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

                                FORM 10-QSB

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

                For the quarterly period ended June 30, 2003

                                     OR

       ( ) TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
           SECURITIES EXCHANGE ACT OF 1934

                        Commission file number 0-28330

                            TALK VISUAL CORPORATION
                            -----------------------
           (Exact name of registrant as specified in its charter)


            Nevada                                       95-4561156
         ------------                                    ----------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

     3550 Biscayne Blvd. Suite 704
         Miami, Florida                           33137
     -----------------------------               -------
  (Address of principal executive offices)      (Zip Code)

                                305-572-0575
                               --------------
                  (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 [ ]

There were 152,725,141 shares outstanding of the registrant's  Common Stock, par
value $.001 per share, as of August 5, 2003.

Transitional Small Business Disclosure Format (check one):  Yes  [X]     No [ ]



<PAGE>


                           TALK VISUAL CORPORATION

                                     INDEX
                                                                      Page No.

                        PART I - FINANCIAL INFORMATION

Item l.  Financial Statements (Unaudited):

                Condensed Consolidated Balance Sheets at
                June 30, 2003 and December 31, 2002.                          3

                Condensed Consolidated Statements of Operations for
                the three and six months ended June 30, 2003 and 2002.        5

                Condensed Consolidated Statements of Cash Flows for
                the six months ended June 30, 2003 and 2002.                  6

                Notes to Condensed Consolidated Financial Statements          8

Item 2.     Management's Discussion and Analysis or Plan
            of Operations                                                    12

Item 3.     Controls and Procedures                                          16


                        PART II - OTHER INFORMATION

Item 1.     Legal Proceedings                                                16

Item 6.     Exhibits and Reports on Form 8-K                                 16

Signatures                                                                   17

Certifications                                                               18

Exhibits    Exhibit 11                                                       18
            Exhibit 31                                                       19
            Exhibit 32                                                       21





                                     Page 2
<PAGE>
<TABLE>
<CAPTION>

                                TALK VISUAL CORPORATION
                         CONDENSED CONSOLIDATED BALANCE SHEETS

                                                            JUNE 30,      DECEMBER 31,
                                                              2003            2002
                                                          -----------     ------------
                                                          (unaudited)

                                   ASSETS

CURRENT ASSETS
<S>                                                     <C>             <C>
   Cash                                                 $    89,510     $   104,101
   Accounts receivable, net of allowance
    for doubtful accounts of $101,355 and $80,625           356,703         400,194
   Due from former officer                                  237,863               -
   Other current assets                                      37,874         133,536
   Assets held for sale, net of reserve
    for impairment of $0 and $3,341,984                        --         1,012,363
                                                         ----------      ----------
   Total current assets                                     721,950       1,650,194

DUE FROM FORMER OFFICER                                        --           245,209

PROPERTY AND EQUIPMENT, net                                 661,077         795,948

INVESTMENT IN EQUITY SECURITIES                                --           793,204

GOODWILL, net                                               226,575         226,575

OTHER ASSETS                                                119,127         118,574
                                                         ----------      ----------
   TOTAL ASSETS                                         $ 1,728,729     $ 3,829,704
                                                         ==========      ==========
</TABLE>






            See notes to condensed consolidated financial statements.



                                     Page 3
<PAGE>
<TABLE>
<CAPTION>

                               TALK VISUAL CORPORATION
                        CONDENSED CONSOLIDATED BALANCE SHEETS

                                                           JUNE 30,       DECEMBER 31,
                                                             2003             2002
                                                         -----------      ------------
                                                         (unaudited)

                    LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES
<S>                                                    <C>              <C>
   Note payable                                        $   200,247      $   941,667
   Accounts payable                                        830,326        2,541,001
   Accrued expenses                                        764,333          594,290
   Other current liabilities                                31,862           49,373
                                                        ----------       ----------
   Total current liabilities                             1,826,768        4,126,331

LONG-TERM DEBT,                                            273,400          289,700
                                                        ----------       ----------
   TOTAL LIABILITIES                                     2,100,168        4,416,031
                                                        ----------       ----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIENCY
Series A Convertible redeemable preferred stock,
     par value $.001 per share, 25,000,000 shares
     authorized; none issued or outstanding

   Common Stock, par value $.001 per share,
     500,000,000 shares authorized; 152,725,141 and
     148,725,141 shares issued and outstanding             152,726          148,725
   Common Stock Subscribed                                 (40,000)            --
   Additional paid in capital                           24,076,063       24,036,063
   Accumulated deficit                                 (24,560,228)     (24,771,115)
                                                        ----------        ---------
   TOTAL STOCKHOLDERS' DEFICIENCY                         (371,439)        (586,327)
                                                        ----------       ----------
       TOTAL                                           $ 1,728,729      $ 3,829,704
                                                        ==========       ==========

</TABLE>




            See notes to condensed consolidated financial statements.



                                     Page 4
<PAGE>
<TABLE>
<CAPTION>


                                     TALK VISUAL CORPORATION
                         CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                           (unaudited)

                                             THREE MONTHS ENDED JUNE 30,     SIX MONTHS ENDED JUNE 30,
                                            ---------------------------     --------------------------
                                               2003            2002            2003            2002
                                            ----------      ----------      ----------      ----------
<S>                                        <C>             <C>             <C>             <C>
REVENUE
 Telecommunication sales and services      $ 1,527,340     $ 2,178,230     $ 2,993,920     $ 4,055,701

COSTS OF SALES AND SERVICES                    940,167       1,502,517       1,990,459       2,861,389
                                            ----------      ----------      ----------      ----------
GROSS PROFIT                                   587,173         675,713       1,003,461       1,194,312
                                            ----------      ----------      ----------      ----------
COSTS AND EXPENSES
 Selling, general and administrative           878,825         888,837       1,752,398       1,791,814
 Depreciation and amortization                  68,635          95,352         137,371         188,790
                                            ----------      ----------       ---------       ---------
Total costs and expenses                       947,460         984,189       1,889,769       1,980,604
                                            ----------      ----------       ---------       ---------
LOSS FROM OPERATIONS                          (360,287)       (308,476)       (886,308)       (786,292)
                                            ----------      ----------       ---------       ---------
OTHER INCOME (EXPENSE)
 Interest income (expense), net                 32,407         (11,250)         (8,342)        (22,501)
 Non Cash Stock Compensation                   (44,000)           --           (44,000)           --
 Gain on disposal of property and equipment       --              --              --             7,321
 Vendor Settlements                          1,152,770            --         1,152,770            --
 Gain on sale of securities                     29,642            --            47,242            --
                                            ----------       ----------      ---------       ---------
                                             1,170,819         (11,250)      1,147,670         (15,180)


INCOME (LOSS) FROM CONTINUING OPERATIONS       810,532        (319,726)        261,362        (801,472)

INCOME (LOSS) FROM DISCONTINUED OPERATIONS        (326)        (64,196)        (50,475)          5,747
                                            ----------      ----------      ---------        ---------

NET INCOME (LOSS)                          $   810,206     $  (383,922)    $   210,887     $  (795,725)
                                            ==========      ==========       =========       =========

NET INCOME (LOSS) PER COMMON SHARE - BASIC:
 Continuing operations                     $    0.0054     $   (0.0021)    $    0.0017     $   (0.0054)
 Discontinued operations                        0.0000         (0.0004)        (0.0003)         0.0000
                                            ----------      ----------       ---------       ---------
Net income (loss)                          $    0.0054     $   (0.0026)    $    0.0014     $   (0.0054)
                                            ==========      ==========       =========       =========
 Weighted average number of common shares
  outstanding                              148,769,541     149,216,741     148,747,341     148,465,151
                                            ==========      ==========      ==========      ==========

NET INCOME (LOSS) PER COMMON SHARE - DILUTED:
 Continuing operations                     $    0.0054     $         *     $    0.0017     $         *
 Discontinued operations                        0.0000               *         (0.0003)              *
                                            ----------      ----------       ---------       ---------
Net income (loss)                          $    0.0054     $         *     $    0.0014     $         *
                                            ==========      ==========       =========       =========
 Weighted average number of common shares
  outstanding                              150,812,305               *     150,565,545               *
                                            ==========      ==========      ==========      ==========
</TABLE>

(*) The effect of common  stock  options and  warrants is excluded  from diluted
earnings per share as its inclusion would be anti-dilutive for the three and six
month periods ended June 30, 2002.




            See notes to condensed consolidated financial statements.

                                     Page 5
<PAGE>
<TABLE>
<CAPTION>

                                 TALK VISUAL CORPORATION
                     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                       (unaudited)

                                                           SIX MONTHS ENDED JUNE 30,
                                                         ---------------------------
                                                              2003           2002
                                                         -----------    -----------
Cash Flows From Operating Activities:
<S>                                                      <C>            <C>
Net Gain (Loss)                                          $   210,887    $  (795,725)

Adjustments to reconcile net loss to net cash
    used in operating activities:
  Depreciation and amortization                              137,371        188,790
  Provision for uncollectible accounts                        20,730           --
  (Gain) loss on Sale of Securities                          (47,242)          --
  (Gain) loss on disposition of property and equipment          --           (7,070)
  Stock issued for compensation                               44,000           --
  Increase in due from officer from
    interest and extension fee income                        (32,654)          --
  Additional non-cash charges
    from discontinued operations                                --           28,110

Increase (decrease) in cash from changes in:
  Accounts receivable                                         22,761       (152,972)
  Other current assets                                        95,662         32,713
  Other assets and equity securities                            (553)        21,366
  Accounts payable                                        (1,710,675)       641,136
  Accrued expenses                                           170,045         38,708
  Other current liabilities                                  (17,511)       (50,754)
                                                         -----------    -----------
    Net Cash from Operating Activities                    (1,107,179)       (55,698)
                                                         -----------    -----------
Cash Flows from Investing Activities:

  Purchase of property and equipment                          (2,500)      (178,997)
  Advances to related parties                                   --           49,549
  Proceeds from sale of discontinued operations            1,012,362           --
  Proceeds from sale of securities                           840,446           --
  Other                                                         --           (4,404)
                                                         -----------    -----------
    Net Cash from Investing Activities                     1,850,308       (133,852)
                                                         -----------    -----------
</TABLE>




            See notes to condensed consolidated financial statements.



                                     Page 6
<PAGE>
<TABLE>
<CAPTION>

                                 TALK VISUAL CORPORATION
                     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                       (unaudited)

                                                          SIX MONTHS ENDED JUNE 30,
                                                         -------------------------
                                                             2003         2002
                                                          ---------    ---------
Cash Flows from Financing Activities:

<S>                                                        <C>            <C>
  Payments on notes payable and long-term debt             (957,967)        --
  Borrowings on debt                                        200,247         --
  Net proceeds from common stock transactions                  --         56,500
                                                          ---------    ---------
    Net Cash (used in) provided by Financing Activities    (757,720)      56,500
                                                          ---------    ---------

Decrease in cash and cash equivalents                       (14,591)    (133,050)
Cash and cash equivalents at beginning of period            104,101      323,928
                                                          ---------    ---------
Cash and cash equivalents at end of period                $  89,510    $ 190,878
                                                          =========    =========

</TABLE>



Supplemental disclosure of cash flow information:

a. Cash paid during the period for:

       interest                                           $   82,842  $        -
                                                           ---------   ---------
       income taxes                                       $      755  $      800
                                                           ---------   ---------

b. Noncash investing and financing transactions:

For the period ended June 30, 2003:

In  accordance  with an amended  severance  agreement  (see Note 6), the Company
issued  $40,000 of its common  stock in an escrow  account and  recorded a stock
subscription of equal amount.

For the period ended June 30, 2002:

Conversion of note receivable in the amount of $462,841 from YAK  Communications
(USA), Inc. ("YAK") to an equity investment in YAK.

Issuance of 1,103,448 shares of common stock in cancellation of accounts payable
in the amount of $40,000, as part of a total issuance of 2,482,759 shares.









            See notes to condensed consolidated financial statements.



                                     Page 7
<PAGE>



                             TALK VISUAL CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(1) General and Summary of Business and Significant Accounting Policies

Basis of presentation

The accompanying unaudited financial statements have been prepared in accordance
with accounting  principles  generally  accepted in the United States of America
for  interim  financial  information  and the  instructions  to Form  10-QSB and
Regulation  S-B.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of only normal recurring accruals)  considered necessary for a fair presentation
of the Company's  financial position at June 30, 2003, the results of operations
for the three months and six months  ended June 30, 2003 and June 30, 2002,  and
the cash flows for the six  months  ended  June 30,  2003 and June 30,  2002 are
included. Operating results for the three month and six month periods ended June
30, 2003 are not necessarily  indicative of the results that may be expected for
the year ending December 31, 2003.

The information contained in this Form 10-QSB should be read in conjunction with
the audited  financial  statements as of December 31, 2002, filed as part of our
Annual Report on Form 10-KSB.


Note 2. Summary of Significant Accounting Policies

Use of Estimates

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

Income Taxes

The Company  accounts  for income  taxes  according  to  Statement  of Financial
Accounting Standards No. 109, which requires a liability approach to calculating
deferred income taxes.  Under this method,  the Company  records  deferred taxes
based on temporary  differences  between tax bases of the  Company's  assets and
liabilities  and their  financial  reporting  bases.  A valuation  allowance  is
established when it is more likely than not that some or all of the deferred tax
assets will not be realized.

The effective tax rate for the six months ended June 30, 2003, differed from the
federal  statutory rate due  principally to a decrease in the deferred tax asset
valuation allowance.

Income (Loss) Per Common Share

Income (loss) per common share is calculated  in  accordance  with  Statement of
Financial  Accounting  Standards  ("SFAS") No. 128,  "Earnings per Share." Basic
income  (loss) per share is computed by dividing the income  (loss)available  to
common shareholders by the weighted-average number of common shares outstanding.
Diluted income  (loss)per  share is computed  similar to basic income  (loss)per
share,  except  that the  denominator  is  increased  to  include  the number of
additional  common  shares  that would have been  outstanding  if the  potential
common shares had been issued and if the additional common shares were dilutive.
For the six months  ended June 30,  2002,  common  stock  equivalents  have been
excluded  from  the  aforementioned   computations  as  their  effect  would  be
anti-dilutive.


                                     Page 8
<PAGE>



A reconciliation  of the weighted  average number of shares  outstanding used in
computing  basic and diluted income per share for the three and six months ended
June 30, 2003, is as follows:

<TABLE>
<CAPTION>

                                                     Three Months Ended     Six Months Ended
                                                        June 30, 2003        June 30, 2003
                                                     ------------------     ----------------
<S>                                                     <C>                    <C>
Weighted average common shares
 outstanding-basic                                      148,769,541            148,747,341

Increase in shares which would result from
 the exercise of stock options and warrants               2,042,764              1,818,204
                                                        -----------            -----------

Weighted average common shares
 outstanding-diluted                                    150,812,305            150,565,545
                                                        ===========            ===========
</TABLE>


New Accounting Pronouncements

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with  Exit  or  Disposal   Activities"  (SFAS  146).  This  statement  addresses
accounting and reporting for costs  associated with exit or disposal  activities
and  nullifies  Emerging  Issues Task Force Issue No.  94-3.  The  statement  is
effective for exit or disposal costs  initiated  after  December 31, 2002,  with
early application encouraged. Adoption of this statement did not have a material
effect on the consolidated financial statements of the Company.

In  November  2002,  the FASB  issued  FASB  Interpretation  No.  45  ("FIN45"),
"Guarantor's  Accounting and Disclosure  Requirements for Guarantees,  including
Indirect Guarantees of Indebtedness of Others." FIN 45 requires that a liability
be recorded in the  guarantor's  balance sheet upon issuance of a guarantee.  In
addition,  FIN 45 requires  disclosures  about the guarantees that an entity has
issued,  including a reconciliation  of changes in the entity's product warranty
liabilities.  The initial recognition and initial measurement  provisions of FIN
45 are applicable on a prospective  basis to guarantees issued or modified after
December  31,  2002,  irrespective  of  the  guarantor's  fiscal  year-end.  The
disclosure  requirements  of FIN 45 are effective  for  financial  statements of
interim or annual  periods  ending after December 15, 2002. The adoption of this
Statement  did  not  have  a  material  impact  on  the  consolidated  financial
statements of the Company.

In December  2002,  the FASB issued SFAS No. 148,  "Accounting  for  Stock-Based
Compensation,  Transition  and  Disclosure."  SFAS No. 148 provides  alternative
methods of transition  for a voluntary  change to the fair value based method of
accounting for  stock-based  employee  compensation.  SFAS No. 148 also requires
that  disclosures  of the pro forma  effect of using  the fair  value  method of
accounting for stock-based  employee  compensation be displayed more prominently
and in a tabular format.  Additionally,  SFAS No. 148 requires disclosure of the
pro forma effect in interim  financial  statements.  The  transition  and annual
disclosure  requirements  of SFAS No. 148 are  effective  for fiscal years ended
after December 15, 2002. The interim  disclosure  requirements are effective for
interim  periods  beginning  after  December 15,  2002.  The Company has not yet
adopted this  statement,  and  management  has not determined the impact of this
statement on the consolidated financial statements of the Company.

In  January  2003,  the FASB  issued  FASB  Interpretation  No.  46 ("FIN  46"),
"Consolidation of Variable Interest Entities,  an Interpretation of ARB No. 51."
FIN 46 requires  certain  variable  interest  entities to be consolidated by the
primary  beneficiary of the entity if the equity  investors in the entity do not
have the  characteristics  of a  controlling  financial  interest or do not have
sufficient  equity at risk for the  entity to  finance  its  activities  without
additional  subordinated  financial  support  from  other  parties.  FIN  46  is
effective immediately for all new variable interest entities created or acquired
after January 31, 2003. For variable interest entities created or acquired prior
to  February  1, 2003,  the  provisions  of FIN 46 must be applied for the first
interim or annual period  beginning after June 15, 2003. The Company has not yet
adopted this  statement and  management  has not  determined  the impact of this
statement on the consolidated financial statements of the Company.


                                     Page 9
<PAGE>

In April 2003, the FASB issued SFAS No. 149, which amends SFAS 133,  "Accounting
for Derivative  Instruments and Hedging  Activities".  The primary focus of this
Statement  is to amend  and  clarify  financial  accounting  and  reporting  for
derivative  instruments.  This Statement is effective for contracts entered into
or modified after June 30, 2003.  The Company is currently  assessing the impact
of SFAS  No.  149,  which  is not  expected  to have a  material  impact  on the
Company's financial statements.

In May 2003,  the FASB issued SFAS No. 150,  "Accounting  For Certain  Financial
Instruments with  Characteristics of both Liabilities and Equity".  SFAS No. 150
changes the accounting for certain financial instruments with characteristics of
both liabilities and equity that, under previous  pronouncements,  issuers could
account for as equity.  The new  accounting  guidance  contained in SFAS No. 150
requires that those  instruments  be classified  as  liabilities  in the balance
sheet.

SFAS No. 150 affects the  issuer's  accounting  for three types of  freestanding
financial  instruments.  One type is mandatorily  redeemable  shares,  which the
issuing company is obligated to buy back in exchange for cash or other assets. A
second type includes put options and forward purchase contracts,  which involves
instruments  that do or may require the issuer to buy back some of its shares in
exchange  for cash or other  assets.  The  third  type of  instruments  that are
liabilities  under this  Statement  are  obligations  that can be  settled  with
shares,  the monetary value of which is fixed, tied solely or predominantly to a
variable  such as a market  index,  or  varies  inversely  with the value of the
issuers' shares. SFAS No. 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety.

Most of the  provisions  of  SFAS  No.  150 are  consistent  with  the  existing
definition  of  liabilities  in FASB  Concepts  Statement  No. 6,  "Elements  of
Financial Statements". The remaining provisions of this Statement are consistent
with the  FASB's  proposal  to  revise  that  definition  to  encompass  certain
obligations  that a  reporting  entity  can or must  settle by  issuing  its own
shares. This Statement shall be effective for financial instruments entered into
or modified after May 31, 2003 and otherwise shall be effective at the beginning
of the first  interim  period  beginning  after June 15,  2003.  The  Company is
currently assessing the impact of SFAS No. 150 on its financial statements.


Reclassifications

Certain  amounts in the 2002 condensed  consolidated  financial  statements have
been reclassified to conform into the 2003 presentation.

Note 3. Financial Condition and Liquidity

As reflected in the accompanying financial statements,  the Company has incurred
significant  operating  net losses  since  inception  and expects to continue to
incur losses and generate negative working capital from operations through 2003.
Until the Company  generates  positive  cash flow,  the Company is  dependent on
proceeds from the sale of certain  assets,  successful  negotiations  related to
vendor  settlements,  refinancing  certain equipment,  collection of receivables
from a former  officer  and in their  absence,  an  infusion  of debt or  equity
capital.

On February 25, 2003, the Company  negotiated a letter of intent to sell the net
assets of Mundo  Express of NY, Ltd. The proposed  sale is subject,  among other
things, to satisfactory  completion of due diligence  procedures by the intended
buyer and is expected to be completed in August 2003.

On February 26, 2003,  the Company sold its property in  Sacramento,  California
for $5,500,000.  As a result of the sale, the existing  mortgage was assigned to
the purchaser and  approximately  $735,000 of notes payable and related interest
were satisfied.


                                    Page 10
<PAGE>

On March 6, 2003,  the  Company  sold its 400,000  shares of Yak  Communications
(USA),  Inc. common stock for $800,000.  The proceeds from the sale were used to
reduce notes payable plus related interest and trade payables.

In March 2003, the Company negotiated  settlement agreements with former vendors
reducing  accounts  payable by approximately  $1,125,000 for  consideration of a
$250,000 payment in March 2003, and a promise to pay $123,000 upon completion of
certain asset sale/debt restructuring events. These amounts were paid during the
second quarter of 2003. The effect on basic and diluted income per share for the
three and six months ended June 30, 2003 was $.0077.

In May 2003, the Company  negotiated for the escrow and repayment of amounts due
to it from a major shareholder. (See Note 6)

In June 2003, the Company negotiated a short-term loan in the amount of $200,000
which is secured by certain receivables of the Company.

Based upon the above events and  management's  projected  operations and related
cash flows,  it believes  that there will be  sufficient  cash flows to meet the
needs of the Company for 2003.

Note 4. Recent Sale of Equity Securities

The  Company  has issued  and sold  unregistered  securities  that have not been
previously reported as set forth below.

Between January 11, 2002 and February 12, 2002, we sold 2,320,754  shares of our
common  stock to  Evertrend  Holdings  Limited at an average  purchase  price of
$0.0269 per share pursuant to a common stock purchase  agreement  between us and
Evertrend.  Ladenburg  Thalmann & Co., Inc. received $5,000.00 in placement fees
and  Evertrend  received a warrant to  purchase  1,160,377  shares of our common
stock at an exercise  price of $0.0269 until March 15, 2002 in  connection  with
this  transaction.  We paid  $1,000  in  escrow  fees in  connection  with  this
transaction.   These  securities  were  issued  in  a  transaction  exempt  from
registration under the Securities Act of 1933 in reliance on Section 4(2) of the
Securities Act of 1993.

Note 5. Discontinued Operations

Revenues and expenses from  discontinued  operations  for the quarter ended June
30,  2003  were  $625  and  $951,  respectively.   Revenues  and  expenses  from
discontinued  operations  for the quarter  ended June 30, 2002 were $322,820 and
$387,016,  respectively.  Revenues and expenses from discontinued operations for
the six months  ended June 30, 2003 were  $233,595 and  $284,070,  respectively.
Revenues and expenses from discontinued operations for the six months ended June
30, 2002 were $675,846 and $670,099, respectively.

Following is summarized financial information for the discontinued operations:

                                        June 30, 2003        December 31, 2002
                                        -------------        -----------------
Current assets                            $   -0-                $    -0-
Total assets                                  15,075               4,982,772
Current liabilities                           -0-                    357,909
Total liabilities                             -0-                  4,261,898
Net assets of discontinued operations         15,075               1,012,363


Note 6. Note Payable

On June 27, 2003,  the Company  entered into a loan and security  agreement  for
$200,000. The note is due and payable with monthly installments of principal and
interest of $7,500 with a balloon  payment due on or before June 26,  2004.  The
note bears interest at the rate of 15% and is secured by certain  receivables of
the Company.



                                    Page 11
<PAGE>

Note 7. Related Parties

As of June 30,  2003,  advances  to related  parties  include  amounts  due from
Michael Zwebner (Mr. Zwebner),  former officer, former Chairman of the Board and
current  stockholder.  In connection with this receivable,  on May 16, 2003, the
Company and Mr. Zwebner agreed to amend Mr. Zwebner's  termination and severance
agreement  originally  dated June 20, 2002.  The new agreement  encompasses  the
following:  1) an  extension  fee of $12,500 upon  signing of the  document;  2)
monthly  payments of $7,500  beginning June 30, 2003; 3) an escrow of YAK common
stock in an amount equal to the unpaid  principal  and  interest  balance of the
notes;  and 4) a balloon  payment due on May 31, 2004. The Company has agreed to
sell Mr. Zwebner 4,000,000 shares of its restricted common stock for $40,000 and
reduce the balloon  payment due on May 31, 2004 by $40,000 if all other terms of
the agreement are kept. In the event of default, the Company will be entitled to
receive an equivalent amount of YAK common stock of the then outstanding balance
of principal and interest and will have the option of rescinding the sale of its
common stock to Mr.  Zwebner.  The Company has recorded  compensation of $40,000
related to the reduction of the balloon payment.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Except for  historical  information  contained  herein,  the  statements in this
report (including  without  limitation,  statements  indicating that the Company
"expects,"  "estimates,"  "anticipates,"  "plans"  or  "believes"  and all other
statements  concerning future financial  results,  product  offerings,  proposed
acquisitions  or  combinations  or other events that have not yet  occurred) are
forward-looking  statements that are made pursuant to the safe harbor provisions
of the  Private  Securities  Litigation  Reform Act of 1995,  Section 21E of the
Securities  Exchange Act of 1934, as amended,  and Section 27A of the Securities
Act of 1933, as amended.  Forward-looking  statements  involve known and unknown
factors, risks and uncertainties which may cause the Company's actual results in
future periods to differ  materially  from forecasted  results.  Forward-looking
statements  are all based on current  expectations,  and the Company  assumes no
obligation to update this information.

Investing  in Talk  Visual  common  stock  involves  a high  degree of risk.  In
particular,  we need  additional  funding to  continue  our  operations.  Future
financing  may not be available to us on  acceptable  terms or at all. If future
financing  requirements are satisfied through the issuance of equity securities,
investors  may  experience  significant  dilution  in terms of their  percentage
ownership  interest.  While we are actively seeking  strategic  solutions to our
funding  issues,  there  is no  assurance  that we will be able to  obtain  such
financing. For additional risk factors regarding our Company, see "Risk Factors"
beginning on page 22 of the Company's  Annual Report on Form 10KSB to read about
factors you should consider before investing in Talk Visual common stock.

BUSINESS AND ORGANIZATION

Overview

Our  company,  Talk  Visual  Corporation  (referred  to  herein  as "we" or "the
Company"),  is a provider of voice  telecommunications  services to key business
and consumer market segments in the United States. These market segments consist
of multiple  sub-segments which include the Latin American  expatriate  business
and consumer communities. Our Retail Operations Division generates sales through
our 9 stores in the greater New York City/New Jersey area and our Sales Division
based in Miami,  Florida  generates  sales through a variety of means  including
direct sales and agent partnerships.

The principal  services that we provide through our Retail  Operations  Division
are  long-distance  telephone  calling in  private  booths in our  stores,  with
payment for such  services  collected  by a cashier  after  calls are  completed
("call-shop  services"),  pre-paid  calling cards,  money transfer  services and
international package delivery services.

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<PAGE>

The  principal   services  that  we  provide  through  our  Sales  Division  are
international and domestic long distance  services,  domestic toll-free services
and various  pre-paid  services.  Our Sales  Division,  in conjunction  with our
finance and accounting department, has developed systems, processes,  procedures
and rate  tables  to resell  international  and  domestic  long  distance  voice
services to business and residential clients.

General
-------

While  economic  conditions are predicted to get better and the condition of the
Company continues to improve,  management continues to take steps to improve the
overall  performance  of the  Company.  During the second  quarter,  the Company
continued to improve overall infrastructure (network,  information systems, etc)
with an  operational  focus on  building  scale in the  Company's  core  markets
(residential and business) by adding  customers and traffic.  The combination of
infrastructure and scale will continue to give the Company the ability to reduce
costs, improve service quality, and introduce new products and services.

Growth is expected to continue  through sales and marketing  efforts  focused on
customers  with  significant  long  distance  usage,  especially   international
calling.

During the quarter ended June 30, 2003, among other things, the Company

         o    Announced a change in the company's name. Talk Visual  Corporation
              received  authority  from the Florida  Secretary of State to begin
              doing business as TVC Telecom.
         o    Developed a marketing  campaign around the theme "It's a whole new
              ball game".
         o    Developed a national advertisement for placement in the 2003 Major
              League Baseball Official Program Guide for the All Star Game.
         o    Began a complete  revamping of our web site with the  objective of
              making the site more  user-friendly and with an eye to future user
              interactivity.
         o    Continued to add agents to the Company's growing agent network.
         o    Increased second quarter revenue from the business and residential
              segments by nearly 11% over the first quarter. This growth was the
              result of increased customer acquisition,  an increase in existing
              customer calling and rapid growth of a primary Internet partner.

RESULTS OF OPERATIONS

For the three  months  ended June 30,  2003,  compared to the three months ended
June 30, 2002:

Revenue  decreased $0.65 million or 29.9% to $1.53 million for the quarter ended
June 30, 2003,  from $2.18  million for the quarter  ended June 30,  2002.  This
decrease is due to a concerted  effort by the Company to reduce its  reliance on
call shop  revenue as it focused  on  residential  and  business  traffic.  When
compared to the second quarter of 2002, the Retail Operations Division increased
its residential  and business  traffic from $0.211 million to $0.544 million for
the quarter ended June 30, 2003. The Retail Operations Division,  which consists
of 9 stores  operated  by the  Company  in the New York  City/New  Jersey  area,
generated  revenue of $0.69 million for the quarter ended June 30, 2003 compared
to $0.74  million for the quarter  ended June 30, 2002.  The decrease in revenue
for  the  Retail  Operations  Division  is due to the  sale of one  store  and a
reduction in the average revenue per minute of usage.  Revenue is recognized and
recorded at the time of customer usage.

Cost of Sales  decreased $0.56 million or 37.4% to $0.94 million for the quarter
ended June 30, 2003,  from $1.5 million for the quarter ended June 30, 2002. The
decrease is directly attributable to the increase in traffic volume in 2003 over
2002.

Gross Profit decreased $0.08 million to $0.59 million for the quarter ended June
30, 2003,  from $0.67 million for the quarter ended June 30, 2002.  The decrease
is due to the changes discussed in Revenue and Cost of Sales. As a percentage of
revenue,  gross profit  increased to 38.4% for the quarter  ended June 30, 2003,
from 31.0% for the quarter ended June 30, 2002.


                                    Page 13
<PAGE>

Selling,  General &  Administrative  (SG&A) expenses  decreased $0.01 million or
1.13% to $0.88 million for the quarter  ended June 30, 2003,  from $0.89 million
for the quarter ended June 30, 2002. The major elements of SG&A are as follows:

                                                  2003            2002
                                               ---------        ---------
          Salaries and benefits               $  350,964       $  384,895
          Travel                                  11,752           28,615
          Office & all other                     127,733           94,974
          Rents, licenses and other expenses     139,288          143,105
          Consultants                             86,516           70,575
          Legal and other professional            40,494           33,790
          Sales & Marketing                      122,078          132,883
                                               ---------        ---------
                     Total                    $  878,825       $  888,837
                                               =========        =========

Salaries and benefits have decreased as a result of the closing of  unprofitable
stores during 2002.

Loss from  Operations  increased $0.05 million or 16.8% to $0.36 million for the
quarter  ended June 30, 2003,  from $0.31 million for the quarter ended June 30,
2002 due to the decreases in revenue and gross profit.

Other (Income)/Expenses  decreased $1.18 million or 10,507.3% to a gain of $1.17
million for the quarter ended June 30, 2003,  from $0.01 million for the quarter
ended June 30, 2002.  The primary  element of this  decrease is a $1.15  million
gain from vendor settlements.

Loss from  Discontinued  Operations  decreased  $63,870 to $326 for the  quarter
ended June 30,  2003 from  $64,196  for the quarter  ended June 30,  2002.  This
decrease  is  primarily  due to the sale of the  Company's  property in Toronto,
Canada and the cessation of day-to-day operations.

Net Income  Applicable  to Common  Shares  increased  $1.20 million or 147.4% to
$0.81 million for the quarter ended June 30, 2003,  from a loss of $0.38 million
for the quarter  ended June 30, 2002  primarily  due to the  increases  in gross
margin percentage,  the gain from vendor settlements and the reduction of losses
from discontinued operations during 2003.

RESULTS OF OPERATIONS

For the six months  ended June 30,  2003,  compared to the six months ended June
30, 2002:

Revenue  decreased  $1.06  million or 26.2% to $2.99  million for the six months
ended June 30, 2003,  from $4.05 million for the six months ended June 30, 2002.
This decrease is due to a concerted effort by the Company to reduce its reliance
on call shop revenue as it focused on  residential  and business  traffic.  When
compared  to the  first  six  months of 2002,  the  Sales  Operations  Divisions
increased  its  residential  and business  revenue  from $0.30  million to $1.05
million for the six months ended June 30, 2003. The Retail Operations  Division,
which  consists of 9 stores  operated  by the  Company in the New York  City/New
Jersey area,  generated  revenue of $1.33  million for the six months ended June
30, 2003 compared to $1.50  million for the six months ended June 30, 2002.  The
decrease in revenue for the Retail Operations Division is due to the sale of one
store and a  reduction  in the average  revenue per minute of usage.  Revenue is
recognized and recorded at the time of customer usage.

Cost of Sales  decreased  $0.87  million or 30.4% to $1.99  million  for the six
months ended June 30, 2003, from $2.86 million for the six months ended June 30,
2002.  This decrease is directly  attributable to the decrease in traffic volume
in 2003 over 2002 and an increase in the gross profit percentage.



                                    Page 14
<PAGE>

Gross Profit  decreased  $0.19 million to $1.00 million for the six months ended
June 30, 2003,  from $1.19 million for the six months ended June 30, 2002.  This
increase is due to the  changes  discussed  in Revenue  and Cost of Sales.  As a
percentage of revenue, gross profit increased to 33.5% from 29.4%.

Selling,  General &  Administrative  (SG&A) expenses  decreased $0.04 million or
2.20% to $1.75  million  for the six  months  ended  June 30,  2003,  from $1.79
million for the six months ended June 30, 2002.  The major  elements of SG&A are
as follows:

                                                   2003            2002
                                               ---------        ---------
          Salaries and benefits               $  683,346       $  764,030
          Travel                                  23,434           50,305
          Office & all other                     236,943          237,391
          Rents, licenses and other expenses     271,740          277,827
          Consultants                            189,082          135,915
          Legal and other professional            87,482           85,436
          Sales & Marketing                      260,371          240,910
                                               ---------      -----------
                     Total                    $1,752,398       $1,791,814
                                               =========      ===========

Salaries and benefits have decreased as a result of the closing of  unprofitable
stores during 2001.

Loss from  Operations  increased $0.10 million or 12.7% to $0.89 million for the
six months ended June 30, 2003, from $0.79 million for the six months ended June
30, 2002 due to the decreases in revenue and gross profit.

Other  (Income)/Expenses  decreased $1.16 million or 7,660.4% to a gain of $1.15
million for the six months ended June 30, 2003,  from $15,180 for the six months
ended June 30, 2002.  The primary  element of this  decrease is a $1.15  million
gain from vendor settlements.

Loss from Discontinued Operations increased $56,222 or 978.3% to $50,475 for the
six months  ended June 30,  2003 from a gain of $5,747 for the six months  ended
June 30, 2002.  This increase is due to final closing costs  associated with the
sale of its Sacramento property on February 26, 2003.

Net Income  Applicable  to Common  Shares  increased  $1.01 million or 126.5% to
$0.21  million  for the six  months  ended June 30,  2003,  from a loss of $0.80
million for the six months ended June 30, 2002 primarily due to the decreases in
revenues,  increases  in  gross  margin  percentage  and the  gain  from  vendor
settlements during 2003.


LIQUIDITY AND CAPITAL RESOURCES

As reflected in the accompanying  financial statement,  the Company has incurred
significant  net losses since  inception and expects to continue to incur losses
and have negative working capital from operation through 2003. Until the Company
generates positive cash flow, the Company is dependent on proceeds from the sale
of  certain  assets,  successful  negotiations  related  to vendor  settlements,
refinancing  certain equipment,  collection of receivables from a former officer
and in their absence, an infusion of debt or equity capital.

We had $1,107,553 in cash outflows from operating  activities for the six months
ended June 30,  2003,  compared  to cash  outflows of $55,698 for the six months
ended June 30, 2002. This increase in outflows of $1,051,855  primarily resulted
from the extensive payment of accounts payable for the six months ended June 30,
2003.




                                    Page 15
<PAGE>

We had $1,850,682 in net cash from investing activities for the six months ended
June 30,  2003,  compared to cash  outflows of $133,852 for the six months ended
June 30, 2002. This increase in cash of $1,984,534  primarily  resulted from the
proceeds  received  from the  sale of  discontinued  operations  and the sale of
securities  during the six months ended June 30, 2003 and the  acquisition  of a
new switch during the six months ended June 30, 2002.

Net cash outflows  from  financing  activities  amounted to $757,720 for the six
months ended June 30, 2003,  compared to net cash from  financing  activities of
$56,500 for the six months ended June 30, 2002. This increase in cash outflow of
$814,220  primarily  resulted from the repayment of all of the Company's secured
debt during the six months ended June 30, 2003.

See pages  18-22 of our  Annual  Report on Form 10KSB for a  description  of the
Company's "Critical Accounting Policies and Estimates."


Item 3. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. The Company maintains controls
and procedures  designed to ensure that information  required to be disclosed in
the reports that the Company files or submits under the Securities  Exchange Act
of 1934 is recorded, processed,  summarized and reported within the time periods
specified  in the rules and forms of the  Securities  and  Exchange  Commission.
Based upon his evaluation of those controls and procedures  performed  within 90
days of the  filing  date of this  report,  the chief  executive  and  principal
financial  officers  of the  Company  concluded  that the  Company's  disclosure
controls and procedures were effective.

Changes in Internal  Controls.  The Company made no  significant  changes in its
internal  controls or in other  factors  that could  significantly  affect these
controls subsequent to the date of the evaluation of those controls by the chief
executive and principal financial officers.

                           PART II - OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS

We are not  currently  involved  in any  litigation  that is  expected to have a
material adverse effect on our business or financial  position.  There can be no
assurance,  however,  that third parties will not assert  infringement  or other
claims against us in the future, which regardless of the outcome,  could have an
adverse  impact  on the  Company  as a result of  defense  costs,  diversion  of
management resources and other factors.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a) The following exhibits are included herewith:

         Exhibit 11 -  Computation  of  Weighted  Average  Common  Stock  Shares
Outstanding

         Exhibit 31 - Certificate Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes Oxley Act of 2002

         Exhibit 32 - Certificate Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes Oxley Act of 2002

(b) The Company filed the  following  reports on Form 8-K during the quarter for
which this form is filed:

         None





                                     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.

Date: August 9, 2002          TALK VISUAL CORPORATION


                               /s/ HARLEY L. ROLLINS
                              ----------------------------
                              Harley L. Rollins
                              President, Chief Executive Officer
                              and Chief Financial Officer (principal
                              executive officer and principal
                              financial and accounting officer)
                              and Director




























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