<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549



                                    FORM 10-Q


[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
         THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY
         PERIOD ENDED MARCH 31, 2000.


[ ]      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: 0-22187


                        ADVANTAGE LEARNING SYSTEMS, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


           WISCONSIN                                     39-1559474
        (STATE OR OTHER                                  (IRS EMPLOYER
JURISDICTION OF INCORPORATION)                        IDENTIFICATION NO.)

                                   PO BOX 8036
                                2911 PEACH STREET
                           WISCONSIN RAPIDS, WISCONSIN
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                   54495-8036
                                   (ZIP CODE)

                                 (715) 424-3636
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                Yes [X] No [ ]


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


<TABLE>
<CAPTION>
                                                         OUTSTANDING AT
           CLASS                                           MAY 1, 2000
           -----                                         --------------
<S>                                                      <C>
 Common Stock, $0.01 par value                              34,214,773
</TABLE>


<PAGE>   2




                        ADVANTAGE LEARNING SYSTEMS, INC.

                               INDEX TO FORM 10-Q

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000




<TABLE>
<CAPTION>
PART I  - FINANCIAL INFORMATION
                                                                                                         Page
                                                                                                        Number
                                                                                                        ------
<S>                                                                                                     <C>
ITEM 1.   FINANCIAL STATEMENTS

         Unaudited Consolidated Balance Sheets at March 31, 2000
                  and December 31, 1999..................................................................1

         Unaudited Consolidated Statements of Income for the Three
                  Months Ended March 31, 2000 and 1999...................................................2

         Unaudited Consolidated Statements of Cash Flows for the Three
                  Months Ended March 31, 2000 and 1999...................................................3

         Notes to Unaudited Consolidated Financial Statements............................................4


ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS............................................................6

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
          MARKET RISK....................................................................................8


PART II - OTHER INFORMATION

ITEM 2.   CHANGES IN SECURITIES  AND USE OF PROCEEDS.....................................................9

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K..............................................................10
</TABLE>





                                    -Index-

<PAGE>   3



PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements


                        ADVANTAGE LEARNING SYSTEMS, INC.
                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


<TABLE>
<CAPTION>


                                                                      MARCH 31,             DECEMBER 31,
                                                                        2000                   1999
                                                                  -----------------    -------------------
                                                                              (In thousands)
                             ASSETS
                             ------
<S>                                                               <C>                  <C>
Current assets:
    Cash and cash equivalents                                     $         23,103     $           23,016
    Investment securities                                                   23,113                 18,012
    Accounts receivable, less allowance of
        $1,203,000 in 2000 and $1,200,000 in 1999                            9,408                 11,796
    Inventories                                                              1,532                  1,707
    Prepaid expenses                                                         1,243                  1,287
    Prepaid income taxes                                                     1,440                    292
    Deferred tax asset                                                       2,534                  2,559
                                                                  -----------------    -------------------
Total current assets                                                        62,373                 58,669
    Property, plant and equipment, net                                      24,749                 24,256
    Deferred tax asset                                                       2,373                  2,297
    Intangibles, net                                                         2,505                  2,702
    Capitalized software, net                                                  401                    495
                                                                  -----------------    -------------------
Total assets                                                      $         92,401     $           88,419
                                                                  =================    ===================

              LIABILITIES AND SHAREHOLDERS' EQUITY
              ------------------------------------
Current liabilities:
    Accounts payable                                              $          3,582     $            2,521
    Deferred revenue                                                         3,374                  4,852
    Payroll and employee benefits                                            2,157                  1,981
    Other current liabilities                                                2,343                  2,392
                                                                  -----------------    -------------------
Total current liabilities                                                   11,456                 11,746
    Deferred revenue                                                         1,520                  1,485
                                                                  -----------------    -------------------
Total liabilities                                                           12,976                 13,231

Minority interest                                                              185                    253

Shareholders' equity                                                        79,240                 74,935
                                                                  -----------------    -------------------
Total liabilities and shareholders' equity                        $         92,401     $           88,419
                                                                  =================    ===================
</TABLE>


See accompanying notes to consolidated financial statements.


                                      - 1 -
<PAGE>   4

                        ADVANTAGE LEARNING SYSTEMS, INC.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                                                         FOR THE THREE MONTHS ENDED
                                                                                   MARCH 31,
                                                                     2000                            1999
                                                                ----------------                ----------------
                                                                     (In thousands, except per share amounts)
<S>                                                              <C>                           <C>
Net sales:
    Products                                                    $        18,372                 $        15,144
    Services                                                              5,698                           3,445
                                                                ----------------                ----------------
        Total net sales                                                  24,070                          18,589
                                                                ----------------                ----------------
Cost of sales:
    Products                                                              2,517                           1,576
    Services                                                              3,049                           1,732
                                                                ----------------                ----------------
        Total cost of sales                                               5,566                           3,308
                                                                ----------------                ----------------
        Gross profit                                                     18,504                          15,281
Operating expenses:
    Product development                                                   3,170                           1,454
    Selling and marketing                                                 6,633                           4,884
    General and administrative                                            2,833                           2,256
                                                                ----------------                ----------------
        Total operating expenses                                         12,636                           8,594
                                                                ----------------                ----------------
        Operating income                                                  5,868                           6,687
Other income:
    Interest income                                                         575                             413
    Other, net                                                              146                             157
                                                                ----------------                ----------------
Income before taxes                                                       6,589                           7,257
Income taxes                                                              2,591                           3,001
                                                                ----------------                ----------------

Net income                                                      $         3,998                 $         4,256
                                                                ================                ================

Basic earnings per share                                        $          0.12                 $          0.13
Diluted earnings per share                                                 0.12                            0.12
</TABLE>


See accompanying notes to consolidated financial statements.



                                      - 2 -

<PAGE>   5




                        ADVANTAGE LEARNING SYSTEMS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                   FOR THE THREE MONTHS ENDED
                                                                                              MARCH 31,
                                                                                    2000               1999
                                                                             ------------------- -----------------
                                                                                          (In thousands)

Reconciliation of net income to net cash provided by operating activities:
<S>                                                                          <C>                 <C>
    Net income                                                               $            3,998  $          4,256
    Noncash (income) expenses included in net income -
        Depreciation and amortization                                                     1,074               667
        Deferred income taxes                                                               (51)             (216)
    Change in assets and liabilities -
            Accounts receivable                                                           2,388            (1,255)
            Inventory                                                                       175                22
            Prepaid expenses                                                             (1,104)             (194)
            Accounts payable and other current liabilities                                1,190             1,288
            Deferred revenue                                                             (1,444)              224
       Other                                                                                 59               (41)
                                                                             ------------------- -----------------
       Net cash provided by operating activities                                          6,285             4,751
                                                                             ------------------- -----------------
Cash flows from investing activities:
    Purchase of property, plant and equipment                                            (1,275)           (1,752)
    Purchase of short term investments, net                                              (5,101)            7,022
    Capitalized software development costs                                                    -               (20)
                                                                             ------------------- -----------------
        Net cash provided by (used in) investing activities                              (6,376)            5,250
                                                                             ------------------- -----------------
Cash flows from financing activities:
    Return of capital to minority interest                                                  (60)                -
    Proceeds from issuance of stock                                                         490               222
    Proceeds from exercise of stock options                                                   6               266
    Purchase of treasury stock                                                             (258)                -
                                                                             ------------------- -----------------
        Net cash provided by financing activities                                           178               488
                                                                             ------------------- -----------------
Net increase in cash                                                                         87            10,489
Cash and cash equivalents, beginning of period                                           23,016            14,264
                                                                             =================== =================
Cash and cash equivalents, end of period                                     $           23,103  $         24,753
                                                                             =================== =================
</TABLE>


See accompanying notes to consolidated financial statements.




                                      - 3 -


<PAGE>   6

                        ADVANTAGE LEARNING SYSTEMS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1. CONSOLIDATION
         The consolidated financial statements include the financial results of
Advantage Learning Systems, Inc. ("ALS") and its consolidated subsidiaries
(collectively the "Company"). The Company's significant subsidiaries include the
School Renaissance Institute, Inc., which changed its name from the Institute
for Academic Excellence, Inc. in March 2000, and IPS Publishing, Inc. The
Company also owns 70% of Athena Holdings LLC which was formed for the purpose of
constructing a facility in Madison, Wisconsin. All significant intercompany
transactions have been eliminated in the consolidated financial statements.


2. BASIS OF PRESENTATION
         The consolidated financial statements reflect all adjustments
(consisting only of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair presentation of the results of the interim
periods, and are presented on an unaudited basis. These financial statements
should be read in conjunction with the Company's financial information contained
in the Company's Annual Report on Form 10-K which is on file with the U.S.
Securities and Exchange Commission.

         Effective July 1, 1999, the Company acquired Generation21 Learning
Systems LLC ("Generation21"), a training and knowledge management enterprise
software firm in Golden, Colorado. The transaction was accounted for as a
pooling-of-interests. Accordingly, financial information for all periods
presented has been restated to include the results of Generation21.

         The results of operations for the three month periods ended March 31,
2000 and 1999 are not necessarily indicative of the results to be expected for
the full year.


3.  EARNINGS PER COMMON SHARE
         Basic earnings per common share has been computed based on the weighted
average number of common shares outstanding. Diluted earnings per common share
has been computed based on the weighted average number of common shares
outstanding, increased by the number of additional common shares that would have
been outstanding if the dilutive potential common shares had been issued.

         On January 3, 2000, the Company's Board of Directors authorized the
repurchase of up to 1,000,000 shares of the Company's common stock. No time
limit was placed on the duration of the repurchase program. Repurchased shares
will become treasury shares and will be used for stock-based employee benefit
plans and for other general corporate purposes. As of March 31, 2000, the
Company had repurchased 20,000 shares.

         The weighted average shares outstanding during the three months ended
March 31, 2000 and 1999 are as follows:


<TABLE>
<CAPTION>

                                                   Three Months Ended                  Three Months Ended
                                                      March 31, 2000                      March 31, 1999
                                                   ------------------                  ------------------
<S>                                                <C>                                 <C>
Basic Weighted Average Shares                           34,220,824                        34,033,527

Impact of Stock Options                                    118,672                           288,603

Diluted Weighted Average Shares                         34,339,496                        34,322,130
</TABLE>






                                      - 4 -

<PAGE>   7

4.  SEGMENT REPORTING
         The Company's reportable segments are strategic business units that
offer different products and services. They are managed separately because each
business requires different technology and marketing strategies. The Company has
two reportable segments: software and training.

         The software segment produces learning information systems software for
the K-12 school market in the United States, Canada, the United Kingdom and
Australia. The software assists educators in assessing and monitoring student
development by increasing the quantity, quality and timeliness of student
performance data in the areas of reading, math and writing. The software segment
also includes training and knowledge management enterprise software, which is
currently sold primarily to corporate customers. Revenue from the software
segment includes product revenue from the sale of software and service revenue
from the sale of software support agreements.

         The training segment provides professional development training
seminars. Its programs train educators on how to accelerate learning in the
classroom through use of the information that the Company's learning information
systems provide. Revenue from the training segment includes service revenue from
a variety of seminars presented in hotels and schools across the country, and
product revenue from training materials.

         The Company evaluates the performance of its operating segments based
on operating income before nonrecurring items. Intersegment sales and transfers
and revenue derived outside of the United States are not significant. Summarized
financial information concerning the Company's reportable segments is shown in
the following table:

<TABLE>
<CAPTION>

                                       Three Months Ended
                                            March 31,
                                     2000             1999
                                 --------------    -----------
                                          (In thousands)
Revenues:
<S>                              <C>               <C>
Software                         $      19,463     $   16,514
Training                                 4,607          2,075
                                 --------------    -----------
Total revenues                   $      24,070     $   18,589
                                 ==============    ===========

Operating income:
Software                         $       6,039     $    7,391
Training                                  (171)          (704)
                                 --------------    -----------
Total operating income           $       5,868     $    6,687
                                 ==============    ===========
</TABLE>

         The reported measures are consistent with those used in measuring
amounts in the consolidated financial statements. Such measurements are
generally along legal entity lines as aggregated. Effective January 1, 2000, the
Company re-evaluated and changed certain cost allocations between the software
and training segments. The result of the re-evaluation on previously reported
segment disclosures is not material.

         It is management's opinion, however, that because many flows of value
between the segments cannot be precisely quantified, this information provides
an incomplete measure of the training segment profit or loss, and should not be
viewed in isolation. Management evaluates the performance of the training
segment based on many factors not captured by the financial accounting system
and often evaluates the Company's financial performance on a total entity basis.

5.  COMPREHENSIVE INCOME
         Total comprehensive income was $4,066,000 and $4,260,000 in the first
quarter of 2000 and 1999, respectively. The Company's comprehensive income
includes foreign currency translation adjustments and unrealized gains and
losses on available-for-sale securities.






                                      - 5 -

<PAGE>   8

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

THREE MONTHS ENDED MARCH 31, 2000 AND 1999

           The following table sets forth certain consolidated income statement
data in dollars and as a percentage of net sales, except that individual
components of costs of sales and gross profit are shown as a percentage of their
corresponding component of net sales:

<TABLE>
<CAPTION>

                                                      THREE MONTHS ENDED MARCH 31,
                                                   2000                        1999                     CHANGE
                                         -------------------------   -------------------------   ----------------------
                                                                       (Dollars in thousands)
<S>                                      <C>              <C>          <C>         <C>           <C>          <C>
Net Sales:
    Products                                 $18,372        76.3%        $15,144        81.5%        $3,228      21.3%
    Services                                   5,698        23.7%          3,445        18.5%         2,253      65.4%
                                            ---------     ========     ----------  ===========   -----------
        Total net sales                       24,070       100.0%         18,589       100.0%         5,481      29.5%
                                            ---------     ========     ----------  ===========   -----------

Cost of sales:
    Products                                   2,517        13.7%          1,576        10.4%           941      59.7%
    Services                                   3,049        53.5%          1,732        50.3%         1,317      76.0%
                                         ------------                ------------                -----------
        Total cost of sales                    5,566        23.1%          3,308        17.8%         2,258      68.3%
                                         ------------                ------------                -----------

Gross profit:
    Products                                  15,855        86.3%         13,568        89.6%         2,287      16.9%
    Services                                   2,649        46.5%          1,713        49.7%           936      54.6%
                                         ------------                ------------                -----------
        Total gross profit                    18,504        76.9%         15,281        82.2%         3,223      21.1%
                                         ------------                ------------                -----------

Operating expenses:
    Product development                        3,170        13.2%          1,454         7.8%         1,716     118.0%
    Selling and marketing                      6,633        27.6%          4,884        26.3%         1,749      35.8%
    General and administrative                 2,833        11.8%          2,256        12.1%           577      25.6%
                                         ------------                ------------                -----------
        Total operating expenses              12,636        52.5%          8,594        46.2%         4,042      47.0%
                                         ------------                ------------                -----------

        Operating income                       5,868        24.4%          6,687        36.0%          (819)    -12.2%

Other income:
    Interest income                              575         2.3%            413         2.2%           162      39.2%
    Other, net                                   146         0.6%            157         0.8%           (11)     -7.0%
                                         ------------                ------------                -----------
        Total other income                       721         3.0%            570         3.1%           151      26.5%
                                         ------------                ------------                -----------

Income before taxes                            6,589        27.4%          7,257        39.0%          (668)     -9.2%

Income taxes                                   2,591        10.8%          3,001        16.1%          (410)    -13.7%
                                         ------------                ------------                -----------

Net income                                    $3,998        16.6%         $4,256        22.9%        $ (258)     -6.1%
                                         ============                ============                ===========
</TABLE>



                                      - 6 -



<PAGE>   9

         Net Sales. The Company's net sales increased by $5.5 million, or 29.5%,
to $24.1 million in the first quarter of 2000 from $18.6 million in the first
quarter of 1999. Product sales increased by $3.2 million, or 21.3%, to $18.4
million in the first quarter of 2000 from $15.1 million in the first quarter of
1999. The increase in product sales is primarily attributable to (i) increased
sales of optical-mark card scanners included with the sale of all Accelerated
Math software and also sold separately, (ii) increased sales of Accelerated
Reader title disks, with about 32,000 available book titles, to a larger base of
Accelerated Reader schools, and (iii) continued strong sales of the Company's
STAR Reading software. The first quarter 1999 product sales included the
shipment of a significant backlog of new Accelerated Math orders, as that
product was completed in late 1998. While title disk sales grew over 1999
levels, management believes the rate of growth continued to be negatively
impacted by the effects of the fall 1999 shipment of its new version of
Accelerated Reader. Management expects the future growth rate of title disk
sales will depend, in part, on schools' completing installation of the new
version of Accelerated Reader.

         Service revenue, which consists of revenue from sales of training
sessions and software support agreements, increased by $2.3 million, or 65.4%,
to $5.7 million in the first quarter of 2000 from $3.4 million in the first
quarter of 1999. Approximately $2.0 million of this increase is attributable to
the Company's first annual National School Renaissance Conference presented in
February. Service revenue from software support was negatively impacted by a
decline in software kit sales in the first quarter of 2000 compared to the first
quarter of 1999 due to the shipment of a significant backlog of Accelerated Math
orders in 1999.

         Cost of Sales. The cost of sales of products increased by $941,000, or
59.7%, to $2.5 million in the first quarter of 2000 from $1.6 million in the
first quarter of 1999. As a percentage of product sales, the cost of sales of
products increased to 13.7% in the first quarter of 2000 compared to 10.4% in
the first quarter of 1999. The increase in cost of sales of products is
primarily due to increased sales of optical-mark card scanners. A scanner is
included with the sale of all Accelerated Math software and in many cases,
additional scanners are sold. Although scanners are profitable, the gross profit
margin on hardware is not as high as the gross profit margin on software. The
cost of sales of services increased by $1.3 million, or 76.0%, to $3.0 million
in the first quarter of 2000 from $1.7 million in the first quarter of 1999. As
a percentage of sales of services, the cost of sales of services increased to
53.5% in the first quarter of 2000 compared to 50.3% in the first quarter of
1999. This increase is primarily the result of costs associated with (i) the
Company's first annual National School Renaissance Conference presented in the
first quarter of 2000 and (ii) increased technical support costs due to broader
product lines and the introduction of new versions of existing products. The
Company's overall gross profit margin decreased to 76.9% in the first quarter of
2000 from 82.2% in the first quarter of 1999 due to decreased gross profit
margins on both products and services and to an increase in service revenue as a
percentage of total revenue in the first quarter of 2000. Management expects
that the overall gross profit margin will improve somewhat in the remainder of
2000 as service sales are not expected to represent as large of a percentage of
total sales in the remainder of the year.

         Product Development. Product development expenses increased by $1.7
million, or 118.0%, to $3.2 million in the first quarter of 2000 from $1.5
million in the first quarter of 1999. These expenses increased primarily due to
increased staff and consulting costs associated with new product development
including Perfect Copy High School, a writing skills product targeted at
secondary-school English teachers; Accelerated Math objectives libraries for the
first- and second-grade market; the completion of approximately 3,300 new
Accelerated Reader quizzes; continued development of a suite of Web-based
versions of the Company's existing core products; enhancements to and
international versions of existing products; and a number of new products at
various stages of development. As a percentage of net sales, product development
costs increased to 13.2% in the first quarter of 2000 from 7.8% in the first
quarter of 1999. The Company anticipates that product development costs will
continue to increase with the Company's continued emphasis on product
development and new business initiatives as a key to achieving future growth.

         Selling and Marketing. Selling and marketing expenses increased by $1.7
million, or 35.8%, to $6.6 million in the first quarter of 2000 from $4.9
million in the first quarter of 1999. These expenses increased due to (i) salary
and recruiting costs associated with the hiring of additional personnel to
market and promote a broader product line, (ii) expenses related to the
Company's National School Renaissance Conference in February 2000, (iii) costs
of marketing the Company's new Generation21 enterprise-wide training and
knowledge management software system and (iv) international marketing efforts.
As a percentage of net sales, selling and marketing expenses increased to 27.6%
in the first quarter of 2000 from 26.3% in the first quarter of 1999. Management
anticipates that selling and marketing expenses will generally continue to rise
as the Company expands its product lines and customer and prospect base.


                                      - 7 -
<PAGE>   10



         General and Administrative. General and administrative expenses
increased by $577,000, or 25.6%, to $2.8 million in the first quarter of 2000
from $2.3 million in the first quarter of 1999. The higher expenses for the
first quarter of 2000 are largely due to increased costs associated with the
hiring of additional personnel, including wages and related benefits to support
a larger base of business including new initiatives such as Generation21 and the
expansion internationally. As a percentage of net sales, general and
administrative costs decreased to 11.8% in the first quarter of 2000 compared to
12.1% in the first quarter of 1999.

         Operating Income. Operating income decreased by $819,000, or 12.2%, to
$5.9 million in the first quarter of 2000 from $6.7 million in the first quarter
of 1999. As a percentage of net sales, operating income decreased to 24.4% in
the first quarter of 2000 compared to 36.0% in the first quarter of 1999.

         Income Tax Expense. Income tax expense of $2.6 million was recorded in
the first quarter of 2000 at an effective income tax rate of 39.3% of pre-tax
income, compared to $3.0 million, or 41.4% of pre-tax income in the first
quarter of 1999. The Company expects to maintain its effective tax rate at
between 39% and 40% for 2000.




LIQUIDITY AND CAPITAL RESOURCES

         As of March 31, 2000, the Company's cash, cash equivalents and
short-term investments increased to $46.2 million from the December 31, 1999
total of $41.0 million. The increase of $5.2 million in the first quarter of
2000 is primarily due to the net effect of an increase of $6.3 million in net
cash provided by operating activities offset by $1.3 million used in the
purchase of property, plant and equipment. The Company believes cash flow from
operations and its current cash position will be sufficient to meet its working
capital requirements and fund future growth acquisition opportunities for the
foreseeable future.

         At March 31, 2000, the Company had a $10.0 million unsecured revolving
line of credit with a bank which is available until March 31, 2001. The line of
credit bears interest at either a floating rate based on the prime rate less
1.0%, or a fixed rate for a period of up to 90 days based on LIBOR plus 1.25%.
The rate is at the option of the Company and is determined at the time of
borrowing. The Company also has a $1.0 million unsecured revolving line of
credit with a bank which is available until April 30, 2001. The line of credit
bears interest at a fixed rate of 7.5%. As of March 31, 2000, the lines of
credit had not been used.


FORWARD-LOOKING STATEMENTS

         In accordance with the Private Securities Litigation Reform Act of
1995, the Company can obtain a "safe-harbor" for forward-looking statements by
identifying those statements and by accompanying those statements with
cautionary statements which identify factors that could cause actual results to
differ materially from those in the forward-looking statements. Accordingly, the
foregoing "Management's Discussion and Analysis of Financial Condition and
Results of Operations" contains certain forward-looking statements relating to
growth plans, projected sales, revenues, earnings and costs, and product
development schedules and plans. The Company's actual results may differ
materially from those contained in the forward-looking statements herein.
Factors which may cause such a difference to occur include those factors
identified in Item 1, Business, Forward-Looking Statements, contained in the
Company's Form 10-K for the year ended December 31, 1999, which factors are
incorporated herein by reference to such Form 10-K.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         At March 31, 2000, the Company had no material market risk exposure
(e.g., interest rate risk, foreign currency exchange rate risk or commodity
price risk).






                                      - 8 -



<PAGE>   11

Part  II - OTHER INFORMATION


Item   2.   Changes in Securities and Use of Proceeds

(a)      Not applicable.

(b)      Not applicable.

(c)      Not applicable.

(d)      The net proceeds to the Company from its initial public offering, after
         deducting underwriting discounts of $3,606,400 and other expenses of
         approximately $941,000, were approximately $46,972,000. From September
         24, 1997 (the effective date of the Company's Form S-1 Registration
         Statement; SEC Reg. No. 333-22519) through March 31, 2000, the Company
         used the net proceeds from the offering as follows:

         (i) Approximately $1.6 million was used to pay compensation expenses
         related to the termination of the Company's phantom stock plan.

         (ii) Approximately $7.2 million was used to pay the entire principal
         and accrued interest on the mortgage note and an unsecured note, both
         related to the construction of the Company's facility in Wisconsin
         Rapids, Wisconsin.

         (iii) Approximately $5.1 million was used to pay the entire principal
         and accrued interest on notes from the Company's principal shareholders
         related to the 1996 acquisition of IPS Publishing, Inc.

         (iv) Approximately $10.9 million was used to pay distributions of S
         corporation retained profits to S corporation shareholders.

         (v) Approximately $7.4 million was used to invest in Athena Holdings
         LLC, a limited liability company formed for the purpose of constructing
         the Company's facility in Madison, Wisconsin.

         (vi) Approximately $2.4 million was used for pilot operations in
         various markets and miscellaneous acquisitions.

         (vii) Approximately $4.0 million was used for capital expenditures for
         expansion of operations.

The Company has broad discretion with respect to the use of the remaining
proceeds.



                                      - 9 -

<PAGE>   12


Item   6.   Exhibits and Reports on Form 8-K


(a) Exhibits.

  Exhibit No.     Description
  -----------     -----------
      3.1         Amended and Restated By-laws of Advantage Learning
                  Systems, Inc., as amended.

     10.1         First Amendment to Credit Agreement dated as of December 31,
                  1997 by and between Norwest Bank Wisconsin, National
                  Association and Advantage Learning Systems, Inc.

     10.2         Second Amendment to Credit Agreement dated as of December 31,
                  1997 by and between Norwest Bank Wisconsin, National
                  Association and Advantage Learning Systems, Inc.

     27.1         Financial Data Schedule

Pursuant to Regulation S-K, Item 601 (b) (4) (iii), the Registrant hereby agrees
to furnish to the Securities and Exchange Commission, upon request, a copy of
each instrument and agreement with respect to long-term debt of the Registrant
and its consolidated subsidiaries which does not exceed ten percent of the total
assets of the Registrant and its subsidiaries on a consolidated basis.


(b) The Company filed no reports on Form 8-K during the quarter covered by this
report.

                                     - 10 -

<PAGE>   13




                                   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.


                        ADVANTAGE LEARNING SYSTEMS, INC.
                        (Registrant)



  May 12, 2000          /s/ Michael H. Baum
 -------------          ------------------------------
     Date               Michael H. Baum
                        Chief Executive Officer
                        (Principal Executive Officer)


  May 12, 2000          /s/ Steven A. Schmidt
  ------------          ------------------------------
     Date               Steven A. Schmidt
                        Secretary, Vice President, and Chief Financial Officer
                        (Principal Financial and Accounting Officer)



<PAGE>   14

                                Index to Exhibits


   Exhibit No.    Description
   -----------    -----------
     3.1          Amended and Restated By-laws of Advantage Learning Systems,
                  Inc., as amended.

    10.1          First Amendment to Credit Agreement dated as of December 31,
                  1997 by and between Norwest Bank Wisconsin, National
                  Association and Advantage Learning Systems, Inc.

    10.2          Second Amendment to Credit Agreement dated as of December 31,
                  1997 by and between Norwest Bank Wisconsin, National
                  Association and Advantage Learning Systems, Inc.

    27.1          Financial Data Schedule