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

                                   FORM 10-QSB

(Mark One)

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

For the quarterly period ended                  March 31, 2005
--------------------------------------------------------------------------------

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

For the transition period from  _____________________ to  ______________________

                            Commission File Number 025449
                                                   ------

                         Sagient Research Systems, Inc.
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)


           Delaware                                  33-0856651
--------------------------------------------------------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification No.)
incorporation or organization)

            3655 Nobel Drive, Suite 540, San Diego, California 92122
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (858) 623-1600
--------------------------------------------------------------------------------
                          (Issuer's telephone number)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 of 15 (d) of the Securities and Exchange Act of 1934
during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

As of April 28, 2005, there were 23,510,796 shares of common stock issued and
outstanding.

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

================================================================================
<PAGE>

                         Sagient Research Systems, Inc.
                                   FORM 10-QSB
                                QUARTERLY REPORT
                                 March 31, 2005


                                TABLE OF CONTENTS



PART I - FINANCIAL INFORMATION

ITEM 1.    Condensed Consolidated Financial Statements:

           Consolidated Balance Sheets..................................     3

           Consolidated Statements of Operations........................     4

           Consolidated Statements of Cash Flows........................     5

           Notes to Consolidated Financial Statements...................     6


ITEM 2.    Management's Discussion and Analysis
             of Financial Condition and Results of Operations...........    13

ITEM 3.    Controls and Procedures......................................    18

PART II - OTHER INFORMATION

ITEM 1.    Legal Proceedings............................................    18

ITEM 2.    Unregistered Sales of Equity Securities and Use of Proceeds..    18

ITEM 3.    Defaults Upon Senior Securities..............................    18

ITEM 4.    Submission of Matters to a Vote of Security Holders..........    19

ITEM 5.    Other Information............................................    19

ITEM 6.    Exhibits.....................................................    19

                                       2
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<PAGE>

                          Part I Financial Information

Item 1.           Condensed Consolidated Financial Statements
                  -------------------------------------------

<TABLE>
<CAPTION>
Sagient Research Systems, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
                                                                     March 31,      December 31,
                                                                       2005             2004
                                                                     Unaudited        Audited
                                                                   ----------------------------
                              ASSETS
<S>                                                                <C>             <C>
CURRENT ASSETS
Cash and cash equivalents                                          $    125,431    $     54,106
Accounts receivable                                                     118,711         133,245
Prepaid research                                                        212,033         233,974
Prepaid commissions                                                      58,143          48,581
Other current assets                                                     10,346           8,276
                                                                   ----------------------------
  Total current assets                                                  524,664         478,182

Property and equipment, net                                             273,998         301,374
Other assets                                                              3,210           3,027
                                                                   ----------------------------
  Total assets                                                     $    801,872    $    782,583
                                                                   ============================

         LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts payable                                                   $     93,706    $    245,047
Accrued interest expense                                                305,930         280,638
Revolving credit facility                                               100,000         100,000
Current portion of convertible debt, net                              1,291,548       1,363,763
Notes payable                                                           300,000         300,000
Notes payable - related parties                                         270,073         287,500
Deferred revenue                                                      1,233,107       1,019,674
Prepaid subscription receipts                                            88,595          79,119
Other current liabilities                                               127,061         135,657
                                                                   ----------------------------
  Total current liabilities                                           3,810,020       3,811,398


STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $.0001 par value; 10,000,000 shares authorized;
  no shares outstanding                                                      --              --
Common stock; $.0001 par value, 80,000,000 shares authorized,
  35,277,512 issued, 23,510,796 outstanding at March 31, 2005
 and December 31, 2004                                                    2,394           2,394
Additional paid-in capital                                           29,040,948      29,040,948
Treasury stock, 417,866 common shares at cost                           (58,501)        (58,501)
Accumulated deficit                                                 (31,992,989)    (32,013,656)
                                                                   ----------------------------
  Total stockholders' equity (deficit)                               (3,008,148)     (3,028,815)
                                                                   ----------------------------

  Total liabilities and stockholders' equity (deficit)             $    801,872    $    782,583
                                                                   ============================
</TABLE>

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

                                       3
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<PAGE>

Sagient Research Systems, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS

                                                        (Unaudited)
                                            For The Three Months Ended March 31,

                                                   2005              2004
                                              ------------------------------

REVENUES
Research services                             $    800,793      $    647,119
Other revenue                                        1,125               600
                                              ------------------------------
  Total Revenues                                   801,918           647,719
                                              ------------------------------

EXPENSES
Compensation and benefits                          292,384           310,325
General and administrative                         132,388           260,570
Product research expenses                          245,217           244,281
Depreciation and amortization                       53,681            70,401
                                              ------------------------------
  Total Expenses                                   723,670           885,577
                                              ------------------------------

Operating income (loss)                             78,248          (237,858)

OTHER EXPENSE
Interest and other                                  57,581            58,183
Loss on joint venture                                   --            60,739
                                              ------------------------------

Net income (loss)                             $     20,667      $   (356,780)
                                              ==============================

Basic earnings (loss) per share               $         --      $      (0.02)
                                              ==============================

Basic weighted-average shares outstanding       23,510,796        22,940,058
                                              ==============================

Diluted earnings (loss) per share             $         --      $      (0.02)
                                              ==============================

Diluted weighted-average shares outstanding     24,087,346        22,940,058
                                              ==============================

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

                                       4
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<PAGE>

Sagient Research Systems, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                            (Unaudited)
                                                                For The Three Months Ended March 31,

                                                                      2005               2004
                                                                 --------------------------------
<S>                                                              <C>                 <C>
Cash flows from operating activities
  Net income (loss)                                              $     20,667        $   (356,780)
  Adjustments to reconcile net income (loss) to net cash
    provided by operating activities
    Depreciation and amortization                                      53,681              70,401
    Stock and stock options issued for services                            --              85,851
    Loss on joint venture                                                  --              60,739
  Net changes in assets and liabilities
    (Increase) decrease in accounts receivable                         14,534             (46,961)
    Decrease in receivables from related parties                           --              62,500
    (Increase) decrease in prepaid research                            21,941             (53,779)
    (Increase) in prepaid commissions and other current assets        (11,632)            (41,228)
    (Increase) decrease in other assets                                  (183)                255
    Increase (decrease) in accounts payable                          (151,341)             95,107
    Increase in accrued expenses and other current liabilities         26,172              57,204
    Increase in deferred revenue                                      213,433             224,817
                                                                 --------------------------------
  Net cash provided by operating activities                           187,272             158,126

Cash flows from investing activities

  Additions to property and equipment                                 (26,305)            (11,646)
                                                                 --------------------------------
  Net cash flows used in investing activities                         (26,305)            (11,646)

Cash flows from financing activities

  Repayment of notes payable to related party                         (17,427)                 --
  Repayment of notes and convertible debt                             (72,215)            (69,745)
                                                                 --------------------------------
  Net cash flows used in financing activities                         (89,642)            (69,745)
                                                                 --------------------------------
  Net increase in cash and cash equivalents                            71,325              76,735

Cash and cash equivalents, beginning of period                         54,106              54,348
                                                                 --------------------------------

Cash and cash equivalents, end of period                         $    125,431        $    131,083
                                                                 ================================

Supplemental disclosures of cash flow information
  Interest paid                                                  $     40,783        $     35,680
                                                                 ================================
  Taxes paid                                                     $      1,600        $         --
                                                                 ================================
</TABLE>

Supplemental disclosures of non-cash information (see Note I).

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

                                       5
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<PAGE>

                 Sagient Research Systems, Inc. and Subsidiaries
              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)

NOTE A - ORGANIZATION

Sagient Research Systems, Inc. ("Sagient Research" or "Parent" or "Company") is
based in San Diego, California and was incorporated in Delaware in 1999. Sagient
Research is a publisher of independent investment research. We operate our
business activities through Sagient Research and through our wholly owned
subsidiary, DP Securities, Inc. d/b/a Sagient Securities ("DPS" or "Sagient
Securities"), a broker-dealer incorporated in the State of California. We
develop, produce and sell proprietary research products to mutual funds, hedge
funds and investment banks. Our business strategy is to leverage our development
technology and marketing expertise to be a leading provider of independent
research to the financial services and institutional investment communities.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation
---------------------

The accompanying unaudited condensed consolidated financial statements of
Sagient Research Systems, Inc. and subsidiaries (the "Company") have been
prepared pursuant to accounting principles generally accepted in the United
States of America ("US GAAP") for interim financial statements and the rules and
regulations of the Securities and Exchange Commission. Accordingly, certain
information and note disclosures normally included in annual financial
statements prepared in accordance with US GAAP have been condensed or omitted
pursuant to those rules and regulations. These consolidated financial statements
should be read in conjunction with the financial statements and the notes to the
financial statements included in the Company's latest audited financial
statements for the year ended December 31, 2004 filed on Form 10-KSB.

The consolidated financial statements for the 2004 interim periods include the
accounts of the Company and its wholly owned broker-dealer subsidiary, DP
Securities, Inc. d/b/a Sagient Securities ("DPS" or "SS"). All material
inter-company accounts and transactions have been eliminated in consolidation.

In the opinion of management all adjustments (consisting of normal recurring
adjustments) necessary for a fair presentation of the Company's financial
position, results of operations and cash flows for the periods presented have
been included. The Company's quarterly results are not necessarily indicative of
results for a full year.

Going Concern and Liquidity
---------------------------

The accompanying unaudited condensed consolidated financial statements have been
prepared assuming the Company will continue as a going concern, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business. As more fully discussed in the Company's 2004
Form 10-KSB, the Company's December 31, 2004 audited financial statements
included a "going concern" qualification from its independent auditors due to
the Company's historical lack of profitability and negative working capital.

To address the going concern issue, management has re-focused its efforts and
the Company's resources toward the single objective of providing high-quality,
independent research to the institutional investment community.

The Company and its management believe that the independent institutional
research market is a viable area to compete, and ultimately achieve
profitability. However, the Company's ability to

                                       6
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<PAGE>

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

continue as a going concern is dependent upon its ability to generate sufficient
cash flow to meet its obligations on a timely basis and to succeed in its
efforts to raise additional capital. Management believes its anticipated cash
flow from operations could be adequate to fund its operating requirements and
contractual commitments, however, there can be no assurances that the Company
will not require additional financing, or whether additional financing will be
available to the Company on acceptable terms, or at all.

For the three months ended March 31, 2005 the Company earned a net profit from
continuing operations of $20,667 and as of March 31, 2005 the Company's current
liabilities exceeded its current assets by $3,285,356. Although this represents
an improvement relative to respective year to date losses during 2004, these
factors among others indicate that the Company may be unable to continue as a
going concern.

The accompanying condensed consolidated financial statements do not include any
adjustments that might result from the resolution of these matters.

Use of Estimates
----------------

The preparation of financial statements in conformity with US GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the period presented. Actual results
could differ materially from those estimates.

Revenue Recognition
-------------------

         Research services revenue represents revenue from providing individual
custom reports or reports on a monthly or annual subscription basis. Revenue
from custom reports is recognized when the report is provided, and revenue from
subscriptions is recognized ratably over the contractual period. Research
services revenue also includes revenue from a licensing agreement to distribute
data, which is recognized ratably over the term of the contract. Deferred
revenue on the consolidated balance sheets consists of subscription and
licensing revenues that will be recognized in future periods.

Other revenue includes computer programming services performed by the Company.
Computer programming services are recognized during the period that such
services are provided.

Earnings (Loss) Per Share
-------------------------

The Company calculates earning per share in accordance with SFAS No. 128,
Earnings Per Share, and SEC Staff Accounting Bulletin No. 98. Accordingly, basic
earnings (loss) per share is computed using the weighted average number of
common shares and diluted earnings (loss) per share are computed based on the
weighted average number of common shares and all common equivalent shares
outstanding during the period in which they are dilutive. Common equivalent
shares consist of shares issuable upon the exercise of stock options or warrants
(using the treasury stock method); common equivalent shares are excluded from
the calculation if their effect is anti-dilutive.

Stock-Based Compensation
------------------------

The Company measures compensation expense related to the grant of stock options
and stock-based awards to employees in accordance with the provisions of
Accounting Principles Board ("APB") Opinion No. 25. Compensation expense, if
any, is generally based on the difference between the exercise price of an
option, or the amount paid for the award and the market price or fair value of
the underlying common stock at the date of the award. Stock-based compensation
arrangements involving non-employees are accounted for under SFAS No. 123,
"Accounting for

                                       7
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<PAGE>

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Stock-Based Compensation," under which such arrangements are accounted for based
on the fair value of the option or award. The Company adopted the disclosure
requirements of SFAS No. 148, "Accounting for Stock-Based Compensation -
Transition and Disclosure," an amendment of SFAS No. 123 as of January 1, 2003,
which require certain disclosures about stock-based employee compensation plans
in an entity's accounting policy note.

Those disclosures include a tabular format of pro forma net income and, if
applicable, earnings per share under the fair value method if the intrinsic
value method is used in any period presented. Pro forma information in a tabular
format is also required in the notes to interim financial information if the
intrinsic value method is used in any period presented. The adoption of SFAS No.
148 did not have a material impact to these condensed consolidated financial
statements and the disclosure requirements are included below.

As of May 15, 2001 the Board of Directors of the Company adopted the 2001 Stock
Plan ("2001 Plan"), which was approved by the Company's shareholders in November
2001. The 2001 Plan provides for accelerated vesting provisions in the event of
a change in control and other events, as defined.

During the quarter ended March 31, 2005 the Company did not issue any options to
employees to purchase shares of its common stock, and options to purchase
397,500 shares were forfeited and cancelled. As of March 31, 2005 options to
purchase 2,397,500 shares of the Company's common stock were outstanding
pursuant to the 2001 Plan.

SFAS No. 123 requires the Company to provide pro forma information regarding net
income (loss) and earnings (loss) per share as if compensation cost for the
Company's stock option issuances had been determined in accordance with the fair
value based method prescribed in SFAS No. 123. The Company estimates the fair
value of each stock option at the grant date by using the Black-Scholes
option-pricing model with the following assumptions used for option grants
during the first quarters of 2005 and 2004, the following assumptions were used:
dividend yield of zero percent, risk-free interest rates ranging from 2.79% to
3.12%, expected lives of five years, and expected volatility of 141%.

Under the accounting provisions of SFAS No. 123, as amended by SFAS No. 148, the
Company's pro forma net loss and loss per share for the three months ended March
31, 3005 and 2004 would have been as follows:

                                                     2005               2004
                                                -------------------------------

Net income (loss) as reported                   $  20,667           $  (356,780)
   SFAS No. 123 effect                               (169)             (124,150)
                                                -------------------------------
   Pro forma net loss                           $  20,498           $  (480,930)
                                                ===============================

Loss per share as reported
   Basic                                        $    0.00           $     (0.02)
   Diluted                                      $    0.00           $     (0.02)
Proforma
   Basic                                        $    0.00           $     (0.02)
   Diluted                                      $    0.00           $     (0.02)


Basic weighted average common
shares outstanding                              23,510,796            22,940,058
Diluted weighted average common
shares outstanding                              24,087,346            22,940,058


                                       8
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<PAGE>

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Segment Information
-------------------

The Company complies with SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information" that requires public business enterprises to
report information regarding reportable operating segments. SFAS No. 131
supersedes SFAS No. 14, "Financial Reporting for Segments of a Business
Enterprise."

Due to the inactive status of Sagient Securities, the Company currently has no
reportable segments. Accordingly, disclosure of segment information is not
applicable.

New Accounting Pronouncements
-----------------------------

In December 2004, FASB issued SFAS No. 123 (revised 2004) "Share-Based Payment,"
which requires companies to recognize in the income statement grant date fair
value of stock options and other equity-based compensation issued to employees.
That cost will be recognized over the period during which an employee is
required to provide services in exchange for the award--the requisite service
period (usually the vesting period). SFAS No. 123R requires the Company to adopt
the new accounting provisions beginning in the first annual reporting period
that begins after December 15, 2005, or for our fiscal year 2006. The Company
has not yet determined the impact of applying the provisions of SFAS No. 123R.
The Company does not believe SFAS No. 123R is likely to have a material effect
on the Company's financial position or results of operations.

Reclassifications
-----------------

Certain amounts from the 2004 consolidated financial statements have been
reclassified to conform to the 2005 presentation.

NOTE C -PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

                                          March 31, 2005      December 31, 2004
                                            (Unaudited)           (Audited)
                                         --------------------------------------
Computer equipment and software          $       1,397,406    $       1,372,476
Furniture and fixtures                              37,797               37,797
Office equipment                                    76,248               76,248
                                         --------------------------------------
                                                 1,511,451            1,486,521
Less accumulated depreciation                   (1,237,453)          (1,185,147)
                                         --------------------------------------
                                         $         273,998    $         301,374
                                         ======================================

Depreciation and amortization expense was $53,681 and $70,401 for the three
months ended March 31, 2005 and 2004, respectively.

NOTE D - REVOLVING LINE OF CREDIT

On June 12, 2003 the Company entered into a promissory note agreement with Bank
of America, providing a $100,000 revolving credit line made available to the
Company through June 10, 2006. During this initial period, the Company is
obligated to pay interest only, based on the outstanding principal balance, on a
monthly basis. The interest rate on the note is variable and is calculated based
on the published Wall Street Journal prime rate listing plus 4.5%. As of March
31, 2005 the interest rate on the note was 9.75%.

                                       9
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<PAGE>

NOTE D - REVOLVING LINE OF CREDIT (Continued)

Following the initial period, the outstanding principal balance, together with
interest based on the applicable interest rate, shall be repaid monthly, on a
fully amortized basis, over the remaining term of the note that runs through
June 12, 2010. As of March 31, 2005 and December 31, 2004 the outstanding
principal balance under the credit line was $100,000. The credit line is
guaranteed by the United States Small Business Administration, as well as by the
Company's President and CEO.

NOTE E - CONVERTIBLE DEBT

On December 17, 2001, the Company issued convertible debentures in the aggregate
principal amount of $1,600,000 and warrants to purchase 160,000 shares of the
Company's common stock. These debentures had a maturity date of December 17,
2003, and bore interest at a rate of 10% per annum, which was due and payable on
the last day of each calendar quarter until they were paid in full or converted
into shares of the Company's common stock.

In February 2003 the Company and the debenture holders restructured certain
terms and provisions of the convertible debentures. At March 31, 2005 and
December 31, 2004 the restructured convertible debt principal totaled $1,291,548
and $1,363,763, respectively, all of which is due within one year and is
classified as a current liability.

Following is a summary of primary terms of the restructured agreements:

$1,250,000 Original Principal Amount Note
-----------------------------------------

The original debenture was amended in February 2003 and the principal balance
was changed to $1,425,000. The amended principal balance includes the original
principal amount plus accrued and unpaid liquidated damages and interest of
$150,000 and $25,000, respectively. The Company paid the remaining balance of
accrued interest at February 28, 2003 totaling $26,736 and $125,000 of accrued
liquidated damages were waived by the debenture holder.

The debenture matures on December 28, 2005 and bears interest at an annual rate
of 14%. The debenture requires fixed monthly payments of principal and interest
beginning on March 28, 2003 of $25,000 for the first five (5) months, $50,000
thereafter through November 28, 2005 and a final payment due December 28, 2005
in the amount of $271,100. The outstanding principal balance may be converted
into shares of the Company's common stock at the option of the holder based on a
fixed conversion price of $0.20 per share, and the warrant to purchase 125,000
shares of the Company's common stock that were included in the original
debenture have a fixed exercise price of $0.086 for the term of the warrants,
which expire December 17, 2006. In addition, the debenture holder agreed to
waive all registration requirements with respect to the convertible debenture,
warrants and shares underlying the warrants.

In February 2003, the debenture holder agreed to defer scheduled monthly
principal and interest payments for the period October 28, 2003 through December
28, 2003, and to add the deferred payments to the amount due with the final
payment on December 28, 2005. In 2004 the debenture holder agreed to defer
scheduled monthly principal and interest payments for the period April 28, 2004
through December 28, 2004, and to add the deferred payments to the amount due at
maturity. As of March 31, 2005 the outstanding principal balance was $1,136,548
all of which was reflected as a current liability. As of April 28, 2005, all
payments due have been paid.

$350,000 Original Principal Amount Note
---------------------------------------

The original debenture was amended in February 2003 and the principal balance
was changed to $155,000. The amended principal balance includes the original
principal amount, less the partial principal payment in November 2002 of
$215,686 plus accrued and unpaid liquidated damages and interest of $16,656 and
$4,030, respectively. The debenture holder waived accrued liquidated

                                       10
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<PAGE>

NOTE E - CONVERTIBLE DEBT (Continued)

damages in the amount of $12,844. The debenture was originally scheduled to
mature on February 28, 2005 and bears interest at an annual rate of 14%. On
March 1, 2005 the debenture holder extended the maturity date to August 31,
2005. Payment of interest is required quarterly, beginning March 30, 2003 and
the principal balance is payable upon the maturity date.

The outstanding principal balance may be converted into shares of the Company's
common stock at the option of the holder based on a fixed conversion price of
$0.20 per share, and the warrant to purchase 35,000 shares of the Company's
common stock that were included in the original debenture have a fixed exercise
price of $0.086 for the term of the warrants. In addition, the debenture holder
agreed to waive all registration requirements with respect to the convertible
debenture, warrants and shares underlying the warrants. In July 2004, the
debenture holder exercised 35,000 warrants via the cashless exercise provision
provided in the warrant.

As of March 31, 2005 the outstanding principal balance was $155,000, all of
which was reflected as a current liability.

NOTE F - NOTES PAYABLE UNRELATED PARTIES

On November 22, 2001 the Company borrowed $300,000 from an unrelated party. In
connection with the loan, the Company issued a note to the lender, which is
unsecured, bears interest at 15% per annum and was originally due in April 2002.
In addition, the Company issued 150,000 detachable warrants to the lender for
150,000 shares of the Company's common stock at an exercise price of $2.30 per
share. The warrants are exercisable at the option of the holder and expire in
November 2006. During 2004 the maturity date was extended to July 1, 2005.
During the three months ended March 31, 2005 the Company recorded interest
expense in connection with this note totaling $11,250, and as of March 31, 2005
the outstanding principal balance was $300,000 and total interest payable in
connection with these loans was $108,875.

NOTE G - NOTES PAYABLE RELATED PARTIES

Between May 2001 and January 2002 the Company borrowed an aggregate of $187,500
from a company controlled by an officer/stockholder pursuant to unsecured
promissory notes. The Company borrowed an additional $35,000 in June 2004 and
$65,000 in July 2004 from the same company and the Company issued an additional
promissory note to the lender. All of the promissory notes bear interest at an
annual rate of 12% and are due and payable on January 1, 2006.

During the three months ended March 31, 2005 the Company recorded interest
expense in connection with these notes totaling $8,354 and paid interest due of
$7,573. As of March 31, 2005 and December 31, 2004 the outstanding principal
balance was $270,073 and $287,500, respectively, and total interest payable in
connection with these loans was $5,460 and $4,679, respectively.

                                       11
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<PAGE>

NOTE H - EARNINGS (LOSS) PER SHARE

The following table illustrates the calculation of basic and diluted earnings
(loss) per common share for the three months ended March 31, 2005:

Basic
Net income (loss)                                          $     20,667
                                                           ============

Basic weighted-average common shares outstanding             23,510,796
                                                           ============

Basic earnings (loss) per common share                     $          0
                                                           ============

Diluted
Net income (loss)                                          $     20,667
                                                           ============

Weighted-average common shares outstanding                   23,510,796
Add:
Exercise of performance warrants                                569,050
Exercise of stock options                                         7,500
                                                           ------------

Diluted weighted-average shares outstanding                  24,087,346
                                                           ============

Diluted earnings (loss) per common share                   $          0
                                                           ============

Stock options, warrants, and shares issuable upon conversion of debt totaling
2,390,000, 628,906, and 6,457,741, respectively at March 31, 2005 have not been
included in the calculation of earnings (loss) per share because the exercise
price was greater than the average market price of the common shares and
therefore, their inclusion would be anti-dilutive. The three months ended March
31, 2004 resulted in a loss and therefore diluted earnings per share are equal
to basic earnings per share.

NOTE I  - SUPPLEMENTAL DISCLOSURES OF NON-CASH INFORMATION

In December 2004, 400,000 shares of common stock were issued to an officer of
the Company as compensation for his outstanding performance.

In July 2004, 22,960 shares of common stock were issued in connection with the
exercise of 35,000 warrants by a debenture holder.

During the three months ended March 31, 2004 an aggregate of 285,000 shares of
the Company's common stock valued at $85,850 were issued in connection with
services provided to the Company.

NOTE J - RELATED PARTY TRANSACTIONS

Consulting Services
-------------------

During the three months ended March 31, 2005 the Company recorded consulting
fees and related expenses of $45,676 for services provided by a corporation
controlled by a stockholder and relative of an officer of the Company.

                                       12
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<PAGE>

NOTE K - COMMITMENTS AND CONTINGENCIES

Litigation
----------

The Company's commitment and contingencies include claims and litigation in the
normal course of business. In the opinion of management, there are no matters
pending or threatened that are expected to have a material adverse effect on the
Company's results of operations and financial position.

Operating Leases
----------------

The Company leases approximately 4,400 square feet of office space in San Diego,
California under a lease, which expires December 31, 2007. Total rental expense
for the three months ended March 31, 2005 was approximately $33,359.




Item 2.
     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
     OPERATIONS.
     --------------------------------------------------------------------------

         The following discussion should be read in conjunction with the
financial statements and notes thereto of the Company. Such financial statements
and information have been prepared to reflect the Company's financial position
as of March 31, 2005 and December 31, 2004.

         Historical results and trends should not be taken as indicative of
future operations, especially in light of the Company's recent restructuring.
Management's statements contained in this report that are not historical facts
are forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Actual results may differ materially from those
included in the forward-looking statements. The Company intends such
forward-looking statements to be covered by the safe harbor provisions for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995, and is including this statement for purposes of complying with
those safe harbor provisions. Forward-looking statements, which are based on
certain assumptions and describe future plans, strategies and expectations of
the Company, are generally identifiable by use of the words "believe," "expect,"
"intend," "anticipate," "estimate," "project," "prospects" or similar
expressions.

         The Company's ability to predict results or the actual effect of future
plans or strategies is inherently uncertain. Information concerning the Company
and its business, including the risks faced by us described herein and in our
most recent annual report on Form 10-KSB could materially affect the Company's
financial results. The Company disclaims any obligation to update or announce
revisions to any forward-looking statements to reflect actual events or
developments.


GENERAL OVERVIEW

         Sagient Research Systems, Inc. ("Sagient Research" or "Parent" or
"Company") is based in San Diego, California and was incorporated in Delaware in
1999. Sagient Research is a publisher of independent investment research. We
operate our business activities through Sagient Research and through our wholly
owned subsidiary, DP Securities, Inc. d/b/a Sagient Securities ("DPS" or
"Sagient Securities"), a broker-dealer incorporated in the State of California.
We develop, produce and sell proprietary research products to mutual funds,
hedge funds and investment banks. Our business strategy is to leverage our
development technology and marketing expertise to be a leading provider of
independent research to the financial services and institutional investment
communities.

                                       13
================================================================================
<PAGE>

Critical Accounting Policies

         Our discussion and analysis of our financial condition and results of
operations is based upon the Company's condensed consolidated financial
statements, which have been prepared in accordance with accounting principles
generally accepted in the United States of America for interim financial
statements and rules and regulations of the Securities and Exchange Commission.
The preparation of these consolidated financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent liabilities.

         On an on-going basis, we evaluate our estimates, including those
related to credit risk on receivables, recoverability of long lived assets,
identified intangibles, goodwill and the valuation of deferred income taxes. We
base our estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions.

Revenue Recognition
-------------------

         Research services revenue represents revenue from providing individual
custom reports or reports on a monthly or annual subscription basis. Revenue
from custom reports is recognized when the report is provided, and revenue from
subscriptions is recognized ratably over the contractual period. Research
services revenue also includes revenue from a licensing agreement to distribute
data, which is recognized ratably over the term of the contract. Deferred
revenue on the consolidated balance sheets consists of subscription and
licensing revenues that will be recognized in future periods. Other revenue
includes computer programming services performed by the Company. Computer
programming services are recognized during the period that such services are
provided.

RESULTS OF OPERATIONS

Three months ended March 31, 2005 compared to the three months ended March 31,
2004.

Revenues
--------

         Total revenues for the three months ended March 31, 2005 increased by
24% to $801,918 compared to $647,719 for the same period in 2004. The increase
in total revenue is primarily due to higher research services revenue in 2005
that has resulted from increased sales and marketing efforts and greater
awareness of our research product services in the institutional investment
community.

Operating Expenses
------------------

         Total operating expenses for the three months ended March 31, 2005
decreased by 18% to $723,670 compared to $885,577 for the same period in 2004.
The primary factors resulting in the decrease in operating expenses during the
2005 period were decreases in general and administrative expenses, compensation
and benefits, and depreciation and amortization expense, and are discussed in
more detail below:

Compensation and Benefits
-------------------------

         Compensation and benefits decreased by 6% in 2005 to $292,384 compared
to $310,325 in 2004. This decrease is due primarily to reduced salaries and
wages, offset partially by an increase in sales-incentive bonuses and commission
expense. Restructuring finance and sales departments resulted in salaries
savings of $51,323 compared to 2004. Beginning in 2004, commissions were
expensed ratably over the life of the subscription resulting in lower
commissions expense during the first quarter of 2004.

                                       14
================================================================================
<PAGE>

General and Administrative
--------------------------

         General and administrative expense in the first three months of 2005
decreased 49% to $132,388 from $260,570 for the same period in 2004.
Contributing to the decrease in general and administrative expenses in the first
three months of 2005 were decreases in legal fees of $11,451, consulting fees of
$25,600, investor relations fees of $83,610, and travel and entertainment
expenses of $8,835.

Depreciation and Amortization
-----------------------------

         Depreciation and amortization expense was $53,681 for the three months
ended March 31, 2005 compared to $70,401 in the same period during 2004. The
decrease is due to certain capitalized computer equipment, software, and
software development assets that became fully depreciated later in 2004.

Net Income (Loss)
-----------------

         As a result of the revenue and expense items mentioned above, the
Company achieved net income $20,667 in the three months ended March 31, 2005
from a net loss of $356,780 in the same period a year ago.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity
---------

         The accompanying consolidated financial statements have been prepared
assuming the Company will continue as a going concern. As more fully discussed
in Company's 2004 Form 10-KSB, the Company's December 31, 2004 audited financial
statements included a "going concern" qualification from its independent
auditors due to the Company's historical lack of profitability and negative
working capital.

         For the three months ended March 31, 2005 the Company earned net income
of $20,667, and as of March 31, 2005 the Company's current liabilities exceeded
its current assets by $3,285,356. Management believes that operating results
will continue to improve based on expected continuing increases in research
services revenues. However, there can be no assurance that expected improvement
in operating results will be sufficient to fund operations for the remainder of
the 2005 fiscal year, or that efforts to raise additional capital will be
successful. If adequate funds are not available, the Company may be required to
delay, scale back or eliminate its operational plans, and it may not be able to
stay in business.

         During the three months ended March 31, 2005 the Company incurred a net
increase in cash and cash equivalents of $71,325, as summarized below:

         Net cash provided by operating activities        $   187,272
         Net cash used in investing activities                (26,305)
         Net cash used in financing activities                (89,642)
                                                          -----------
         Net increase in cash and cash equivalents        $    71,325
                                                          ===========

Operating Activities
--------------------

         Net cash provided by operating activities during the three months ended
March 31, 2005 totaled $187,272 and occurred as a result of changes in asset and
liability accounts that generated net cash in the amount of $112,924. Net income
during the period, adjusted for non-cash items, provided cash in the amount of
$74,348.

                                       15
================================================================================
<PAGE>

Investing Activities
--------------------

         Net cash used in investing activities during the three months ended
March 31, 2005 totaled $26,305 and resulted from additions of property and
equipment.

Financing Activities
--------------------

         Net cash used in financing activities during the three months ended
March 31, 2005 totaled $89,642 and resulted from repayments of convertible debt
in the amount of $72,215 and repayments of notes payable to related parties in
the amount of $17,427.

Debt Agreements
---------------

Credit Facility-Bank of America
-------------------------------

         On June 12, 2003 the Company entered into a promissory note agreement
with Bank of America, providing a $100,000 revolving credit line made available
to the Company through June 10, 2006. During this initial period, the Company is
obligated to pay interest only, based on the outstanding principal balance, on a
monthly basis. The interest rate on the note is variable and is calculated based
on the published Wall Street Journal prime rate listing plus 4.5%. As of March
31, 2005 the interest rate on the note was 9.75%.

         Following the initial period, the outstanding principal balance,
together with interest based on the applicable interest rate, shall be repaid
monthly, on a fully amortized basis, over the remaining term of the note that
runs through June 12, 2010. As of March 31, 2005 and December 31, 2004 the
outstanding principal balance under the credit line was $100,000. The credit
line is guaranteed by the United States Small Business Administration, as well
as by the Company's President and CEO.

Convertible Debt
----------------

         On December 17, 2001 the Company issued convertible debentures in the
amount of $1,600,000. These debentures had a maturity date of December 17, 2003,
and bore interest at a rate of 10% per annum, which was due and payable on the
last day of each calendar quarter until paid in full or converted into shares of
the Company's common stock.

         In February 2003 the Company and the debenture holders restructured
certain terms and provisions of the convertible debentures. At March 31, 2005
the restructured convertible debt principal totaled $1,291,548, all of which is
due within one year and is classified as a current liability, and accrued
interest payable totaled $191,594.

Following is a summary of primary terms of the restructured agreements:

$1,250,000 Original Principal Amount Note
-----------------------------------------

         The original debenture was amended in February 2003 and the principal
balance was changed to $1,425,000. The amended principal balance includes the
original principal amount plus accrued and unpaid liquidated damages and
interest of $150,000 and $25,000, respectively. The Company paid the remaining
balance of accrued interest at February 28, 2003 totaling $26,736 and $125,000
of accrued liquidated damages were waived by the debenture holder.

         The debenture matures on December 28, 2005 and bears interest at an
annual rate of 14%. The debenture requires fixed monthly payments of principal
and interest beginning on March 28, 2003 of $25,000 for the first five (5)
months, $50,000 thereafter through November 28, 2005 and a final payment due
December 28, 2005 in the amount of $271,100. The outstanding principal balance
may be converted into shares of the Company's common stock at the option of the

                                       16
================================================================================
<PAGE>

holder based on a fixed conversion price of $0.20 per share, and the warrant to
purchase 125,000 shares of the Company's common stock that were included in the
original debenture have a fixed exercise price of $0.086 for the term of the
warrants, which expire December 17, 2006. In addition, the debenture holder
agreed to waive all registration requirements with respect to the convertible
debenture, warrants and shares underlying the warrants.

         In February 2003, the debenture holder agreed to defer scheduled
monthly principal and interest payments for the period October 28, 2003 through
December 28, 2003, and to add the deferred payments to the amount due with the
final payment on December 28, 2005. In 2004 the debenture holder agreed to defer
scheduled monthly principal and interest payments for the period April 28, 2004
through December 28, 2004, and to add the deferred payments to the amount due at
maturity. As of March 31, 2005 the outstanding principal balance was $1,136,548
all of which is due within one year and is classified as a current liability. As
of April 28, 2005, all payments due have been paid.

$350,000 Original Principal Amount Note
---------------------------------------

         The original debenture was amended in February 2003 and the principal
balance was changed to $155,000. The amended principal balance includes the
original principal amount, less the partial principal payment in November 2002
of $215,686 plus accrued and unpaid liquidated damages and interest of $16,656
and $4,030, respectively. The debenture holder waived accrued liquidated damages
in the amount of $12,844. The debenture was originally scheduled to mature on
February 28, 2005 and bears interest at an annual rate of 14%. On March 1, 2005
the debenture holder extended the maturity date to August 31, 2005. Payment of
interest is required quarterly, beginning March 30, 2003 and the principal
balance is payable upon the maturity date.

         The outstanding principal balance may be converted into shares of the
Company's common stock at the option of the holder based on a fixed conversion
price of $0.20 per share, and the warrant to purchase 35,000 shares of the
Company's common stock that were included in the original debenture have a fixed
exercise price of $0.086 for the term of the warrants. In addition, the
debenture holder agreed to waive all registration requirements with respect to
the convertible debenture, warrants and shares underlying the warrants. In July
2004, the debenture holder exercised 35,000 warrants via the cashless exercise
provision provided in the warrant. As of March 31, 2005 the outstanding
principal balance was $155,000, all of which was reflected as a current
liability.

Notes Payable
-------------

         On November 22, 2001 the Company borrowed $300,000 from an unrelated
party. In connection with the loan, the Company issued a note to the lender,
which is unsecured, bears interest at 15% per annum and was originally due in
April 2002. In addition, the Company issued 150,000 detachable warrants to the
lender for 150,000 shares of the Company's common stock at an exercise price of
$2.30 per share. The warrants are exercisable at the option of the holder and
expire in November 2006. During 2004 the maturity date was extended to July 1,
2005. During the three months ended March 31, 2005 the Company recorded interest
expense in connection with this note totaling $11,250 and as of March 31, 2005
the outstanding principal balance was $300,000 and total interest payable in
connection with these loans was $108,875.

Notes Payable - Related Parties
-------------------------------

         Between May 2001 and January 2002 the Company borrowed an aggregate of
$187,500 from a company controlled by an officer/stockholder pursuant to
unsecured promissory notes. The Company borrowed an additional $35,000 in June
2004 and $65,000 in July 2004 from the same company and the Company issued an
additional promissory note to the lender. All of the promissory notes bear
interest at an annual rate of 12% and are due and payable on January 1, 2006.

         During the three months ended March 31, 2005 the Company recorded
interest expense in connection with these notes totaling $8,354 and paid

                                       17
================================================================================
<PAGE>

interest due of $7,573. As of March 31, 2005 the outstanding principal balance
was $270,073 and total interest payable in connection with these loans was
$5,460.

New Accounting Pronouncements
-----------------------------

         In December 2004, FASB issued SFAS No. 123 (revised 2004) "Share-Based
Payment," which requires companies to recognize in the income statement grant
date fair value of stock options and other equity-based compensation issued to
employees. That cost will be recognized over the period during which an employee
is required to provide services in exchange for the award--the requisite service
period (usually the vesting period). SFAS No. 123R requires the Company to adopt
the new accounting provisions beginning in the first annual reporting period
that begins after December 15, 2005, or for our fiscal year 2006. The Company
has not yet determined the impact of applying the provisions of SFAS No. 123R.
The Company does not believe SFAS No. 123R is likely to have a material effect
on the Company's financial position or results of operations.

Item 3.           Controls and Procedures
                  -----------------------

         An evaluation of the Company's disclosure controls and procedures (as
defined in Section 13(a)-14(c) of the Exchange Act) was carried out under the
supervision and with the participation of the Company's Chief Executive Officer
and Principal Accounting Officer and other members of the Company's senior
management as of the end of the period covered by this Quarterly Report. The
Company's Chief Executive Officer and Principal Accounting Officer concluded
that the Company's disclosure controls and procedures as currently in effect are
effective in ensuring that the information required to be disclosed by the
Company in the reports it files or submits under the Exchange Act is (i)
accumulated and communicated to the Company's management (including the Chief
Executive Officer and Principal Accounting Officer) in a timely manner, and (ii)
recorded, processed, summarized and reported within the time periods specified
in the Securities and Exchange Commission's rules and forms. There have been no
changes in the Company's internal control over financial reporting (as defined
in Rule 13a-15(f) of the Exchange Act) that occurred during the quarter ended
March 31, 2005 that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.

         The Company intends to continually review and evaluate the design and
effectiveness of its disclosure controls and procedures and to improve its
controls and procedures over time and to correct any deficiencies that it may
discover in the future. The goal is to ensure that senior management has timely
access to all material financial and non-financial information concerning the
Company's business. While the Company believes the present design of its
disclosure controls and procedures is effective to achieve its goal, future
events affecting its business may cause the Company to modify its disclosure
controls and procedures.

Part II Other Information

Item 1.           Legal Proceedings.
                  -----------------

         There are no material legal proceedings pending or, to the Company's
knowledge, threatened against the Company.

Item 2.           Unregistered Sales of Equity Securities and Use of Proceeds
                  -----------------------------------------------------------

         None

Item 3.           Default Upon Senior Securities
                  ------------------------------

         None

                                       18
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<PAGE>

Item 4.           Submission of Matters to a Vote of Security Holders
                  ---------------------------------------------------

         None

Item 5.           Other Information
                  -----------------

         None

Item 6.            Exhibits
                   --------


              31.  Certifications of the Company's Chief Executive Officer and
                   Principal Accounting Officer pursuant to Section 302 of the
                   Sarbanes-Oxley Act of 2002.

              32.  Certifications of the Company's Chief Executive Officer and
                   Principal Accounting Officer pursuant to Section 906 of the
                   Sarbanes-Oxley Act of 2002.

                                       19
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<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report on Form 10-QSB to be signed on its behalf
by the undersigned thereunto duly authorized.




                                SAGIENT RESEARCH SYSTEMS, INC.


                                By: /s/ BRIAN M. OVERSTREET
                                    --------------------------------------------
                                    Name: Brian M. Overstreet
                                    Title: President and Chief Executive Officer

Dated: April 28, 2005

                                       20
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