<Page>

                                  United States
                       Securities and Exchange Commission
                             Washington, D.C. 20549


                                    FORM 10-Q

(Mark One)

[X]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934
               For the Quarterly Period Ended October 31, 2001 or

[ ]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934

            For the Transition Period From __________ to __________


                         Commission file number 0-22532


                           ULTIMATE ELECTRONICS, INC.
             (Exact name of registrant as specified in its charter)


                 DELAWARE                              84-0585211
     (State or other jurisdiction of                (I.R.S. employer
           identification no.)               incorporation or organization)


             321 WEST 84TH AVENUE, SUITE A, THORNTON, COLORADO 80260
               (Address of principal executive offices, zip code)

                                 (303) 412-2500
              (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 / /

The number of outstanding shares of common stock as of December 12, 2001 was
11,111,567.

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                           ULTIMATE ELECTRONICS, INC.

                                    FORM 10-Q

                                      INDEX

<Table>
<Caption>
                                                                              Page No.
<S>                                                                           <C>
PART I.   FINANCIAL INFORMATION

Item 1.   Financial Statements:

          Condensed Consolidated Balance Sheets as of October 31, 2001
          (unaudited) and January 31, 2001....................................   3

          Consolidated Statements of Operations for the three and nine months
          ended October 31, 2001 and 2000 (unaudited).........................   4

          Condensed Consolidated Statements of Cash Flows for the nine months
          ended October 31, 2001 and 2000 (unaudited).........................   5

          Notes to Condensed Consolidated Financial Statements (unaudited)....   6

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

Item 3.   Quantitative and Qualitative Disclosures About Market Risk..........  11

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings...................................................  11

Item 2.   Changes in Securities...............................................  11

Item 3.   Defaults Upon Senior Securities.....................................  12

Item 4.   Submission of Matters to a Vote of Security Holders.................  12

Item 5.   Other Information...................................................  12

Item 6.   Exhibits and Reports on Form 8-K....................................  12

</Table>

                                       2
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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                           ULTIMATE ELECTRONICS, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
             (amounts in thousands, except share and per share data)

<Table>
<Caption>
                                                            October 31,      January 31,
                                                               2001              2001
                                                            -----------      -----------
                                                            (Unaudited)
<S>                                                         <C>              <C>
ASSETS:
Current assets:
   Cash and cash equivalents                                 $  2,209         $  2,954
   Accounts receivable, net                                    31,429           28,499
   Merchandise inventories, net                                89,259           67,567
   Property held for sale                                          --            4,494
   Other assets                                                 2,660            1,857
                                                             --------         --------
      Total current assets                                    125,557          105,371
Property and equipment, net                                    98,793           64,972
Other assets                                                    3,462            3,677
                                                             --------         --------
      Total assets                                           $227,812         $174,020
                                                             ========         ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
   Accounts payable                                          $ 49,222         $ 29,677
   Accrued liabilities                                         23,316           23,696
   Revolving line of credit                                        --            7,304
   Deferred revenue                                             1,750            2,248
   Other current liabilities                                      110              120
                                                             --------         --------
      Total current liabilities                                74,398           63,045
Revolving line of credit                                       37,277               --
Deferred revenue, less current portion                          1,612            2,863
Capital lease obligations, including related parties            1,575            1,659
Other long term liabilities                                       483              483
                                                             --------         --------
     Total long term liabilities                               40,947            5,005
Commitments
Stockholders' equity:
   Preferred stock, par value $.01 per share
      Authorized shares - 10,000,000
      No shares issued and outstanding                             --               --
   Common stock, par value $.01 per share
      Authorized shares - 40,000,000
      Issued and outstanding shares: 11,066,002
      and 10,938,331 at October 31, 2001 and
      January 31, 2001                                            110              109
   Additional paid-in capital                                  74,610           73,290
   Retained earnings                                           37,747           32,571
                                                             --------         --------
      Total stockholders' equity                              112,467          105,970
                                                             --------         --------
      Total liabilities and stockholders' equity             $227,812         $174,020
                                                             ========         ========
</Table>

See accompanying notes to Condensed Consolidated Financial Statements.

                                       3
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                           ULTIMATE ELECTRONICS, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                  (amounts in thousands, except per share data)
<Table>
<Caption>
                                                                 Three Months Ended                  Nine Months Ended
                                                                     October 31,                        October 31,
                                                               -------------------------         -------------------------
                                                                 2001            2000              2001             2000
                                                               --------         --------         --------         --------
<S>                                                            <C>              <C>              <C>              <C>
Sales                                                          $132,803         $117,207         $365,542         $314,191
Cost of goods sold                                               90,565           79,473          249,285          213,687
                                                               --------         --------         --------         --------

Gross profit                                                     42,238           37,734          116,257          100,504
Selling, general and administrative expenses                     39,443           32,285          107,688           88,547
                                                               --------         --------         --------         --------
Income from operations                                            2,795            5,449            8,569           11,957
Interest expense, net                                                63               29              152               75
                                                               --------         --------         --------         --------
Income before taxes and extraordinary item                        2,732            5,420            8,417           11,882
Income tax expense                                                1,052            2,033            3,241            4,431
                                                               --------         --------         --------         --------
Income before extraordinary item                                  1,680            3,387            5,176            7,451
Extraordinary loss on early extinguishment
of debt, net of taxes                                                --               --               --              254
                                                               --------         --------         --------         --------
Net income                                                     $  1,680         $  3,387         $  5,176         $  7,197
                                                               ========         ========         ========         ========

Earnings per share before extraordinary item - basic           $    .15         $    .31         $    .47         $    .69
Earnings per share before extraordinary item - diluted         $    .15         $    .30         $    .45         $    .65
Earnings per share - basic                                     $    .15         $    .31         $    .47         $    .67
Earnings per share - diluted                                   $    .15         $    .30         $    .45         $    .63
Weighted average shares outstanding - basic                      11,059           10,804           11,005           10,757
Weighted average shares outstanding - diluted                    11,479           11,455           11,468           11,390

</Table>

See accompanying notes to Condensed Consolidated Financial Statements.

                                       4
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                           ULTIMATE ELECTRONICS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                             (amounts in thousands)

<Table>
<Caption>
                                                                            Nine Months Ended
                                                                               October 31,
                                                                       --------------------------
                                                                         2001              2000
                                                                       --------          --------
<S>                                                                    <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities                    $  4,644          $ (8,677)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of investments available for sale                         --            12,003
Purchases of property and equipment, net                                (36,589)          (18,089)
                                                                       --------          --------
Net cash used in investing activities                                   (36,589)           (6,086)

CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term bonds payable                                --           (11,700)
Net borrowings under revolving credit agreement                          29,973            13,716
Principal payments on term loans and capital lease obligations              (94)             (309)
Proceeds from exercise of stock options                                   1,321               473
                                                                       --------          --------
Net cash provided by financing activities                                31,200             2,180
                                                                       --------          --------
Net decrease in cash and cash equivalents                                  (745)          (12,583)

Cash and cash equivalents at beginning of period                          2,954            17,311
                                                                       --------          --------
Cash and cash equivalents at end of period                             $  2,209          $  4,728
                                                                       ========          ========
</Table>

See accompanying notes to Condensed Consolidated Financial Statements.

                                       5
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                           ULTIMATE ELECTRONICS, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

                                OCTOBER 31, 2001


1.   SIGNIFICANT ACCOUNTING POLICIES

     BACKGROUND

     Ultimate Electronics, Inc. is a leading specialty retailer of consumer
     electronics and home entertainment products located in the Rocky Mountain,
     Midwest and Southwest regions of the United States. The Company currently
     operates forty-six stores, including twenty-seven stores in Arizona, Idaho,
     Iowa, Missouri, Nevada, New Mexico, Oklahoma, South Dakota and Utah under
     the trade name Ultimate Electronics, eleven stores in Colorado under the
     trade name SoundTrack and eight stores in Minnesota under the trade name
     Audio King.

     The Company's unaudited condensed consolidated financial statements have
     been prepared by the Company in accordance with accounting principles
     generally accepted in the United States for interim financial reporting and
     the regulations of the Securities and Exchange Commission for quarterly
     reporting. Accordingly, they do not include all information and footnotes
     required by accounting principles generally accepted in the United States
     for complete financial statements. In the opinion of the Company, the
     statements include all adjustments, consisting only of normal recurring
     adjustments that are necessary for a fair presentation of the financial
     position, results of operations and cash flows for the interim periods.
     Operating results for the three and nine month periods ended October 31,
     2001 are not necessarily indicative of the results that may be expected for
     the year ending January 31, 2002. Seasonal fluctuations in sales of the
     Company's products result primarily from the purchasing patterns of
     individual consumers during the holiday selling season. These patterns tend
     to moderately concentrate sales in the latter half of the year,
     particularly in the fourth quarter. For further information, refer to the
     financial statements and accompanying footnotes included in the Company's
     Annual Report on Form 10-K for the year ended January 31, 2001 and other
     filings with the Securities and Exchange Commission.

     PRINCIPLES OF CONSOLIDATION

     The unaudited condensed consolidated financial statements include the
     accounts of all subsidiaries. All intercompany accounts and transactions
     have been eliminated upon consolidation.

     REVOLVING LINE OF CREDIT AGREEMENT

     On September 28, 2001, the Company entered into a three-year $50 million
     credit agreement with Wells Fargo Retail Finance, LLC. On December 12, 2001
     the Company amended the agreement to increase the credit limit to $80
     million. The agreement replaced the Company's previous $40 million line of
     credit agreement with Foothill Capital Corporation, a wholly owned
     subsidiary of Wells Fargo Bank. Borrowings under this revolving line of
     credit are limited to the lesser of $80 million or 70% of eligible
     inventory plus the lesser of 70% of eligible accounts receivable and
     $2,500,000. Borrowings under this credit facility were $37.3 million as of
     October 31, 2001. Borrowings bear interest, payable monthly, based on a
     blend of LIBOR plus 1.75% to 2.25% and Wells Fargo Bank's prime rate minus
     0.375%. Inventories, accounts receivable, equipment and intangibles secure
     the borrowings.

                                       6
<Page>

     NEW STORE OPENINGS

     On October 31, 2001 the Company opened its eighth Phoenix, Arizona
     metropolitan area store. On November 14, 2001 the Company entered the St.
     Louis, Missouri market with two new stores and opened two additional new
     stores in that market on December 5, 2001.

     RELATED PARTY/SALE-LEASEBACK TRANSACTION

     During 2000 the Company purchased land and constructed a building for a new
     store located in Colorado Springs, Colorado. The store opened in November
     2000. In February 2001, the Company entered into a sale-leaseback
     arrangement with Pearse Investment Company, LLLP, an entity controlled by
     two principle stockholders of the Company, William J. and Barbara A.
     Pearse. There was no gain or loss recognized as a result of the sale.

     COMMON STOCK ISSUANCES

     The Company issued 127,671 shares of common stock during the nine months
     ended October 31, 2001, of which 76,769 were issued upon exercise of
     options granted under its Stock Option Plan and 50,902 were issued through
     its Employee Stock Purchase Plan.

     RECENTLY ISSUED ACCOUNTING STANDARDS

     In July 2001, the Financial Accounting Standards Board issued Statement No.
     141, BUSINESS COMBINATIONS ("SFAS 141") and Statement No. 142, GOODWILL AND
     OTHER INTANGIBLE ASSETS ("SFAS 142"). SFAS 141 requires companies to
     reflect intangible assets apart from goodwill and supercedes previous
     guidance related to business combinations. SFAS 142 eliminates amortization
     of goodwill and amortization of indefinite-lived intangible assets.
     However, SFAS 142 also requires the Company to perform impairment tests at
     least annually on all goodwill and other intangible assets. These
     statements are required to be adopted by the Company on February 1, 2002
     and for any acquisitions entered into after July 1, 2001. The Company is
     currently evaluating the impact upon adoption of these statements on its
     financial position, results of operations and cash flows.

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

     This quarterly report on Form 10-Q contains statements that are not
     historical facts but are forward-looking statements within the meaning of
     Section 27A of the Securities Act of 1933, as amended, and Section 21E of
     the Securities Act of 1934, as amended. Forward-looking statements are made
     based upon management's current expectations and beliefs concerning future
     developments and their potential effects upon the Company. Such statements
     involve risks and uncertainties and there can be no assurance that future
     developments affecting the Company will be those anticipated by management.
     Actual results may differ materially from those included in the
     forward-looking statements. Forward-looking statements address activities,
     events, or developments that the Company expects, believes, projects,
     intends or anticipates will or may occur, including such matters as the
     anticipated costs of new store openings, expansions and relocations of
     existing stores, and its ability to obtain additional financing to fund its
     operations, debt repayment and expansion. Factors that could cause actual
     results to differ materially from the Company's projections, forecasts,
     estimates and expectations include, but are not limited to: risks related
     to the Company's ability to open and operate new stores; the Company's
     ability to profitably relocate and/or expand existing stores; the
     willingness of vendors to permit product sales over the internet;
     significant competition, including new competition from internet retailers;
     seasonal fluctuations in the Company's business; changes in trade
     regulations and currency fluctuations; risks regarding increases in
     promotional activities of competitors; the presence or absence of new
     products or product features in the Company's merchandise categories;
     changes in the distribution strategy of the Company's vendors; changes in
     vendor support for advertising and promotional programs; changes in the
     Company's

                                       7
<Page>

     merchandise sales mix; the results of financing efforts; fluctuations in
     consumer demand and preferences; terrorism and acts of war; budgets and
     plans; earnings per share projections and general economic conditions.
     Please refer to a discussion of these and other factors in the Company's
     Annual Report on Form 10-K for the year ended January 31, 2001 and other
     filings with the Securities and Exchange Commission. The Company disclaims
     any intent or obligation to update publicly these forward-looking
     statements, whether as a result of new information, future events or
     otherwise.

     RESULTS OF OPERATIONS

     Sales for the three months ended October 31, 2001 increased 13% to $132.8
     million from $117.2 million for the three months ended October 31, 2000.
     Sales for the nine months ended October 31, 2001 were $365.5 million, an
     increase of 16% from sales of $314.2 million for the nine months ended
     October 31, 2000. The increase in sales was substantially the result of new
     store openings. Sales of comparable stores were down 6% and 4%,
     respectively, for the three and nine months ended October 31, 2001.

     Gross profit for the three months ended October 31, 2001 increased 12% to
     $42.2 million (31.8% of sales) from $37.7 million (32.2% of sales) for the
     three months ended October 31, 2000. Gross profit for the nine months ended
     October 31, 2001 increased 16% to $116.3 million (31.8% of sales) compared
     to $100.5 million (32.0% of sales) for the nine months ended October 31,
     2000. Gross profit for the quarter was impacted by the continued shift in
     mix towards television and DVD and away from the home and mobile audio
     product categories.

     Selling, general and administrative expenses for the three months ended
     October 31, 2001 were $39.4 million (29.7% of sales) compared to $32.3
     million (27.5% of sales) for the three months ended October 31, 2000.
     Selling, general and administrative expenses for the nine months ended
     October 31, 2001 were $107.7 million (29.5% of sales) compared to $88.5
     million (28.2% of sales) for the nine months ended October 31, 2000. The
     increase in selling, general and administrative expenses as a percentage of
     sales was directly related to infrastructure additions to facilitate the
     store expansion this year and next, higher preopening expenses due to more
     store openings this year compared to last year as well as lower comparable
     store sales.

     The Company recorded income from operations of $2.8 million (2.1% of sales)
     for the three months ended October 31, 2001 compared to income from
     operations of $5.4 million (4.7% of sales) for the three months ended
     October 31, 2000. Income from operations was $8.6 million (2.3% of sales)
     for the nine months ended October 31, 2001 compared to $12.0 million (3.8%
     of sales) for the nine months ended October 31, 2000.

     Net interest expense was $63,000 and $152,000, respectively, for the three
     and nine months ended October 31, 2001 compared to $29,000 and $75,000,
     respectively, for the three and nine months ended October 31, 2000.

     Extraordinary loss on early extinguishment of debt of $254,000 (net of
     taxes) for the nine months ended October 31, 2000 relates to the repayment,
     in full, of the Company's 10.25% bonds on March 31, 2000.

     LIQUIDITY AND CAPITAL RESOURCES

     Historically, the Company's primary sources of liquidity for funding
     expansion and growth have been net cash from operations, revolving credit
     lines, term debt and issuances of common stock. The Company's primary cash
     requirements are related to expenditures for new store openings and the
     relocation and/or remodeling of existing store locations. These
     expenditures include preopening expenses and additional inventory for new
     or relocated stores, as well as working capital to support the Company's
     inventory

                                       8
<Page>

     requirements and selling, general and administrative expenses. The Company
     currently operates a total of forty-six stores in eleven states.

     Net cash provided by operating activities was $4.6 million for the nine
     months ended October 31, 2001 compared to net cash used in operating
     activities of $8.7 million for the nine months ended October 31, 2000. This
     increase was primarily due to higher accounts payable balances partially
     offset by higher inventory balances in the current year.

     Net cash used in investing activities was $36.6 million for the nine months
     ended October 31, 2001 compared to net cash used in investing activities of
     $6.1 million for the nine months ended October 31, 2000. The Company had
     capital expenditures of $41.1 million during the nine months ended October
     31, 2001 primarily related to new store openings, the installation of
     warehouse management software, the reconfiguration of the Company's
     warehouse distribution center and upgrades to the Company's information
     systems. In February, 2001 the Company received $4.5 million in proceeds
     from a sale-leaseback arrangement on a new store in Colorado Springs,
     Colorado. In October, 2001 the Company increased the size of its main
     distribution center in Thornton, Colorado by 50,000 square feet with the
     ability to further increase the warehouse by another 100,000 square feet at
     a future date. For the nine months ended October 31, 2000 the Company had
     capital expenditures of $18.1 million for new store openings and the
     relocation and expansion of an existing store location. The Company also
     received $12.0 in proceeds from the sale of an investment available for
     sale, which matured on March 29, 2000.

     Net cash provided by financing activities was $31.2 million for the nine
     months ended October 31, 2001 compared to net cash provided by financing
     activities of $2.2 million for the nine months ended October 31, 2000. Net
     cash provided by financing activities for the current year related
     primarily to net borrowings on the Company's revolving line of credit. Net
     cash provided by financing activities for the prior year was primarily the
     result of borrowings on the Company's revolving line of credit partially
     offset by repayment, in full, of the Company's 10.25% bonds on March 31,
     2000.

     The Company intends to continue to expand into select metropolitan areas in
     the Rocky Mountain, Midwest and Southwest regions with 30,000 to 34,000
     square foot stores. In certain smaller markets, the store size may be as
     small as 22,000 square feet. With the exception of the Thornton, Colorado
     facility, all current stores are leased. The Company opened its eighth
     Phoenix, Arizona metropolitan area store on October 31, 2001. The Company
     entered the St. Louis, Missouri market on November 14, 2001 with two new
     stores and opened two additional new stores in that market on December 5,
     2001. The Company expects to open two additional new stores in the St.
     Louis, Missouri market in the summer of 2002. On June 7, 2001 the Company
     announced plans to open thirteen new stores over the next two years in the
     Dallas/Ft. Worth, Texas area. Six of these stores are planned to be open by
     late summer of 2002 with an additional two to four stores by November 2002.

     The Company continues to analyze new store opportunities in existing
     markets to replace or expand some of its smaller locations. With the
     addition of a new warehouse and install facility, the Company's Fort
     Collins, Colorado store was expanded from 16,600 to 24,000 square feet in
     October, 2001. The Company also expanded its Rochester, Minnesota store
     from 3,900 to 5,600 square feet in November, 2001 and is analyzing
     additional opportunities in the Minneapolis/St. Paul area to relocate
     and/or expand a number of those locations. This process is expected to be
     ongoing over the next few years.

     The cost of these future stores is anticipated to average $3.3 million per
     store. Leasehold improvements, fixtures and equipment are expected to
     average $2.2 million, depending on tenant allowances. The inventory
     requirement for the Company's new stores is expected to average
     approximately $1.5 million, approximately $750,000 of which will be
     financed through trade credit. Preopening expenses for new stores are
     expected to average $350,000, and include such items as advertising prior
     to opening, recruitment and training of new employees and other costs
     associated with opening stores. In the event of

                                       9
<Page>

     relocations of existing stores, preopening costs are expected to average
     $150,000 and will be higher if the Company is required to terminate
     existing store leases prior to their maturity.

     The Company's expansion strategy focuses on identification of attractive
     metropolitan areas in the Rocky Mountain, Midwest and Southwest regions
     based on an evaluation of local market opportunities, as well as the size,
     strength and merchandising philosophy of potential competitors. The Company
     obtains demographic analyses of major metropolitan areas to determine new
     store locations and potential sales volumes, as well as the optimum number
     of stores to open in a specific market. The Company's specific location
     strategy focuses on power centers or freestanding locations near shopping
     malls. In choosing sites within a market, the Company applies standard site
     selection criteria that take into account numerous factors including local
     demographics, traffic patterns, highway visibility and overall retail
     activity.

     On September 28, 2001, the Company entered into a three-year $50 million
     credit agreement with Wells Fargo Retail Finance, LLC. On December 12, 2001
     the Company amended the agreement to increase the credit limit to $80
     million. The agreement replaced the Company's previous $40 million line of
     credit agreement with Foothill Capital Corporation, a wholly owned
     subsidiary of Wells Fargo Bank. Borrowings under this revolving line of
     credit are limited to the lesser of $80 million or 70% of eligible
     inventory plus the lesser of 70% of eligible accounts receivable and
     $2,500,000. Borrowings under this credit facility were $37.3 million as of
     October 31, 2001. Borrowings bear interest, payable monthly, based on a
     blend of LIBOR plus 1.75% to 2.25% and Wells Fargo Bank's prime rate minus
     0.375%. Inventories, accounts receivable, equipment and intangibles secure
     the borrowings. The facility includes negative covenants that limit the
     Company's ability to, without the bank's prior approval, and subject to
     various exceptions, incur indebtedness, create liens, enter into mergers
     and consolidations, pay dividends, repurchase the Company's capital stock,
     issue guarantees, sell assets or engage in transactions with affiliates.
     The facility also contains covenants regulating the Company's gross
     margins, inventory levels, tangible net worth and capital expenditures. The
     Company was in compliance with all borrowing covenants as of October 31,
     2001.

     On March 23, 1995, the Company completed an offering for the sale of
     $13,000,000 aggregate principal amount of bonds payable (the "Bonds"). The
     Bonds were redeemable by the Company at par any time at or after March 31,
     2000. On March 31, 2000, the Company paid $13,111,000 to redeem the Bonds
     in full. The Bonds were redeemed at a redemption price of 100% of the
     principal amount and all accrued and unpaid interest as of such date, which
     totaled $111,000. As a result of the redemption of the Bonds, the Company
     recognized an extraordinary loss of $254,000 (net of taxes).

     The Company believes that its cash flows from operations and borrowings
     under its credit facility will be sufficient to fund the Company's
     operations, debt repayment and expansion through fiscal 2002. To fund the
     capital requirements for its anticipated expansion plans beyond fiscal
     2002, the Company may be required to seek additional financing, which may
     take the form of expansion of its existing credit facility, or possibly
     additional debt or equity financings. The Company may also re-mortgage its
     Thornton facility. There can be no assurance that the Company will be able
     to obtain such funds on favorable terms, if at all.

     SEASONALITY

     The Company's business is affected by seasonal consumer buying patterns. As
     is the case with many other retailers, the Company's sales and profits are
     greatest in the fourth quarter (which includes the holiday selling season).
     Due to the importance of the holiday selling season, any factors negatively
     impacting the holiday selling season could have a material adverse impact
     on the Company's financial condition and results of operations. Operating
     results are dependent on a number of factors, including discretionary
     consumer spending, which is affected by local, regional and national
     economic conditions affecting disposable consumer income, such as
     employment, business conditions, interest rates and

                                       10
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     taxation. The Company's quarterly results of operations may fluctuate
     significantly as a result of a number of factors, including:

     -    the timing of new or relocated and expanded store openings;

     -    expenses related to relocation and expansion;

     -    unexpected changes in volume related rebates from manufacturers;

     -    the success of new stores; and

     -    the impact of new stores on existing stores.

     As the Company has opened additional stores or relocated and expanded
     stores within markets it already serves, sales at existing stores have been
     adversely affected. Such adverse effects may occur in the future. The
     Company's quarterly operating results also may be affected by increases in
     merchandise costs, price changes in response to competitive factors, new
     and increased competition and product availability.

     IMPACT OF INFLATION

     The Company believes, because of competition among manufacturers and the
     technological changes in the consumer electronics industry, inflation has
     not had a significant effect on results of operations during the last few
     years.

ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

     The following discusses the Company's exposure to market risks related to
     changes in interest rates and other general market risks. All of the
     Company's investment and financing decisions are supervised or managed by
     its executive committee.

     CASH AND CASH EQUIVALENTS. As of October 31, 2001, the Company had $2.2
     million in non-restricted cash and cash equivalents held in various
     non-interest bearing accounts. Management considers all highly liquid
     investments purchased with an original maturity of three months or less to
     be cash equivalents.

     OUTSTANDING DEBT OF THE COMPANY. The Company had a $50 million revolving
     line of credit on October 31, 2001. Borrowings under the line of credit
     bear interest, payable monthly, based on a blend of LIBOR plus 1.75% to
     2.25% and Wells Fargo Bank's prime rate minus 0.375%. Borrowings under this
     credit facility were $37.3 million as of October 31, 2001. Increases in
     interest rates could increase interest expense associated with future
     borrowings by the Company, if any. The Company has not hedged against
     interest rate changes.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

     From time to time, the Company is a party to certain legal proceedings
     arising in the ordinary course of its business. Management believes that
     any resulting liability, individually or in the aggregate, will either be
     covered by insurance or will not have a material adverse effect on the
     Company's financial condition.

ITEM 2. CHANGES IN SECURITIES.

     None

                                       11
<Page>

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

     None

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

     None

ITEM 5. OTHER INFORMATION.

     On September 28, 2001, the Company entered into a three-year $50 million
     credit agreement with Wells Fargo Retail Finance, LLC. On December 7, 2001
     the Company amended the agreement to increase the credit limit to $80
     million. The agreement replaced the Company's previous $40 million line of
     credit agreement with Foothill Capital Corporation, a wholly owned
     subsidiary of Wells Fargo Bank. Borrowings under this revolving line of
     credit are limited to the lesser of $80 million or 70% of eligible
     inventory plus the lesser of 70% of eligible accounts receivable and
     $2,500,000. Borrowings under this credit facility were $37.3 million as of
     October 31, 2001. Borrowings bear interest, payable monthly, based on a
     blend of LIBOR plus 1.75% to 2.25% and Wells Fargo Bank's prime rate minus
     0.375%. Inventories, accounts receivable, equipment and intangibles secure
     the borrowings.

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

     (a)  Exhibits:

          Documents filed with this report:

          10.1 Second Amended and Restated Loan and Security Agreement by and
               among Ultimate Electronics, Inc. and Wells Fargo Retail Finance,
               LLC dated September 28, 2001. The exhibits and schedules to the
               Agreement, which are listed in the Agreement, are omitted.
               Ultimate Electronics agrees to supplementally furnish to the
               Commission a copy of any such exhibit or schedule upon request.

          10.2 First Amendment to Second Amended and Restated Loan and Security
               Agreement dated December 12, 2001.

     (b)  Reports on Form 8-K:

          None


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<Page>

                                   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.


                                        Ultimate Electronics, Inc.




Date: December 13, 2001                 By: /s/ Alan E. Kessock
                                            ------------------------------------
                                            Alan E. Kessock
                                            Senior Vice President, Chief
                                            Financial Officer, Secretary and a
                                            Director (Principal Financial
                                            and Accounting Officer)





                                       13

<Page>

                                  EXHIBIT INDEX

<Table>
<Caption>
NUMBER    DESCRIPTION OF EXHIBITS
------    -----------------------
<S>       <C>
10.1      Second Amended and Restated Loan and Security Agreement by and among
          Ultimate Electronics, Inc. and Wells Fargo Retail Finance, LLC dated
          September 28, 2001.

10.2      First Amendment to Second Amended and Restated Loan and Security
          Agreement dated December 12, 2001.

</Table>


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