<PAGE>

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-Q



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

               For the quarterly period ended September 30, 1999
                                       or
[ ]   Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

                        Commission File Number 000-21755

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


             PENNSYLVANIA                                   25-1802235
             ------------                                   ----------
     (State or other jurisdiction                       (I.R.S. Employer
    of incorporation or organization)                  Identification No.)

             1004 McKee Road
          Oakdale, Pennsylvania                               15071
(Address of  principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code:  (412) 787-2100


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

                                 Yes  X    No
                                     ----     ----

The number of shares of the registrant's Common Stock, par value $0.01 per
share, outstanding as of October 29, 1999 was 50,459,064.
<PAGE>

                              MASTECH CORPORATION
                         QUARTERLY REPORT ON FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 1999

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                      PAGE
                                                                                      ----
<S>          <C>                                                                      <C>
PART I.      FINANCIAL INFORMATION                                                       3

ITEM 1.      CONSOLIDATED CONDENSED FINANCIAL STATEMENTS:

             UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME FOR EACH OF THE
             THREE AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER
             30, 1998                                                                    3

             CONSOLIDATED CONDENSED BALANCE SHEETS AS OF SEPTEMBER 30, 1999
             (UNAUDITED) AND DECEMBER 31, 1998                                           4

             UNAUDITED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY AS OF SEPTEMBER
             30, 1999                                                                    5

             UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS FOR EACH OF
             THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 1998      6

             NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS              7

             REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS                                   12

ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
             OF OPERATIONS                                                              13

ITEM 3.      QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK                  19



PART II.     OTHER INFORMATION

ITEM 1.      LEGAL PROCEEDINGS                                                          20
ITEM 2.      CHANGES IN SECURITIES AND USE OF PROCEEDS                                  20
ITEM 3.      DEFAULTS UPON SENIOR SECURITIES                                            20
ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                        20
ITEM 5.      OTHER INFORMATION                                                          20
ITEM 6.      EXHIBITS AND REPORTS ON FORM 8-K                                           21

             SIGNATURES                                                                 22

             EXHIBIT INDEX                                                              23
</TABLE>

                                       2
<PAGE>

PART I. FINANCIAL INFORMATION


ITEM 1. CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

                              MASTECH CORPORATION
                  CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                 (dollars in thousands, except per share data)
                                  (unaudited)
<TABLE>
<CAPTION>
                                                      Three Months Ended September 30,           Nine Months Ended September 30,
                                                      --------------------------------           -------------------------------
                                                          1999             1998 (1)                  1999             1998 (1)
                                                          ----             --------                  ----             --------
<S>                                                <C>                    <C>                     <C>                 <C>

Revenues                                                 $117,173          $106,498               $363,064            $285,442
Cost of revenues                                           77,774            71,263                242,445             191,882
                                                         --------          --------               --------            --------
Gross profit                                               39,399            35,235                120,619              93,560

Selling, general and administrative                        24,395            20,407                 69,979              54,789
Special Charge (See Note 7)                                 3,528                --                  3,528                  --
                                                         --------          --------               --------            --------
Income from operations                                     11,476            14,828                 47,112              38,771

Other income, net                                            (465)             (730)                (1,801)             (2,135)
Merger-related expenses                                        --                --                  1,727               3,212
                                                         --------          --------               --------            --------
Income before income taxes                                 11,941            15,558                 47,186              37,694
Provision for income taxes                                  4,332             5,495                 16,970              14,789
                                                         --------          --------               --------            --------
Net income                                               $  7,609          $ 10,063               $ 30,216            $ 22,905
                                                         ========          ========               ========            ========

Earnings per share:
    Basic                                                $   0.15          $   0.20               $   0.60            $   0.46
                                                         ========          ========               ========            ========
    Diluted                                              $   0.15          $   0.20               $   0.59            $   0.45
                                                         ========          ========               ========            ========

Weighted average common shares outstanding:
    Basic                                                  50,440            50,115                 50,380              50,050
    Diluted                                                52,060            50,945                 51,340              50,905

</TABLE>

(1) Restated for pooling of interests transaction as discussed in Note 5.

The accompanying notes are an integral part of these consolidated condensed
financial statements.

                                       3
<PAGE>

                         MASTECH CORPORATION
                CONSOLIDATED CONDENSED BALANCE SHEETS
                       (dollars in thousands)

<TABLE>
<CAPTION>

                                                                              September 30,            December 31,
                                                                                  1999                   1998 (1)
                                                                              -------------            ------------
                                                                               (Unaudited)              (Audited)
<S>                                                                           <C>                      <C>
                               ASSETS
Current assets:
     Cash and cash equivalents (cost approximates market value)                 $  33,254               $  35,493
     Investments                                                                   83,218                  47,153
     Accounts receivable, net                                                      80,678                  73,313
     Unbilled receivables                                                          20,246                  12,261
     Prepaid and other assets                                                       8,637                   8,484
     Prepaid income taxes                                                           2,851                       -
     Deferred income taxes                                                          1,927                   2,312
                                                                              -------------            ------------
           Total current assets                                                   230,811                 179,016

Investments in joint ventures                                                         450                       -
Equipment and leasehold improvements, net                                          18,049                  17,234
Intangible assets, net                                                             31,160                  21,208
                                                                              -------------            ------------
           Total assets                                                         $ 280,470               $ 217,458
                                                                              =============            ============

                LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                                           $   9,193               $   8,523
     Accrued payroll and related costs                                             28,151                  29,367
     Other accrued liabilities                                                     12,639                  11,015
                                                                              -------------            ------------
           Total current liabilities                                               49,983                  48,905

     Long term debt                                                                30,000                       -
     Other long term liabilities                                                    5,350                   4,563
     Deferred income taxes                                                          4,239                   5,455
                                                                              -------------            ------------
           Total liabilities                                                       89,572                  58,923

Shareholders' equity:
     Preferred Stock, without par value                                                 -                       -
     Common Stock, par value $0.01 per share                                          504                     502
     Additional paid-in capital                                                   114,783                 111,508
     Retained earnings                                                             77,312                  47,096
     Accumulated other comprehensive income                                          (785)                   (571)
     Common stock in treasury, at cost                                               (916)                      -
                                                                              -------------            ------------
            Total shareholders' equity                                            190,898                 158,535
                                                                              -------------            ------------
Total liabilities and shareholders' equity                                      $ 280,470               $ 217,458
                                                                              =============            ============
</TABLE>

(1) Restated for pooling of interests transaction as discussed in Note 5.

The accompanying notes are an integral part of these consolidated condensed
financial statements.

                                       4
<PAGE>

                              MASTECH CORPORATION
                CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                 (dollars in thousands, except per share data)
<TABLE>
<CAPTION>

                                                                                                  Accumu-
                                                                                                   lated
                                                     Series A       Addi-                          Other    Total
                                  Common Stock      Preferred      tional                         Compre-   Share-
                                             Par           Par     Paid-in   Retained  Treasury   hensive   holders' Comprehensive
                                 Shares     Value  Shares Value    Capital   Earnings   Shares    Income    Equity      Income
                              ------------  -----  ------ -----    -------   --------   -------   -------   -------  -------------
<S>                            <C>          <C>    <C>    <C>      <C>       <C>        <C>       <C>       <C>      <C>
Balance, December 31, 1998 (1) 50,236,080   $ 502     1      -    $111,508    $ 47,096    $ -      $ (571) $ 158,535

Exercise of stock options,
    includes effect of tax
    benefit recognized            220,984       2     -      -       3,275           -      -           -      3,277
Purchase of treasury shares       (72,500)      -     -      -           -           -   (916)          -       (916)
Comprehensive income:
  Net unrealized loss
    on investments                      -       -     -      -           -           -      -        (448)      (448)    $ (448)
Currency translation
    adjustment                          -       -     -      -           -           -      -         234        234        234
  Net income                            -       -     -      -           -      30,216      -           -     30,216     30,216
                               ------------------------------------------------------------------------------------------------
Balance, September 30, 1999    50,384,564   $ 504     1      -    $114,783    $ 77,312  $(916)     $ (785) $ 190,898   $ 30,002
                               ================================================================================================
</TABLE>
(1)  Restated for pooling of interests transaction as discussed in Note 5.

The accompanying notes are an integral part of these consolidated condensed
financial statements.

                                       5
<PAGE>

                              MASTECH CORPORATION
                CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                            (dollars in thousands)
                                  (unaudited)
<TABLE>
<CAPTION>
                                                                   Nine Months Ended September 30,
                                                                   -------------------------------
                                                                       1999            1998 (1)
                                                                     ---------         --------
<S>                                                                  <C>               <C>
Net cash flows provided by operations                                $ 17,864          $ 15,615

Cash flows from investing activities:
     Acquisitions, net of cash acquired                               (10,480)           (4,154)
     Investments in joint ventures                                       (450)                -
     Additions to equipment and leasehold improvements, net            (5,255)           (8,070)
     Dividends paid                                                         -              (749)
     Purchases of investments, net                                    (36,513)          (58,481)
                                                                     ---------         --------
Net cash flows used in investing activities                           (52,698)          (71,454)

Cash flows from financing activities:
     Net payments under revolving credit facilities                         -            (6,905)
     Proceeds from the issuance of long term debt                      30,000                 -
     Payments to acquire treasury stock                                  (916)                -
     Proceeds from exercise of stock options, net of tax benefit        3,275             3,935
     Other                                                                236              (567)
                                                                     ---------         --------
Net cash flows provided by (used in) financing activities              32,595            (3,537)

Net change in cash and cash equivalents                                (2,239)          (59,376)
Cash and cash equivalents, beginning of period                         35,493            83,152
                                                                     ---------         --------
Cash and cash equivalents, end of period                             $ 33,254          $ 23,776
                                                                     =========         ========

</TABLE>

(1)  Restated for pooling of interests transaction as discussed in Note 5.

The accompanying notes are an integral part of these consolidated condensed
financial statements.

                                       6
<PAGE>

         NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS



1.  BASIS OF PRESENTATION

The accompanying unaudited consolidated condensed financial statements included
herein have been prepared by Mastech Corporation (the "Company") in accordance
with generally accepted accounting principles for the interim financial
information and Article 10 of Regulation S-X under the Securities Exchange Act
of 1934, as amended. The consolidated condensed financial statements as of and
for the quarter and nine months ended September 30, 1999 should be read in
conjunction with the Company's consolidated financial statements (and notes
thereto) included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1998. Accordingly, the accompanying consolidated condensed
financial statements do not include all of the information and notes required by
generally accepted accounting principles for complete financial statements. In
the opinion of the Company's management, all adjustments considered necessary
for a fair presentation of the accompanying consolidated condensed financial
statements have been included, and all adjustments unless otherwise discussed in
the notes to the consolidated condensed financial statements are of a normal and
recurring nature. The information contained herein is not a comprehensive
management overview and analysis of the financial condition and results of
operations of Mastech Corporation, but rather updates disclosures made in the
Company's Annual Report on Form 10-K. All significant intercompany accounts and
transactions have been eliminated in consolidation. Operating results for the
quarter and nine months ended September 30, 1999 are not necessarily indicative
of the results that may be expected for the year ending December 31, 1999.

As discussed in Note 5, on January 4, 1999, the Company acquired all of the
issued and outstanding capital stock of The Amber Group ("Amber").  The
transaction was accounted for as a pooling of interests and, accordingly, the
Company's historical consolidated condensed financial statements have been
restated to include results for Amber for all periods presented.

The use of generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amount of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

2.  INVESTMENTS

The Company accounts for its investments in marketable securities in accordance
with Statement of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity Securities".  The Company has determined
that all of its investments in marketable securities are to be classified as
available-for-sale and recorded at fair value.  These investments are carried at
market value, with the unrealized gains or losses, net of tax, reported as a
component of comprehensive income in the statement of shareholders' equity.
Realized gains or losses on securities sold are based upon the specific
identification method.

The Company entered into two 50% owned joint ventures during the third quarter
of 1999.  Both of these joint ventures are in the start-up phase of their
existence.  The Company accounts for its 50% ownership using the equity method
of accounting.

                                       7
<PAGE>

3.   EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per
share:

(dollars in thousands, except per share data)

                                        Three Months Ended   Nine Months Ended
                                        September 30, 1999   September 30, 1999
                                        ------------------   ------------------
Basic earnings per share:
Net income                                  $     7,609          $    30,216
                                            ===========          ===========
Divided by:
   Weighted average common shares            50,439,747           50,380,317
                                            ===========          ===========
Basic earnings per share                    $      0.15          $      0.60
                                            ===========          ===========
Diluted earnings per share:
Net income                                  $     7,609          $    30,216
                                            ===========          ===========
Divided by the sum of:
   Weighted average common shares            50,439,747           50,380,317
   Dilutive effect of convertible
     securities                               1,070,000              360,000
   Dilutive effect of common stock
     equivalents                                550,253              599,683
                                            -----------          -----------
   Diluted average common shares             52,060,000           51,340,000
                                            ===========          ===========
Diluted earnings per share                  $      0.15          $      0.59
                                            ===========          ===========


4.  RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("SFAS No. 133").  The Statement establishes
accounting and reporting standards requiring that every derivative instrument
(including certain derivative instruments embedded in other contracts) be
recorded in the balance sheet as either an asset or liability measured at its
fair value.  The Statement requires that changes in the derivative's fair value
be recognized currently in earnings unless specific hedge accounting criteria
are met.  Special accounting for qualifying hedges allows a derivative's gains
and losses to offset related results on the hedged item in the income statement,
and requires that a company must formally document, designate, and assess the
effectiveness of transactions that receive hedge accounting.  SFAS No. 133 was
originally effective for fiscal years beginning after June 15, 1999. Companies
may also implement the Statement as of the beginning of any fiscal quarter after
issuance (that is, fiscal quarters beginning June 16, 1998 and thereafter).
SFAS No. 133 cannot be applied retroactively.  SFAS No. 133 must be applied to
(a) derivative instruments and (b) certain derivative instruments embedded in
hybrid contracts that were issued, acquired, or substantively modified after
December 31, 1997 (and, at the company's election, before January 1, 1998).

In June 1999, the FASB issued Statement of Financial Accounting Standards No.
137, "Accounting for Derivative Instruments and Hedging Activities--Deferral of
the Effective Date of FASB Statement No. 133"  ("SFAS 137") delaying the
effective date of SFAS 133 for all fiscal quarters of all fiscal years beginning
after June 15, 2000.

The Company has not yet quantified the impacts of adopting SFAS No. 133 on its
financial statements and has not determined the timing of or method of adoption
of SFAS No. 133.  The Company does not significantly participate in derivative
contracts or participate in contracts with derivative instruments embedded in
other contracts; however, the statement may increase volatility in earnings and
other comprehensive income.

                                       8
<PAGE>

5.  BUSINESS COMBINATIONS

Purchases
---------

The following is a discussion of the Company's acquisitions accounted for as
purchases.  Operating results for each of the respective acquisitions have been
included in the Company's operations since the date of acquisition.  Pro forma
disclosure regarding these purchase acquisitions have not been provided because
they are not material to the operations of the Company.  On January 29, 1999,
the Company acquired Global Resource Management ("GRM"), located in
Jacksonville, Florida.  On January 9, 1999, the Company acquired Direct
Resources Scotland Limited ("Direct Resources"), of Edinburgh, Scotland.

The GRM and Direct Resources acquisitions had combined revenues of approximately
$15.7 million for the year ended December 31, 1998.  Additionally, the assets of
these two companies as of December 31, 1998 were approximately $3.2 million.
The excess of purchase price over the fair value of net assets acquired has been
recorded as goodwill and will be amortized over a thirty-year life using the
straight-line method. Future payments for each acquisition will be made based
upon an agreed upon calculation for the years ending 1999 and 2000.  The
aggregate amount of the payments related to the independent agreements will not
exceed  $2.9 million.  A payment of approximately $1.4 million was made during
the third quarter 1999 related to these agreements.

On October 26, 1998, the Company acquired International MIS, Inc. ("IMIS"),
located in San Francisco, California.  On July 1, 1998, the Company acquired MC
Computer Services Pty Limited ("MCCS") of Canberra, Australia.  As part of these
two independent agreements, an agreed upon amount was recorded as a long-term
liability which represents the unpaid purchase price related to these
acquisitions.  Additionally, goodwill has been recorded for these two purchases
and will be adjusted based upon the finalization of the fair value studies of
assets acquired and may be adjusted based upon future payments.   Any such
adjustments will not materially affect the overall financial position or results
of operations of the Company.  Future payments will be made based upon an agreed
upon calculation for the years ending 1999, 2000 and 2001. Future payments will
not exceed $8.0 million under the terms of one agreement.

Pooling of Interests
--------------------

On January 4, 1999 the Company acquired all the issued and outstanding stock of
The Amber Group ("Amber") in exchange for 1,095,001 of the Company's common
stock.  The revenues related to Amber were $10.5 million as of December 31,
1998.  The Company's consolidated condensed financial statements have been
restated to include results for Amber for all periods presented.  In connection
with the merger, the Company incurred approximately $1.7 million of merger-
related costs which were expensed in the first quarter of 1999.


6.  SEGMENT INFORMATION

The Company is a provider of IT services, and is organized into office locations
throughout the world. The Company has three reportable segments: the High Value
Services group, the U.S. Client Services group and the International Client
Services group.  The chief operating decision-makers evaluate each segment's
performance based primarily on their revenues, gross margin and operating
income. The accounting policies of the operating segments are the same as those
of the entire Company.

                                       9
<PAGE>

The following table summarizes selected financial information of the Company's
operations by segment:


<TABLE>
<CAPTION>
(dollars in thousands)
                                                 High             U.S.        International
                                                 Value           Client           Client        Corporate
Nine Months Ended September 30, 1999           Services         Services         Services     Activities (1)      Total
------------------------------------           --------         --------       ------------   --------------      -----
<S>                                            <C>             <C>            <C>             <C>               <C>
Revenues                                       $171,969         $101,488          $93,813       $      -        $367,270
Intersegment sales                               (4,206)               -                -              -          (4,206)
                                               --------         --------          -------       --------        --------
Reported revenues                               167,763          101,488           93,813              -         363,064
                                               --------         --------          -------       --------        --------
Expenses                                              -                -                -        332,848         332,848
                                               --------         --------          -------       --------        --------
Net income                                                                                                      $ 30,216
                                                                                                                ========
                                                 High             U.S.        International
                                                 Value           Client           Client        Corporate
Nine Months Ended September 30, 1998(2)        Services         Services         Services     Activities (1)      Total
---------------------------------------        --------         --------       ------------   --------------      -----
Revenues                                       $120,400         $ 95,494          $74,283       $      -        $290,177
Intersegment sales                               (4,735)               -                -              -          (4,735)
                                               --------         --------          -------       --------        --------
Reported revenues                               115,665           95,494           74,283              -         285,442
                                               --------         --------          -------       --------        --------
Expenses                                              -                -                -        262,537         262,537
                                               --------         --------          -------       --------        --------
Net income                                                                                                      $ 22,905
                                                                                                                ========
                                                 High             U.S.        International
                                                 Value           Client           Client        Corporate
Three Months Ended September 30, 1999          Services         Services         Services     Activities (1)      Total
-------------------------------------          --------         --------       ------------   --------------      -----
Revenues                                       $ 60,052         $ 30,155          $28,195       $      -        $118,402
Intersegment sales                               (1,229)               -                -              -          (1,229)
                                               --------         --------          -------       --------        --------
Reported revenues                                58,823           30,155           28,195              -         117,173
                                               --------         --------          -------       --------        --------
Expenses                                              -                -                -        109,564         109,564
                                               --------         --------          -------       --------        --------
Net income                                                                                                      $  7,609
                                                                                                                ========
                                                 High             U.S.        International
                                                 Value           Client           Client        Corporate
Three Months Ended September 30, 1998(2)       Services         Services         Services     Activities (1)      Total
----------------------------------------       --------         --------       ------------   --------------      -----
Revenues                                       $ 46,116         $ 33,926          $27,636       $      -        $107,678
Intersegment sales                               (1,180)               -                -              -          (1,180)
                                               --------         --------          -------       --------        --------
Reported revenues                                44,936           33,926           27,636              -         106,498
                                               --------         --------          -------       --------        --------
Expenses                                              -                -                -         96,435          96,435
                                               --------         --------          -------       --------        --------
Net income                                                                                                      $ 10,063
                                                                                                                ========
</TABLE>
(1) Corporate activities include all general and selling expenses as well as
    merger-related expenses and special charges. This line item also includes
    interest income and other unallocated charges. Since all expenses have not
    been allocated to the business segments, this basis is not necessarily a
    measure computed in accordance with generally accepted accounting
    principles and may not be comparable to other companies.

(2) Restated for pooling of interests transaction as discussed in Note 5.


There have been no material changes in total assets from the amount disclosed in
the 1998 annual report on Form 10-K.  Additionally, there have been no changes
to the basis of measurements of segments between the 1998 annual report on Form
10-K and the first nine months ended 1999.

                                       10
<PAGE>

7.  SPECIAL CHARGE

The Company incurred a special charge of $3.5 million or $0.05 per basic share
during the third quarter of 1999 related to the winding down of past and current
projects with a large integrator client.  These costs consist primarily of
relocation costs and extra training costs for personnel previously engaged with
this client.

8.  MERGER-RELATED EXPENSES

In connection with the acquisition of Amber,  $1.7 million or $0.03 per share of
merger-related costs and expenses were incurred and have been charged to expense
in the first quarter of 1999.  These expenses consisted primarily of severance
payments, office closures, and related professional fees. The Company assessed
its workforce as part of the acquisition of Amber and concluded that the
additional layer of management that would have been formed was not consistent
with the Company's long-range business plan.

In connection with the acquisition of Quantum Information Resources ("Quantum"),
$3.2 million or $0.06 per share of merger-related costs and expenses were
incurred and were charged to expense in the second quarter of 1998.


9.   GE  INVESTMENT

On July 22, 1999, Mastech completed a private placement of a $30,000,000
Convertible Promissory Note (the "Note") with GE Capital Equity Investments,
Inc. ("GE Capital").  The entire principal amount of the Note matures on July
22, 2004.  The Note accrues interest at the rate of 6.30% per annum, payable
semi-annually in arrears on the last day of each July and January.  The first
interest payment is scheduled for January 31, 2000.  The Note is convertible at
any time after July 22, 2003 through its maturity, at the option of the holder,
into shares of Mastech common stock at an initial conversion price of $21.64 per
share in the event that the certain performance targets are achieved.


10.  SHARE REPURCHASE PROGRAM

On September 13, 1999, the Company announced that its Board of Directors had
approved a stock repurchase plan for up to 3,000,000 common shares or
approximately 6% of the total outstanding shares of the company.  The
repurchases of common stock may occur from time to time on the open market or
through privately negotiated transactions funded through cash on hand.  As of
October 29, 1999, the Company has purchased 373,500 shares at a cost of $5.0
million and has placed these shares in treasury. Any gains or losses incurred on
the transactions based upon these shares will be properly offset to additional
paid-in capital in accordance with generally accepted accounting principles.

                                       11
<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors of Mastech Corporation:

We have reviewed the accompanying condensed consolidated balance sheet of
Mastech Corporation (a Pennsylvania Corporation)  and subsidiaries as of
September 30, 1999,  the related condensed consolidated statements of income for
the three and nine month periods ended September 30, 1999 and 1998 and the
condensed consolidated statement of shareholders' equity and cash flows for the
nine month periods ended September 30, 1999 and 1998. These condensed
consolidated financial statements are the responsibility of the Company's
management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying condensed consolidated financial statements referred
to above for them to be in conformity with generally accepted accounting
principles.

We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Mastech Corporation and
subsidiaries as of December 31, 1998, (not presented herein) prior to the
restatement of the consolidated balance sheet in connection with the pooling of
interests transaction described in Note 1, and, in our report dated February 9,
1999, we expressed an unqualified opinion on that statement.  In our opinion,
the information set forth in the accompanying condensed consolidated balance
sheet as of December 31, 1998, is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.


                                                     /S/ ARTHUR ANDERSEN LLP

Pittsburgh, Pennsylvania,
October 22, 1999




                                       12
<PAGE>

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

Part I, Item 2 of this report should be read in conjunction with Part II, Item 7
of Mastech's Annual Report to the United States Securities and Exchange
Commission ("SEC") on Form 10-K for the year ended December 31, 1998. The
information contained herein is not a comprehensive management overview and
analysis of the financial condition and results of operations of the Company,
but rather updates disclosures made in the aforementioned filing.  The following
discussion should also be read in conjunction with the consolidated condensed
financial statements and notes thereto appearing elsewhere in this report. As
used herein, "Mastech" or the "Company" shall mean Mastech Corporation and each
of its consolidated subsidiaries.

This Form 10-Q contains certain "forward-looking statements" (statements which
are not historical facts) such as statements about future financial performance,
capital expenditures, liquidity sources and needs, the Year 2000 ("Y2K") problem
and certain other operations matters. Words or phrases denoting the anticipated
results of future events--such as "anticipate," "believe," "estimate," "expect,"
"will likely," "are expected to," "will continue," "project," and similar
expressions that denote uncertainty--are intended to identify such forward-
looking statements. These forward-looking statements are subject to several
risks and uncertainties, and the Company's actual future results may differ
significantly from those stated in any forward-looking statements. While it is
impossible to identify each factor and event that could affect the Company's
results, variations in the Company's revenues and operating results occur from
time to time as a result of a number of factors, such as the significance of
client engagements commenced and completed during a quarter or a year, the
number of working days in a quarter or a year, employee hiring, retention, and
utilization rates, acceptance and profitability of the Company's services in new
territories, integration of companies acquired, competition, general economic
conditions and economic conditions specific to the information technology
industry, which are discussed in Mastech's 1998 Annual Report to the SEC
Form 10-K under the caption "Risk Factors". Many of these factors are beyond the
Company's ability to predict or control. As a result of these and other factors,
quarterly revenues and operating results are difficult to forecast, and the
Company may experience significant quarterly and yearly variations in operating
results.


OVERVIEW

Mastech Corporation was incorporated in Pennsylvania on November 12, 1996.
Mastech Systems, a Pennsylvania corporation through which the business of the
Company has been conducted since its inception in July 1986, is an indirect,
wholly owned subsidiary of the Company.

Mastech's revenues are derived from fees paid by clients for professional
services. Historically, a substantial majority of the Company's projects have
been client-managed. On client-managed projects, Mastech provides professional
services as a member of the project team on a time-and-materials basis. The
Company recognizes revenues on time-and-materials projects as the services are
performed. On Mastech-managed projects, Mastech assumes responsibility for
project management and bills the client on a time-and-materials or fixed-price
basis. Revenues on fixed-price contracts are recognized by the percentage of
completion method. Revenues generated through offshore software development
centers on U.S. Client engagements are included in U.S. revenues.

Mastech's most significant cost is its personnel expense, which consists
primarily of salaries and benefits of the Company's billable personnel. The
number of information technology ("IT") professionals assigned to projects may
vary depending on the size and duration of each engagement. Moreover, project
terminations, project completions and scheduling delays may result in periods
when personnel are not assigned to active projects. Mastech manages its
personnel costs by closely monitoring client needs and basing personnel
increases on specific project engagements. While the number of IT professionals
may be adjusted to reflect active projects, the Company must maintain a
sufficient number of professionals to respond to demand for the Company's
services on both existing projects and new engagements.

The Company has incurred significant incremental expenses to help ensure that
the Company has both an adequate number of skilled IT professionals and the
infrastructure necessary to sustain the Company's growth. These expenditures
were incurred in connection with: (i) the development and launch of additional
service offerings, including E-Business and

                                       13
<PAGE>

Enterprise Network Solutions; (ii) the establishment of a recruiting division to
recruit IT professionals in the U.S. and worldwide; (iii) the opening of foreign
sales offices to provide better access to the global market; (iv) the
development of three offshore software development centers in India; (v) the
hiring of additional managers to support a larger organization; and (vi) the
establishment of a training center to improve the skill levels of new and
current employees. While these expenses have increased the Company's selling,
general and administrative expenses, the Company believes that the revenues
expected to be derived as a result of these expenditures have not yet been fully
realized.

Mastech sells its services to large and medium-sized organizations. The
Company's sales force is organized to meet the needs of the marketplace through
three primary groups: (i) the High Value Services group (ii) the U.S. Client
Services group; and (iii) the International Client Services group.

The High Value Services group provides IT professionals trained in ERP
implementations, E-business consulting and network services, in addition to
managing engagements in the aforementioned services. Additionally, this group
provides services through offshore software development centers which are
connected via secure, high-speed satellite links to the Company's headquarters
and client sites. This group works directly with the end-user clients and also
partners with a wide array of software companies, ranging from ERP to supply-
chain and customer relationship management, and systems integrators on teamed
implementation efforts.

The U.S. Client Services group is divided into geographic regions, each of which
is directed by a Manager or Regional Director. Each region includes multiple new
business development managers. These individuals use a proprietary database of
several thousand prospects to telemarket Mastech's services nationally. The
Company subsequently sends interested prospective clients a written proposal
providing information about the Company, its approach and methodology,
schedules, team members, pricing and terms. The U.S. Client Services group also
focuses on developing national and global relationships with major systems
integrators such as IBM, KPMG, Ernst & Young and Oracle. Mastech assists these
integrators in meeting their customers' needs by providing specialized technical
expertise and complementary capabilities such as offshore development.

The International Client Services group operates through offices in eleven
different countries. Each office is supervised by a Country Manager and
supported by dedicated sales personnel who sell directly to new clients using an
approach similar to the Company's U.S. sales approach. Additionally, these
offices focus on leveraging Mastech's existing relationships with its U.S.-based
multinational clients.

Financial results for the nine months ended September 30, 1998 have been
restated to reflect the acquisition of Amber in a business combination that was
accounted for as a pooling of interests, which is discussed in Note 5 to the
consolidated condensed financial statements.

THREE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED
WITH THE THREE MONTHS ENDED SEPTEMBER 30, 1998

  Revenues.   The Company's revenues increased 10.0%, or $10.7 million, to
$117.2 million in the third quarter of 1999 from $106.5 million in the third
quarter of 1998. Of this overall increase in revenues, the High Value Services
group, U.S. Client Services group and International Client Services group
contributed an increase of $13.9 million, a decrease of $3.8 million and an
increase of $600,000, respectively. The increase in High Value Services group
can be attributed to additional services provided to existing clients and
continued market penetration, as well as the rapid increase in e-Business
services. The increase in the International Client Services group is primarily
the result of the continued increase in market penetration and strong market
demand in Australia and Europe. The decrease in the U.S. Client Services group
was primarily a result of the winding down of services with a large integrator
client as well as a general decline in demand for Company services due to the
reluctance of customers to implement new IT projects as they focus on their
internal Year 2000 compliance efforts.

  Gross Profit.   Gross profit consists of revenues less cost of revenues. Cost
of revenues consists primarily of salaries and employee benefits for billable IT
professionals and the associated travel and relocation costs of these
professionals, as

                                       14
<PAGE>

well as the cost of the independent contractors used by the Company. Gross
profit increased 11.8%, or $4.2 million to $39.4 million in the third quarter of
1999 from $35.2 million in the third quarter of 1998. Gross profit as a
percentage of revenues increased slightly to 33.6% in the third quarter of 1999
from 33.1% in the third quarter of 1998. The primary reasons for the increase in
gross profit as a percentage of revenues were the expansion into new higher
margin business lines such as E-Business services, network solutions and
customer relationship management and improved IT-professional utilization.

  Selling, General and Administrative Expenses.   Selling, general and
administrative ("SG&A") expenses consist of costs associated with the Company's
sales and marketing efforts, executive management, finance and human resource
functions, facilities and telecommunication costs and other general overhead
expenses. SG&A expenses increased 19.5%, or $4.0 million, to $24.4 million in
the third quarter of 1999 from $20.4 million in the third quarter of 1998. The
increase in SG&A expenses reflects the costs of supporting the Company's
continued revenue growth and expansion into new business lines and geographic
regions. As a percentage of revenues, SG&A expenses increased to 20.8% for the
third quarter of 1999 from 19.2% for the third quarter of 1998. The Company
continues to monitor SG&A costs and expenses through an aggressive focus on
utilizing cost saving technologies.

   Special Charge.    The Company incurred a special charge of $3.5 million or
$0.05 per basic share during the third quarter of 1999 related to the winding
down of past and current projects with a large integrator client. These costs
consist primarily of relocation costs and extra training costs for personnel
previously engaged with this client.

  Other Income, Net.     Other income was $465,000 in the third quarter of 1999
compared to other income of $730,000 in the third quarter of 1998. This decrease
of $265,000 in other income was primarily the result of losses incurred due to
the Company's investments in two 50% owned joint ventures during the third
quarter of 1999.

  Income taxes.   Provision for income taxes was $4.3 million, or an effective
tax rate of 36.3% for the third quarter ended September 30, 1999 compared to
$5.5 million, or an effective tax rate of 35.3% for the third quarter ended
September 30, 1998. Primary factors for the change in effective tax rates
includes the effect of non-deductible special charges recognized in the third
quarter of 1999 and acceleration of permanent tax differences into income.
Other factors contributing to the effective tax rate included an increase in the
amounts of permanent book to tax differences which consist primarily of goodwill
and amortization;  changes in tax status of acquired businesses; tax-exempt
interest income generated by the Company's municipal bond portfolio; and the tax
holiday for the Company's Indian operations as well as overall tax planning
initiatives.

   Outlook.   The Company has experienced, and expects to continue to experience
through at least December 31, 1999, a decline in the demand for its non-Year
2000 services, due to the reluctance of customers to implement new IT projects
as they focus on their Year 2000 compliance efforts.  The reduction in demand
for the Company's services arising from Year 2000 related factors could result
in significant fluctuations in the Company's quarterly revenues or operating
results and could result in significant differences between the Company's actual
and expected results.

NINE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED
WITH THE NINE MONTHS ENDED SEPTEMBER 30, 1998

  Revenues.   The Company's revenues increased 27.2%, or $77.6 million, to
$363.0 million in the first nine months of 1999 from $285.4 million in the first
nine months ended 1998. Of this overall increase in revenues, the High Value
Services group, U.S. Client Services group and the International Client Services
group contributed increases of $52.1 million, $6.0 million and $19.5 million,
respectively.  The increase in the High Value Services group can be attributed
to additional services provided to existing clients and continued market
penetration and the continued growth of e-Business services. The increase in the
International Client Services group is primarily the result of the continued
increase in market penetration and strong market demand in Australia and Europe.
The smaller increase in the U.S. Client Services group was primarily a result of
the winding down of services with a large integrator client as well as a general
decline in demand for Company services due to the reluctance of customers to
implement new IT projects as they focus on their internal Year 2000 compliance
efforts.

                                       15
<PAGE>

  Gross Profit.  Gross profit increased 28.9%, or $27.1 million to $120.6
million in the first nine months of 1999 from $93.5 million in the first nine
months ended 1998.  Gross profit as a percentage of revenues increased to 33.2%
in the first nine months of 1999 from 32.8% in the first nine months of 1998.
The primary reasons for the increase in gross profit as a percentage of revenues
were the expansion into new higher margin business lines such as E-Business
services, network solutions and customer relationship management and improved
IT-professional utilization.

  Selling, General and Administrative Expenses.   Selling, general and
administrative expenses increased 27.7%, or $15.2 million, to $70.0 million in
the first nine months of 1999 from $54.8 million in the first nine months of
1998. The increase in selling, general and administrative expenses reflects the
costs of supporting the Company's continued revenue growth and expansion into
new business lines and geographic regions. As a percentage of revenues, SG&A
expenses increased slightly to 19.3% in the first nine months of 1999 from 19.2%
in the first nine months of 1998. The Company continues to monitor its SG&A
costs and expenses through an aggressive focus on utilizing cost saving
technologies.

   Special Charge.   The Company incurred a special charge of $3.5 million or
$0.05 per basic share during the third quarter of 1999 related to the winding
down of past and current projects with a large integrator client. These costs
consist primarily of relocation costs and extra training costs for personnel
previously engaged with this client.

  Other Income, Net.   Other income was $1.8 million in the first nine months of
1999 compared to other income of $2.1 million in the first nine months of 1998.
This decrease of $300,000 in other income was primarily the result of losses
incurred due to the Company's investments in two 50% owned joint ventures during
the third quarter of 1999.

  Merger-Related Expenses.   The Company incurred $1.7 million of merger-related
expenses in connection with the Amber acquisition during the first nine months
of 1999. The Company also incurred $3.2 million of merger-related expenses in
connection with the Quantum acquisition during the first nine months of 1998.
These expenses consisted primarily of severance payments, office closures, and
related professional fees.

  Income taxes.   Provision for income taxes was $16.9 million, or an effective
tax rate of 35.9% for the first nine months of 1999 compared to $14.8 million,
or an effective tax rate of 39.2% for the first nine months of 1998. Factors
contributing to the reduction in the effective tax rate included an increase in
the amounts of permanent book to tax differences which consist primarily of
goodwill and amortization;  changes in tax status of acquired businesses; tax-
exempt interest income generated by the Company's municipal bond portfolio; and
the tax holiday for the Company's Indian operations as well as overall tax
planning.


Liquidity and Capital Resources

The Company continued to generate cash flows from operations to fund its
business growth.  The Company has also continued to strengthen its working
capital position.  At September 30, 1999, the Company had cash and short-term
investments of $116.4 million, consisting of cash of $33.2 million and short-
term investments of $83.2 million.  This compares to cash and short-term
investments of $82.6 million, consisting of cash of $35.5 million and short-term
investments of $47.1 million at December 31, 1998.   Cash provided by operating
activities was $17.9 million for the nine months ended September 30, 1999 as
compared to cash provided by operating activities of $15.6 million for the nine
months ended September 30, 1998.   The increase of $2.2 million resulted from
increases in net income and accrued liabilities.

At September 30, 1999, the Company's billed days sales outstanding ("DSO") based
upon billed receivables was 65 compared to 60 billed DSO at December 31, 1998.
The increases in DSO were primarily associated with several major clients
centered mostly in the United States.  The Company continually focuses on
collecting on its receivables, involving several management departments.

Cash used in investing activities was $52.7 million and $71.5 million for the
nine months ended September 30, 1999 and 1998, respectively. Acquisitions, net
of cash acquired totaled approximately $10.5 million during the first nine
months of 1999 compared to $4.2 million during the first nine months of 1998.
Capital expenditures for the nine months ended

                                       16
<PAGE>

September 30, 1999 and 1998 were approximately $5.3 million and $8.1 million,
respectively. These capital expenditures consisted primarily of computer and
related equipment to support its technical, consulting and administrative
functions. Also included in these capital expenditures were leasehold
improvements. Cash used to purchase investments were $36.5 million during the
first nine months of 1999. During the first nine months of 1998, the Company
recorded its net purchase of investments of $58.5 million. These investments are
classified as available-for-sale and recorded at fair value. Purchases of
investments for the first nine months of 1999 includes the proceeds from the
issuance of long term debt to GE Capital Equity Investments, Inc. (see below).

The Company entered into two 50% owned joint ventures during the third quarter
of 1999.  Both of these joint ventures are in the start-up phase of their
existence. Cash flows net of losses incurred due to start up totaled $450,000.

Net cash flows provided by financing activities was $31.1 million for the first
nine months of 1999; this amount was primarily due to the proceeds from the
issuance of long term debt as discussed below. Net cash flows used in financing
activities were $4.3 million for the first nine months of 1998.  At September
30, 1999, the company purchased treasury stock at a cost of $916,000. Cash
provided by financing activities was $3.3 million for the first nine months
ended September 30, 1999, mainly due to the proceeds from the exercise of
employee stock options. This compares to cash provided by financing activities
related to the proceeds from the exercise of employee stock options of $3.9
million for the first nine months of September 30, 1998.

On July 22, 1999, Mastech completed a private placement of a $30,000,000
Convertible Promissory Note (the "Note") with GE Capital Equity Investments,
Inc. ("GE Capital").  The entire principal amount of the Note matures on July
22, 2004.  The Note accrues interest at the rate of 6.30% per annum, payable
semi-annually in arrears on the last day of each July and January.  The first
interest payment is scheduled for January 31, 2000.  The Note is convertible at
any time after July 22, 2003 through its maturity, at the option of the holder,
into shares of Mastech common stock at an initial conversion price of $21.64 per
share in the event that the certain performance targets are achieved.

The Company has in place a $75.0 million revolving credit facility with PNC
Bank, National Association ("the Credit Facility").  This Credit Facility bears
interest at a rate per annum equal to a base rate (which is adjusted by a change
in the prime rate or the Federal Funds Effective Rate at the Company's option)
that is equal to the sum of the Euro-rate plus an applicable Euro-rate margin.
The Credit Facility contains certain restrictive covenants and financial ratio
requirements which would limit distributions to shareholders and additional
borrowings.  There were no borrowings outstanding under this arrangement at
September 30, 1999 or at December 31, 1998.

The Company does not believe that inflation had a significant impact on the
Company's results of operations for the periods presented. On an ongoing basis,
the Company attempts to minimize any effects of inflation on its operating
results by controlling operating costs and, whenever possible, seeking to insure
that billing rates reflect increases in costs due to inflation.

Management believes that the Company will be able to meet its liquidity and cash
needs for the next twelve months through a combination of cash flows from
operating activities, cash balances and unused borrowing capacities (see above).

The Company's functional currency for financial reporting purposes is the US
Dollar. The Company generally invoices its clients in the local currency of the
country in which the client is located. Translation gains and losses arising
from differences between the functional and local currencies are recognized in
the consolidated condensed income statements and have not had a significant
impact on the results of operations. Gains and losses as a result of
fluctuations in foreign currency exchange rates are recognized in shareholders'
equity as a component of comprehensive income. The Company continually evaluates
the economic conditions of each country in which it operates and bases its
foreign currency accounting policies on those assessments.

                                       17
<PAGE>

Year 2000 ("Y2K")

The Y2K problem refers to problems which may occur because some computer systems
currently record years in a two-digit format. These computer systems may have
difficulty recognizing or processing date information after December 31, 1999.
The Y2K problem may also occur with embedded chips. The Company has been working
to evaluate the potential effect of the Y2K problem on the Company's operations.


Internal Systems

The Company developed a plan to evaluate its key internal computer systems. The
plan consisted of the following four phases: Inventory; Evaluation/Assessment of
Y2K Risk; Remediation and Testing. The Company has completed all phases of
evaluation for the internal financial and operational systems located at the
corporate headquarters of the Company. Based upon written documentation and
information available on vendor websites, certain testing procedures for
business critical hardware and software were developed and implemented by the
Company. An independent third party reviewed both vendor information and testing
results and conducted other tests to validate work performed. As a result of
this, the Company does not believe that the internal computer systems at its
corporate headquarters will experience significant Y2K problems.

The Company has also completed the evaluation of the internal financial and
operational systems of its other U.S. locations and international operations,
excluding certain systems involving operations of companies recently acquired by
the Company. The Company has completed an evaluation of the internal financial
and operational systems of companies acquired through September 30, 1999. At
this time, the Company does not believe that the internal financial and
operational systems of its other U.S. location computer systems will experience
significant Y2K problems.

Cost of Year 2000 Compliance Efforts

The Company does not expect to incur substantial costs with respect to its Y2K
compliance efforts and the Company has not deferred other information technology
projects as a result of the Y2K problem. To date, the Company has incurred
expenses totaling $129,000 and anticipates that its total expenses will not
exceed $250,000 These figures are primarily reflective of the costs associated
with the use of third parties to review and validate work performed and the
costs assessing Y2K problems relating to or arising with respect to third
parties. The cost estimates do not include the cost of internal efforts by
Company personnel. The Company has not separately accounted for these internal
costs.

Third Party Relationships

The Company has contacted its key vendors regarding their Y2K compliance
efforts. Although the Company has received some information from its vendors
regarding their Y2K compliance efforts, there can be no assurance that the
Company will not experience disruptions in its ability to conduct its business
because of Y2K problems experienced by the Company's vendors.

In addition, the Company has contacted its key customers regarding their Y2K
compliance efforts. Although the Company has received some information from its
customers regarding their Y2K compliance efforts, there can be no assurance that
such customers will not experience disruptions in their business which would
result in material adverse affects to the Company. One example of a worst case
scenario would be a failure in the accounting systems of a significant number of
the Company's key clients due to the Y2K problem that resulted in a delay in the
payment of invoices issued by the Company for services and expenses.

Potential Liability to Third Parties

The Company has participated in Y2K remediation projects for some of its
customers. Although the Company has no reason to believe that any such work will
result in litigation against the Company, it is possible that the Company could
be materially adversely affected by litigation in connection with the Y2K
remediation services provided by the Company.

                                       18
<PAGE>

The Company's policy has been to attempt to include provisions in client
contracts that, among other things, disclaim implied warranties, limit the
duration of express warranties, limit the Company's liability to predetermined
amounts, and disclaim any liability arising from third-party software that is
implemented or installed by the Company. The Company also maintains insurance to
protect against potential liability in connection with Y2K remediation services
provided by the Company. There can be no assurance that the Company will be able
to obtain the desired contractual protections in agreements or that any such
contractual provisions will prevent clients from asserting claims against the
Company with respect to the Y2K issue. There also can be no assurance that the
contractual protections, if any, obtained by the Company or the insurance
coverage will operate to protect the Company from, or adequately limit the
amount of, any liability arising from claims asserted against the Company.

Contingency Plan

The Company has developed a contingency plan to address various situations which
may result if the Company experiences Y2K problems. The plan will include
identification of major systems, dependencies on third parties and resources and
strategies necessary to restore operations or work around failures. The
contingency plan will be approved by the Board of Directors on December 6, 1999.
There can be no assurance that the contingency plan developed by the Company
will adequately protect the Company from internal Y2K problems or prevent
service interruption or failures experienced by customers and suppliers from
having a material adverse effect on the Company.

Demand for Year 2000 Services

Many of the Company's clients have needed to repair or replace their legacy
systems because of Y2K issues. The Company believes this has favorably impacted
the demand for its services and products. Mastech expects that the demand for
its  Y2K related services will diminish significantly over time and will
eventually disappear. The Company also believes that as companies focus on Y2K
issues, other less critical projects have not been and may not be initiated or
may be suspended. Although the Company provides a broad range of information
technology services, Mastech believes that the reduction in the future demand
for its services that may result from these Y2K-related factors could have an
adverse impact on its future performance.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

On June 30, 1998, the Company entered into a foreign exchange contract with PNC
Bank, National Association to hedge its foreign exchange exposure on certain
intercompany debt. This contract matured on each fiscal quarter end and was
extended for an additional three months each time.  The Company realized interim
gains on the contract extensions at each of September 30, 1998 and December 31,
1998, and September 30, 1999; and realized an interim loss on the contract
extensions at each of March 31, 1999 and June 30, 1999. Gains or losses were
recognized under hedge accounting in Shareholder's Equity as a component of
Currency Translation Adjustment. Such gains and losses are essentially offset in
Currency Translation Adjustment by gains or losses on the translation of the
related debt. On September 30, 1999, the contract was extended to December 30,
1999.

The outstanding contract is the far end of a swap for the sale by the Company of
7 million Canadian dollars at 1.4615 (US $4,789,600). It is the intention of the
Company to continue to extend the contract on a quarterly basis until ultimate
repayment of the intercompany loan. If the Canadian dollar weakens resulting in
a higher USD/CAD exchange rate than 1.4615 on September 30, 1999, the Company
will record an interim gain upon extension of the contract. If the Canadian
dollar strengthens resulting in a lower USD/CAD exchange rate than 1.4615 on
December 30, 1999, the Company will record an interim loss upon extension of the
contract.  At September 30, 1999, the USD/CAD exchange rate was 1.4680.

                                       19
<PAGE>

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

Neither the Company nor any of its subsidiaries is party to any litigation that
is expected to have a material or adverse effect on the Company or its business.


ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

On July 22, 1999, Mastech completed a private placement of a $30,000,000
Convertible Promissory Note (the "Note") with GE Capital Equity Investments,
Inc. ("GE Capital").  The entire principal amount of the Note matures on July
22, 2004.  The Note accrues interest at the rate of 6.30% per annum, payable
semi-annually in arrears on the last day of each July and January.  The first
interest payment is scheduled for January 31, 2000.  The Note is convertible at
any time after July 22, 2003 through its maturity, at the option of the holder,
into shares of Mastech common stock at an initial conversion price of $21.64 per
share in the event that the certain performance targets are achieved.

The Company relied upon the exemption from registration provided by Section 4(2)
of the Securities Act of 1933, as amended, in connection with the offer and sale
of the Note and shares of Mastech common stock underlying the Note. In this
regard, the Company relied upon representation from GE Capital regarding its
investment intent, sophistication and status as an accredited investor. No
underwriter was involved in this private placement. The Company has agreed to
file a registration statement registering the shares of Mastech common stock
underlying the Note for resale.


ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

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

         None.


ITEM 5.  OTHER INFORMATION


Government Regulation of Immigration

The Company recruits its IT professionals on a global basis and, therefore, must
comply with the immigration laws in the countries in which it operates,
particularly the United States. As of September 30, 1999, approximately 35% of
the Company's worldwide workforce were working under H-1B temporary work permits
in the United States. Government regulation limits the number of new H-1B
permits that may be approved in a fiscal year. On October 22, 1998, the
"American Competitiveness and Workforce Improvement Act" was signed into law.
The H-1B annual quota for fiscal year 1999 was increased from 65,000 to 115,000.
The quota for fiscal years 2000 and 2001 will be 115,000 and 107,500
respectively. If the Company is unable to obtain H-1B visas for its employees in
sufficient quantities or at a sufficient rate for a significant period of time,
the Company's business, operating results and financial condition could be
adversely affected. As of September 30, 1999, there have been no significant
amendments or modifications to this law.

                                       20
<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)    Exhibits:

       The following exhibits are being filed with this report:

Exhibit Number     Description
--------------     -----------
      4.1          Note Purchase Agreement dated as of July 22, 1999 between
                   Mastech Corporation and GE Capital Equity Investments, Inc.

      4.2          Registration Rights Agreement dated as of July 22, 1999
                   between Mastech Corporation and GE Capital Equity
                   Investments, Inc.

     27.1          Financial Data Schedule for the three months ended
                   September 30, 1999

(b)    Reports on Form 8-K:

       The Company filed a Form 8-K on September 9, 1999, disclosing two press
       releases. The first press release announced the Company's revision of its
       revenue and earnings estimates for the quarter ending September 30, 1999.
       The second press release, dated September 13, 1999, announced that the
       Company's Board of Directors authorized the repurchase of up to 3,000,000
       shares of the Company's outstanding common stock from time to time on the
       open market or through privately negotiated transactions.

                                       21
<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.

                                           MASTECH CORPORATION
                                               (REGISTRANT)


Dated:   November 15, 1999                 /s/ Sunil Wadhwani
                                           ----------------------------
                                           Co-Chairman, Chief Executive
                                           Officer and Director

Dated:   November 15, 1999                 /s/ Jeffrey A. McCandless
                                           ----------------------------
                                           Vice President, Finance and
                                           Chief Financial Officer

                                       22
<PAGE>

                                 EXHIBIT INDEX

Exhibit Number     Description
--------------     -----------
     4.1           Note Purchase Agreement dated as of July 22, 1999 between
                   Mastech Corporation and GE Capital Equity Investments, Inc.

     4.2           Registration Rights Agreement dated as of July 22, 1999
                   between Mastech Corporation and GE Capital Equity
                   Investments, Inc.

    27.1           Financial Data Schedule for the three months ended
                   September 30, 1999

                                       23