regulation S-X of the Securities and Exchange Commission.
         The accompanying unaudited condensed financial statements reflect, in
         the opinion of management, all adjustments necessary to achieve a fair
         statement of the Company's financial position and results for the
         interim periods presented. All such adjustments are of a normal and
         recurring nature. It is suggested that these condensed financial
         statements be read in conjunction with the financial statements and
         notes thereto included in the Company's Annual Report on Form 10-K for
         the year ended December 31, 1996 (File No. 0-27890).

2.       Certain amounts in the prior year financial statements have been 
         reclassified to conform to the current year presentation.

3.       Net loss per share is computed using the weighted average number of
         shares of common stock and dilutive common stock equivalent shares from
         stock options (using the treasury stock method). For the periods
         presented, options to purchase shares of the Company's common stock are
         excluded from the calculation as their effect is antidilutive.

4.       There was no provision for or cash payment of income taxes for the nine
         months ended September 30, 1997 and 1996, respectively, as the Company
         had net taxable loss for these periods and anticipates a net taxable
         loss for the year ended December 31, 1997.


                                        5

<PAGE>   6


ITEM 2-

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

                  MindSpring Enterprises, Inc. (the "Company") is a national 
provider of Internet access. The Company reincorporated in Delaware in December
1995. At September 30, 1997, the Company served a total of approximately 224,000
subscribers.

                  The Company offers local Internet access to subscribers in
most major metropolitan areas of the United States, either through Company owned
points of presence ("POPs") or through access to third party POPs in accordance
with network services agreements between the Company and third party network
providers. Currently, the Company has agreements with, and provides services
through the network POPs of PSINet, Inc. ("PSINet") and GridNet International,
L.L.C. ("GridNet"). Pursuant to the network services agreements between the
Company and each of PSINet and GridNet (the "PSINet Services Agreement" and
"GridNet Services Agreement," respectively), the Company has the flexibility to
offer Internet access in overlapping POP locations through a MindSpring POP, a
PSINet or GridNet POP or a combination of all three.

                  The Company derives revenue primarily from monthly
subscriptions and start-up fees from individuals for dial-up access to the
Internet. Monthly subscription fees vary by billing plan. Under the Company's
current pricing plans, customers have a choice of two "flat rate" plans (The
Works and Unlimited Access) and two "usage-sensitive" plans (Standard and
Light). For the quarters ended September 30, 1997 and September 30, 1996, the
average monthly recurring revenue per dial-up subscriber was approximately $20
(monthly recurring revenue plus usage charges for non-"flat rate" subscribers,
divided by total subscribers). Start-up fees for new subscribers vary depending
upon the promotional method by which the subscriber is acquired, ranging up to a
maximum of $25. Aggregate subscriber start up fees are sufficient to cover the
aggregate costs of direct materials, mailing expenses, and licensing fees
associated with new subscribers. Most of the Company's individual subscribers
pay their MindSpring fees automatically by preauthorized monthly charges to the
subscriber's credit card.

                  In addition, the Company earns revenue by providing
Web-hosting services, full-time dedicated access connections to the Internet and
domain registration. The Company's Web-hosting services allow a business or
individual to post information on the World Wide Web so that the information is
available to anyone who has access to the Internet. Through its domain
registration services, the Company provides subscribers the ability to
personalize electronic mail addresses and URLs (Uniform Resource Locators). The
services described in this paragraph have been classified as business services
in the statements of operations and the "Results of Operations" table set forth
below.

                  The Company's costs include (1) costs of revenue that are
primarily related to the number of subscribers, (2) selling, general and
administrative expenses that are associated more generally with operations, and
(3) depreciation and amortization, which are related to the size of the
Company's network and the deferred costs associated with acquired customer
bases.

                  Costs of revenue that are primarily related to the number of
subscribers include both recurring costs and subscriber start-up expenses.
Recurring costs of revenue consist primarily of the costs of telecommunications
facilities necessary to provide service to subscribers and certain monthly
licensing fees per subscriber for the right to receive and make available
certain proprietary on-line services. Telecommunications facilities costs
include the costs of providing local telephone lines into each Company-owned
POP, costs related to the use of third party networks pursuant to services


                                        6

<PAGE>   7


agreements and costs associated with leased lines connecting each Company-owned
POP and third party network to the Company's hub and connecting the Company's
hub to the Internet backbone. Start-up expenses for each subscriber include
one-time license fees paid to third parties for the right to bundle other
capabilities into the Company's software, cost of diskettes and other product
media, manuals, and packaging and delivery costs associated with the materials
provided to new subscribers. The Company does not defer any such subscriber
start-up expenses.

                  Selling, general and administrative costs are incurred in the
areas of sales and marketing, customer support, network operations and
maintenance, engineering, accounting and administration. Selling, general and
administrative costs will increase over time as the Company's scope of
operations increases. However, the Company expects that such costs will be more
than offset by anticipated increases in revenue attributable to overall
subscriber growth. In addition, significant levels of marketing activity may be
necessary in order for the Company to build or increase its subscriber base in a
given market to a size large enough to generate sufficient revenue to offset
such marketing expenses. The Company does not defer any start-up expenses
related to entering new markets. The costs associated with the development and
registration of the Company's trademarks have been expensed as incurred. Such
costs have not been material.

                  Prior to the PSINet Services Agreement and the GridNet
Services Agreement, as the demand for the Company's services in a particular POP
had grown, the Company had been required to invest in additional
telecommunications equipment and provide additional local telephone lines for
that POP. The third party network services agreements provide the Company the
option to evaluate on a POP-by-POP basis whether to continue to develop
MindSpring POPs using the Company's capital resources or to conserve capital
through utilization of third party POPs for a specified fee. As the Company
expands into new markets, both costs of revenue and selling, general and
administrative expenses will increase. To the extent the Company opens
MindSpring POPs in new markets, such expenses may also increase as a percentage
of revenue in the short term after a new MindSpring POP is opened because many
of the fixed costs of providing service in a new market are incurred before
significant revenue can be expected from that market. However, to the extent
that the Company expands into new markets by using third party POPs instead of
opening its own POPs, the Company's incremental monthly recurring costs will
consist primarily of the fees to be paid to third parties as provided in the
PSINet Services Agreement and the GridNet Services Agreement. The margins on
such subscribers will initially be higher than if the Company had developed its
own POP in new markets. Once a new market matures, costs of revenue as a
percentage of revenue will tend to be higher in markets served through
utilization of purchased network services rather than Company-owned POPs since
the full costs of utilizing such network services is included in costs of
revenue while a portion of the costs of utilizing Company-owned POPs is included
in depreciation and amortization. Beginning October 1, 1997 the Company began
providing services through new Company owned POPs in California and New York
City, markets that were previously served through PSINet POPs. The Company does
not currently plan to open a significant number of additional MindSpring POPs
during the remainder of 1997. Management will, however, evaluate on a POP-by-POP
basis the closing or expansion of existing MindSpring POPs or the opening of new
MindSpring POPs based on subscriber demand and strategic considerations.

                  The Company has experienced operating losses since its
inception as a result of efforts to build its network infrastructure and
internal staffing, develop its systems, and expand into new markets. The Company
has, however, begun to generate cash flows from operations. The Company expects
to continue to focus on increasing its subscriber base which will result in
higher expenses, but believes that the development of its operations will
provide certain economies of scale which will decrease its cost of start-up
fees, selling expenses, and general and administrative expenses as a percentage
of revenue in the future.


                                        7

<PAGE>   8




RESULTS OF OPERATIONS

QUARTER ENDED SEPTEMBER 30, 1997 COMPARED TO QUARTER ENDED SEPTEMBER 30, 1996

                  The following table sets forth certain unaudited financial
data for the quarters ended September 30, 1997 and 1996. Operating results for
any period are not necessarily indicative of results for any future period.
Dollar amounts (except per share data) are shown in thousands.

                              RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                          QUARTER ENDED                 QUARTER ENDED
                                                        SEPTEMBER 30, 1997           SEPTEMBER 30, 1996
                                                         (000'S)       % OF           (000'S)       % OF
                                                                     REVENUE                      REVENUE
<S>                                                  <C>            <C>          <C>              <C>
STATEMENTS OF OPERATIONS DATA:
Revenue
   Dial-up access to the Internet                    $   10,858            78     $    3,911             74
   Start-up fees                                          1,025             7            735             14
   Business services                                      2,084            15            655             12
                                                     ----------     ---------     ----------      ---------
          Total revenue                                  13,967           100          5,301            100
Costs and expenses:
   Costs of revenue- recurring                            3,949            28          1,906             36
   Costs of revenue- start-up fees                          440             3            941             18
   Selling, general and administrative                    7,771            55          4,043             76
   Depreciation                                           1,213             9            508             10
   Amortization of acquired customer bases                1,060             8            504              9

                                                     ----------     ---------     ----------      ---------
         Total  costs and expenses                       14,433           103          7,902            149
                                                     ----------     ---------     ----------      ---------
Operating loss                                             (466)           (3)        (2,601)           (49)
Interest expense, net                                      (161)           (1)          (101)            (2) 
                                                     ----------     ---------     ----------      ---------
Net loss                                                   (627)           (4)        (2,702)           (51)
                                                     ==========                   ========== 

PER SHARE DATA:
Net loss per share                                   $    (0.08)                  $    (0.53)
Weighted average common shares outstanding            7,528,102                    5,138,836

OPERATING DATA:

Approximate number of subscribers at end of period      223,800                      117,360
Number of Company employees at end of period
                                                            465                          319
</TABLE>




                  Revenue: Revenue for the quarter ended September 30, 1997
totaled approximately $13,967,000, compared to approximately $5,301,000 for the
quarter ended September 30, 1996. The approximately 163% increase in period
revenue resulted primarily from an increase in subscribers. Revenues from
dial-up access to the Internet for the quarter ended September 30, 1997
represented approximately 78% of revenue, compared to approximately 74% of
revenue for the same quarter in the prior year. Subscriber start-up fees
accounted for approximately 7% of revenue for the quarter ended September 30,


                                        8

<PAGE>   9


1997, compared to approximately 14% for the quarter ended September 30, 1996.
The Company anticipates that as its customer base continues to expand,
subscriber start-up fees will progressively represent a smaller percentage of
revenue. Business services revenue for the quarter ended September 30, 1997
increased to approximately 15% of total revenue, compared to approximately 12%
of total revenue for the quarter ended September 30, 1996. This increase is
primarily attributable to the increase in the number of the Company's web
hosting customers.

                  Costs of revenue-recurring: For the quarter ended September
30, 1997, costs of revenue-recurring decreased to approximately 28% of total
revenue, compared to approximately 36% of total revenue for the quarter ended
September 30, 1996. Costs of revenue-recurring also decreased as a percentage of
dial-up access revenue from approximately 49% in the third quarter of 1996 to
approximately 36% in the third quarter of 1997. Exclusive of $550,000 in
discounts received in the third quarter of 1997 pursuant to the PSINet Services
Agreement, costs of revenue-recurring would have been approximately 41% of total
dial-up revenue for the period, compared to approximately 49% for the quarter
ended September 30, 1996. This decrease of costs of revenue-recurring as a
percentage of total revenue and as a percentage of dial-up access revenue
resulted primarily from increased efficiency and reduced network costs in the
Company's own network.

                  Costs of revenue-start-up fees: For the quarter ended
September 30, 1997, subscriber start-up expenses decreased to approximately 3%
of total revenue, compared to approximately 18% of total revenue for the quarter
ended September 30, 1996, and decreased to approximately 43% of start-up fee
revenue for the quarter ended September 30, 1997 compared to approximately 128%
of start-up fee revenue for the quarter ended September 30, 1996. The Company
had abnormally high customer start-up costs in the third quarter of 1996 due to
expenditures for license fees and starter kits related to the acquisition of
certain individual subscriber accounts of PSINet. However, the Company
anticipates that start-up expenses will continue to decrease as a percentage of
total revenue to the extent that the number of new subscribers decreases as a
percentage of the entire subscriber base. The decrease in start-up expenses as a
percentage of start-up fees resulted from reduced expenditures per new
subscriber for licenses and kit materials.

                  Selling, general and administrative expenses: Selling, general
and administrative expenses were approximately 55% of revenue for the quarter
ended September 30, 1997, compared to approximately 76% of revenue for the
quarter ended September 30, 1996. The decrease in selling, general and
administrative expenses as a percentage of revenue resulted from economies of
scale with respect to such costs as employee compensation that do not increase
in direct proportion to increases in revenue and to cost control efforts
implemented by management.

                  Depreciation and amortization: Depreciation and amortization
expenses decreased to approximately 17% of revenue for the quarter ended
September 30, 1997, compared to approximately 19% of revenue for the same period
in the prior year. Amortization expense for the quarter ended September 30, 1997
was approximately 8% of revenue compared to approximately 9% of revenue for the
quarter ended September 30, 1996. Amortization expense resulted solely from
acquired customer bases which are being amortized over three years. Depreciation
expense was approximately 9% of total revenue for the quarter ended September
30, 1997, compared to approximately 10% for the comparable period in the prior
year. The decrease in depreciation expense as a percentage of total revenue
resulted from efficiencies within the Company's owned POPs resulting from
reductions in cost of new equipment and improved utilization within the
Company's network and the addition of capacity through increased utilization of
purchased network services as opposed to increasing capacity by the construction
of additional Company-owned POPs.

                  Interest expense: Interest expense for the quarter ended
September 30, 1997 consisted of approximately $258,000 related to capital leases
of equipment and imputed interest related to a note payable issued to PSINet, 
offset by approximately $97,000 of interest income. For the quarter ended
September 30, 1996, the Company had interest expense related to notes payable


                                        9

<PAGE>   10


issued to PSINet of approximately $155,000 and interest income of approximately
$54,000.


                                       10

<PAGE>   11



NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED TO NINE MONTHS SEPTEMBER 30, 1996

                  The following table sets forth certain unaudited financial
data for the nine months ended September 30, 1997 and 1996. Operating results
for any period are not necessarily indicative of results for any future period.
Dollar amounts (except per share data) are shown in thousands.

                              RESULTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                       NINE MONTHS ENDED      NINE MONTHS ENDED
                                                       SEPTEMBER 30, 1997     SEPTEMBER 30, 1996
                                                         (000'S)   % OF         (000'S)   % OF
                                                                  REVENUE                REVENUE
<S>                                                  <C>          <C>      <C>           <C>
STATEMENTS OF OPERATIONS DATA:
Revenue
   Dial-up access to the Internet                    $    27,267     77    $     6,700      69
   Start-up fees                                           2,832      8          1,581      17
   Business services                                       5,249     15          1,327      14
                                                     -----------   ----    -----------    ----
          Total revenue                                   35,348    100          9,608     100
Costs and expenses:
   Costs of revenue- recurring                            10,642     30          3,202      34
   Costs of revenue- start-up fees                         1,100      3          1,558      16
   Selling, general and administrative                    21,836     62          8,384      87
   Depreciation                                            3,048      8          1,104      12
   Amortization of acquired customer bases                 3,113      9            504       5
                                                     -----------   ----    -----------    ----
         Total  costs and expenses                        39,739    112         14,752     154
                                                     -----------   ----    -----------    ----
Operating loss                                            (4,391)   (12)        (5,144)    (54)
Interest expense, net                                       (190)    (1)           (57)      0
                                                     -----------   ----    -----------    ----
Net loss                                                  (4,581)   (13)        (5,201)    (54)
                                                     ===========           ===========    

PER SHARE DATA:
Net loss per share                                   $     (0.61)          $     (1.13) 
Weighted average common shares outstanding             7,508,200             4,588,202  


OPERATING DATA:
Approximate number of subscribers at end of period       223,800               117,360  
Number of Company employees at end of period                 465                   319  
</TABLE>




                  Revenue: Revenue for the nine months ended September 30, 1997
totaled approximately $35,348,000, compared to approximately $9,608,000 for the
nine months ended September 30, 1996. The approximately 268% increase in period
revenue resulted primarily from an increase in subscribers. Revenue from dial-up
access to the Internet for the nine month period ended September 30, 1997
represented approximately 77% of revenue, compared to approximately 69% of
revenue for the same period in the prior year. Subscriber start-up fees
accounted for approximately 8% of revenue for the nine months ended September
30, 1997, compared to approximately 17% for the nine months ended September 30,
1996. The Company anticipates that as its customer base 


                                       11

<PAGE>   12


continues to expand, subscriber start-up fees will progressively represent a
smaller percentage of revenue. Business services revenue increased slightly as a
percentage of total revenue representing approximately 15% of revenue for the
nine months ended September 30, 1997, compared to approximately 14% for the nine
months ended September 30, 1996.

                  Costs of revenue-recurring: For the nine months ended
September 30, 1997, costs of revenue-recurring decreased to approximately 30% of
total revenue as compared to approximately 34% of total revenue for the nine
months ended September 30, 1996. Costs of revenue-recurring also decreased as a
percentage of dial-up access revenue from approximately 48% in the first nine
months of 1996 to approximately 39% in the first nine months of 1997. Exclusive
of $1,450,000 in discounts received in the first nine months of 1997 pursuant to
the PSINet Services Agreement, costs of revenue-recurring would have been
approximately 44% of total dial-up revenue for the period, compared to
approximately 48% for the nine months ended September 30, 1996. This decrease of
the cost of revenue-recurring as a percentage of total revenue and as a
percentage of dial-up access revenue resulted primarily from increased
efficiency and reduced Actwork costs in the Company's own Actwork.

                  Costs of revenue-start-up fees: For the nine months ended
September 30, 1997, subscriber start-up expenses decreased to approximately 3%
of total revenue, compared to approximately 16% of total revenue for the nine
months ended September 30, 1996, and decreased to approximately 39% of start-up
fee revenue for the nine months ended September 30, 1997, compared to
approximately 99% of start-up fee revenue for the nine months ended September
30, 1996. The company had abnormally high customer start-up costs in the third
quarter of 1996 due to the expenditures for license fees and starter kits
related to the acquisition of certain individual subscriber accounts of PSINet.
However, the Company anticipates that start-up expenses will continue to
decrease as a percentage of total revenue to the extent that the number of new
subscribers decreases as a percentage of the entire subscriber base. The
decrease in start-up expenses as a percentage of start-up fees resulted from
reduced expenditures per new subscriber for licenses and kit materials.

                  Selling, general and administrative expenses: Selling, general
and administrative expenses were approximately 62% of revenue for the nine
months ended September 30, 1997, compared to approximately 87% of revenue for
the nine months ended September 30, 1996. The decrease in selling, general and
administrative expenses as a percentage of revenue resulted from economies of
scale with respect to such costs as employee compensation that do not increase
in direct proportion to increases in revenue and to cost control efforts
implemented by management.

                  Depreciation and amortization: Amortization expense increased
for the nine months ended September 30, 1997 to approximately 9% of revenue from
approximately 5% of revenue for the nine months ended September 30, 1996. This
increase resulted from the large number of subscribers added in the third
quarter of 1996 in connection with the acquisition of certain individual
subscriber accounts of PSINet. Amortization expense resulted solely from
acquired customer bases which are being amortized over three years. Depreciation
expense was approximately 8% of total revenue for the nine months ended
September 30, 1997, compared to approximately 12% for the comparable period in
the prior year. The decrease in depreciation expense as a percentage of total
revenue resulted from efficiencies within the Company's owned POPs resulting
from reductions in cost of new equipment and improved utilization within the
Company's network and the addition of capacity through increased utilization of
purchased network services as opposed to increasing capacity by the construction
of additional Company-owned POPs.

                  Interest expense: Interest expense for the nine months ended
September 30, 1997 consisted of approximately $494,000 related to capital leases
of equipment and imputed interest related to a note payable issued to PSINet,
offset by $304,000 of interest income. For the nine months ended September 30,
1996, the Company had interest expense of approximately $247,000 


                                       12


<PAGE>   13


which primarily related to a credit facility that was repaid in March 1996 and a
note payable issued to PSINet, offset by approximately $190,000 of interest
income.

LIQUIDITY AND CAPITAL RESOURCES
        
                The Company generated net cash from operations in the amount of
$4,235,000 for the nine months ending September 30, 1997 versus using cash of
approximately $2,749,000 to support operating activities during the nine months
ended September 30, 1996. The operating cash flow has been used in the current
period primarily to cover the Company's investing activities of approximately
$5,002,000 primarily related to purchases of telecommunications equipment
necessary for the provision of service to subscribers. In addition to the
purchased equipment, the Company acquired approximately $6,116,000 of equipment
under capital lease agreements in the first nine months ended September 30,
1997. There were no capital lease agreements for the nine months ended  
September 30, 1996. The Company also used approximately $620,000 for
customer bases acquired during the nine months ended September 30, 1997. The
Company's primary financing activities of approximately $1,569,000 for the nine
months ended September 30, 1997 consisted of cash paid for capital lease
obligations and cash paid to PSINet in connection with a transaction between
the Company and PSINet in 1996 in which the Company purchased certain
individual subscriber accounts of PSINet and related assets (the "PSINet
Transaction"). Total cash provided from financing activities for the nine
months ended September 30, 1996 was approximately $23,679,000, consisting
primarily of the net proceeds of the Company's initial public offering in March
1996.

                  On October 14, 1996, the Company and Monorail Inc.
("Monorail"), an Internet-ready computer manufacturer, entered into an agreement
pursuant to which the Company's software is to be included on the personal
computers manufactured by Monorail. The Company provided a $500,000 prepayment
to Monorail for potential subscribers to be acquired by the Company pursuant to
this agreement (the "Monorail Prepayment"). As of September 30, 1997, Monorail
had earned approximately $65,000 of the Monorail Prepayment. Monorail may
continue to offset the Monorail Prepayment by referring subscribers to the
Company, or may repay all or part of the balance of the Monorail Prepayment at
any time. The Company has agreed to accept warrants to purchase Monorail stock
in lieu of interest on the balance of the Monorail Prepayment outstanding.

                  In June 1997, the Company entered into various agreements with
BellSouth (collectively, the "BellSouth Agreement"), pursuant to which the
Company has agreed to purchase certain telecommunications facilities from
BellSouth over a term of twenty-four months. The Company estimates the total
commitment under the BellSouth Agreement to be approximately $2,700,000 per
year.

                  As of September 30, 1997, the Company had cash on hand of
approximately $7,317,000. The Company's significant capital commitments for the
remainder of 1997 and to the end of 1998 include approximately $2,281,000 in
principal under a non-interest bearing note issued to PSINet in connection with
the PSINet Transaction. The Company anticipates that it will continue to
generate cash flows from operations for the remainder of 1997 and into 1998. The
Company estimates that its cash and financing needs into 1998 will be met by
cash on hand, additional capital financing arrangements, and cash flow from
operations. However, any increases in the Company's growth rate, shortfalls in
anticipated revenue, increases in anticipated expenses, or significant
acquisition opportunities could have a material adverse effect on the Company's
liquidity and capital resources and would require the company to raise
additional capital from public or private equity or debt sources in order to
finance operating losses, anticipated growth and contemplated capital
expenditures. If such sources of financing are insufficient or unavailable, the
Company will be required to modify its growth and operating plans in accordance
with the extent of available funding and attempt to attain profitability in its
existing markets (including those accessible pursuant to the third party network
services agreements). The Company may need to raise additional funds in order to
take advantage of unanticipated opportunities, such as acquisitions 


                                       13

<PAGE>   14


of complementary businesses or the development of new products, or otherwise
respond to unanticipated competitive pressures. There can be no assurance that
the Company will be able to raise any such capital on terms acceptable to the
Company or at all.

RECENT ACCOUNTING PRONOUNCEMENTS

                  In February 1997, the Financial Accounting Standards Board
issued Statement 128, "Earnings per Share" ("SFAS 128") which redefines how
entities compute earnings per share. Primary earnings per share will be replaced
by basic earnings per share which will be computed exclusively based on the
weighted average number of common shares outstanding. This statement is
effective for periods ending after December 15, 1997 and will require
restatement of all prior period earnings per share data presented. The adoption
of SFAS 128 is not expected to have a material impact on the Company's earnings
per share data.

                  In June 1997, the Financial Accounting Standards Board issued
Statement 130, "Reporting Comprehensive Income" ("SFAS 130") which establishes
standards for reporting and presentation of comprehensive income and its
components in a full set of general purpose financial statements. This statement
is effective for periods beginning after December 15, 1997. The adoption of SFAS
130 is not expected to have an impact on the Company's financial statements.



                                       14


<PAGE>   15


                                    PART II

                                OTHER INFORMATION

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

   (a)  Exhibits

        11.  Statement Re: Computation of loss per common share

        27.  Financial Data Schedule


                                       15


<PAGE>   16



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.

                                  MINDSPRING ENTERPRISES, INC.
                                  ----------------------------
                                  (Registrant)

Date:  November 11, 1997          By:  /s/ Michael S. McQuary
                                       ------------------------------
                                  Michael S. McQuary
                                  President and Chief
                                  Operating Officer

Date:  November 11, 1997          By:  /s/ Michael G. Misikoff
                                       ------------------------------
                                  Michael G. Misikoff
                                  Vice President, and Chief Financial
                                  Officer


                                       16

<PAGE>   17



                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit                          Exhibit Description                     Sequentially 
-------                          -------------------                     ------------
Number                                                                   Numbered Page
------                                                                   -------------
            
 <S>                 <C>                                                 <C>     
 11.                 Statement Re: Computation of loss per common 
                     share
            
 27.                 Financial Data Schedule
</TABLE>


                                       17