| **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****March                31, 2007**                                                          |
|  **OR**                                                                                                                                |
|                                                                                                                                        |
| **o                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****1-13550**                                                                                        |
|                                                                                                                                        |
| **HAUPPAUGE                DIGITAL, INC****.**                                                                                              |
| **(Exact                name of registrant as specified in its                charter)**                                                    |

|  **Delaware **                           |   |  **11-3227864**                         |
|----------------------------------------------------|--------|----------------------------------------------|
| **(State                or other jurisdiction of** |   |  (**I.R.S.                Employer**    |
| **incorporation                or organization)**  |   |  **Identification                No.)** |

| **91                Cabot Court, Hauppauge, New York 11788**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(Address                of principal executive offices)**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| **(631)                434-1600**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| **(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.                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| **x                YES o NO**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Indicate                by check mark whether the registrant is a large accelerated filer,                an                accelerated filer or a non-accelerated filer (See definition of                “accelerated filer and large accelerated filer’ in Rule 12b-2 of the                Exchange Act). **x                LARGE ACCELERATED                FILER o                ACCELERATED FILER x NON-ACCELERATED                FILER** Indicate                by check mark whether the registrant is a shell company (as defined                in                Rule12b-2 of the Exchange act). **o                YES x NO** |
|  ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| As                of April 30, 2007, 9,958,766 shares of .01 par value Common Stock                of the                issuer were outstanding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

----

**HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**INDEX**

|                                                                                                                                                                                                        |   | **Page                no.** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|
| **PART              I. FINANCIAL INFORMATION**                                                                                                                                                              |   |                        |
|                                                                                                                                                                                                        |   |                        |
| **Item              1. Financial Statements**                                                                                                                                                               |   |                        |
|                                                                                                                                                                                                        |   |                        |
| **Condensed                Consolidated Balance Sheets -****March                31, 2007 (unaudited) and September 30, 2006**                                                                              |   | **3**                       |
|                                                                                                                                                                                                        |   |                        |
| **Condensed                Consolidated Statements of Income -****Three                Months ended March 31, 2007 (unaudited) and 2006                (unaudited)**                                        |   | **4**                       |
|                                                                                                                                                                                                        |   |                        |
| **Condensed                Consolidated Statements of Income -****Six                Months ended March 31, 2007 (unaudited) and 2006                (unaudited)**                                          |   | **5**                       |
|                                                                                                                                                                                                        |   |                        |
| **Condensed                Consolidated Statements of Other Comprehensive Income -Three and                six                months ended March 31, 2007 (unaudited) and 2006                (unaudited)** |   | **6**                       |
|                                                                                                                                                                                                        |   |                        |
| **Condensed                Consolidated Statements of Cash Flows-Six months ended March 31,                2007                (unaudited) and 2006 (unaudited)**                                           |   | **7**                       |
|                                                                                                                                                                                                        |   |                        |
| **Notes                to Condensed Consolidated Financial Statements**                                                                                                                                     |   | **8 -12**              |
|                                                                                                                                                                                                        |   |                        |
| **Item                2. Management's Discussion and Analysis of Financial Condition and                Results                of Operations**                                                              |   | **13 -19**             |
|                                                                                                                                                                                                        |   |                        |
| **Item                3. Quantitative and Qualitative Disclosures about Market                Risk**                                                                                                        |   | **20**                      |
|                                                                                                                                                                                                        |   |                        |
| **Item                4. Controls and Procedures**                                                                                                                                                          |   | **21**                      |
|                                                                                                                                                                                                        |   |                        |
| **PART                II. OTHER INFORMATION**                                                                                                                                                               |   |                        |
|                                                                                                                                                                                                        |   |                        |
| **Item                1A. Risk Factors**                                                                                                                                                                    |   | **22**                      |
|                                                                                                                                                                                                        |   |                        |
| **Item                2.****Unregistered                Sales of Equity Securities and Use of Proceeds**                                                                                                    |   | **22**                      |
|                                                                                                                                                                                                        |   |                        |
| **Item                6. Exhibits**                                                                                                                                                                         |   | **22**                      |
|                                                                                                                                                                                                        |   |                        |
| **Signatures**                                                                                                                                                                                              |   | **23**                      |

----

**PART      I. FINANCIAL INFORMATION**

**Item      1.Financial Statements**

| **HAUPPAUGE                DIGITAL, INC. AND SUBSIDIARIES**             |
|-------------------------------------------------------------------------|
| **CONDENSED                CONSOLIDATED BALANCE                SHEETS** |

|                                                                                                                                        |   | **March                31, 2007 (unaudited)** |           | **September                30, 2006** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|----------------|---------------------------------------|--------|
| **Assets:**                                                                                                                                 |   |                                          |                |                                  |   |   |   |
| **Current              Assets:**                                                                                                            |   |                                          |           |                                  |   |   |   |
| **Cash                and cash equivalents**                                                                                                |   | **$**                                         | **10,090,574** |                                  | **$**  | **9,020,941** |   |
| **Receivables,                net of various allowances**                                                                                   |   |                                          | **28,636,149** |                                  |   | **16,132,928** |   |
| **Inventories**                                                                                                                             |   |                                          | **11,992,208** |                                  |   | **9,905,746** |   |
| **Prepaid                expenses and other current assets**                                                                                |   |                                          | **1,009,171**  |                                  |   | **895,223** |   |
| **Total                current assets**                                                                                                     |   |                                          | **51,728,102** |                                  |   | **35,954,838** |   |
|                                                                                                                                        |   |                                          |           |                                  |   |   |   |
| **Property,                plant and equipment, net**                                                                                       |   |                                          | **694,438**    |                                  |   | **612,311** |   |
| **Security                deposits and other non current assets**                                                                           |   |                                          | **83,428**     |                                  |   | **83,239** |   |
| **Total                assets**                                                                                                             |   | **$**                                         | **52,505,968** |                                  | **$**  | **36,650,388** |   |
|                                                                                                                                        |   |                                          |                |                                  |   |  |   |
|                                                                                                                                        |   |                                          |                |                                  |   |  |   |
| **Liabilities                and Stockholders’ Equity:**                                                                              |   |                                          |                |                                  |   |  |   |
|                                                                                                                                        |   |                                          |                |                                  |   |  |   |
| **Current                Liabilities:**                                                                                                     |   |                                          |                |                                  |   |  |   |
| **Accounts                payable**                                                                                                         |   | **$**                                         | **22,071,671** |                                  | **$**  | **12,011,232** |   |
| **Accrued                expenses - fees**                                                                                                  |   |                                          | **7,691,641**  |                                  |   | **5,481,005** |   |
| **Accrued                expenses - other**                                                                                                 |   |                                          | **1,010,811**  |                                  |   | **1,174,323** |   |
| **Income                taxes payable**                                                                                                     |   |                                          | **220,660**    |                                  |   | **204,103** |   |
| **Total                current liabilities**                                                                                                |   |                                          | **30,994,783** |                                  |   | **18,870,663** |   |
|                                                                                                                                        |   |                                          |                |                                  |   |  |   |
| **Stockholders'                Equity:**                                                                                                    |   |                                          |                |                                  |   |  |   |
| **Common                stock $.01 par value; 25,000,000 shares authorized, 10,559,053 and                10,260,464 issued, respectively** |   |                                          | **105,591**    |                                  |   | **102,605** |   |
| **Additional                paid-in capital**                                                                                               |   |                                          | **15,112,939** |                                  |   | **14,222,890** |   |
| **Retained                earnings**                                                                                                        |   |                                          | **9,201,169**  |                                  |   | **5,721,500** |   |
| **Accumulated                other comprehensive (loss)**                                                                                   |   |                                          | **(1,150,563** | **)**                                 |   | **(509,319** | **)** |
| **Treasury                Stock, at cost, 607,547 shares**                                                                                  |   |                                          | **(1,757,951** | **)**                                 |   | **(1,757,951** | **)** |
| **Total                stockholders' equity**                                                                                               |   |                                          | **21,511,185** |                                  |   | **17,779,725** |   |
| **Total                liabilities and stockholders' equity**                                                                               |   | **$**                                         | **52,505,968** |                                  | **$**  | **36,650,388** |   |

* *
***See      accompanying notes to condensed consolidated financial      statements***

----

| **HAUPPAUGE                DIGITAL, INC. AND SUBSIDIARIES**                   |
|-------------------------------------------------------------------------------|
| **CONDENSED                CONSOLIDATED STATEMENTS OF                INCOME** |

**(UNAUDITED)**

|                                                            |   | **Three                months ended March 31,** |           |
|-----------------------------------------------------------------|--------|-------------------------------------------------|----------------|
|                                                            |   | **2007**                                        |           | **2006** |   |
| **Net                sales**                                    |   | **$**                                           | **29,891,841** |   | **$** | **26,685,393** |   |
| **Cost                of sales**                                |   |                                            | **24,248,250** |   |   | **21,503,859** |   |
| **Gross                profit**                                 |   |                                            | **5,643,591**  |   |   | **5,181,534** |   |
|                                                            |   |                                            |                |   |   |  |   |
| **Selling,                general and administrative expenses** |   |                                            | **3,550,240**  |   |   | **3,429,858** |   |
| **Research                and development expenses**            |   |                                            | **749,827**    |   |   | **768,832** |   |
| **Income                from operations**                       |   |                                            | **1,343,524**  |   |   | **982,844** |   |
|                                                            |   |                                            |                |   |   |  |   |
| **Other                income (expense):**                      |   |                                            |                |   |   |  |   |
| **Interest                income**                              |   |                                            | **9,347**      |   |   | **6,275** |   |
| **Foreign                currency**                             |   |                                            | **(18,245**    | **)** |   | **13,487** |   |
| **Other                income (expense)**                       |   |                                            | **(8,898**     | **)** |   | **19,762** |   |
| **Income                before taxes on income**                |   |                                            | **1,334,626**  |   |   | **1,002,606** |   |
| **Tax                provision**                                |   |                                            | **57,693**     |   |   | **44,728** |   |
| **Net                income**                                   |   | **$**                                           | **1,276,933**  |   | **$** | **957,878** |   |
|                                                            |   |                                            |                |   |   |  |   |
|                                                            |   |                                            |                |   |   |  |   |
| **Net                income per share:**                        |   |                                            |                |   |   |  |   |
| **Basic**                                                       |   | **$**                                           | **0.13**       |   | **$** | **0.10** |   |
| **Diluted**                                                     |   | **$**                                           | **0.12**       |   | **$** | **0.10** |   |

***See      accompanying notes to condensed consolidated financial      statements***

----

| **HAUPPAUGE                DIGITAL, INC. AND SUBSIDIARIES**                   |
|-------------------------------------------------------------------------------|
| **CONDENSED                CONSOLIDATED STATEMENTS OF                INCOME** |

**(UNAUDITED)**

|                                                            |   | **Six                months ended March 31,** |           |
|-----------------------------------------------------------------|--------|-----------------------------------------------|----------------|
|                                                            |   | **2007**                                      |           | **2006** |   |
| **Net                sales**                                    |   | **$**                                         | **59,810,974** |   | **$** | **51,730,383** |   |
| **Cost                of sales**                                |   |                                          | **47,349,846** |   |   | **41,317,065** |   |
| **Gross                profit**                                 |   |                                          | **12,461,128** |   |   | **10,413,318** |   |
|                                                            |   |                                          |                |   |   |  |   |
| **Selling,                general and administrative expenses** |   |                                          | **7,352,462**  |   |   | **6,810,926** |   |
| **Research                and development expenses**            |   |                                          | **1,503,272**  |   |   | **1,562,833** |   |
| **Income                from operations**                       |   |                                          | **3,605,394**  |   |   | **2,039,559** |   |
|                                                            |   |                                          |                |   |   |  |   |
| **Other                income:**                                |   |                                          |                |   |   |  |   |
| **Interest                income**                              |   |                                          | **21,738**     |   |   | **11,481** |   |
| **Foreign                currency**                             |   |                                          | **(6,218**     | **)** |   | **14,451** |   |
| **Other                income**                                 |   |                                          | **15,520**     |   |   | **25,932** |   |
| **Income                before taxes on income**                |   |                                          | **3,620,914**  |   |   | **2,065,491** |   |
| **Tax                provision**                                |   |                                          | **141,245**    |   |   | **87,139** |   |
| **Net                income**                                   |   | **$**                                         | **3,479,669**  |   | **$** | **1,978,352** |   |
|                                                            |   |                                          |                |   |   |  |   |
|                                                            |   |                                          |                |   |   |  |   |
| **Net                income per share:**                        |   |                                          |                |   |   |  |   |
| **Basic**                                                       |   | **$**                                         | **0.36**       |   | **$** | **0.21** |   |
| **Diluted**                                                     |   | **$**                                         | **0.34**       |   | **$** | **0.20** |   |

***See      accompanying notes to condensed consolidated financial      statements***

----

| **HAUPPAUGE                DIGITAL, INC. AND SUBSIDIARIES**                                       |
|---------------------------------------------------------------------------------------------------|
| **CONDENSED                CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE                INCOME** |

**(UNAUDITED)**

|                                                           |   |  **Three                months ended March 31,** |          |
|----------------------------------------------------------------|--------|-------------------------------------------------------|---------------|
|                                                           |   | **2007**                                              |          | **2006** |   |
| **Net                income**                                  |   | **$**                                                 | **1,276,933** |   | **$** | **957,878** |   |
| **Foreign                currency translation (loss)**         |   |                                                  | **(644,215**  | **)** |   | **(175,651** | **)** |
| **Forward                exchange contracts marked to market** |   |                                                  | **31,403**    |   |   | **(39,528** | **)** |
| **Other                comprehensive income**                  |   | **$**                                                 | **664,121**   |   | **$** | **742,699** |   |

|                                                           |   | **Six                months ended March 31,**  |          |
|----------------------------------------------------------------|--------|-----------------------------------------------------|---------------|
|                                                           |   | **2007**                                            |          | **2006** |   |
| **Net                income**                                  |   | **$**                                               | **3,479,669** |   | **$** | **1,978,352** |   |
| **Foreign                currency translation (loss)**         |   |                                                | **(587,950**  | **)** |   | **(918,922** | **)** |
| **Forward                exchange contracts marked to market** |   |                                                | **(53,294**   | **)** |   | **(143,666** | **)** |
| **Other                comprehensive income**                  |   | **$**                                               | **2,838,425** |   | **$** | **915,764** |   |

***See      accompanying notes to condensed consolidated financial      statements***

----

| **HAUPPAUGE                DIGITAL, INC. AND SUBSIDIARIES**                       |
|-----------------------------------------------------------------------------------|
| **CONDENSED                CONSOLIDATED STATEMENTS OF CASH                FLOWS** |

**(UNAUDITED)**

|  ** **** **                                                                                                    |   | **Six                months ended March 31,** |            |
|-------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|-----------------|
|                                                                                                                          |   | **2007**                                      |            | **2006** |   |
| **Net                income**                                                                                                 |   | **$**                                         | **3,479,669**   |   | **$** | **1,978,352** |   |
| **Adjustments                to reconcile net income to net cash provided by (used in) operating                activities:** |   |                                          |            |   |   |   |   |
| **Depreciation                and amortization**                                                                              |   |                                          | **105,051**     |   |   | **90,609** |   |
| **Stock                compensation expense**                                                                                 |   |                                          | **236,584**     |   |   | **187,824** |   |
| **Other                non cash items**                                                                                       |   |                                          | **(189**        | **)** |   | **(1,711** | **)** |
| **Changes                in current assets and liabilities:**                                                                 |   |                                          |                 |   |   |  |   |
| **Accounts                receivable**                                                                                        |   |                                          | **(12,503,221** | **)** |   | **(14,813,398** | **)** |
| **Inventories**                                                                                                               |   |                                          | **(2,086,462**  | **)** |   | **(2,946,148** | **)** |
| **Prepaid                expenses and other current assets**                                                                  |   |                                          | **(113,948**    | **)** |   | **(50,749** | **)** |
| **Accounts                payable**                                                                                           |   |                                          | **10,060,439**  |   |   | **12,817,718** |   |
| **Accrued                expenses and other current liabilities**                                                             |   |                                          | **2,063,681**   |   |   | **590,578** |   |
| **Total                adjustments**                                                                                          |   |                                          | **(2,238,065**  | **)** |   | **(4,125,277** | **)** |
| **Net                cash provided by (used in) operating activities**                                                        |   |                                          | **1,241,604**   |   |   | **(2,146,925** | **)** |
|                                                                                                                          |   |                                          |                 |   |   |  |   |
| **Cash                Flows From Investing Activities:**                                                                      |   |                                          |                 |   |   |  |   |
| **Purchases                of property, plant and equipment**                                                                 |   |                                          | **(187,178**    | **)** |   | **(107,670** | **)** |
| **Net                cash used in investing activities**                                                                      |   |                                          | **(187,178**    | **)** |   | **(107,670** | **)** |
|                                                                                                                          |   |                                          |                 |   |   |  |   |
| **Cash                Flows From Financing Activities:**                                                                      |   |                                          |                 |   |   |   |   |
| **Proceeds                from the exercise of stock options and employee****stock                purchases**                 |   |                                          | **656,451**     |   |   | **205,308** |   |
| **Net                cash provided by financing activities**                                                                  |   |                                          | **656,451**     |   |   | **205,038** |   |
| **Effect                of exchange rates on cash**                                                                           |   |                                          | **(641,244**    | **)** |   | **(1,062,588** | **)** |
| **Net                increase (decrease) in cash and cash equivalents**                                                       |   |                                          | **1,069,633**   |   |   | **(3,111,875** | **)** |
| **Cash                and cash equivalents, beginning of period**                                                             |   |                                          | **9,020,941**   |   |   | **7,567,393** |   |
| **Cash                and cash equivalents, end of period**                                                                   |   | **$**                                         | **10,090,574**  |   | **$** | **4,455,518** |   |
| **Supplemental                disclosures:**                                                                                  |   |                                          |            |   |   |   |   |
| **Income                taxes paid**                                                                                          |   | **$**                                         | **123,211**     |   | **$** | **36,607** |   |

***See      accompanying notes to condensed consolidated financial      statements***
*** ***

----

** HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Note      1. Basis of presentation**

**Note      2. Receivables**

|                                                  |   | **March                    31,****2007** |       | ** September                30,**** 2006** |   |
|-------------------------------------------------------|--------|------------------------------------------|------------|------------------------------------------------------|--------|
| Trade                receivables                      |   | $                                        | 19,273,613 |                                                 | $      | 13,910,101 |   |
| Receivable                from contract manufacturers |   |                                     | 11,702,044 |                                                 |   | 4,916,402 |   |
| GST                and VAT taxes receivables          |   |                                     | 1,241,724  |                                                 |   | 616,119 |   |
| Allowances                and reserves                |   |                                     | (3,652,500 | )                                                    |   | (3,377,000 | ) |
| Other                                                 |   |                                     | 71,268     |                                                 |   | 67,306 |   |
|                                                  |   | $                                        | 28,636,149 |                                                 | $      | 16,132,928 |   |

**Note      3. Foreign currency translations and transactions **

----

**HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Note      4. Inventories**

|                           |   | March                    31,2007 |       | September                  30,2006 |   |
|--------------------------------|--------|----------------------------------|------------|------------------------------------|--------|
| Component                parts |   | $                                | 5,190,544  |                               | $      | 4,868,483 |   |
| Finished                goods  |   |                             | 6,801,664  |                               |   | 5,037,263 |   |
|                           |   | $                                | 11,992,208 |                               | $      | 9,905,746 |   |

**Note      5. Net income per share **

|                                                                            |   | Three                months ended March 31, |       | Six                months ended March 31, |   |
|---------------------------------------------------------------------------------|--------|---------------------------------------------|------------|-------------------------------------------|--------|
|                                                                            |   | 2007                                        |       | 2006                                      |   |                  2007 |   |                  2006 |   |
| Weighted              average              shares outstanding-basic             |   |                                        | 9,885,419  |                                      |   | 9,576,522 |   |   | 9,781,009 |   |   | 9,541,935 |   |
| Number                of shares issued on the assumed exercise of stock options |   |                                        | 671,985    |                                      |   | 481,063 |   |   | 586,553 |   |   | 447,764 |   |
| Weighted                average shares outstanding-diluted                      |   |                                        | 10,557,404 |                                      |   | 10,057,585 |   |   | 10,367,562 |   |   | 9,989,699 |   |

----

**HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Note      6. Accumulated other comprehensive income (loss) **

| Accumulated              other comprehensive income (loss)Fiscal                  2007 activity |   | Balance                    as ofSept                    30 2006 |     | Oct                    06 to Mar 07gains                    (losses) |   | Balance                    as ofMar                    31, 2007 |   |
|-------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------|----------|----------------------------------------------------------------------|--------|-----------------------------------------------------------------|--------|
| Translation                gains and losses                                                     |   | $                                                               | (531,289 | )                                                                    | $      | (587,950                                                        | )      | $ | (1,119,239 | ) |
| FAS                133 mark to market adjustment                                                |   |                                                            | 21,970   |                                                                 |   | (53,294                                                         | )      |   | (31,324 | ) |
|                                                                                            |   | $                                                               | (509,319 | )                                                                    | $      | (641,244                                                        | )      | $ | (1,150,563 | ) |

**Note      7. Revenue recognition**

** **

----

**HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Note      8. Product segment and geographic information **

|                                        |   |  Three                months ended March                31, |       |  Six                months ended March 31, |   |
|---------------------------------------------|--------|------------------------------------------------------------------|------------|-------------------------------------------------|--------|
| Product              line sales             |   | 2007                                                             |       | 2006                                            |   | 2007 |   |                  2006 |   |
| Analog                sales                 |   | $                                                                | 18,517,756 |                                            | $      | 19,073,668 |   | $ | 33,075,148 |   | $ | 34,111,143 |   |
| Digital                sales                |   |                                                             | 10,786,065 |                                            |   | 7,117,034 |   |   | 25,639,367 |   |   | 16,514,879 |   |
| Other                non-TV tuners products |   |                                                             | 588,020    |                                            |   | 494,691 |   |   | 1,096,459 |   |   | 1,104,361 |   |
| Total                sales                  |   | $                                                                | 29,891,841 |                                            | $      | 26,685,393 |   | $ | 59,810,974 |   | $ | 51,730,383 |   |

|                                            |   | Three                months ended March 31,  |   | Six                months ended March 31,  |   |
|-------------------------------------------------|--------|---------------------------------------------------|--------|-------------------------------------------------|--------|
| Sales              percent by geographic region |   | 2007                                              |   | 2006                                            |   | 2007 |   | 2006 |   |
| The                Americas                     |   |                                              | 60     | %                                               |   | 51 | % |   | 51 | % |   | 46 | % |
| Europe                                          |   |                                              | 39     | %                                               |   | 47 | % |   | 47 | % |   | 52 | % |
| Asia                                            |   |                                              | 1      | %                                               |   | 2 | % |   | 2 | % |   | 2 | % |
| Total                                           |   |                                              | 100    | %                                               |   | 100 | % |   | 100 | % |   | 100 | % |

----

**HAUPPAUGE      DIGITAL, INC. AND SUBSIDIARIES**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**Note      9. Stock-based compensation**

**Note      10.  Arrangements with off-balance sheet risk - guarantees**

----

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

**THREE      MONTH PERIOD ENDED MARCH 31, 2007 COMPARED TO THREE MONTH PERIOD ENDED MARCH      31,      2006**

|                                                             |   | Three                Months Ended  |       | Three                Months Ended  |   | Variance   |   | Percentage                of sales |      |
|------------------------------------------------------------------|--------|-----------------------------------------|------------|-----------------------------------------|--------|------------|--------|------------------------------------|-----------|
|                                                             |   | 3/31/07                                 |       | 3/31/06                                 |   | $     |   | 2007                               |      | 2006 |   | Variance |   |
| Net                sales                                         |   | $                                       | 29,891,841 |                                    | $      | 26,685,393 |   | $                                  | 3,206,448 |   |   | 100.00 | % |   | 100.00 | % |   | - |   |
| Cost                of sales                                     |   |                                    | 24,248,250 |                                    |   | 21,503,859 |   |                               | 2,744,391 |   |   | 81.12 | % |   | 80.58 | % |   | 0.54 | % |
| Gross                profit                                      |   |                                    | 5,643,591  |                                    |   | 5,181,534  |   |                               | 462,057   |   |   | 18.88 | % |   | 19.42 | % |   | -0.54 | % |
| Gross                profit %                                    |   |                                    | 18.88      | %                                       |   | 19.42      | %      |                               | -0.54     | % |   |   |   |   |   |   |   |   |   |
| Selling                , general and administrative expenses:    |   |                                    |       |                                    |   |       |   |                               |      |   |   |  |   |   |  |   |   |  |   |
| Sales                and marketing                               |   |                                    | 2,428,804  |                                    |   | 2,315,414  |   |                               | 113,390   |   |   | 8.13 | % |   | 8.68 | % |   | -0.55 | % |
| Technical                support                                 |   |                                    | 146,570    |                                    |   | 154,771    |   |                               | (8,201    | ) |   | 0.49 | % |   | 0.58 | % |   | -0.09 | % |
| General                and administrative                        |   |                                    | 894,179    |                                    |   | 901,419    |   |                               | (7,240    | ) |   | 2.99 | % |   | 3.38 | % |   | -0.39 | % |
| Stock                compensation expense                        |   |                                    | 80,687     |                                    |   | 58,254     |   |                               | 22,433    |   |   | 0.27 | % |   | 0.22 | % |   | 0.05 | % |
| Total                selling, general and administrative expense |   |                                    | 3,550,240  |                                    |   | 3,429,858  |   |                               | 120,382   |   |   | 11.88 | % |   | 12.86 | % |   | -0.98 | % |
| Research                and development                          |   |                                    | 702,798    |                                    |   | 740,140    |   |                               | (37,342   | ) |   | 2.35 | % |   | 2.77 | % |   | -0.42 | % |
| Research                and stock compensation expense           |   |                                    | 47,029     |                                    |   | 28,692     |   |                               | 18,337    |   |   | 0.16 | % |   | 0.11 | % |   | 0.05 | % |
| Total                expenses                                    |   |                                    | 4,300,067  |                                    |   | 4,198,690  |   |                               | 101,377   |   |   | 14.39 | % |   | 15.74 | % |   | -1.35 | % |
| Net                operating income                              |   |                                    | 1,343,524  |                                    |   | 982,844    |   |                               | 360,680   |   |   | 4.49 | % |   | 3.68 | % |   | 0.81 | % |
|                                                             |   |                                    |       |                                    |   |       |   |                               |      |   |   |   |   |   |   |   |   |   |   |
| Other                income (expense) :                          |   |                                    |       |                                    |   |       |   |                               |      |   |   |   |   |   |   |   |   |   |   |
| Interest                income                                   |   |                                    | 9,347      |                                    |   | 6,275      |   |                               | 3,072     |   |   | 0.03 | % |   | 0.02 | % |   | 0.01 | % |
| Foreign                currency                                  |   |                                    | (18,245    | )                                       |   | 13,487     |   |                               | (31,732   | ) |   | -0.06 | % |   | 0.05 | % |   | -0.11 | % |
| Total                other income (expense)                      |   |                                    | (8,898     | )                                       |   | 19,762     |   |                               | (28,660   | ) |   | -0.03 | % |   | 0.07 | % |   | -0.10 | % |
| Income                before taxes on income                     |   |                                    | 1,334,626  |                                    |   | 1,002,606  |   |                               | 332,020   |   |   | 4.46 | % |   | 3.75 | % |   | 0.71 | % |
| Taxes                on income                                   |   |                                    | 57,693     |                                    |   | 44,728     |   |                               | 12,965    |   |   | 0.19 | % |   | 0.17 | % |   | 0.02 | % |
| Net                income                                        |   | $                                       | 1,276,933  |                                    | $      | 957,878    |   | $                                  | 319,055   |   |   | 4.27 | % |   | 3.58 | % |   | 0.69 | % |

|                             |   | Three                Months ended   |       | Three                Months ended   |   | Increase(decrease) Dollar   |   |  Increase(decrease)                variance |       | Percentage                of sales bygeographic                region |   |
|-----------------------------|--------|-----------------------------------------------|------------|-----------------------------------------------|--------|--------------------------------------------|--------|--------------------------------------------------|------------|-----------------------------------------------------------------------|--------|
| Location                    |   | 3/31/07                                       |       | 3/31/06                                       |   | variance                                   |   |  %                                          |       | 2007                                                                  |   | 2006 |   |
| The                Americas |   | $                                             | 17,927,014 |                                          | $      | 13,477,731                                 |   | $                                                | 4,449,283  |                                                                  |   | 33 | % |   | 60 | % |   | 51 | % |
| Europe                      |   |                                          | 11,579,486 |                                          |   | 12,682,887                                 |   |                                             | (1,103,401 | )                                                                     |   | -9 | % |   | 39 | % |   | 47 | % |
| Asia                        |   |                                          | 385,341    |                                          |   | 524,775                                    |   |                                             | (139,434   | )                                                                     |   | -27 | % |   | 1 | % |   | 2 | % |
| Total                       |   | $                                             | 29,891,841 |                                          | $      | 26,685,393                                 |   | $                                                | 3,206,448  |                                                                  |   | 12 | % |   | 100 | % |   | 100 | % |

----

**Gross      profit**

|                                                   |   | Increase(decrease)  |     |
|--------------------------------------------------------|--------|--------------------------|----------|
| Increased                sales                         |   | $                        | 891,774  |   |
| Lower                gross profit on sales mix         |   |                     | (554,780 | ) |
| Production                and production related costs |   |                     | 125,063  |   |
| Total                increase in gross profit          |   | $                        | 462,057  |   |

|                                                   |   |  Increase (decrease)  |   |
|--------------------------------------------------------|--------|--------------------------------------|--------|
| Lower                gross profit on sales mix         |   |                                 | (1.85  | %) |
| Production                and production related costs |   |                                 | 1.31   | % |
| Net                decrease in gross profit percent    |   |                                 | (0.54  | %) |

| ·   | A                higher sales percentage of lower gross profit margin products contributed                to a 1.85% decrease in gross profit |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Production                and shipping costs declined as a percentage of sales which contributed                to                a 1.31% increase in the gross profit percent. The increase in net                sales                was about 12% while the production costs decreased by about 6%. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Selling,      general and administrative expenses**

|                                      |   |                  Three months ended March 31, Dollar Costs   |      | Percentage                of Sales   |   |
|-------------------------------------------|--------|-----------------------------------------------------------------------------|-----------|------------------------------------------------|--------|
|                                      |   |                                                                        |      |                                           |   | Increase |   |   |   |   |   | Increase |   |
|                                      |   | 2007                                                                        |      | 2006                                           |   | (decrease) |   | 2007 |   | 2006 |   | (decrease) |   |
| Sales                and marketing        |   | $                                                                           | 2,428,804 |                                           | $      | 2,315,414 |   | $ | 113,390 |   |   | 8.13 | % |   | 8.68 | % |   | -0.55 | % |
| Technical                support          |   |                                                                        | 146,570   |                                           |   | 154,771 |   |   | (8,201 | ) |   | 0.49 | % |   | 0.58 | % |   | -0.09 | % |
| General                and administrative |   |                                                                        | 894,179   |                                           |   | 901,419 |   |   | (7,240 | ) |   | 2.99 | % |   | 3.38 | % |   | -0.39 | % |
| Stock                compensation expense |   |                                                                        | 80,687    |                                           |   | 58,254 |   |   | 22,433 |   |   | 0.27 | % |   | 0.22 | % |   | 0.05 | % |
| Total                                     |   | $                                                                           | 3,550,240 |                                           | $      | 3,429,858 |   | $ | 120,382 |   |   | 11.88 | % |   | 12.86 | % |   | -0.98 | % |

----

**Research      and development expenses**

**Other      income (expense)**

**Tax      provision**

|                                                  |   |     Three                months ended March 31,  |   |
|-------------------------------------------------------|--------|---------------------------------------------------------------------------|--------|
|                                                  |   | 2007                                                                      |   |                  2006 |   |
| AMT                Tax attributable to U.S operations |   | $                                                                         | 21,000 |   | $ | 20,000 |   |
| Tax                expense European operations        |   |                                                                      | 31,693 |   |   | 19,728 |   |
| State                taxes                            |   |                                                                      | 5,000  |   |   | 5,000 |   |
| Net                tax provision                      |   | $                                                                         | 57,693 |   | $ | 44,728 |   |

|  | · | the                tax losses incurred by our domestic operations in three out of the                last                five years |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the                seasonal nature and cyclical nature of the business, which makes                it                difficult to predict the future realization of the deferred tax                asset |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the                dynamic market and technological changes that occur in our                industry |
|--|--------|-------------------------------------------------------------------------------------------------------|

----

**SIX      MONTH PERIOD ENDED MARCH 31, 2007 COMPARED TO**

**SIX      MONTH PEROID ENDED MARCH 31, 2006**

|                                                             |   | SixMonthsEnded |       | SixMonthsEnded |   | Variance   |   | Percentage                of sales |      |
|------------------------------------------------------------------|--------|----------------|------------|----------------|--------|------------|--------|------------------------------------|-----------|
|                                                             |   | 3/31/07        |       | 3/31/06        |   | $     |   | 2007                               |      | 2006 |   | Variance  |   |
| Net                sales                                         |   | $              | 59,810,974 |           | $      | 51,730,383 |   | $                                  | 8,080,591 |   |   | 100.00 | % |   | 100.00 | % |   | - |   |
| Cost                of sales                                     |   |           | 47,349,846 |           |   | 41,317,065 |   |                               | 6,032,781 |   |   | 79.17 | % |   | 79.87 | % |   | -0.70 | % |
| Gross                profit                                      |   |           | 12,461,128 |           |   | 10,413,318 |   |                               | 2,047,810 |   |   | 20.83 | % |   | 20.13 | % |   | 0.70 | % |
| Gross                profit %                                    |   |           | 20.83      | %              |   | 20.13      | %      |                               | 0.70      | % |   |   |   |   |   |   |   |   |   |
| Selling                , general and administrative expenses:    |   |           |       |           |   |       |   |                               |      |   |   |  |   |   |  |   |   |  |   |
| Sales                and marketing                               |   |           | 5,136,025  |           |   | 4,671,985  |   |                               | 464,040   |   |   | 8.59 | % |   | 9.03 | % |   | -0.44 | % |
| Technical                support                                 |   |           | 282,975    |           |   | 286,850    |   |                               | (3,875    | ) |   | 0.47 | % |   | 0.55 | % |   | -0.08 | % |
| General                and administrative                        |   |           | 1,785,162  |           |   | 1,726,236  |   |                               | 58,926    |   |   | 2.98 | % |   | 3.34 | % |   | -0.36 | % |
| Stock                compensation expense                        |   |           | 148,300    |           |   | 125,855    |   |                               | 22,445    |   |   | 0.25 | % |   | 0.24 | % |   | 0.01 | % |
| Total                selling, general and administrative expense |   |           | 7,352,462  |           |   | 6,810,926  |   |                               | 541,536   |   |   | 12.29 | % |   | 13.16 | % |   | -0.87 | % |
| Research                and development                          |   |           | 1,414,988  |           |   | 1,500,864  |   |                               | (85,876   | ) |   | 2.37 | % |   | 2.90 | % |   | -0.53 | % |
| Research                and stock compensation expense           |   |           | 88,284     |           |   | 61,969     |   |                               | 26,315    |   |   | 0.15 | % |   | 0.12 | % |   | 0.03 | % |
| Total                expenses                                    |   |           | 8,855,734  |           |   | 8,373,759  |   |                               | 481,975   |   |   | 14.81 | % |   | 16.18 | % |   | -1.37 | % |
| Net                operating income                              |   |           | 3,605,394  |           |   | 2,039,559  |   |                               | 1,565,835 |   |   | 6.02 | % |   | 3.95 | % |   | 2.07 | % |
|                                                             |   |           |       |           |   |       |   |                               |      |   |   |   |   |   |   |   |   |   |   |
| Other                income :                                    |   |           |       |           |   |       |   |                               |      |   |   |   |   |   |   |   |   |   |   |
| Interest                income                                   |   |           | 21,738     |           |   | 11,481     |   |                               | 10,257    |   |   | 0.04 | % |   | 0.02 | % |   | 0.02 | % |
| Foreign                currency                                  |   |           | (6,218     | )              |   | 14,451     |   |                               | (20,669   | ) |   | -0.01 | % |   | 0.03 | % |   | -0.04 | % |
| Total                other income                                |   |           | 15,520     |           |   | 25,932     |   |                               | (10,412   | ) |   | 0.03 | % |   | 0.05 | % |   | -0.02 | % |
| Income                before taxes on income                     |   |           | 3,620,914  |           |   | 2,065,491  |   |                               | 1,555,423 |   |   | 6.05 | % |   | 4.00 | % |   | 2.05 | % |
| Taxes                on income                                   |   |           | 141,245    |           |   | 87,139     |   |                               | 54,106    |   |   | 0.24 | % |   | 0.17 | % |   | 0.07 | % |
| Net                income                                        |   | $              | 3,479,669  |           | $      | 1,978,352  |   | $                                  | 1,501,317 |   |   | 5.81 | % |   | 3.83 | % |   | 1.98 | % |

|                        |   | Six                Monthsended |       | Six                Monthsended   |   |  Increase(decrease)Dollar |   | Increase(decrease)              |      | Percentage                of sales by  geographic region |   |
|-----------------------------|--------|--------------------------------|------------|--------------------------------------------|--------|--------------------------------|--------|---------------------------------|-----------|---------------------------------------------------------------|--------|
| Location                    |   | 3/31/07                   |       |  3/31/06                              |   | variance                       |   | variance                %  |      |  2007                                                    |   |  2006 |   |
| The                Americas |   |                           | 30,399,845 |                                       |   | 23,682,666                     |   |                            | 6,717,179 |                                                          |   | 28 | % |   | 51 | % |   | 46 | % |
| Europe                      |   |                           | 28,499,543 |                                       |   | 26,859,813                     |   |                            | 1,639,730 |                                                          |   | 6 | % |   | 47 | % |   | 52 | % |
| Asia                        |   |                           | 911,586    |                                       |   | 1,187,904                      |   |                            | (276,318  | )                                                             |   | -23 | % |   | 2 | % |   | 2 | % |
| Total                       |   | $                              | 59,810,974 |                                       | $      | 51,730,383                     |   | $                               | 8,080,591 |                                                          |   | 16 | % |   | 100 | % |   | 100 | % |

----

**Gross      profit**

|                                                   |   | Increase  (decrease)  |      |
|--------------------------------------------------------|--------|--------------------------------------|-----------|
| Increased                sales                         |   | $                                    | 2,269,256 |   |
| Lower                gross profit on sales mix         |   |                                 | (55,490   | ) |
| Production                and production related costs |   |                                 | (165,956  | ) |
| Total                increase in gross profit          |   | $                                    | 2,047,810 |   |

|                                     |   |  Increase   |   |
|---------------------------------------------------------|--------|------------------|--------|
|                                                    |   |  (decrease) |   |
| Lower                gross profit on sales mix          |   |             | (0.09  | %) |
| Production                and production related costs  |   |             | 0.79   | % |
|  Net              decrease in gross profit percent |   |             | 0.70   | % |

| ·   | A                higher sales percentage of lower gross profit margin products contributed                to a 0.09% decrease in gross profit |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Production                and shipping costs declined as a percentage of sales which contributed                to                a 0.79% increase in gross profit percent. The increase in net sales                was                about 16% while the increase in production costs was about 4% |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Selling,      general and administrative expenses**

|                                      |   |                  Six months ended March 31, Dollar                Costs  |      | Percentage                of Sales   |   |
|-------------------------------------------|--------|------------------------------------------------------------------------------------|-----------|------------------------------------------------|--------|
|                                      |   |                                                                               |      |                                           |   | Increase |   |   |   |   |   | Increase |   |
|                                      |   | 2007                                                                               |      | 2006                                           |   | (deecrease) |   | 2007 |   | 2006 |   | (decrease) |   |
| Sales                and marketing        |   | $                                                                                  | 5,136,025 |                                           | $      | 4,671,985 |   | $ | 464,040 |   |   | 8.59 | % |   | 9.03 | % |   | -0.44 | % |
| Technical                support          |   |                                                                               | 282,975   |                                           |   | 286,850 |   |   | (3,875 | ) |   | 0.47 | % |   | 0.55 | % |   | -0.08 | % |
| General                and administrative |   |                                                                               | 1,785,162 |                                           |   | 1,726,236 |   |   | 58,926 |   |   | 2.98 | % |   | 3.34 | % |   | -0.36 | % |
| Stock                compensation expense |   |                                                                               | 148,300   |                                           |   | 125,855 |   |   | 22,445 |   |   | 0.25 | % |   | 0.24 | % |   | 0.01 | % |
| Total                                     |   | $                                                                                  | 7,352,462 |                                           | $      | 6,810,926 |   | $ | 541,536 |   |   | 12.29 | % |   | 13.16 | % |   | -0.87 | % |

----

**Research      and development expenses**

**Other      income **

**Tax      provision**

|                                                  |   |     Six                months ended March 31,  |    |
|-------------------------------------------------------|--------|-------------------------------------------------------------------------|---------|
|                                                  |   | 2007                                                                    |    | 2006 |   |
| AMT                Tax attributable to U.S operations |   | $                                                                       | 52,000  |   | $ | 30,000 |   |
| Tax                expense European operations        |   |                                                                    | 79,245  |   |   | 47,139 |   |
| State                taxes                            |   |                                                                    | 10,000  |   |   | 10,000 |   |
| Net                tax provision                      |   | $                                                                       | 141,245 |   | $ | 87,139 |   |

|  | · | the                tax losses incurred by our domestic operations in three out of the                last                five years |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the                seasonal nature and cyclical nature of the business, which makes                it                difficult to predict the future realization of the deferred tax                asset |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the                dynamic market and technological changes that occur in our                industry |
|--|--------|-------------------------------------------------------------------------------------------------------|

----

**Seasonality**

**Liquidity      and capital resources**

|                                      |   | March                31, 2007 |       | September                30, 2006 |   |
|-------------------------------------------|--------|-------------------------------|------------|-----------------------------------|--------|
| Cash                                      |   | $                             | 10,090,574 |                              | $      | 9,020,941 |   |
| Working                Capital            |   |                          | 20,733,319 |                              |   | 17,084,175 |   |
| Stockholders’                Equity |   |                          | 21,511,185 |                              |   | 17,779,725 |   |

| Sources                of cash:                                      |   |   |        |   |
|----------------------------------------------------------------------|--------|--------|-------------|--------|
| Net                income adjusted for non cash items                |   | $      | 3,821,115   |   |
| Increase                in accounts payable and accrued expenses     |   |   | 12,124,120  |   |
| Proceeds                from employee stock purchases                |   |   | 656,451     |   |
| Less                cash used for:                                   |   |   |        |   |
| Increase                in account receivables                       |   |   | (12,503,221 | )      |
| Increase                in inventories                               |   |   | (2,086,462  | )      |
| Increase                in prepaid expenses and other current assets |   |   | (113,948    | )      |
| Effect                of exchange rates on cash                      |   |   | (641,244    | )      |
| Capital                equipment purchases                           |   |   | (187,178    | )      |
| Net                cash increase                                     |   | $      | 1,069,633   |   |

----

**Future      contractual obligations**

|                                       |   | Payments                due by period |      |
|--------------------------------------------|--------|---------------------------------------|-----------|
|                                       |   | Total                                 |      | Less                than 1 year |   | 1-3                years |   |                  3                to 5 years |   |
| Operating                lease obligations |   | $                                     | 2,210,869 |   | $ | 572,268 |   | $ | 1,482,924 |   | $ | 155,677 |   |

**Inflation**

**Item      3. Quantitative and qualitative disclosures about market      risks**

| ·   | volatility                of the currency markets |
|--------------------|---------------------------------------------------|

|   |   |
|--------|--------|

| ·   | availability                of hedging instruments |
|--------------------|----------------------------------------------------|

|   |   |
|--------|--------|

| ·   | accuracy                of our inventory forecasts |
|--------------------|----------------------------------------------------|

----

**Item      4. Controls and procedures**

**Special      note regarding forward looking statements**

----

**PART      II. OTHER INFORMATION**

**Item      1A. Risk factors**

**Item      2. Unregistered sales of equity securities and use of      proceeds**
** **

**Item      6. Exhibits **

----

**SIGNATURES**

|                                              |                                                                                                                                                                            |                                  |
|---------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------|
|                                              | HAUPPAUGE                DIGITAL INC.Registrant                                                                                                                                 |
|                                         |                                                                                                                                                                       |                             |
| Date: May              10,              2007 | By                                                                                                                                                                    | /s/ Kenneth              Plotkin |
|                                              | KENNETH                PLOTKINChief                Executive Officer, Chairman of the Board, President                (Principal Executive Officer) and                Director |

|                                                          |                                                                                                                                                 |                                    |
|---------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------|
| Date: May              10,              2007   | By                                                                                                                                         | /s/ Gerald              Tucciarone |
|                                                          | GERALD TUCCIARONETreasurer,                  Chief Financial Officer, (Principal                  Accounting officer) and                  Secretary |

----