<PAGE>



                         SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C.  20549


                                 --------------------

                                     FORM 10-QSB

(Mark one)
[x]    Quarterly Report under section 13 or 15(d) of the Securities 
       Exchange Act of 1934

                       For the quarter ended March 31, 1997

[ ]    Transition Report under section 13 or 15(d) of the Securities 
       Exchange Act of 1934

                              Commission File No. 0-27908

                      Semiconductor Laser International Corporation
  ------------------------------------------------------------------------
       (Exact Name of Small Business Issuer as Specified in its Charter)

             New York                                    16-1446679
----------------------------------------              -------------------
(State or other Jurisdiction of                         (I.R.S. Employer
Incorporation or Organization)                         Identification No.)

15 Link Drive, Binghamton, New York                          13904
----------------------------------------              -------------------
(Address of principal executive offices)                   (Zip code)

Registrant's telephone number, including area code: (607) 722-3800

     Check whether the issuer (1) 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 a 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    [ ]

     As of May 1, 1997, there were outstanding 3,530,868 shares of the 
issuers common stock, par value $.01 per share.

Transitional Small Business Disclosure Format

               Yes    [ ]                        No    [x]

<PAGE>

                         Part I. Financial Information

Item 1. Financial Statements


                   Semiconductor Laser International Corporation
                         (A Development Stage Enterprise)

                                   Balance Sheet
<TABLE>
<CAPTION>

                                                   December 31,      March 31,
                                                       1996            1997 
                                                                    (unaudited)
                                                   ------------     ------------
<S>                                               <C>              <C>
Assets
Current assets
  Cash and cash equivalents                       $  4,266,168     $  3,159,974
  Accounts Receivable, net of allowance for
   doubtful accounts of $25,000 and $25,000,             
   respectively                                         61,047           73,492
  Inventory                                              6,316           29,815
                                                   ------------     ------------
                  Total current assets               4,333,531        3,263,281

Property, plant and equipment, net                   3,035,929        2,461,819
Intangible assets, net                                   1,348            1,180
Deposits and other assets                              655,928          623,407
                                                   ------------     ------------
                  Total assets                    $  8,026,736     $  6,349,687   
                                                   ============     ============

Liabilities and Shareholders' Equity
Current liabilities
  Accounts payable                                $  1,142,272     $    514,681
  Accrued expenses and other liabilities                92,199           43,645
  Current portion of long-term debt                     25,948           31,800
                                                   ------------     ------------
                  Total current liabilities          1,260,419          590,126

Long-term debt                                         809,926          827,170
Accrued royalty payments                               100,000          100,000
                                                   ------------     ------------
                  Total liabilities                  2,170,345        1,517,296
                                                   ------------     ------------
Commitments and contingencies (Note 6)

Shareholders' Equity
Common stock, $.01 par value, 20,000,000 shares
 authorized, 3,409,607 issued and outstanding
 at December 31, 1996, and 3,530,838 issued and
 outstanding at March 31, 1997                          34,096           35,308
Common stock issuable                                1,123,438           51,250
Treasury stock                                        (248,241)        (248,241)
Additional paid-in capital                          10,081,464       11,152,436
Deficit accumulated during the development stage    (5,134,366)      (6,158,362)
                                                   ------------     ------------
                  Total Shareholders' Equity         5,856,391        4,832,391
                                                   ------------     ------------
                  Total liabilities and 
                    Shareholders' Equity          $  8,026,736     $  6,349,687   
                                                   ============     ============
</TABLE>

                  See accompanying notes to financial statements      

<PAGE>

                  Semiconductor Laser International Corporation
                        (A Development Stage Enterprise)

                             Statement of Operations

<TABLE>
<CAPTION>
                                        Three Months Ended
                                             March 31,           Cumulative
                                         1996         1997      From Inception
                                      (unaudited)  (unaudited)    (unaudited)
                                      -----------  -----------  --------------
<S>                                   <C>          <C>          <C>
Operating expenses:

Research and development expenses     $    83,320  $   508,816  $   2,948,674
General and administrative expenses       304,470      558,669      3,117,844
Royalties                                                             100,000
                                       ----------   ----------   ------------
         Loss from operations             387,790    1,067,485      6,166,518

Interest income                            17,187       43,489        313,457
                                       ----------   ----------   ------------
         Loss before extraordinary
           item                           370,603    1,023,996      5,853,061

Extraordinary loss on the early 
  extinguishment of debt                  305,301        -            305,301
                                       ----------   ----------   ------------   
         Net loss after extraordinary
           item                       $   675,904    1,023,996      6,158,362
                                       ==========   ==========   ============
Net loss per share

        Loss before extraordinary 
           item                          $  (0.20)    $  (O.29)      $  (1.68)
        Extraordinary item                  (0.17)          -           (0.09)
                                          -------      -------        -------
Net loss                                 $  (0.37)    $  (0.29)      $  (1.77)   
                                          =======      =======        =======

Weighted average shares outstanding     1,831,426    3,481,495      3,481,495
                                        =========    =========      =========

</TABLE>



                  See accompanying notes to financial statements

<PAGE>


                  Semiconductor Laser International Corporation
                        (A Development Stage Enterprise)

                            Statement of Cash Flows

<TABLE>
<CAPTION>
                                            Three Months Ended
                                                 March 31,           Cumulative
                                             1996         1997      From Inception
                                          (unaudited)  (unaudited)    (unaudited)
                                          -----------  -----------  --------------
<S>                                       <C>          <C>          <C>
Cash flows from operating activities:
Net loss                                  $  (675,904) $(1,023,996) $ (6,158,362)
Adjustments to reconcile net loss to
  net cash used in operating 
  activities:
   Depreciation                                11,033       25,194       126,091
   Expenses settled through the 
     issuance of common stock                                          1,254,590
   Amortization of debt discount               51,585                     64,699
   Amortization of deferred expenses                        23,294        23,294
   Extraordinary loss on early                
     extinguishment of debt                   305,301                    305,301
   Gain on sale of equipment                               (17,364)      (17,364)
Change in assets and liabilities:
   (Increase)decrease in accounts
     receivable, net                          (12,835)     (12,445)      (73,492)
   Decrease (increase)in inventory               (740)     (23,499)      (29,815)         
   (Increase) decrease in deposits
     and other assets                                     (333,040)     (449,096)
   (Increase) decrease in deferred
     financing costs                          134,431   
   Increase (decrease) in accounts
     payable                                  103,492      151,119     1,239,391
   Increase(decrease) in accrued 
     expenses and other liabilities            63,950      (48,554)       43,645
   Increase in accrued royalty 
     payments                                                            100,000
                                           -----------  -----------   -----------
Net cash used in operating activities         (19,687)  (1,259,291)   (3,517,118)
                                           -----------  -----------   -----------
Cash flows from investing activities:
Purchase of plant, property and 
   equipment                                  (30,969)  (2,546,855)   (6,906,531)
Sale of equipment                                        2,676,855     3,572,461
Increase in intangible assets                                             (3,370)
                                           -----------  -----------   -----------
Net cash provided from (used for)
   investing activities                       (30,969)     130,000    (3,337,440)          
                                           -----------  -----------   -----------
Cash flows from financing activities
Proceeds from long-term debt                  455,000       31,306     1,573,975
Payments on long-term debt                   (838,789)      (8,209)     (840,005)
Issuance of common stock, net of
   expenses                                 7,323,985                  9,280,562
                                           -----------  -----------   -----------
Net cash provided by financing
   activities                               6,940,196       23,097    10,014,532
                                           -----------  -----------   -----------
Net (decrease) increase in cash, cash
   equivalents and restricted cash          6,889,540   (1,106,194)    3,159,974
Cash, cash equivalents and restricted
   cash at beginning of period                531,042    4,266,168
                                           -----------  -----------   -----------
Cash, cash equivalents and restricted 
   cash at end of period                  $ 7,420,582  $ 3,159,974   $ 3,159,974
                                           ===========  ===========   ===========                                   
       
</TABLE>


                  See accompanying notes to financial statements

<PAGE>


                  Semiconductor Laser International Corporation
                        (A Development Stage Enterprise)


                          Notes to Financial Statements
                                  March 31, 1997



1. Organization
     
   Semiconductor Laser International Corporation ( the "Company") was 
   incorporated in New York State on September 21, 1993 (inception) to 
   produce high power semiconductor diode laser wafers and bars ("HPDLs)
   and to market these products worldwide.

   The Company's primary activities since incorporation as a development 
   stage enterprise had been research and development, business planning,
   raising capital, and constructing and equipping its manufacturing 
   facility. The Company had previously relied on facilities provided 
   through the Wright Cooperative Research and Development Agreement (CRDA) 
   with the U.S. Air Force for the development and quality control testing 
   of its HPDLs.  The Company has since completed the construction of its
   manufacturing facility in Binghamton, New York where it is conducting 
   all activities.

   Production of the Company's products has begun at the Company's new
   facility in Binghamton, New York.

2. Basis of Presentation

   The accompanying unaudited financial statements have been prepared by the
   Company.  Certain information and footnote disclosures normally included
   in financial statements prepared in conformity with generally accepted 
   accounting principles have been condensed or omitted.  In the opinion of
   the Company's  management, the disclosures made are adequate to make the 
   information presented not misleading, and the financial statements 
   contain all adjustments necessary to present fairly the financial 
   position as of March 31, 1997, and the results of operations and cash 
   flows for the three months ended March 31, 1997 and 1996.  The results of 
   operations for the three months ended March 31, 1997 are not necessarily 
   indicative of the results to be expected for the full year.

3. Summary of Significant Accounting Policies

   Use of Estimates

   The preparation of financial statements in conformity with generally 
   accepted accounting principles requires management to make estimates 
   and assumptions that affect the 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 revenue 
   and expenses during the period.  Actual results could differ from those 
   estimates.

   Cash Equivalents

   For purposes of the Statement of Cash Flows, the Company considers all 
   highly liquid debt instruments purchased with an initial maturity of
   three months or less to be cash equivalents.

<PAGE>

   Inventory

   Inventory is valued at the lower of cost or market.  Cost is determined
   by the first in, first out (FIFO) method and the cost of finished goods
   includes costs to purchase materials and subcontracted labor costs.

   Deferred Financing Costs

   Costs incurred in the preparation of the Company's initial public 
   offering were deferred and offset against the proceeds received from
   the offering

   Depreciation and Amortization

   Property plant and equipment are recorded at cost and depreciated over
   the assets' estimated useful lives ranging from three to thirty years.
   Depreciation is computed using the straight line method for financial 
   reporting and the modified accelerated cost recovery system for income 
   tax purposes.  Expenditures for major renewals and betterments that 
   extend the useful lives of the property and equipment are capitalized.
   Expenditures for maintenance and repairs are charged to expense as 
   incurred.

   Intangible assets are amortized using the straight-line method over 
   five years.

   Research and Development

   Research and development costs are expensed as incurred.  Included in 
   research and development expenses are costs related to the development
   of prototypes of $508,816 for the period ended March 31, 1997.

   Income Taxes

   The Company follows the asset and liability approach for deferred income
   taxes.  This method provides that deferred tax assets and liabilities 
   are recorded, using currently enacted tax rates, based upon the 
   difference between the tax bases of assets and liabilities and their 
   carrying amounts for financial statement purposes.  A valuation 
   allowance is recorded when it is more likely than not that deferred 
   tax assets will not be realized.

   Net Loss Per Share

   Net loss per share is computed using the weighted average number of 
   common shares outstanding and dilutive common share equivalents.  Common 
   shares issued, and options and warrants granted, by the Company during 
   the twelve months preceding the initial public offering have been 
   included in the calculation of common and common equivalent shares 
   outstanding as if they were outstanding for all periods presented using 
   the Treasury Stock method and an initial public offering price of $5.00 
   per share.  Options and warrants granted before the aforementioned 
   twelve-month period and subsequent to the Company's initial public 
   offering have been included in the calculation of common and common 
   equivalent shares outstanding when dilutive.

   In February 1997, the Financial Accounting Standards Board issued
   Statement of Accounting Standards No. 128, "Earnings per Share"
   ("FAS 128"), which requires the presentation of basic earnings per share
   in financial statements for reporting periods ending subsequent to
   December 15, 1997. Early adoption of FAS 128 is not permitted.  The
   adoption of FAS 128 is not expected to have a material impact on the
   Company's financial statements.

   As of March 31,1997, the Company had outstanding warrants and options
   to purchase 1,948,000 and 174,659 shares of Common Stock, respectively,
   which are not included in the calculation of earnings per share for the
   three months ended March 31, 1997, and would not be included in such
   calculation under the guidance prescribed by FAS 128, due to the anti-
   dilutive nature of these instruments.

4. Inventories

   Inventories at March 31, 1997 and December 31, 1996 consist solely of 
   raw materials and supplies.  As the company is not in full production 
   and continues to be in the development stage, the cost of prototypes, 
   including the cost of raw materials and subcontracted labor costs, has 
   been charged to research and development expenses.

5. Plant, Property and Equipment

   During the period ended March 31, 1997 the Company completed the 
   construction and equipping of its manufacturing facility.  In 1996, 
   the Company entered into a master sale and leaseback agreement designed 
   to cover the majority of its manufacturing equipment.  In connection 
   therewith, the Company sold approximately $3,600,000 of equipment 
   purchased since June 1996.  The Company is currently leasing such over 
   a four year period at a cost of approximately $90,000 per month.

6. Commitment, Contingencies and Other Matters

   Operating Leases

   In October 1996, the Company entered into a master equipment lease 
   agreement with FINOVA Technology Finance, Inc. ("FINOVA").  The agreement
   provides for the sale and leaseback by the Company of up to $3,850,000 of
   equipment, furnishings and fixtures.  As part of the consideration for
   the agreement, the Company issued a warrant certificate for 58,334
   warrants, entitling FINOVA to purchase a corresponding number of shares
   of the Company's Common Stock at $5.00 per share.  The warrants cannot
   be assigned, sold, transferred or otherwise disposed of prior to
   February 27, 1998. The warrants are currently exercisable and have been
   valued at $167,710 and are being amortized over the term of the lease.

   Rent expense under non-cancellable operating leases, including the FINOVA
   leases, was $197,959 for the three months ended March 31,1997.

   Future minimum payments under non-cancellable operating leases, including 
   the FINOVA lease agreement, at March 31, 1997, are as follows:

<TABLE>
<CAPTION>

                                 Year ending
                                 December 31,      Commitment
                                -------------     -------------
<S>                                 <C>            <C>
                                    1997           $  796,000
                                    1998            1,009,000
                                    1999            1,009,000
                                    2000            1,009,000
                                    2001              213,000
                                                  -------------
                                                   $4,036,000
                                                  =============

</TABLE>

   Litigation

   The Company is currently engaged in a dispute with Theodore Konopelski
   ("Konopelski"), a director and former employee and officer of the Company
   The dispute involves the termination of Konopelski's employment for 
   cause. An arbitration proceeding was instituted by Konopelski in 
   Syracuse, New York challenging his termination under his employment 
   contract.  Konopelski is seeking damages in the aggregate of $500,000.
   The arbitration is in process and the Company believes the termination 
   was proper and that no amount should be awarded to Konopelski.  
   Subsequent to the commencement of the arbitration, the Company brought 
   an action against Konopelski in the New York Supreme Court (Broome 
   County) alleging violation by Konopelski of his obligations under the 
   terms of a non-disclosure agreement between Konopelski and the Company. 
   The Court issued a temporary restraining order barring Konopelski from 
   making any disclosures or using confidential information or trade 
   secrets.  The restraining order remains in effect.  

   The Company believes it will prevail in the arbitration as well as in all 
   matters with respect to the enforcement of Konopelski's non-disclosure
   obligations.  Konopelski has also alleged that he ceased to be a 
   director on August 4, 1996 by virtue of his removal from the Company.  
   The Company maintains that Konopelski was removed as an officer and 
   employee and that if he chooses not to consider himself as a director, 
   it is his choice alone.

<PAGE>

Item 2.  Managements Discussion and Analysis

   The following information should be read in conjunction with the 
   unaudited financial statements included herein.  See Item 1.

OVERVIEW

The Company's future results of operations and the other forward 
looking statements contained in this discussion involve a number of risks
and uncertainties.  In addition to the factors discussed below are other 
factors that could cause actual results to differ materially such as 
business conditions, growth in the industry and the general economy.

The Company has begun the production of its products at the Company's new
production facility in Binghamton, New York. Since its inception in 1993,
the Company had been engaged primarily in research and development, business
and financial planning, recruitment of key management and technical
personnel, raising capital to fund operations and the development of 
its HPDL prototypes.  As a result, the Company has not generated any 
significant product sales through March 31, 1997.  The Company has completed
the construction and equipping of the first phase of its manufacturing 
facility and has begun production of its products and the generation of 
sales revenues.  The Company also continues to secure licensing agreements
for the production, marketing and sale of technologically improved products
which complement its product line.

RESULTS OF OPERATIONS

Three months ended March 31, 1997, compared to three months ended March
31, 1996.

The Company is not reflecting sales or revenues during the periods as during
each period the Company was considered a development stage enterprise.  
Revenues realized from sales and the costs associated therewith have been
offset against research and development expenses.

Research and development expenditures were $508,816 for the three months
ended March 31, 1997 as compared to $83,320 for the three months ended 
March 31, 1996. The increase of approximately $426,000 is primarily 
associated with increased spending on labor, materials, subcontract work and
equipment costs associated with the development and refinement of the
Company's product line. Subsequent to March 31, 1996, the Company began to
increase staffing and expenditure levels to meet its production goals, such
increased activity leading to the higher level of research and development
expense.

General and administrative expenses were $558,669 for the three months
ended March 31, 1997 as compared to $304,470 for the same period in 1996.
The increase of approximately $254,000 is associated with increases in
medical and general insurances relating to a greater number of employees
and increased property values associated with the construction of the
Company's manufacturing facility ($7,400), increases in marketing activities,
principally advertising and trade shows ($100,000), increases in payroll
costs attributable to higher employee levels ($37,700), increases in
professional fees associated with litigation, patent activity and public
relation activities ($95,000), increases in state taxes, real estate taxes
and utility costs in connection with the Company's Delaware subsidiary and
its new manufacturing facility ($33,000), increased depreciation related to 
increased plant and equipment investment ($3,000) and a net decrease in other
costs approximating $22,000.  On an overall basis, absent increased legal 
costs associated with litigation, general and administrative costs increased
as a result of the Company achieving the commercial production of its
products.

Interest income increased approximately $26,000 as a result of higher levels 
of invested cash.  The higher levels of cash are associated with the
Company's initial public offering in March 1996.

The extraordinary loss of $305,301 recognized for the three month period
ended March 31, 1996 resulted from the early retirement of debt associated
with the bridge financing undertaken in the first quarter of 1996.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash requirements have been significant but are expected to 
moderate through 1997.  The Company's cash and cash equivalents at March 31,
1997 were $3,159,974 as compared to $4,266,168 at December 31, 1996, a
decrease of $1,106,194 for the period ended March 31, 1997.

The net cash used in operating activities for the three month period ended
March 31, 1997 of $1,259,291 was used to fund the operating loss of 
$1,023,996 and net changes in other working capital of $266,419, offset 
by net non-cash expenditures of $31,124.

Net cash provided by investing activities of $130,000 is primarily the result
of the sale and leaseback transaction entered into with FINOVA and the 
timing of the same.

Although cash expenditures have been significant over the period, the 
Company expects such expenditures to decrease as a result of a relative 
decrease in future requirements associated with start up activities both
operationally and from a facility and equipment standpoint.

<PAGE>


                          PART II. - OTHER INFORMATION

Item 1. Legal Proceedings.

     The Company is involved in litigation described in Note 6 in the 
     financial statements.  This litigation does not involve more than
     10% of the Company's assets


Item 2. Change in Securities.

     None


Item 3. Defaults Upon Senior Securities.

     None


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

     None


Item 5. Other Information.

     None


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

         (a)   Exhibits.

               No. 11   Statement re: Computation of Weighted Average
                          Shares Outstanding

               No. 27   Financial Data Schedule

         (b)   Reports on Form 8-K.
               
                     None

<PAGE>

                                 SIGNATURES

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


                    Semiconductor Laser International Corporation
                    ---------------------------------------------
                                     (Registrant)



Date: May 9, 1997                    By:/s/ Geoffrey T Burnham
                                        ----------------------------
                                        Geoffrey T. Burnham
                                        Chairman, President and 
                                          Chief Executive Officer


Date: May 9, 1997                    By:/s/ Nicholas L.Prioletti, Jr.
                                        -----------------------------
                                        Nicholas L. Prioletti, Jr.
                                        Chief Financial Officer, 
                                          Principal Financial Officer
                                          and Principal Accounting 
                                          Officer