<PAGE>   1

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(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, 2001

                                       OR

[ ]      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 000-28473

                                 TRUETIME, INC.



       DELAWARE                                              94-3343279
      (STATE OF                                           (I.R.S. EMPLOYER
    INCORPORATION)                                       IDENTIFICATION NO.)

                               3750 WESTWIND BLVD.

                          SANTA ROSA, CALIFORNIA 95403

                                 (707) 528-1230

                                   ----------

                                 2835 DUKE COURT

                          SANTA ROSA, CALIFORNIA 95407

                 (FORMER ADDRESS OF PRINCIPLE EXECUTIVE OFFICES)


    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 5,950,000 shares of the Registrant's Common Stock outstanding as
of the close of business on May 9, 2001.


================================================================================

<PAGE>   2



                                 TRUETIME, INC.



<TABLE>
<CAPTION>
                                                                                                      PAGE
                                                                                                     NUMBER
                                                                                                     ------


<S>                                                                                                  <C>
PART I.  FINANCIAL INFORMATION

   Item 1.  Financial Statements and Notes                                                              3

   Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations       7

   Item 3.  Quantitative and Qualitative Disclosure about Market Risk                                  14


PART II.  OTHER INFORMATION

   Item 1.  Legal Proceedings                                                                          15

   Item 2.  Changes in Securities and Use of Proceeds                                                  15

   Item 3.  Defaults Upon Senior Securities                                                            15

   Item 4.  Submission of Matters to a Vote of Security Holders                                        15

   Item 5.  Other Information                                                                          15

   Item 6.  Exhibits and Reports on Form 8-K                                                           15
</TABLE>




                                       2
<PAGE>   3




                          PART I: FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS AND NOTES

                                 TrueTime, Inc.
                                 BALANCE SHEETS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                              September 30,  March 31,
                                                                                                 2000          2001
                                                                                                           (unaudited)

<S>                                                                                             <C>          <C>
ASSETS
             Current assets:
                        Cash and cash equivalents ........................................      $ 7,884      $ 6,342
                        Trade accounts receivable, net of allowance of $34 and $22 .......        4,435        3,786
                        Inventories ......................................................        7,428        7,335
                        Prepaid expenses and other assets ................................          365          874
                        Deferred income tax ..............................................          300          483
                                                                                                -------      -------

                           Total current assets ..........................................       20,412       18,820

             Property and equipment, net .................................................        2,903        4,169
             Prepaid expenses, non-current ...............................................          307          180
             Goodwill, net of accumulated amortization of $241 and $254 ..................          791          778
                                                                                                -------      -------

                                               Total assets ..............................      $24,413      $23,947
                                                                                                =======      =======

LIABILITIES AND STOCKHOLDERS' EQUITY
               Current liabilities:
                        Trade accounts payable ...........................................      $   810      $   748
                        Accrued expenses .................................................        1,180        1,159
                        Deferred revenue .................................................           --           16
                                                                                                -------      -------

                           Total current liabilities .....................................        1,990        1,923

               Deferred revenue ..........................................................           --           56
                                                                                                -------      -------

                           Total liabilities .............................................        1,990        1,979
                                                                                                -------      -------

               Commitments and contingencies

               Stockholders' equity:
                        Preferred stock, $.01 par value, 1,000,000 shares
                        authorized, no shares issued and outstanding .....................           --           --
                        Common stock, $.01 par value, 20,000,000 authorized; 5,950,000
                        shares issued and outstanding ....................................           60           60
                        Additional paid-in capital .......................................       12,901       12,907
                        Additional paid-in capital - warrants ............................          455          455
                        Retained earnings ................................................        9,007        8,546
                                                                                                -------      -------

                           Total stockholders' equity ....................................       22,423       21,968
                                                                                                -------      -------

                           Total liabilities and stockholders' equity ....................      $24,413      $23,947
                                                                                                =======      =======
</TABLE>

    The accompanying notes are an integral part of the financial statements.



                                       3
<PAGE>   4



                                 TrueTime, Inc.
                            STATEMENTS OF OPERATIONS
               (in thousands, except share and per share amounts)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                              Three months ended                     Six months ended
                                                       March 31, 2000     March 31, 2001     March 31, 2000     March 31, 2001

<S>                                                   <C>                <C>                 <C>                <C>
Net sales ........................................    $         4,659    $         4,561     $        10,215    $         9,504

Cost of sales ....................................              1,947              2,440               4,529              4,840
                                                      ---------------    ---------------     ---------------    ---------------

Gross profit .....................................              2,712              2,121               5,686              4,664

Selling, general and administrative expenses .....              1,441              2,088               2,980              3,918
Research & development ...........................              1,048                909               1,825              1,704
                                                      ---------------    ---------------     ---------------    ---------------

Income (loss) from operations ....................                223               (876)                881               (958)

Interest income ..................................                143                 82                 251                190
                                                      ---------------    ---------------     ---------------    ---------------

Income (loss) before taxes .......................                366               (794)              1,132               (768)

Income taxes .....................................                148               (318)                462               (307)
                                                      ---------------    ---------------     ---------------    ---------------

Net income (loss) ................................    $           218    $          (476)    $           670    $          (461)
                                                      ===============    ===============     ===============    ===============


Weighted average shares outstanding - Basic ......          5,925,000          5,950,000           5,078,000          5,950,000

Weighted average shares outstanding - Diluted ....          6,231,000          5,950,281           5,246,000          5,950,255

Basic Earnings (Loss) Per Share ..................    $          0.04    $         (0.08)    $          0.13    $         (0.08)

Diluted Earnings (Loss) Per Share ................    $          0.03                 --     $          0.13                 --
</TABLE>


    The accompanying notes are an integral part of the financial statements.










                                       4
<PAGE>   5



                                 TrueTime, Inc.
                            STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                        Six months ended    Six months ended
                                                                                         March 31, 2000      March 31, 2001

<S>                                                                                      <C>                 <C>
Cash flows from operating activities:
                      Net income (loss) .............................................    $           670     $          (461)
                      Adjustments to reconcile net income (loss) to net cash
                      (used in) provided by operating activities
                                     Deferred income taxes ..........................                (17)               (183)
                                     Depreciation and amortization ..................                232                 319
                                     Loss on disposal of property and
                                     equipment ......................................                 --                   6
                                     Compensation expense related to
                                     options granted ................................                 43                   6
                                     Effects of changes in operating
                                     assets and liabilities
                                             Trade accounts receivables .............              1,374                 649
                                             Inventories ............................             (2,148)                 93
                                             Prepaid expenses and
                                             other current assets ...................             (1,158)               (382)
                                             Trade accounts payable .................                231                 (62)
                                             Accrued expenses .......................               (451)                (21)
                                             Deferred revenue .......................                 --                  72
                                                                                         ---------------     ---------------

                         Net cash (used in) provided by operating activities ........             (1,224)                 36
                                                                                         ---------------     ---------------

Cash flows from investing activities:
                      Repayment of related party receivables ........................                433                  --
                      Capital expenditures ..........................................               (722)             (1,578)
                                                                                         ---------------     ---------------

                         Net cash used in investing activities ......................               (289)             (1,578)
                                                                                         ---------------     ---------------

Cash flows from financing activities:
                      Proceeds of Initial Public Offering, net of offering costs ....              8,643                  --
                                                                                         ---------------     ---------------

                         Net cash provided by financing activities ..................              8,643                  --
                                                                                         ---------------     ---------------

Increase (decrease) in cash and cash equivalents ....................................              7,130              (1,542)

Cash and cash equivalents, beginning of period ......................................              3,539               7,884
                                                                                         ---------------     ---------------

Cash and cash equivalents, end of period ............................................    $        10,669     $         6,342
                                                                                         ===============     ===============
</TABLE>

    The accompanying notes are an integral part of the financial statements.




                                       5
<PAGE>   6



TRUETIME, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

1. BASIS OF PRESENTATION

The balance sheet of TrueTime, Inc. at September 30, 2000 has been derived from
the Company's audited financial statements at that date. The balance sheet at
March 31, 2001, the statements of operations for the three months and six months
ended March 31, 2001 and 2000, and the statement of cash flows for the six
months ended March 31, 2001 and 2000 have been prepared by the Company,
unaudited. In the opinion of management, all adjustments, consisting of normal
recurring adjustments, necessary to present fairly the financial position,
results of operations and cash flows have been made. The results of operations
for the three months and six months ended March 31, 2001 and 2000 are not
necessarily indicative of the operating results for a full year or for future
operations.

Certain information and footnote disclosures normally included in financial
statements presented in accordance with accounting principles generally accepted
in the United States of America have been omitted. The accompanying financial
statements should be read in conjunction with the financial statements and notes
thereto contained in the Company's Form 10-K, as amended, for the year ending
September 30, 2000.


2. EARNINGS (LOSS) PER COMMON SHARE

The following table summarizes the calculation of net earnings and weighted
average common shares and common equivalent shares outstanding for purposes of
the computation of earnings (loss) per share:


                                 TrueTime, Inc.
                        EARNINGS (LOSS) PER COMMON SHARE

<TABLE>
<CAPTION>
                                                               Three months                         Six months
                                                      March 31, 2000    March 31, 2001     March 31, 2000    March 31, 2001

<S>                                                   <C>               <C>                <C>               <C>
Net earnings (loss) available to common
stockholders (in thousands) ......................    $          218    $         (476)    $          670    $         (461)
                                                      ==============    ==============     ==============    ==============

Weighted average common shares outstanding .......         5,925,000         5,950,000          5,078,000         5,950,000
Weighted average common share equivalents
outstanding* .....................................           306,000               281            168,000               255
                                                      --------------    --------------     --------------    --------------
Weighted average common shares and common share
equivalents outstanding ..........................         6,231,000         5,950,281          5,246,000         5,950,255
                                                      ==============    ==============     ==============    ==============

Basic earnings (loss) per common share ...........    $         0.04    $        (0.08)    $         0.13    $        (0.08)
                                                      ==============    ==============     ==============    ==============

Diluted earnings (loss) per common share .........    $         0.03                --     $         0.13                --
                                                      ==============    ==============     ==============    ==============
</TABLE>

* Due to their anti-dilutive effect, additional warrants and options of
1,037,150 shares equivalent are excluded from the calculation above for the
three month and six month periods ending March 31, 2001.

3. INVENTORIES

Inventories consisted of the following (in thousands), net of reserves of $220
at September 30, 2000 and $72 at March 31, 2001:

<TABLE>
<CAPTION>
                                              September 30, 2000   March 31, 2001

<S>                                              <C>               <C>
Finished goods ..............................    $        1,266    $        1,198
Work in process .............................             2,449             1,509
Raw material ................................             3,713             4,628
                                                 --------------    --------------
                                                 $        7,428    $        7,335
                                                 ==============    ==============
</TABLE>





                                       6
<PAGE>   7

4. INITIAL PUBLIC OFFERING

On November 1, 1999, the Company was reincorporated in Delaware with 4,000,000
shares of common stock outstanding. On December 16, 1999, the Company completed
its Initial Public Offering in which the Company sold 1,500,000 shares of common
stock at $5.00 per share and the Company's owner, OYO Corporation U.S.A., sold
1,500,000 shares of common stock at $5.00 per share. The Company received
$6,564,118 after commissions of $525,000 and expenses of $410,882.

On January 6, 2000, the Company's underwriters exercised their over-allotment
option and purchased 450,000 shares of the Company's common stock at $5.00 per
share. The Company received $2,078,549 after commissions of $157,500 and
expenses of $13,951.

5. ADOPTION OF NEW ACCOUNTING PRONOUNCEMENTS

Accounting for Derivative Instruments and Hedging Activities-

The Company has adopted the provisions of Financial Accounting Standards Board
(FASB) No. 133, "Accounting for Derivative Instruments and Hedging Activities".
The Company does not currently hold derivative instruments or engage in hedging
activities and therefore the adoption of FASB No. 133 has not had a significant
effect on the Company's financial position, results of operations or cash flows.



ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The following analysis of the financial condition and results of operations of
TrueTime, Inc. should be read in conjunction with the Financial Statements and
Notes related thereto included elsewhere in this Form 10-Q.

GENERAL

     TrueTime designs, develops, manufactures and markets precision time and
precision frequency products that are essential components used in
telecommunications, computer networking, e-commerce, aerospace and various other
commercial markets. Our products use a variety of external timing references,
including most importantly the Global Positioning System, or GPS, together with
advanced electronic circuitry and software to provide high quality signals and
precise time. We offer a wide variety of products, which can be divided into the
following broad categories:

         o        precise time and frequency products

         o        computer plug-in cards with precise timing capabilities

         o        computer network time servers

         o        time code products

         o        time displays




                                       7
<PAGE>   8

RESULTS OF OPERATIONS

         The following table sets forth for the three months and six months
ended March 31, 2001 and 2000, the percentage of income statement items to total
sales:

<TABLE>
<CAPTION>
                                                Three Months Ended      Six Months Ended
                                                     March 31,              March 31,
                                                  2000       2001        2000       2001
                                                 ------     ------      ------     ------

<S>                                             <C>        <C>         <C>        <C>
Sales .......................................     100.0%     100.0%      100.0%     100.0%
Cost of sales ...............................      41.8       53.5        44.3       50.9
Gross profit ................................      58.2       46.5        55.7       49.1
Operating expenses:
    Selling, general and administrative .....      30.9       45.8        29.2       41.3
    Research and development ................      22.5       19.9        17.9       17.9
        Total operating expenses ............      53.4       65.7        47.1       59.2
Income from operations ......................       4.8      (19.2)        8.6      (10.1)
Interest income .............................       3.1        1.8         2.5        2.0
Income before income taxes ..................       7.9      (17.4)       11.1       (8.1)
Income taxes ................................       3.2       (7.0)        4.5       (3.2)
Net income (loss) ...........................       4.7%     (10.4)%       6.6%      (4.9)%
</TABLE>


Three Months and Six Months Ended March 31, 2001 compared to Three Months and
Six Months Ended March 31, 2000

         Sales. Sales for the quarter ended March 31, 2001 were $4.6 million, a
decrease of $0.1 million, or 2.1%, from $4.7 million for the quarter ended March
31, 2000. This slight decrease in sales is attributed to the timing of our
Government orders. Sales to Government and indirect Government customers totaled
47.0% of total sales for the quarter ended March 31, 2001 compared with 23.5%
for the comparable period in 2000. For the six months ended March 31, 2001,
sales were $9.5 million, a decrease of $0.7 million, or 6.9%, from $10.2 million
for the six months ended March 31, 2000. The decrease in sales for this
comparable period is attributed to the large amount of backlog at the beginning
of fiscal 2000. The actual backlog of orders increased by $0.6 million for the
six months ended March 31, 2001 compared to a decrease in backlog of $2.4
million for the same period last year. International orders for the first six
months ended March 31, 2001 represented 17.3% of total sales compared with 23%
for the comparable period in 2000. TrueTime has emphasized entering the computer
networking and telecommunications markets as part of our strategy. These markets
have experienced economic slowdowns, and in turn, TrueTime has also experienced
a slowdown with regards to order growth in these markets. We are unable to
predict the duration or depth of the declining economic conditions affecting
these technology sectors. This economic development is leading to an increased
effort on our part to reduce inventories. We are also experiencing an increased
level of competition in our traditional government business as many of our
competitors, possibly driven by the economic slowdown in the commercial markets,
refocus their efforts in the government market space. This increased competition
could also affect our operations for the foreseeable future.

         Cost of Sales. Cost of sales for the quarter ended March 31, 2001 was
$2.4 million, an increase of $0.5 million, or 26.3%, from $1.9 million for the
quarter ended March 31, 2000. Cost of sales increased as a percentage of total
sales to 53.5% in the quarter ended March 31, 2001 from 41.8% in the quarter
ended March 31, 2000. This increase is primarily related to the following:

         o        increased labor expenses due to investments in engineering
                  personnel as well as upward wage pressures ($0.2 million or
                  40.0% of total increase)

         o        increased depreciation expenses related to investments in
                  upgrading our production facilities and equipment as well as
                  higher overhead expenses ($0.1 million or 20.0% of total
                  increase)

         o        increase in reserves for obsolete inventory ($0.1 million
                  or 20.0% of total increase)

         o        broader product mix of lower margin items coupled with lower
                  volumes in general

Cost of sales for the six months ended March 31, 2001 was $4.8 million, an
increase of $0.3 million, or 6.7% from $4.5 million in the six months ended
March 31, 2000. Cost of sales as a percentage of total sales increased to 50.9%
of sales in the six months ended





                                       8
<PAGE>   9

March 31, 2001 from 44.3% of sales in the six months ended March 31, 2000. Such
percentage increases are primarily related to the following:

         o        increased labor expenses due to investments in engineering
                  personnel as well as upward wage pressures ($0.3 million or
                  50.0% of total increase)

         o        increased depreciation expenses related to investments in
                  upgrading our production facilities and equipment as well as
                  higher overhead expenses ($0.2 million or 33.3% of total
                  increase)

         o        increase in reserves for obsolete inventory ($0.1 million or
                  16.7% of total increase)

         o        broader product mix of lower margin items coupled with lower
                  volumes in general

         Operating Expenses. Operating expenses for the quarter ended March 31,
2001 were $3.0 million, an increase of $0.5 million, or 20.0%, from $2.5 million
for the quarter ended March 31, 2000. Operating costs increased as a percentage
of total sales to 65.7% in the quarter ended March 31, 2001 from 53.4% in the
quarter ended March 31, 2000. This percentage increase in operating expenses is
primarily related to the following:

         o        increased investments in our sales and marketing efforts ($0.2
                  million or 36% of total increase)

         o        higher rent and building overhead expenses ($0.2 million or
                  36% of total increase)

         o        increased administrative expenses and fees relating to being a
                  public company ($0.1 million or 18% of total increase)


Operating expenses for the six months ended March 31, 2001 were $5.6 million, an
increase of $0.8 million, or 16.7% from $4.8 million in the six months ended
March 31, 2000. Operating expenses increased to 59.2% of sales in the six months
ended March 31, 2001 from 47.1% in the six months ended March 31, 2000. Such
percentage increases are primarily related to the following:

         o        increased investments in our sales and marketing efforts ($0.5
                  million or 45.5% of total increase)

         o        higher rent and building overhead expenses ($0.3 million or
                  26.1% of total increase)

         o        increased administrative expenses and fees relating to being a
                  public company ($0.2 million or 17.4% of total increase)

         Interest Income. Interest income for the quarter ended March 31, 2001
was $0.08 million, a decrease of $0.06 million from $0.14 million for the
quarter ended March 31, 2000. Interest income decreased as a percentage of total
sales to 1.8% in the quarter ended March 31, 2001 from 3.1% in the quarter ended
March 31, 2000. Interest income for the six months ended March 31, 2001 was
$0.19 million, a decrease of $0.06 million, or 24% from $0.25 million for the
six months ended March 31, 2000. Such percentage decreases are the result of the
decreased cash balance due to facility and equipment investments, coupled with
the decrease in interest rates over the prior year.

         Income Taxes. Income taxes for the quarter ended March 31, 2001 were
40.0% of income (loss) before tax compared to 40.4% of income before tax for the
quarter ended March 31, 2000. Income taxes for the six months ended March 31,
2001 were 40.0% of income (loss) before tax compared to 40.8% of income before
tax for the six months ended March 31, 2000. Income taxes include federal and
state income taxes and are included on an estimated basis. Our effective income
tax rate differs from the statutory federal rate of 34% primarily as a result of
the effect of California state income taxes.



LIQUIDITY AND SOURCES OF CAPITAL

         TrueTime completed its Initial Public Offering of its common stock on
December 16, 1999. Gross proceeds to TrueTime were $7,500,000. Net proceeds
after discounts, commissions, and expenses of the Offering were $6,564,118. On
January 6, 2000, the






                                       9
<PAGE>   10

Company's underwriters exercised their over-allotment option and purchased an
additional 450,000 shares of the Company's common stock at $5.00 per share.
Gross proceeds to TrueTime were $2,250,000. Net proceeds after discounts,
commissions, and expenses were $2,078,549.

At March 31, 2001, our cash balance was $6.3 million compared to $7.9 million on
September 30, 2000.

For the six month period ended March 31, 2001, operating activities provided
$0.04 million. The largest contributors to this amount include $0.6 million
provided by a reduction in trade receivables, $0.1 million provided by the
reduction of inventories, and $0.1 million provided by deferred revenue and
income taxes. Cash used by operating activities include $0.1 million in
decreased accrued trade payables and accrued expenses and $0.6 million in
increased prepaid expenses which includes federal and state deferred tax
benefits and federal and state income taxes receivable.

For the six month period ended March 31, 2001, investing activities used $1.6
million for capital expenditures. Of this amount, $0.7 million was used for
facility tenant improvements, $0.6 million was used for the purchase of new
modular furnishings, $0.1 million was used for new computer equipment and
software and $0.2 million was used for the purchase of electronic equipment.
Anticipated capital expenditures for the next six months are $0.12 million,
primarily in the area of electronic test and computer equipment.

Previously, TrueTime announced that it would be moving into a new facility in
early fiscal year 2001. The Company took possession of the new facility at the
end of December 2000. The actual move to the new location was completed in
January 2001. The Company's capitalized tenant improvement costs were $1.3
million. Furnishings for the new facility cost $0.6 million. TrueTime intends to
enter into a sale leaseback transaction with a commercial bank on the above
mentioned furnishings and other previously purchased equipment in the third
quarter. The results of this transaction, if it is accomplished as intended,
will increase our cash by $.75 million at the time of signing the lease.

RECENT ACCOUNTING PRONOUNCEMENTS

         In June 1999, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 137, Accounting for
Derivative Instruments and Hedging Activities - Deferral of the Effective Date
of FASB Statement No. 133, an amendment of FASB Statement No. 133, Accounting
for Derivative Instruments and Hedging Activities. SFAS No.133 establishes new
standards of accounting and reporting for derivative instruments and hedging
activities. SFAS No.133 requires that all derivatives be recognized at fair
value in the balance sheet, and that the corresponding gains or losses be
reported either in the statement of operations or as a component of
comprehensive income, depending on the type of hedging relationship that exists.
SFAS No. 133, as amended, was effective for fiscal years beginning after June
15, 2000. The Company does not currently hold derivative instruments or engage
in hedging activities and, accordingly, the adoption of SFAS No. 133 has not had
a significant effect on its financial position, results of operations, or cash
flows.

FORWARD LOOKING STATEMENTS

         Certain of the statements contained in this document and in documents
incorporated by reference herein, including those made under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," are "forward-looking" statements within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. All statements other than statements of historical fact included herein,
including statements regarding potential future products and markets, the
Company's future financial position, business strategy and other plans and
objectives for future operations, are forward-looking statements. We can give no
assurance that such expectations will prove to have been correct. These
statements are subject to known and unknown risks, uncertainties and other
factors that may cause our actual results, performance or achievements to differ
materially from the future results, performance or achievements expressed or
implied by such forward-looking statements. Important factors that could cause
actual results performance or achievements to differ materially from the
Company's expectations are disclosed below and in our Annual Report on Form 10-K
for the fiscal year ended September 30, 2000, as amended, and the Company's
registration statement on Form S-3 filed with the Securities and Exchange
Commission, under the headings "Forward Looking Statements" and "Risk Factors"
and elsewhere. Further, all written and verbal forward-looking statements
attributable to the Company or persons acting on its behalf are expressly
qualified in their entirety by such factors.





                                       10
<PAGE>   11

RISK FACTORS


     The following risks could impact our business and operations and should be
considered by investors.

     OUR BUSINESS WILL SUFFER IF WE CONTINUE TO EXPERIENCE A GENERAL ECONOMIC
SLOWDOWN IN THE U.S., PARTICULARLY AS THAT SLOWDOWN AFFECTS TECHNOLOGY MARKETS.

     Our commercial operations are cyclical and dependent for success on the
general economic well-being of the United States and certain other world
markets. A general economic downturn will adversely affect demand for our
products and services. Although the economy of the United States has experienced
one of its longest periods of growth in recent history, the continued strength
of the United States economy cannot be assured. There are some signs that we are
entering a period of general economic slowdown and a particularly acute slowdown
in technology markets. Moreover, there are also some signs that we are entering
a period of a world economic slowdown. If the United States or world economies
were to begin to decline or the demand for technology continues its recent
trends, the demand for, and price of, our products could be adversely affected,
thus adversely affecting our revenues and income. Further, other general market
conditions such as increased inflation and higher interest rates, were they to
occur, could also adversely impact our revenues and results.

     POWER GENERATION PROBLEMS IN CALIFORNIA COULD BE DETRIMENTAL TO OUR
BUSINESS.

     California has recently experienced power shortages, resulting in the
implementation of rolling blackouts throughout the state. These blackouts could
disrupt our operations and increase our expenses. Our insurance currently does
not provide for coverage for any damages we may incur as a result of any
disruption in our power supply. California has also recently experienced rising
energy costs which could negatively impact our results.


     OUR BUSINESS WILL SUFFER IF WE ARE UNABLE TO KEEP UP WITH RAPID
TECHNOLOGICAL CHANGE AND PRODUCT OBSOLESCENCE.

     If we fail to maintain our technological leadership and good reputation
with our customers in the areas of GPS, real-time operating systems and network
technologies, the value of your investment will decrease. The markets for timing
and frequency products are characterized by continual and rapid technological
developments that have resulted in, and will likely continue to result in,
substantial improvements in product function and performance. Our success will
depend on our ability to anticipate changes in technology and industry
requirements and to respond to technological developments on a timely basis,
either internally or through strategic alliances.

     It is likely that we will be constantly threatened by current competitors
or new market entrants who may develop new technologies or products or establish
new standards that could render our products obsolete and unmarketable. Thus, we
can offer no assurances that we will be successful in developing and marketing,
on a timely and cost effective basis, product enhancements or new products that
respond to technological developments, that are accepted in the marketplace or
that comply with industry standards.

     WE RELY ON A LIMITED NUMBER OF SUPPLIERS FOR CERTAIN CRITICAL COMPONENTS,
AND WE USE A SINGLE SUPPLIER FOR MOST OF OUR GPS-BASED COMPONENTS, MAKING US
SUBJECT TO SUPPLY AND QUALITY CONTROL PROBLEMS.

     Most of our products incorporate certain components or technology supplied
in part by third parties. From time to time, we experience delays and
disruptions in our supply chain. To date, these delays and disruptions have not
materially adversely affected our business, but they could do so in the future.
Wherever possible, we try to develop multiple sources of supply, but we do not
always succeed. To the extent that we experience significant supply or quality
control problems with our vendors, these problems can cause us to have
difficulty in controlling our quality and can have a significant adverse effect
on our ability to meet future production and delivery commitments to our
customers.

     Currently, Trimble Navigation Limited provides most of our GPS receivers, a
key component for our older GPS-based products. In addition, Trimble has begun
competing in markets similar to our own. While there can be no assurances that
we can ensure continuous supply of these components, we have partially mitigated
this risk by developing and integrating our own proprietary GPS receiver
technology that is based upon widely available GPS chip sets. Further, this
technology has been integrated into several of our newer products. If we are
unable to obtain adequate supplies of Trimble's component for any reason or to
successfully integrate our own substitute technology, we will likely experience
delays or reductions in production and increased expenses. Our operations will



                                       11
<PAGE>   12

be negatively affected if we experience inadequate supplies of any key
components.

     OUR TRADE SECRETS, TRADEMARKS AND PATENTS MAY NOT BE ADEQUATE OR
ENFORCEABLE AND OTHERS MAY USE OUR PROPRIETARY TECHNOLOGY.

     Historically, we have not generally filed patents to protect our
intellectual property. While we hope our intellectual property is adequately
protected by our confidential trade-secret protection plans and programs, we
cannot be sure that our competitors will be prevented from gaining access to our
proprietary and confidential technologies. Furthermore, although we have applied
for a patent related to a computer network timing product, we can offer no
assurances that a patent will be issued for this patent application or other
future applications and, if issued, that any patent will be enforceable. If the
protection of our intellectual property proves to be inadequate or
unenforceable, others may use our proprietary developments without compensation
to us and in competition against us.

     WE FACE THE RISK OF LITIGATION ALLEGING OUR INFRINGEMENT OF OTHER PEOPLE'S
INTELLECTUAL PROPERTY RIGHTS.

     We do not know of any instances where our products violate the intellectual
property rights of others or inappropriately use their technology. However,
technology-based companies are often very litigious. Therefore, we face the risk
of adverse claims and litigation alleging infringement of other people's
intellectual property rights. These claims could result in costly litigation and
divert management's attention from other matters. Alternatively, these claims
could practically require us to obtain licenses in order to use, manufacture,
and sell certain of our products, regardless of the merits of the infringement
claims, in order to maintain business levels, or we could otherwise be excluded
from participation in certain markets. We cannot be certain that any necessary
licenses will be available or that, if available, they can be obtained on
reasonable terms acceptable to us.

     OUR COMPETITORS MAY USE THEIR GREATER RESOURCES AND BROADER PRODUCT
OFFERINGS TO INCREASE COMPETITION AND REDUCE OUR SALES AND PROFITABILITY.

     Many of our existing and potential competitors have substantially greater
marketing, financial and technical resources than we have. In addition, some of
our competitors have broader product offerings and manufacture internally
certain critical components of time and frequency products. Currently, we do not
have a complete offering of precise time and frequency products nor do we
manufacture internally certain critical components, placing us at a disadvantage
to some of our competitors. In addition, we believe that some of our competitors
have obtained and maintained business that loses money - "loss leading" - in
order to maintain a competitive advantage with regard to specific customers or
products. If our competitors were to use such tactics in the future, we would be
unable to maintain our market position without incurring a negative impact on
our profitability.

     The race for a leading position in new technological advances is always
very competitive. Advances in technology may reduce the cost for potential
competitors to gain market entry, particularly for less expensive time and
frequency products. We cannot assure you that sales of our products will
continue at current volumes or prices in any event, but especially if our
current competitors or new market entrants introduce new products with better
features, better performance or lower prices or having other characteristics
that are more attractive than our own. Competitive pressures or other factors
also may result in significant price competition that could have a material
adverse effect on our results of operations.

     OUR INDUSTRY MAY NOT GROW AS FORECASTED AND OUR REVENUES AND OPERATING
RESULTS MAY BE DIMINISHED.

     Our future successful performance is inextricably tied to the growth of our
industry. However, even if our industry grows, there can be no assurance that we
will be able to grow consistently with our industry.

     OUR RELATIONSHIPS WITH OUR SALES REPRESENTATIVES COULD BE IMPAIRED AND
CAUSE US TO LOSE ORDERS.

     More than 85% of our orders come through our 43 domestic and worldwide
sales representative offices. Many of these representatives act as relationship
brokers and the loss of any key representatives could have a negative effect on
our sales.

     WE MAY BE UNABLE TO ATTRACT AND RETAIN KEY EMPLOYEES, DELAYING PRODUCT
DEVELOPMENT AND MANUFACTURING.

     Our success depends upon attracting and retaining highly skilled
professionals. A number of our employees are highly skilled engineers and other
technical professionals, and our failure to continue to attract and retain such
individuals could adversely affect our ability to compete in the industry. In
addition, our success will depend to a significant extent upon the abilities and
efforts of several members of our senior management.




                                       12
<PAGE>   13

     BECAUSE MANY OF OUR KEY CUSTOMERS ARE UNITS OF THE U.S. GOVERNMENT AND
ENTITIES THAT ARE DEPENDENT UPON U.S. GOVERNMENT FUNDING FOR PURCHASES,
DECREASED GOVERNMENT SPENDING OR INCREASED COMPETITION FOR GOVERNMENT BUSINESS
COULD ADVERSELY AFFECT OUR BUSINESS.

     Our defense, military and aerospace based business depends largely on U.S.
government expenditures, whether directly with us or indirectly with our
customers who contract with the U.S. government. In recent years, units of the
U.S. government have collectively accounted for an approximate range of 21% to
36% of our annual revenues. There can be no assurances as to whether future
governmental spending will adequately support our business in those areas, and
substantial decreases in government spending or loss of U.S. governmental
customers could materially and adversely affect our operations. With the
slowdown in technology markets in the U.S. in general, we may experience
considerable competition for our traditional government business.

     OUR MARKET IS SEGMENTED INTO A LIMITED NUMBER OF CUSTOMER GROUPS, THE LOSS
OR CHANGE OF WHICH COULD SIGNIFICANTLY DECREASE OUR SALES.

     While we sell our products to a large number of individual customers, the
number of customer groups is limited. These groups include telecommunications,
computer networking, aerospace, military, satellite, U.S. government and power
utility customers. The loss, or changes in the purchasing behavior, of one or
more of these groups of customers could cause a material decrease in the sale of
our products.

     THE FAILURE OF GPS AND OTHER TIME AND FREQUENCY REFERENCES WOULD CAUSE OUR
PRODUCTS TO FAIL TO PERFORM TO SPECIFICATION.

     The time and frequency products that we manufacture rely upon the
availability of highly accurate timing references, primarily GPS operated by the
U.S. Department of Defense, and to a lesser degree, other timing references
operated by the U.S. National Institute of Science and Technology and other
outside signal sources. The failure of these timing references, particularly
GPS, would create many problems for our products and our customers and seriously
disrupt the sale of our products.

     OUR PRODUCTS COULD FAIL TO PERFORM ACCORDING TO SPECIFICATION OR PROVE TO
BE UNRELIABLE, CAUSING DAMAGE TO OUR CUSTOMER RELATIONSHIPS AND INDUSTRY
REPUTATION AND RESULTING IN LOSS OF SALES.

     Our customers require demanding specifications for product performance and
reliability. Because our precision time and frequency products are complex and
often use state-of-the-art components, processes and techniques, undetected
errors and design flaws may occur. Product defects result in higher product
service and warranty and replacement costs and may cause serious damage to our
customer relationships and industry reputation, all of which will negatively
impact our sales and business.

     IF WE ARE UNABLE TO EXPAND OUR PRODUCTION CAPACITY TO MAINTAIN COMPETITIVE
DELIVERY TIMES, WE WILL LIKELY LOSE CUSTOMERS.

     Our production capacity, and ability to fill orders for our customers on a
timely basis, is limited by our equipment, the size of our production
facilities, the ability of our suppliers and subcontractors to meet our needs,
and our human resources. These resources in turn are limited by the availability
of capital and the time required to increase capacity, particularly to qualify
acceptable subcontractors, and to hire and train employees. We cannot assure you
that we will have sufficient capital and resources to expand our production
capacity and to maintain delivery times which our customers consider
appropriate. Further, an increase in our delivery times may result in loss of
customers.

     OUR RESULTS OF OPERATIONS WILL BE ADVERSELY AFFECTED IF WE DO NOT HAVE
ENOUGH DEMAND FOR OUR PRODUCTS TO JUSTIFY OUR INCREASED CAPACITY.

     To meet our goals for future growth, we have moved into new, larger
manufacturing and office facilities, using a portion of our working capital to
build out and equip the new facility. The additional capacity provided by the
new facility and equipment will allow us to more than double our output given
sufficient market demand. However, after increasing our production capacity, we
may find that demand for our products does not remain sufficiently high for us
to realize a satisfactory return on the capital we have spent to increase
capacity.

     FLUCTUATIONS IN QUARTERLY PERFORMANCE CAN RESULT IN INCREASES IN OUR
INVENTORY AND RELATED CARRYING COSTS, CAN DIMINISH OUR OPERATING RESULTS AND
CASH FLOW AND CAN RESULT IN A LOWER TRUETIME STOCK PRICE.





                                       13
<PAGE>   14

     Historically, the rate of incoming orders for our products has varied
substantially from quarter to quarter. In past fiscal years, our highest sales
quarter has been as much as 250% of our lowest sales quarter. This quarter to
quarter variation is not seasonal or predictable. We attempt to accurately
forecast orders for our products and commence purchasing and manufacturing prior
to the receipt of such orders. However, it is highly unlikely that we will
consistently accurately forecast the timing and rate of orders. The flow of
orders (or lack thereof) from governmental agencies has been particularly
difficult to forecast in recent periods. This aspect of our business makes our
planning inexact and, in turn, affects our shipments, costs, inventories,
operating results and cash flow for any given quarter. In addition, our
quarterly operating results are affected by competitive pricing, announcements
regarding new product developments and cyclical conditions in the industry.
Accordingly, we may experience wide quarterly fluctuations in our operating
performance and profitability, which may adversely affect our stock price even
if our year to year performance is more stable, which it also may not be. In
addition, many of our products require significant manufacturing time, making it
difficult to increase production on short notice. If we are unable to satisfy
unexpected customer orders, our business and customer relationships could
suffer.

     CARRYING VALUES OF INVENTORIES OF OUR PRODUCTS AND COMPONENTS MAY BE
SUBJECT TO PERIODIC WRITE-DOWN, ADVERSELY AFFECTING OUR OPERATIONS.

     To be competitive in certain of our markets, particularly commercial
markets, we will be required to build up inventories of certain products in
anticipation of future orders. There can be no assurance that we will not
experience problems of obsolete, excess or slow-moving inventory if we are not
able to properly balance inventories against the prospect of future orders, and
our operations may, therefore, be adversely affected by inventory write-downs
from time to time. In periods of general economic slowdown or slowdowns in the
technology sector we could be especially affected by such problems.

     CARRYING VALUES OF INTANGIBLE ASSETS MAY BE SUBJECT TO PERIODIC WRITE-DOWN,
ADVERSELY AFFECTING OUR OPERATIONS.

     Goodwill and other intangible assets are reviewed for impairment
whenever an event or change in circumstances indicates that the carrying amount
may not be recoverable. If the carrying value of our intangible assets exceeds
the expected undiscounted future cash flows, a loss would be recognized to the
extent the carrying amount of assets exceeds their fair values. This loss may
negatively impact our results of operation.


ITEM 3:  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

         We are exposed to market risks related to changes in interest rates in
the future. The unused proceeds from our Initial Public Offering are invested in
short-term financial instruments, the value of which is subject to interest rate
risk and could fall if interest rates rise. These short-term instruments are in
low-yield, high quality investments for which fluctuations in the interest rate
would have very little effect on our results of operations. Additionally, any
future borrowings will likely have a variable rate component that will fluctuate
as interest rates change. If market interest rates were to increase immediately
and uniformly by 10%, there would not be a material effect on the results of
operations or on our balance sheet because we currently have no debt.





                                       14
<PAGE>   15



                           PART II: OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

         From time to time, the Company is a party to legal proceedings arising
in the ordinary course of business. The Company is not currently a party to any
litigation that it believes could have a material adverse effect on the results
of operations, financial condition, or cash flows of the Company.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

         The Company commenced the Initial Public Offering (the "Offering") of
its common stock on December 16, 1999 pursuant to a Registration Statement on
Form S-1 (Registration No. 333-90269), which was declared effective by the
Securities and Exchange Commission on December 16, 1999. The Offering was
terminated upon the sale of all of the securities covered by such Registration
Statement. The Company has used approximately $6,437,714 of the initial net
proceeds of $8,642,667 from the offering for day to day working capital
requirements and capital improvements. As of March 31, 2001, the Company had
invested unused net proceeds of the Offering in the amount of approximately
$2,205,000 in short-term money market investments.


ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

    None.


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         On February 23, 2001, we held our Annual Meeting of Stockholders (the
"Meeting"). At the Meeting, our stockholders approved the election of Charles J.
Abbe and Haresh C. Shah as directors, each holding office until the 2004 Annual
Meeting of stockholders or until his successor is duly elected and qualified.
The directors whose term of office continued after the Meeting are Satoru Ohya,
Katsuhiko Kobayashi, Elizabeth A. Withers and Charles H. Still.

The directors were so elected with the following votes:

<TABLE>
<CAPTION>
                                               For                         Withheld
                                               ---                         --------

<S>                                         <C>                             <C>
         Charles J. Abbe                    5,215,122                       22,253
         Haresh C. Shah                     5,214,622                       22,753
</TABLE>

The total voted shares represented in person or by proxy was 5,237,375.


ITEM 5. OTHER INFORMATION.

      None.

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

(a)   Exhibits filed with this Quarterly Report.

      None

(b)   Reports on Form 8-K.

      None.




                                       15
<PAGE>   16


                                   SIGNATURES

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


                               TRUETIME, INC.



                               By:         /s/ Elizabeth A. Withers
                                   --------------------------------------------
                                               Elizabeth A. Withers
                                       President and Chief Executive Officer
                                           (Principal Executive Officer)



                               By:           /s/ John E. Dutil
                                   --------------------------------------------
                                                   John E. Dutil
                                             Chief Financial Officer
                                   (Principal Financial and Accounting Officer)

Date: May 9, 2001




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