FORM 10-Q


                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549



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



                 For the Quarterly Period Ended June 30, 1997



                         Commission File Number 1-9026



                          COMPAQ COMPUTER CORPORATION
            (Exact name of registrant as specified in its charter)


                  Delaware                          76-0011617
      (State or other jurisdiction of            (I.R.S. Employer
       Incorporation or organization)           Identification No.)


                      20555 SH 249, Houston, Texas 77070
                                (281) 370-0670
         (Address, including zip code, and telephone number, including
            area code, of registrant's principal 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  [   ]


The  number of  shares of  the  registrant's  Common Stock,  $.01  par value, 
outstanding  as  of June 30, 1997, was 691.2 million (as adjusted  to reflect 
a five-for-two stock split).





                        PART I.  FINANCIAL INFORMATION

ITEM 1.  Financial Statements

<TABLE>
<CAPTION>

                           COMPAQ COMPUTER CORPORATION
                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)


                                     ASSETS
                                                                  June 30,    December 31,
                                                                    1997          1996
                                                                ------------  ------------
                                                                      (in millions)
<S>                                                             <C>           <C>
Current assets:
   Cash and cash equivalents                                    $     4,215   $     2,920
   Short-term investments                                               898         1,073
   Accounts receivable, net                                           2,172         3,168
   Inventories                                                        1,598         1,152
   Deferred income taxes                                                791           761
   Other current assets                                                 121            95
                                                                ------------  ------------
        Total current assets                                          9,795         9,169
Property, plant, and equipment, less accumulated depreciation         1,223         1,172
Other assets                                                            262           185
                                                                ------------  ------------
                                                                $    11,280   $    10,526
                                                                ============  ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable                                             $     2,421   $     1,962
   Income taxes payable                                                 192           322
   Other current liabilities                                          1,591         1,568
                                                                ------------  ------------
        Total current liabilities                                     4,204         3,852
                                                                ------------  ------------
Long-term debt                                                                        300
                                                                ------------  ------------
Deferred income taxes                                                   259           230
                                                                ------------  ------------
Stockholders' equity:
    Preferred stock, $.01 par value
       (authorized: 10 million shares; issued: none)
    Common stock and capital in excess of $.01 par value
       (authorized: 1 billion shares; issued and outstanding:
       691.2 million shares at June 30, 1997 and
       683.9 million shares at December 31, 1996)                     1,179         1,107
    Retained earnings                                                 5,638         5,037
                                                                ------------  ------------
       Total stockholders' equity                                     6,817         6,144
                                                                ------------  ------------
                                                                $    11,280   $    10,526
                                                                ============  ============
<FN>

              See accompanying notes to consolidated financial data

</TABLE>


<TABLE>
<CAPTION>

                          COMPAQ COMPUTER CORPORATION
                       CONSOLIDATED STATEMENT OF INCOME
                                  (Unaudited)



                                                 Six Months          Quarter 
                                               ended June 30,     ended June 30,
                                              -----------------  ----------------
                                               1997      1996     1997     1996
                                              -------   -------  -------  -------
                                                     (in millions, except
                                                       per share amounts)
<S>                                           <C>       <C>      <C>      <C>
Sales                                         $9,817    $8,206   $5,012   $4,001
Cost of sales                                  7,370     6,400    3,743    3,080
                                              -------   -------  -------  -------
                                               2,447     1,806    1,269      921
                                              -------   -------  -------  -------

Selling, general, and administrative expense   1,021       871      522      440
Research and development costs                   250       197      128       94
Purchased in-process technology                  208                208 
Other income and expense, net                    (14)       22       (2)       5
                                              -------   -------  -------  -------
                                               1,465     1,090      856      539
                                              -------   -------  -------  -------
Income before provision for income taxes         982       716      413      382
Provision for income taxes                       381       215      199      115
                                              -------   -------  -------  -------
Net income                                    $  601    $  501   $  214   $  267
                                              =======   =======  =======  =======

Earnings per common and common
    equivalent share:
          Primary                             $  .85    $  .73   $  .30   $  .39
                                              =======   =======  =======  =======
          Assuming full dilution              $  .84    $  .72   $  .30   $  .39
                                              =======   =======  =======  =======

Shares used in computing earnings per common
    and common equivalent share:
          Primary                              709.6     691.0    711.5    691.8
                                              =======   =======  =======  =======
          Assuming full dilution               712.0     692.5    712.4    692.8
                                              =======   =======  =======  =======
<FN>

             See accompanying notes to consolidated financial data

</TABLE>



<TABLE>
<CAPTION>

                              COMPAQ COMPUTER CORPORATION
                          CONSOLIDATED STATEMENT OF CASH FLOWS
                                      (Unaudited)


                                                                  Six months ended June 30,
                                                                  --------------------------
                                                                      1997          1996    
                                                                  ------------  ------------
                                                                        (in millions)
<S>                                                               <C>           <C>
Cash flows from operating activities:
     Cash received from customers                                 $    10,757   $     8,615 
     Cash paid to suppliers and employees                              (8,445)       (6,924)
     Interest and dividends received                                      116            24 
     Interest paid                                                        (64)          (42)
     Income taxes paid                                                   (535)         (322)
                                                                  ------------  ------------
              Net cash provided by operating activities                 1,829         1,351 
                                                                  ------------  ------------
Cash flows from investing activities:
     Purchases of property, plant, and equipment, net                    (224)         (201)
     Purchases of short-term investments                                 (968)
     Proceeds from short-term investments                               1,143 
     Acquisition of businesses, net of cash acquired                     (268)          (22)
     Other, net                                                           (23)           (5)
                                                                   ------------  ------------
              Net cash used in investing activities                      (340)         (228)
                                                                   ------------  ------------
Cash flows from financing activities:
     Repayment of long-term debt                                          (293)
     Issuance of common stock pursuant to stock option plans                62            32 
                                                                   ------------  ------------
              Net cash provided by (used in) financing activities         (231)           32 
                                                                   ------------  ------------
Effect of exchange rate changes on cash                                     37            27 
                                                                   ------------  ------------
              Net increase in cash and cash equivalents                  1,295         1,182 
Cash and cash equivalents at beginning of period                         2,920           745
                                                                   ------------  ------------
Cash and cash equivalents at end of period                           $   4,215   $     1,927 
                                                                   ============  ============

Reconciliation of net income to net cash provided by
     Operating activities:
     Net income                                                    $       601   $       501 
           Depreciation and amortization                                   166           131 
           Provision for bad debts                                         (28)           14 
           Purchased in-process technology                                 208 
           Deferred income taxes                                                           1 
           Loss on disposal of assets                                        1 
           Exchange rate effect                                              9             6 
           Decrease in accounts receivable                                 949           409 
           Decrease (increase) in inventories                             (431)          621 
           Increase in other current assets                                (26)           (5)
           Increase (decrease) in accounts payable                         457          (236)
           Decrease in income taxes payable                               (124)         (106)
           Increase in other current liabilities                            47            15 
                                                                   ------------  ------------
              Net cash provided by operating activities            $     1,829   $     1,351 
                                                                   ============  ============
<FN>

                 See accompanying notes to consolidated financial data
</TABLE>




<TABLE>
<CAPTION>

                          COMPAQ COMPUTER CORPORATION
                     CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (continued)

                      Supplemental Cash Flow Information



                                               Six months
                                             ended June 30,
                                                  1997
                                            ---------------
                                             (in millions)
<S>                                         <C>
Acquisition (Note 5)
     Fair value of assets acquired          $          362 
     Liabilities assumed                               (74)
     Options assumed                                   (10)
                                            ---------------
     Cash paid                                         278 
Less: cash acquired                                    (10)
                                            ---------------
Net cash paid for acquisition               $          268 
                                            ===============
<FN>

             See accompanying notes to consolidated financial data

</TABLE>






                          COMPAQ COMPUTER CORPORATION
                     NOTES TO CONSOLIDATED FINANCIAL DATA



Note 1 - Basis of Presentation
------------------------------

     The  accompanying  unaudited  financial  data  as  of  June  30, 1997 and
December 31, 1996 and for the three- and six-month periods ended June 30, 1997
and  1996  have been prepared on substantially the same basis as the Company's
annual  consolidated  financial statements. In the opinion of the Company, the
data   reflects   all   adjustments,  consisting   only  of  normal  recurring
adjustments,  necessary  for  a  fair  presentation  of  the results for those
periods  and  the  financial  condition  at  those  dates.


Note 2 - Inventories
--------------------

     Inventories consisted of the following components:
<TABLE>
<CAPTION>

                                      June 30,   December 31,
                                       1997          1996
                                   ------------  ------------ 
                                         (in millions)

<S>                                <C>           <C>
Raw materials and work-in-process  $       718   $       552
Finished goods                             880           600
                                   ------------  ------------
                                   $     1,598   $     1,152
                                   ============  ============

</TABLE>


Note 3 - Other Income and Expense
---------------------------------

     Other income and expense consisted of the following:
<TABLE>
<CAPTION>

                                            Six months ended June 30,    Quarter ended June 30,
                                           --------------------------  --------------------------
                                              1997          1996          1997          1996
                                           ------------  ------------  ------------  ------------
                                                              (in millions)

<S>                                        <C>           <C>           <C>           <C>
Interest and dividend income               $      (116)  $       (24)  $       (61)  $       (18)
Interest income associated with hedging             (3)                         (1)           (1)
Other interest expense                              66            37            32            22 
Currency losses, net                                12             6             9             1 
Other, net                                          27             3            19             1 
                                           ------------  ------------  ------------  ------------
                                           $       (14)  $        22   $        (2)  $         5 
                                           ============  ============  ============  ============
</TABLE>





Note 4 - Tender Offer for Notes
-------------------------------

     In  May  1997,  the  Company completed a cash tender offer for all of its
outstanding $150 million 6 1/2% Senior Notes Due March 15, 1999 ("1999 Notes")
and  $150  million  7  1/4%  Senior  Notes  Due March 15, 2004 ("2004 Notes").
Ninety-eight  percent  or  $148  million  of  the 1999 Notes were tendered and
ninety-seven  percent  or  $145  million  of the 2004 Notes were tendered. The
Company paid an aggregate of $298 million (excluding accrued interest) for the
notes  tendered.    The  untendered  balance of the notes is included in other
current  liabilities.


Note 5 - Business Combinations
------------------------------

     In  May  1997,  Compaq  completed  a  tender  offer for Microcom, Inc., a
manufacturer  of  remote  access  technologies  and  solutions.  The aggregate
purchase  price  of  $288  million  consisted  of $278 million in cash and the
assumption  of  certain  employee  stock  options.

The  transaction  was accounted for as a purchase. Accordingly, the results of
operations of the acquired business and the fair market values of the acquired
assets  and  liabilities  were  included in the Company's financial statements
from  the date of acquisition. The aggregate purchase price has been allocated
to  the assets and liabilities acquired. The aggregate purchase price included
$208  million,  which  represented the value of in-process technology that had
not  yet  reached technological feasibility and had no alternative future use.
This  amount  was  expensed  in the Company's consolidated statement of income
during  the  quarter.  In  addition,  the  aggregate  purchase  price included
approximately   $58  million  representing   purchased  technology  and  other
identifiable  intangibles.  Pro  forma statements of operations reflecting the
acquisition of Microcom are not shown as they would not differ materially from
reported  results.

On  June  23, 1997, the Company announced the execution of a definitive merger
agreement with Tandem Computers Incorporated in a stock-for-stock transaction.
Under  the  terms  of the agreement, the Company will issue approximately 72.5
million  shares  of  Compaq  common stock, based on an exchange ratio of 0.525
shares  of  Compaq  common  stock  (adjusted  to  take  into consideration the
Company's  five-for-two  stock  split  in  July 1997) for each share of Tandem
common  stock  in a transaction to be accounted for as a pooling of interests.
The  agreement  is  subject  to  approval  of Tandem's shareholders as well as
certain  regulatory  approvals. The agreement is expected to be consummated in
the  third  quarter  of  1997.


Note 6 - Subsequent Event
------------------------

     On  July 1, 1997, Compaq announced that the Board of Directors approved a
five-for-two  stock  split  in  the  form of a stock dividend. Shareholders of
record  as  of  July  14,  1997 will receive three additional shares of common
stock  for every two shares they own on that date, effective on July 28, 1997.
Share  and  per share data for all periods presented herein have been adjusted
to  give  effect  to  the  five-for-two  split.






Note 7 - Recent Pronouncement
-----------------------------

     In  1997, Financial Accounting Standards No. 128 ("FAS 128") Earnings Per
Share  was  issued.   FAS 128 is effective for earnings per share calculations
for periods ending after December 15, 1997.  At that time, the Company will be
required to change the method currently used to compute earnings per share and
to restate all prior periods.  The following table presents pro forma earnings
per  share  amounts  computed  using  FAS  128.

<TABLE>
<CAPTION>
                                         Six months ended June 30,    Quarter ended June 30,
                                        --------------------------  --------------------------
                                            1997          1996          1997          1996
                                        ------------  ------------  ------------  ------------
<S>                                     <C>           <C>           <C>           <C>   
Pro forma earnings per share:
  Earnings per common share             $       .88   $       .75   $       .31   $       .40
                                        ============  ============  ============  ============
  Earnings per common share - assuming
    dilution                            $       .85   $       .73   $       .30   $       .39
                                        ============  ============  ============  ============
</TABLE>

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

     The  following  discussion  should  be  read   in  conjunction  with  the
consolidated  interim  financial statements. Except as specifically indicated,
the  forward-looking  statements contained in this discussion do not take into
consideration  the impact of Compaq's agreement to merge with Tandem Computers
Incorporated  which  is subject to the approval of Tandem shareholders as well
as  certain  regulatory approvals. The merger is expected to be consummated in
the  third  quarter  of  1997.

Results of Operations

     The  following table presents, as a percentage of sales, certain selected
financial data  for  the three- and six-month periods ended June 30, 1997  and
1996.

<TABLE>
<CAPTION>
                                                  Six months         Quarter 
                                                ended June 30,    ended June 30,
                                               ----------------  ----------------
                                                 1997    1996     1997     1996
                                               -------  -------  -------  -------
                                                      (in millions, except
                                                        per share amounts)
<S>                                            <C>      <C>      <C>      <C>
Sales                                           100.0%   100.0%   100.0%   100.0%
Cost of sales                                    75.1     78.0     74.7     77.0 
                                               -------  -------  -------  -------
Gross margin                                     24.9     22.0     25.3     23.0 

Selling, general and administrative expenses     10.4     10.6     10.4     11.0 
Research and development costs                    2.5      2.4      2.6      2.4 
Purchased in-process technology (1)               2.1               4.1 
Other income and expense, net                    (0.1)     0.3               0.1
                                               -------  -------  -------  ------- 
                                                 14.9     13.3     17.1     13.5
                                               -------  -------  -------  ------- 
Income before provision for income taxes         10.0%     8.7%     8.2%     9.5%
                                               =======  =======  =======  =======
<FN>

_______________
(1)  Represents  a  $208  million  ($ .29  per  share)  non-recurring, non-tax 
deductible  charge for purchased  in-process technology in connection with the 
Microcom acquisition during the second quarter of 1997.
</TABLE>

Sales

     Sales increased 25% and 20% in the second quarter and first half of 1997,
respectively,  over  the  comparable periods of 1996, primarily as a result of
increased  unit and option sales.  Sales grew in the second quarter and second
half of 1997 in  all regions with North American sales increasing 30% and 21%,
respectively,  European  sales increasing 21% and 18%, respectively, and other
international  sales increasing 19% and 20%, respectively, over the comparable
periods  in  1996.  Second  quarter  and first half 1997 North American sales,
including  Canada, represented 53% and 52% of total sales compared with 51% in
each of the comparable periods of 1996. European sales represented 32% and 34%
of  total  sales  in the second quarter and first half of 1997 compared to 33%
and  34%  in  the  comparable  periods  of  1996.


Gross Margin

     Gross  margin  as  a percentage of sales increased to 25.3% in the second
quarter  of  1997,  compared to 23.0% in the comparable period of 1996.  Gross
margin  increased  to  24.9%  in  the  first  half  of  1997 from 22.0% in the
comparable  1996  period.  These  increases  resulted  primarily from a higher
portion  of sales of enterprise products and options, production and logistics
cost  savings,  and  overall  asset  management  improvements.


Operating Expenses

     Compaq's  selling,  general,  and  administrative  expense  declined as a
percentage  of  sales  in the second quarter of 1997 as compared with the same
period  of  1996  as  a result of Compaq's ongoing efforts to manage operating
expenses  relative to sales growth and gross margin levels. Compaq anticipates
that  the  remainder of 1997 selling, general, and administrative expense will
increase   in  absolute  dollars  as   it  supports  significant  new  product
introductions,  steps  up its advertising and promotion programs, expands into
new  markets, and increases its investment in the area of service and support.
Compaq  strives  to  manage total operating expenses in line with sales growth
and  gross  margin  levels.

     Research and development costs increased to 2.6% in the second quarter of
1997 compared to 2.4% in the corresponding period of 1996. Compaq is committed
to  continuing a significant research and development program and research and
development  costs  in absolute dollars are likely to remain at current levels
or  increase  slightly  for  the  remainder  of  the  year.

     In   addition,  in   the  second  quarter  of  1997,  Compaq  incurred  a
non-recurring,  non-tax  deductible  charge  of  $208  million  for  purchased
in-process  technology  in  connection  with  the  purchase  of Microcom, Inc.


Other Items

     Compaq  had  other  income  of  $2 million in the second quarter of 1997,
compared  to  other expense of $5 million in the second quarter of 1996.  This
difference  was  primarily  due  to  a  significant  increase  in interest and
dividend  income  related  to  higher  combined cash and short-term investment
balances.

     The  translation gains and losses relating to the financial statements of
Compaq's  international  subsidiaries,  net  of  offsetting  gains  and losses
associated with hedging activities related to the net monetary assets of these
subsidiaries,  are included in other income and expense and were a net loss of
$9 million in the second quarter of 1997, compared to a net loss of $1 million
in  the  second  quarter  of  1996.


Provision for Income Taxes 

     Compaq  estimates  its effective tax rate for 1997 will be 32% (excluding
the  $208  million non-deductible charge for purchased in-process technology),
an  increase  from  30%  in  1996.    This  increase  is  primarily  due to an
anticipated  decline  in  the  ratio  of  earnings  derived  from  Singaporean
manufacturing  activities  to  total  earnings.


Liquidity and Capital Resources

     Compaq's  working  capital  increased  to  $5.6 billion at June 30, 1997,
compared  to  $5.3  billion  at  December  31,  1996.

     Compaq's  cash, cash equivalents, and short-term investments increased to
$5.1  billion  at  June  30,  1997,  from  $4.0  billion at December 31, 1996,
primarily  due  to  positive  cash  flow  from operating activities, including
improved  management  of  accounts  receivable  and accounts payable. Accounts
receivable  decreased  to  $2.2  billion  at  June  30, 1997, compared to $3.2
billion  at  December  31,  1996,  reflecting  Compaq's  continued emphasis on
receivables  management.   Inventory levels increased to $1.6 billion compared
to  $1.2  billion  at  December  31, 1996 primarily as a result of a strategic
build  up  of  inventory.

     In  May  1997,  Compaq  utilized  approximately  $298  million in cash to
complete  a  tender offer for its 1999 and 2004 Senior Notes payable.  Also in
May  1997, Compaq completed a tender offer for Microcom, Inc. for $278 million
in  cash.    Cash  used  in  the  second  quarter  of 1997 for the purchase of
property,  plant,  and  equipment  totaled $120 million. Compaq estimates that
capital  expenditures  for land, buildings, and equipment during the remainder
of  1997 will be approximately $281 million. Compaq has commitments for only a
portion  of  such  amounts  and  the actual level of spending will depend on a
variety  of  factors,  including  general  economic  conditions  and  Compaq's
business.

     Compaq currently expects to fund expenditures for capital requirements as
well  as  liquidity  needs  from  a  combination  of  available cash balances,
internally  generated  funds  and  financing arrangements. Compaq from time to
time may borrow funds for actual or anticipated funding needs or because it is
economically  beneficial  to borrow funds instead of repatriating funds in the
form  of  dividends  from  Compaq's  foreign  subsidiaries.  Compaq has a $1.5
billion  syndicated  credit facility (of which $500 million expires in October
1997  and  $1 billion expires in October 2001) that remains unused at June 30,
1997.  Compaq  has  established  a  commercial paper program, supported by the
syndicated credit facility, which was unused at June 30, 1997. Compaq believes
that  these sources of credit provide sufficient financial flexibility to meet
future  funding  requirements.   Compaq  continually  evaluates  the  need  to
establish  other sources of working capital and will pursue those it considers
appropriate  based  upon  Compaq's  needs  and  market  conditions.


Factors That May Affect Future Results

     Compaq  participates  in a highly volatile industry that is characterized
by  fierce  industry-wide  competition for market share. Industry participants
confront  aggressive  pricing  practices, continually changing customer demand
patterns,  growing  competition  from  well-capitalized  high  technology  and
consumer  electronics  companies,  and rapid technological development carried
out  in  the  midst  of  legal  battles  over intellectual property rights. In
accordance with the provisions of the Private Securities Litigation Reform Act
of  1995,  the cautionary statements set forth below discuss important factors
that  could  cause  actual  results  to  differ  materially from the projected
results  contained  in  the  forward-looking  statements  in  this  report.

     Competitive Environment.  We expect the computer market to expand in 1997
in  line  with third party research organizations' forecasts of unit growth in
the  range  of  17  to 20%.  Competition remains fierce with a large number of
competitors  vying  for  market  share. This competition creates an aggressive
pricing environment which continues to put pressure on Compaq's gross margins.
Although  Compaq  has  programs and products focused on meeting market demand,
gaining  market  share  profitably  and  maintaining  gross  margins, Compaq's
ability  to  achieve  these  goals  is  subject to the risks set forth in this
discussion.

     Risks  of  Newly  Acquired  Businesses.  Compaq  plans  to use  strategic 
Acquisitions to  assist  in  the  growth  of its business.   During the second
quarter  1997,  Compaq   completed  the  acquisition  of  Microcom,  Inc.  and 
announced  the  pending merger  with  Tandem  Computers  Incorporated.  Compaq
believes   that   both  acquisitions  will  enhance   the  Company's operating 
results,  but   as   with  any  significant   acquisition,   Compaq  confronts 
significant  challenges in retaining key  employees  and  reconciling  diverse
corporate   cultures,  synchronizing  product roadmaps and business processes, 
and  integrating logistics, marketing, product development, and  manufacturing
operations  to  achieve  greater efficiencies.   Subject to certain regulatory
approvals  and  approval  by  Tandem  shareholders,  Compaq  will  expand  its
enterprise  computing through  the  merger with  Tandem.  At that time, Compaq
will   confront  a  number  of  risks  associated  with   Tandem's   business,
including  managing  the  transition  from   RISC-based  enterprise  computing 
to  industry  standard  enterprise  computing.

     Inventory.   We anticipate  that inventory  turns, which were 10.4 at the
end  of  the  second  quarter  1997, will continue to increase in 1997.  These
increases result from improved product cycle management and other efficiencies
accompanying  the  reengineering  of certain internal processes.  If worldwide
demand  for  PC products drops, demand for one or more of Compaq's products is
lower than anticipated, difficulties arise in managing product transitions, or
component  pricing movements affect the value of raw material inventory, there
could  be  an  adverse  impact  on inventory, cash, and related profitability.

     Third  Party  Relationships.  We work with third parties as suppliers, in
arrangements  to  provide  services  in areas other than core competencies and
ensure the service and support of our customers, and in strategic alliances to
facilitate  product  offerings,  product  development,  compatibility, and the
adoption  of  industry  standards.   Although we try to achieve strong working
relationships  with  parties  who  share  our industry goals and have adequate
resources  to  fulfill  their  responsibilities, these relationships lead to a
number  of  risks.  First, these companies may suffer financial or operational
difficulties  that  affect  their  performance,  which could lead to delays in
product  development  and  gaps  in component supplies.  Second, certain major
companies from which we purchase components or services (such as Intel, Cisco,
IBM,  and  Digital)  may  be  competitors  in  other areas, which could affect
pricing, new product development or future performance.  Finally, difficulties
in coordinating activities may lead to gaps in delivery and performance of our
products.

     Rapid  Technology  Cycles. We believe the computer industry will continue
to drive rapid technology cycles. In planning product transitions, we evaluate
the  speed  at  which  customers  are  likely to switch to newer products. The
contrast between prices of old and new products, which is related to component
costs,  is a critical variable in predicting customer decisions to move to the
next  generation  of  products.  Because of the lead times associated with our
volume  production,  should  we  be  unable  to  gauge  the  rate  of  product
transitions  accurately, there could be an adverse impact on inventory levels,
cash,  and  profitability.

     Product  Transitions.    In  each  product cycle, we confront the risk of
delays in production that could impact sales of newer products while we manage
the  inventory  of  older  products and facilitate the sale of older inventory
held  by  resellers. To ease product transitions, we carry out pricing actions
and  marketing  programs  to  raise  sales  in  reseller  channels. We provide
currently  for  estimated  product returns and price protection that may occur
under reseller programs and under floor planning arrangements with third-party
finance companies. Should we be unable to sell the inventory of older products
at  anticipated  prices  or  if  dealers  hold higher than expected amounts of
inventory subject to price protection at the time of planned price reductions,
there  could  be  a  resulting  adverse  impact  on  sales, gross margins, and
profitability.

     Systems  Implementation. During 1997, Compaq continues to focus on making
its  business  and information management processes more efficient in order to
increase  customer satisfaction, improve productivity, and lower costs. In the
event  of  a  delay  in  implementing  improvements, there could be an adverse
impact  on inventory, cash and related profitability. In connection with these
efforts,  we  are  moving  many  of  our  systems from a legacy environment of
proprietary  systems  to client-server architectures. Should the transition to
new  systems  not  occur  in  a smooth and orderly manner, we could experience
disruptions  in  operations,  which  could  have  an adverse financial impact.

     Technology  Standards  and  Key  Licenses.  Participants  in the computer
industry  generally  rely  on  the  creation  and implementation of technology
standards  to  win  the  broadest market acceptance for their products. Compaq
must successfully manage and participate in the development of standards while
continuing  to  differentiate  its  products  in a manner valued by customers.
While  industry  participants  generally accept, and may encourage, the use of
their  intellectual property by third parties under license, when intellectual
property  owned  by  competitors  or suppliers becomes accepted as an industry
standard,  Compaq  must  obtain  a license, purchase components utilizing such
technology from the owners of such technology or their licensees, or otherwise
acquire  rights to use such technology, which could result in increased costs.
Compaq  has  entered  into  license agreements with key industry participants,
including  Intel,  Texas  Instruments,  and  Microsoft.    Compaq is currently
negotiating  with  Microsoft  and  IBM  for  the  successors  to  the  current
agreements.    There can be no assurance that Compaq will be able to negotiate
terms   under  such  license  agreements  that  offer  it  competitive  market
advantages.

     Production  Forecasts.  In managing production, we must forecast customer
demand  for  our products. Should we underestimate the supplies needed to meet
demand, we could be unable to meet customer demand. Should we overestimate the
supplies  needed  to  meet  customer  demand,  cash and profitability could be
adversely  affected. Many of the components used in our products, particularly
microprocessors and memory, experience steep price declines over their product
lives. If we are unable to manage purchases and utilization of such components
efficiently  to maintain low inventory levels immediately prior to major price
declines,  we  could be unable to take immediate advantage of such declines to
lower product costs, which could adversely affect our sales and gross margins.
In  addition,  should  prices  for  components increase unexpectedly, Compaq's
gross  margin could be adversely affected.  Recently, Compaq has established a
variety  of  programs  designed  to  increase  its  manufacturing and business
process  efficiencies.   The  success  of  these  programs  depends  upon  the
implementation   of   more  efficient  component  supply,  manufacturing,  and
distribution  strategies  to increase overall efficiencies, which will lead to
lower  prices  being  offered  to  its  end  users.

     Credit  Risks. Compaq's primary means of distribution remains third-party
resellers. We continually monitor and manage the credit we extend to resellers
and  attempt  to  limit  credit  risks  by  broadening  distribution channels,
utilizing certain risk transfer arrangements and obtaining security interests.
Our  business  could  be  adversely  affected  in the event that the financial
condition  of  third-party  computer  resellers  worsens.  Upon  the financial
failure  of  a major reseller, we could experience disruptions in distribution
as  well  as  the  loss  of  the unsecured portion of any outstanding accounts
receivable.  Geographic expansion, particularly the expansion of manufacturing
operations  in  developing  countries,  such  as  Brazil  and  China,  and the
expansion  of  sales  into economically and politically volatile areas such as
China,  Latin  America,  and  Eastern  Europe,  subjects Compaq to a number of
economic  and  other  risks,  such as currency devaluation, expropriation, and
financial  instability  among resellers in these regions. Compaq generally has
experienced  longer  accounts  receivable  cycles  in   emerging  markets,  in
particular  China  and  Latin  America,  when  compared  to  U.S. and European
markets. Compaq continues to evaluate its business operations in these regions
and  attempts  to  take  measures  to  limit  risks  in  these  areas.

     Currency and Hedging Risks. The value of the U.S. dollar affects Compaq's
financial   results.   The  functional  currency  for  Compaq's  international
subsidiaries  is  the  U.S. dollar. Accordingly, changes in exchange rates may
positively or negatively affect Compaq's sales (as expressed in U.S. dollars),
gross  margins,  and  operating  expenses.  Compaq engages in hedging programs
aimed  at  limiting in part the impact of currency fluctuations. Through these
programs,  Compaq  hedges  its  non-U.S.  dollar  net  monetary  assets  using
primarily  forward exchange contracts. For certain markets, particularly Latin
America,  Compaq  has  determined  that ongoing hedging of non-U.S. dollar net
monetary  assets  is  not  cost  effective  and  instead  attempts to minimize
currency  exposure  risk  through  working capital management. There can be no
assurance that such an approach will be successful, especially in the event of
a  significant  and sudden decline in the value of local currencies. From time
to  time,  Compaq  purchases  foreign  currency  option  contracts  as well as
short-term  forward  exchange  contracts  to protect against currency exchange
risks   associated  with  the  anticipated  sales  of  Compaq's  international
marketing  subsidiaries,  principally  in  Europe  and  Japan.  These  hedging
activities  provide  only  limited protection against currency exchange risks.
Factors  that  could  impact  the  effectiveness  of Compaq's hedging programs
include  accuracy  of sales forecasts, volatility of the currency markets, and
availability  of  hedging instruments. All currency contracts that are entered
into by Compaq are components of hedging programs and are entered into for the
sole  purpose of hedging an existing or anticipated currency exposure, not for
speculation.  Although Compaq maintains these programs to reduce the impact of
changes  in  currency  exchange  rates,   when  the  U.S.  dollar  sustains  a
strengthening  position against currencies in which Compaq sells products or a
weakening  exchange  rate  against  currencies  in  which Compaq incurs costs,
particularly the Japanese yen, Compaq's sales or costs are adversely affected.

     Tax  Rate.  Compaq's tax rate is heavily dependent upon the proportion of
earnings  that  are  derived from its Singaporean manufacturing subsidiary and
its  ability  to  reinvest  those earnings permanently outside the U.S. If the
earnings of this subsidiary as a percentage of Compaq's total earnings were to
decline  significantly  from anticipated levels, or should Compaq's ability to
reinvest  these  earnings be reduced, Compaq's effective tax rate would exceed
the currently estimated 32% rate for 1997 (before the effect of non-deductible
purchased  in-process  technology).  In addition, should Compaq's intercompany
transfer  pricing  with  respect  to  its Singaporean manufacturing subsidiary
require  significant  adjustment due to audits or regulatory changes, Compaq's
overall  effective  tax  rate  could  increase.

Because  of  the  foregoing  factors, as well as other variables affecting the
Company's   operating  results,  past  financial  performance  should  not  be
considered  a  reliable  indicator of future performance, and investors should
not  use  historical trends to anticipate results or trends in future periods.




                          PART II.  OTHER INFORMATION


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

     At  the  annual  meeting of stockholders of Compaq on April 24, 1997, the
stockholders  voted  on the election of directors.  The votes in this election
were  set  forth  in Item 4 of the Company's Quarterly Report on Form 10-Q for
the  quarter  ended  March  31, 1997, which results are incorporated herein by
reference.


Item  6.    Exhibits and Reports on Form 8-K

(a)     Exhibit No.     Description

     11          Statement regarding computation of per share earnings

     27          EDGAR financial data schedule

(b) (i)     Report on  Form  8-K  dated  April 10, 1997,  containing  Compaq's
news  release dated  April 10, 1997,  relating to the  execution  of a  merger
agreement to acquire Microcom, Inc.

    (ii)    Report  on  Form  8-K  dated April 16, 1997,  containing  Compaq's
news  release  dated April 16, 1997,  with respect  to its  financial  results
for the period ended March 31, 1997.

    (iii)   Report on Form  8-K dated May 14, 1997,  containing  Compaq's news
release  dated  May 14, 1997, relating  to  its  successful  tender  offer for
Microcom, Inc.

    (iv)    Reports  on   Form  8-K  dated  June 22, 1997,   with  respect  to
Compaq's proposed merger with Tandem Computers Incorporated.

    (v)     Report on Form  8-K dated  July 1, 1997,  containing Compaq's news
release dated July 1, 1997,  relating to its  five-for-two  stock split in the
form of a stock dividend.

(vi) Report  on  Form  8-K  dated  July 10, 1997,  containing  Compaq's
news release dated July 10, 1997,  with respect to its  financial  results for
the period ended June 30, 1997.

All  other  items  specified  by Part II of  this report are  inapplicable and
accordingly have been omitted.






                                  SIGNATURES

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

     July 23, 1997                    COMPAQ COMPUTER CORPORATION


                                          /s/    EARL L. MASON

                                      ---------------------------------------
                                      Earl L. Mason, Senior Vice President
                                      and Chief Financial Officer
                                      (as authorized officer and as principal
                                      financial officer)