<PAGE>   1


                                  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 JUNE 30, 1999

                                       OR

 / /  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
      SECURITIES EXCHANGE ACT OF 1934

                        COMMISSION FILE NUMBER: 000-23747


                               GETTY IMAGES, INC.
             (Exact name of Registrant as specified in its charter)

           DELAWARE                                      98-0177556
   (State of Incorporation)                 (I.R.S. Employer Identification No.)


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


                               2101 FOURTH AVENUE
                                   FIFTH FLOOR
                            SEATTLE, WASHINGTON 98121
                                 (206) 695 3400

    (Address, including zip code, and telephone number, including area code,
                         of principal executive offices)


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


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 twelve 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 ninety days. Yes X No

As of August 5, 1999, there were 35,434,676 shares of the Registrant's common
stock, par value $0.01 per share, outstanding.



<PAGE>   2


                               GETTY IMAGES, INC.

                     INDEX TO QUARTERLY REPORT ON FORM 10-Q
                                     FOR THE
                        THREE MONTHS ENDED JUNE 30, 1999




                                                                           PAGE

PART I  -  FINANCIAL INFORMATION
   Item 1.  Consolidated Financial Statements                                 3
   Item 2.  Management's Discussion and Analysis of Financial
            Condition and Results of Operations                              12
   Item 3.  Quantitative and Qualitative Disclosures about
            Market Risk                                                      22


PART II - OTHER INFORMATION
   Item 2.  Changes in Securities and Use of Proceeds                        26
   Item 4.  Submission of Matters to a Vote of Security Holders              26
   Item 5.  Other Information                                                26
   Item 6.  Exhibits and Reports on Form 8-K                                 26





2
<PAGE>   3


                               GETTY IMAGES, INC.

                                     PART I.
                              FINANCIAL INFORMATION


ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS

                               GETTY IMAGES, INC.
                 UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED
                                                  ------------------------------------
                                                      JUNE 30, 1999   JUNE 30, 1998
                                                             $               $
                                                      (IN THOUSANDS  (IN THOUSANDS
                                                        EXCEPT PER     EXCEPT PER
                                                        SHARE DATA)    SHARE DATA)
<S>                                                      <C>           <C>
Sales                                                    $ 54,957      $ 48,126
Cost of sales                                              14,764        13,909
                                                          -------       -------
GROSS PROFIT                                               40,193        34,217
                                                          -------       -------
Selling, general and administrative expenses               32,072        25,837
Amortization of intangibles                                16,797        10,007
Depreciation                                                5,455         3,547
Non-recurring integration and restructuring costs            --           9,137
                                                          -------       -------
                                                           54,324        48,528
                                                          -------       -------

OPERATING LOSS                                            (14,131)      (14,311)
Net interest expense                                         (962)         (768)
Net exchange gains                                             20           296
                                                          -------       -------

LOSS BEFORE INCOME TAXES                                  (15,073)      (14,783)
Income taxes                                                 (733)          712
                                                          -------       -------

Net loss before extraordinary items                       (15,806)      (14,071)
Extraordinary items                                          --            (830)
                                                          -------       -------
NET LOSS                                                 $(15,806)     $(14,901)
                                                          =======       =======

Basic loss per share                                       $(0.47)       $(0.49)
                                                          =======       =======
Diluted earnings per share                                    N/A           N/A
                                                          =======       =======
</TABLE>



    The accompanying notes on pages 7 to 10 are an integral part of these
                       consolidated financial statements.


3

<PAGE>   4


                               GETTY IMAGES, INC.

                 UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>
                                                        SIX MONTHS ENDED
                                              ----------------------------------
                                               JUNE 30, 1999   JUNE 30, 1998(1)
                                                          $               $
                                                   (IN THOUSANDS   (IN THOUSANDS
                                                    EXCEPT PER      EXCEPT PER
                                                    SHARE DATA)     SHARE DATA)
<S>                                                   <C>            <C>
Sales                                                 $107,107       $ 86,057
Cost of sales                                           28,605         25,516
                                                      --------       --------
GROSS PROFIT                                            78,502         60,541
                                                      --------       --------
Selling, general and administrative expenses            60,796         45,585
Amortization of intangibles                             27,021         16,903
Depreciation                                            10,061          6,445
Non-recurring integration and restructuring costs         --            9,137
                                                      --------       --------
                                                        97,878         78,070
                                                      --------       --------

OPERATING LOSS                                         (19,376)       (17,529)
Net interest expense                                    (1,773)        (1,319)
Net exchange loss                                         (371)           (59)
                                                      --------       --------

LOSS BEFORE INCOME TAXES                               (21,520)       (18,907)
Income taxes                                            (2,168)          (369)
                                                      --------       --------

Net loss before extraordinary items                    (23,688)       (19,276)
Extraordinary items                                       --             (830)
                                                      --------       --------
NET LOSS                                              $(23,688)      $(20,106)
                                                      ========       ========

Basic loss per share                                  $  (0.74)      $  (0.72)
                                                      ========       ========
Diluted earnings per share                                 N/A            N/A
                                                      ========       ========
</TABLE>


(1)      Reflects the combination of the unaudited consolidated statement of
         operations of Getty Communications plc (the predecessor company) for
         the period January 1, 1998 through February 9, 1998 and the unaudited
         consolidated statement of operations of Getty Images, Inc. for the
         period February 10, 1998 through June 30, 1998.





    The accompanying notes on pages 7 to 10 are an integral part of these
                       consolidated financial statements.



4

<PAGE>   5


                               GETTY IMAGES, INC.

                      UNAUDITED CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>

                                                    JUNE 30, 1999    DECEMBER 31, 1998
                                                           $                 $
                                                    (IN THOUSANDS)    (IN THOUSANDS)

<S>                                                    <C>               <C>
                                     ASSETS

CURRENT ASSETS
Cash and cash equivalents                              $ 14,394          $ 16,150
Accounts receivable, net                                 39,677            32,967
Prepaid expenses and other assets                        28,389            17,258
Inventories, net                                          4,573             2,834
                                                       --------          --------

TOTAL CURRENT ASSETS                                     87,033            69,209
Fixed assets, net                                        68,612            62,757
Intangible assets, net                                  421,077           325,861
Deferred tax assets                                       4,875             5,036
                                                       --------          --------

TOTAL ASSETS                                           $581,597          $462,863
                                                       ========          ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable                                         31,444            26,232
Accrued expenses                                         23,386            20,148
Income taxes payable                                        308              --
Short-term debt                                          15,333               202
                                                       --------          --------

TOTAL CURRENT LIABILITIES                                70,471            46,582
Long-term debt                                           72,778            72,354
                                                       --------          --------

TOTAL LIABILITIES                                       143,249           118,936
                                                       --------          --------

STOCKHOLDERS' EQUITY
Common stock                                                353               306
Additional paid-in capital                              492,490           368,267
Retained losses                                         (51,947)          (28,259)
Cumulative translation adjustments                       (2,548)            3,613
                                                       --------          --------

TOTAL STOCKHOLDERS' EQUITY                              438,348           343,927
                                                       --------          --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY             $581,597          $462,863
                                                       ========          ========

</TABLE>


    The accompanying notes on pages 7 to 10 are an integral part of these
                       consolidated financial statements.


5

<PAGE>   6


                               GETTY IMAGES, INC.
            UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                                SIX MONTHS ENDED
                                                                  ----------------------------------------------
                                                                      JUNE 30, 1999         JUNE 30, 1998(1)
                                                                            $                       $
                                                                      (IN THOUSANDS)         (IN THOUSANDS)

<S>                                                                     <C>                     <C>
NET CASH FLOWS FROM OPERATING ACTIVITIES                                 $  2,689                $  5,220
                                                                         --------                --------

CASH FLOWS FROM INVESTING ACTIVITIES
         Business acquisitions, net of cash acquired                          429                 (75,172)
         Purchase of fixed assets                                         (17,884)                 (8,495)
                                                                         --------                --------

NET CASH USED IN INVESTING ACTIVITIES                                     (17,455)                (83,667)
                                                                         --------                --------

CASH FLOWS FROM FINANCING ACTIVITIES
         Proceeds from debt issuance                                       15,000                 119,569
         Payments of principal balance of debt                                111                 (67,093)
         Proceeds from issuance of ordinary shares                          1,276                  32,477
                                                                         --------                --------

NET CASH PROVIDED BY FINANCING ACTIVITIES                                  16,387                  84,953
                                                                         --------                --------

Net increase in cash and cash equivalents                                   1,621                   6,506
Exchange rate differences arising from translation of foreign
  currency balances                                                        (3,377)                    423
Cash and cash equivalents
-        beginning of period                                               16,150                  29,234
                                                                         --------                --------
-        end of period                                                   $ 14,394                $ 36,163
                                                                         ========                ========
</TABLE>


            UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

<TABLE>
<CAPTION>
                                                                                SIX MONTHS ENDED
                                                                  ----------------------------------------------
                                                                      JUNE 30, 1999         JUNE 30, 1998(1)
                                                                            $                       $
                                                                      (IN THOUSANDS)         (IN THOUSANDS)

<S>                                                                      <C>                     <C>
Net loss                                                                 $(23,688)               $(20,106)
Other comprehensive income, net of tax:
Foreign currency translation adjustments                                   (6,161)                 (6,774)
                                                                         --------                --------
COMPREHENSIVE LOSS                                                       $(29,849)               $(26,880)
                                                                         ========                ========
</TABLE>


(1)      Reflects the combination of the unaudited condensed consolidated
         statement of cash flows and the unaudited consolidated statement of
         comprehensive income of Getty Communications plc (the predecessor
         company) for the period January 1, 1998 through February 9, 1998 and
         the unaudited condensed consolidated statement of cash flows and the
         unaudited consolidated statement of comprehensive income of Getty
         Images, Inc. for the period February 10, 1998 through June 30, 1998.

         The accompanying notes on pages 7 to 10 are an integral part of
                     these consolidated financial statements.





6

<PAGE>   7


                               GETTY IMAGES, INC.

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.       BASIS OF PREPARATION

The unaudited consolidated financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q and do not include all
the information and note disclosures required by generally accepted accounting
principles. The statements should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1998 (the "Annual Report"),
Commission file No. 000-23747, that was filed with the Commission on March 31,
1999. In the opinion of management, the accompanying consolidated financial
statements include all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the Company's financial position and
results of operations. The results of the operations for the three and six month
periods ended June 30, 1999 may not be indicative of the results that may be
expected for the full fiscal year.

The year end condensed balance sheet data was derived from audited financial
statements but does not include all disclosures required by generally accepted
accounting principles.

         RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board issued SFAS 133,
"Accounting for Derivative Instruments and Hedging Activities". The standard
requires that an entity recognize all derivatives as either assets or
liabilities and measure those instruments at fair value. The new rules will be
effective for fiscal years beginning after June 15, 2000.

2.       PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include Getty Images, Inc.
and its subsidiaries, all of which are 100% owned, from the date of acquisition.
All material intercompany amounts and transactions have been eliminated in the
consolidated financial statements. The acquisitions of PhotoDisc and Allsport
in February 1998, and Art.com in May 1999, have been consolidated using the
purchase method of accounting.



7

<PAGE>   8


3.       NON-RECURRING INTEGRATION AND RESTRUCTURING CHARGES

During the six months ended June 30, 1998, the Company approved and commenced a
program to integrate its businesses following the acquisitions of PhotoDisc and
Allsport in February 1998. This resulted in integration and restructuring
charges being incurred.

Integration costs in the six months ended June 30, 1998 amounted to $1.3 million
and were associated with the activities of teams responsible for integrating the
various businesses of the Company for the benefit of future operations. These
included items such as consulting and professional fees, systems and process
integration costs and contract renegotiation costs. These costs were expensed as
incurred.

Restructuring costs, which amounted to $7.8 million in the six months ended June
30, 1998, were for estimated exit costs associated with the closure of 10
facilities, asset write downs, employee termination costs and contract
termination costs.

4.       EXTRAORDINARY ITEMS

On May 22, 1998, the Company completed the issue of $75 million, 4.75%
convertible subordinated notes due 2003, the proceeds of which were applied
partially to the repayment of $49 million of term debt due to Midland Bank plc.
The early payment of such debt resulted in an extraordinary charge of $830,000
($0.03 per share) net of an income tax benefit of $408,000.

5.       PROVISION FOR INCOME TAXES

In accordance with generally accepted accounting principles, the Company
provides for income taxes on an interim basis using its estimated annual income
tax rate. The Company is providing for income taxes in 1999 at an effective
annual tax rate of 39.4% of net income before amortization of goodwill, which is
largely non-tax deductible. The comparative rate for the year ended December 31,
1998 was 38.0%.

6.       EARNINGS PER SHARE

Diluted earnings per share are not given for the three or six month periods
ended June 30, 1999 or June 30, 1998 due to the loss incurred in those periods.
Basic loss per share for the three and six month periods ended June 30, 1999 are
computed on the basis of 33,603,000 and 32,134,000 weighted average number of
shares in issue respectively. Basic loss per share for the three and six month
periods ended June 30, 1998 are computed on the basis of 30,352,000 and
27,787,000 weighted average number of shares in issue respectively.


8


<PAGE>   9


7.       FOREIGN CURRENCY TRANSLATION

Unrealized net exchange losses of $1,813,000 for the three month period ended
June 30, 1999 and $3,630,000 for the six month period ended June 30, 1999 (three
and six month period ended June 30, 1998: $nil) arose on the translation of
certain intercompany foreign currency transactions deemed to be of a long-term
nature. These transactions are not planned to be settled in the foreseeable
future and are reported in the same manner as foreign currency translation
adjustments in stockholders' equity in accordance with FAS52 `Foreign Currency
Translation'.

8.       SEGMENT INFORMATION

Getty Images operates in one business segment and all intercompany transactions
are eliminated on consolidation.

As a result, revenues from external customers are $107,107,000 for the first six
months of 1999 and $54,957,000 for the quarter ended June 30, 1999 ($86,057,000
for the first six months of 1998 and $48,126,000 for the quarter ended June 30,
1998).

9.       ACQUISITIONS

On May 4, 1999, Getty Images purchased the entire issued share capital of
Art.com, Inc. The purchase consideration was $135.3 million, satisfied as
follows:


<TABLE>
<CAPTION>
Art.com                                                                               $
                                                                               (IN THOUSANDS)

<S>                                                                             <C>
 4,252,271 shares of common stock of Getty Images  at $27.21 per share            $115,704
                                                                                  --------

Capital contribution made to Art.com                                                10,000

Getty Images' estimated transaction expenses                                         3,726
                                                                                  --------
Cash costs of the acquisition                                                       13,726
                                                                                  --------
Fair value of options over shares of Art.com Common Stock exchanged for
options over shares of Getty Images Common Stock                                     5,910
                                                                                  --------

Total purchase price                                                               135,340

Art.com net assets at May 4, 1999                                                  (13,104)
                                                                                  --------

Excess of purchase price over net assets acquired allocated to goodwill
  (amortized over three years)                                                    $122,236
                                                                                  ========

</TABLE>


9

<PAGE>   10


10.      SUBSEQUENT EVENTS

On August 9, 1999, the Company acquired all of the outstanding stock of EyeWire,
Inc. ("EyeWire"). Under the terms of the acquisition, EyeWire shareholders
received 1.85 million newly issued shares of Getty Images Common Stock at a
total market value of $32,375,000.


11.      PRO FORMA INFORMATION RELATING TO ACQUISITIONS (UNAUDITED)

The following unaudited pro forma information shows the results of the Company
for the six month period ended June 30, 1999 and June 30, 1998 respectively, as
if the acquisitions of PhotoDisc and Allsport had occurred on January 1, 1998
and the acquisition of Art.com had occurred on January 1, 1999. The pro forma
information includes adjustments related to the financing of the acquisitions,
the effect of amortizing goodwill and other intangible assets acquired, as well
as the related tax effects. The pro forma results of operations are unaudited,
have been prepared for comparative purposes only and do not purport to indicate
the results of operations which would have actually occurred had the
combinations been in effect on the dates indicated or which may occur in the
future.

<TABLE>
<CAPTION>

                                                      UNAUDITED
                                              SIX MONTHS ENDED JUNE 30
                                           1999                     1998
                                             $                       $
                                       (IN THOUSANDS           (IN THOUSANDS
                                        EXCEPT LOSS             EXCEPT LOSS
                                       PER SHARE DATA)         PER SHARE DATA)

<S>                                   <C>                        <C>



  Sales                                   $107,659               $ 92,596
  Net loss                                 (40,168)               (20,339)
  Basic loss per share                    $  (1.15)              $  (0.63)

</TABLE>




10

<PAGE>   11


REPORT ON UNAUDITED INTERIM FINANCIAL INFORMATION


TO THE BOARD OF DIRECTORS OF GETTY IMAGES, INC.


We have reviewed the accompanying interim consolidated financial statements of
Getty Images, Inc. and subsidiaries as of June 30, 1999 and for the three month
and six month period then ended as set out on pages 3 to 10. These interim
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 interim financial statements for them to be in
conformity with generally accepted accounting principles.



PricewaterhouseCoopers
Chartered Accountants
LONDON
England


August 16, 1999





11

<PAGE>   12


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

THE FOLLOWING SHOULD BE READ IN CONJUNCTION WITH THE UNAUDITED CONSOLIDATED
FINANCIAL STATEMENTS OF GETTY IMAGES, INC. ("GETTY IMAGES" OR THE
"COMPANY") AND THE NOTES THERETO, AND OTHER FINANCIAL INFORMATION CONTAINED
ELSEWHERE IN THIS REPORT ON FORM 10-Q.

THE STATEMENTS IN THIS SECTION THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING
STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS
AMENDED, AND SECTION 27E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
THAT INVOLVE RISKS AND UNCERTAINTIES, SUCH AS STATEMENTS OF THE COMPANY'S PLANS,
OBJECTIVES, EXPECTATIONS AND INTENTIONS. THE CAUTIONARY STATEMENTS MADE IN THIS
QUARTERLY REPORT SHOULD BE READ AS BEING APPLICABLE TO ALL RELATED
FORWARD-LOOKING STATEMENTS AS A RESULT OF A VARIETY OF FACTORS, INCLUDING THOSE
SET FORTH UNDER "ITEM 1: BUSINESS - H. FACTORS THAT MAY AFFECT THE BUSINESS" IN
THE COMPANY'S FORM 10-K.

THE FOLLOWING DISCUSSION DOES NOT INCORPORATE THE ACQUISITION OF EYEWIRE ON
AUGUST 9, 1999.

OVERVIEW

Getty Images (getty-images.com) is a leading international provider of visual
content to both the professional and consumer markets. The Company is
extensively involved in e-commerce, offering products and services over its
websites and through a diverse set of channels. Getty Images owns or controls
content products across most major categories of the visual content industry.
Through its e-commerce enabled websites and international network of wholly-
owned offices, agents and distributors, Getty Images is able to provide its
customers access to image and footage products. Its visual content brands and
businesses include Allsport (allsport.com), a leading provider of global sports
photography; Energy Film Library (digital-energy.com), a leading provider of
stock footage; Liaison Agency (liaisonphoto.com), a leading provider of North
American news and reporting photography; Hulton Getty (hultongetty.com), one of
the largest commercially available collections of archival photography; Art.com
(Art.com), a premier online destination for custom framed and unframed art and
art-related products; and Tony Stone Images (tonystone.com) and PhotoDisc
(photodisc.com), leaders in contemporary stock photography.

Getty Communications commenced operations on March 14, 1995 with the acquisition
of Tony Stone Images, one of the world's leading providers of contemporary stock
photography. In April 1996, the Company broadened its visual content product
offerings with the acquisitions of Hulton Deutsch Collection Limited (now Hulton
Getty), one of the world's largest commercially available collections of
archival photography and Fabulous Footage, a leading North American provider of
contemporary stock footage. In March 1997, Getty Communications acquired
Liaison, a well-established leader in the photojournalism market. In July 1997,
the Company acquired Energy Film Library, one of


12

<PAGE>   13

the leading international providers of contemporary stock footage to the
advertising, television, feature film, corporate communications and
multimedia markets.

During September 1997, Getty Communications entered into an acquisition
agreement with PhotoDisc, Inc., leading to the formation of Getty Images and the
completion of the full acquisition in February 1998. PhotoDisc is a leading
provider of royalty-free imagery and one of the largest providers of imagery on
the Internet. Also in February 1998, the Company acquired Allsport Photographic
plc, a leading provider of worldwide sports photography.

The Company continued its global expansion in March 1998 with the acquisition of
Fototeca Stone, a leading stock photography agent based in Barcelona, Spain and
previously an exclusive agent for Tony Stone Images. The expansion in the
distribution network included the opening of wholly-owned offices in Brazil and
Dubai. The Company also appointed exclusive distributors in Costa Rica and
Colombia. During 1998, PhotoDisc opened wholly-owned offices in Sweden and
France. In May 1998, Allsport opened an office in Sydney, Australia with the
acquisition of images previously owned by Australian Picture Library. In
November 1998, the Company acquired Sporting Pix, a leading sports picture
agency based in Melbourne, Australia. These acquisitions significantly built the
Company's base in Australia ahead of the 2000 Summer Olympic Games as Allsport
has been selected as the official photographer of the US Olympic Committee and
the International Olympic Committee marketing partners.

In August 1998, the Company acquired Imageways, Inc., a noted archival footage
collection. Imageways' collection is comprised of industrial footage,
lifestyles, feature films and newsreels and is being marketed by Energy Film
Library. During 1998, Energy Film Library expanded its agency network into Italy
and commenced selling its product in the United Kingdom.

In March 1999, Getty Images announced the relocation of its corporate
headquarters in London, England to Seattle, USA; this move reflects the
Company's increasing emphasis on e-commerce as well as a desire to bring the
Company's senior management team closer to the majority of its customers,
stockholders, employees, photographers, and partners. The move will also enable
the senior management team to work under the same roof as the Company's
technology resources. The move is expected to be completed in the third quarter
of 1999.

In May 1999, the Company acquired Art.com, a premier online destination for art.
The acquisition marks the expansion of Getty Images' current online business
into the consumer art market, a move that management believes will significantly
increase the Company's potential customer base and market opportunity.

The Company's sales are primarily derived from the marketing of image
reproduction and broadcasting rights to a range of business customers. Sales
generally consist of a large number of relatively small transactions involving
the sale either of single images, video and film clips or of CD-ROM products
containing between 100 and 300 images. Getty Images utilizes a variety of
digital and analog distribution platforms, including




13


<PAGE>   14
the Internet, CD-ROM, 35mm film, video and traditional analog transparencies.
Price is determined by the extent of rights granted over the use of the
image or video clip and can vary significantly across geographic markets and
customer groups. Sales are also generated from subscription and bulk purchase
deals where customers are provided access to imagery online.

The Company experienced a significant increase in the rate of demand for
digital search, selection and fulfillment of imagery in the first six months
of 1999 particularly in North America. Digital sales, consisting of
e-commerce and CD-ROM sales, accounted for 42 percent of the Company's sales
in the six months to June 30, 1999, up from 32 percent in the same period
last year.

Getty Images' cost of sales primarily consists of commission payments to
contributing photographers and cinematographers. These suppliers are under
contract to the Company and receive payments of up to 50 percent of sales
depending on the product sold and the location of the sale. Minimal payments
are due for sales of Hulton Getty's and Allsport's imagery and certain images
of the other brands as most of the images are owned by the Company and do not
require commission payments. Also included in the cost of sales is the cost
of CD-ROM production at PhotoDisc.

The Company's selling, general and administrative expenses include salaries
and related staff costs, premises and utility costs and marketing and
catalog costs. In the case of Allsport, staff costs include salaries of
photographers who are employed directly by the Company.

Getty Images amortizes goodwill and other intangibles, and depreciates the
cost of the investment in digital files, duplicate transparencies, the
archival picture collection, computer systems and other fixed assets, over
their expected useful lives. The acquisitions of PhotoDisc, Allsport and Art.
com generated $364 million of goodwill, of which $242 million will be
amortized over twenty years and $122 million will be amortized over three
years, and $51 million of other intangibles that will be amortized over
periods varying from two to three years.

As a result of Getty Images' various acquisitions and their consequential
financial and accounting effects on net income, the Company believes that
EBITDA provides stockholders, investors and analysts with an appropriate
measure of the operating performance of Getty Images. Getty Images defines
EBITDA as earnings before interest, taxes, exchange gains/(losses),
depreciation, amortization, non-recurring integration and restructuring
costs, and extraordinary items. EBITDA should not be considered as an
alternative to operating income as an indicator of Getty Images' operating
performance or to cash flows as a measure of Getty Images' liquidity.


14


<PAGE>   15


UNAUDITED RESULTS OF OPERATIONS:

<TABLE>
<CAPTION>

                                                                            SIX MONTHS ENDED JUNE 30
                                                      --------------------------------------------------------------------
                                                                             % of                              % of
                                                           1999          NET REVENUES         1998         NET REVENUES
                                                                      (IN THOUSANDS, EXCEPT PERCENTAGES)

<S>                                                      <C>                 <C>             <C>               <C>
INCOME STATEMENT DATA:
Sales                                                    $107,107            100.0%          $86,057           100.0%
Gross profit                                               78,502             73.3%           60,541            70.3%
Selling, general and administrative expenses              (60,796)           (56.8%)         (45,585)          (53.0%)
Non-recurring integration and restructuring costs               -              -              (9,137)          (10.6%)
Amortization and depreciation                             (37,082)           (34.6%)         (23,348)          (27.0%)
Operating loss                                            (19,376)           (18.1%)         (17,529)          (20.4%)
Net interest expense                                       (1,773)            (1.7%)          (1,319)           (1.5%)
Net exchange losses                                          (371)            (0.3%)             (59)           (0.1%)
Extraordinary items                                             -              -                (830)           (1.0%)
Net loss                                                  (23,688)           (22.1%)         (20,106)          (23.4%)

OPERATING DATA:
EBITDA(1)                                                 $17,706             16.5%          $14,956            17.4%

</TABLE>

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED JUNE 30
                                                      --------------------------------------------------------------------
                                                                             % of                             % of
                                                           1999          NET REVENUES        1998         NET REVENUES
                                                                      (IN THOUSANDS, EXCEPT PERCENTAGES)

<S>                                                       <C>                <C>            <C>               <C>
INCOME STATEMENT DATA:
Sales                                                      $54,957           100.0%          $48,126          100.0%
Gross profit                                                40,193            73.1%           34,217           71.1%
Selling, general and administrative expenses               (32,072)          (58.4%)         (25,837)         (53.7%)
Non-recurring integration and restructuring costs                -             -              (9,137)         (19.0%)
Amortization and depreciation                              (22,252)          (40.5%)         (13,554)         (28.2%)
Operating loss                                             (14,131)          (25.7%)         (14,311)         (29.7%)
Net interest expense                                          (962)           (1.8%)            (768)          (1.6%)
Net exchange gains                                              20             -                 296            0.6%
Extraordinary items                                              -             -                (830)          (1.7%)
Net loss                                                   (15,806)          (28.8%)         (14,901)         (31.0%)

OPERATING DATA:
EBITDA(1)                                                   $8,121            14.8%           $8,380           17.4%
</TABLE>

(1)      "EBITDA" is defined as earnings before interest, taxes, exchange
         gains/(losses), depreciation, amortization, non-recurring integration
         and restructuring costs, and extraordinary items. EBITDA should not be
         considered as an alternative to operating income as an indicator of
         Getty Images' operating performance or to cash flows as a measure of
         Getty Images' liquidity.




15

<PAGE>   16


LIQUIDITY AND CAPITAL RESOURCES

<TABLE>
<CAPTION>
                                                                     SIX MONTHS ENDED JUNE 30
                                                            ------------------------------------------
                                                                 1999                         1998
                                                            (IN THOUSANDS)               (IN THOUSANDS)

<S>                                                            <C>                          <C>
Net cash provided by/(used in):
         Operating activities                                   $2,689                        $5,220
         Investing activities                                  (17,455)                      (83,667)
         Financing activities                                   16,387                        84,953
Exchange  differences  arising from  translation
of foreign currency balances                                    (3,377)                          423
                                                                ------                         -----

Net (decrease)/increase in cash
and cash equivalents                                           $(1,756)                       $6,929
                                                                ======                         =====
</TABLE>




SALES

Getty Images' revenues increased from $86.1 million in the six month period
ended June 30, 1998 to $107.1 million in the six month period ended June 30,
1999, an increase of 24.5%, and from $48.1 million in the three month period
ended June 30, 1998 to $55.0 million in the three month period ended June 30,
1999, an increase of 14.2%. This increase was largely attributable to the
continued success of Getty Images' business-to-business brands, notably the
success of the Company's e-commerce websites.

Strong growth in digital sales, consisting of e-commerce and CD-ROM sales,
continued during the year, accounting for approximately 42% and 43% of the
Company's sales in the six and three month periods ended June 30, 1999 at $44.5
million and $23.5 million respectively. This represents growth of 86% and 54%
respectively over the equivalent periods in 1998.

E-commerce sales grew strongly, accounting for approximately 22.5% and 25.0% of
the Company's sales in the six and three month periods ended June 30, 1999 at
$24.1 million and $13.8 million respectively. This represents continued growth
from e-commerce sales of $11.5 million and $6.4 million, accounting for 13.4%
and 13.3% of sales, in the six and three month periods ended June 30, 1998.

Tony Stone Images reported sales growth in the six month period ended June 30,
1999 of 12% over the comparable period in 1998, and sales growth in the three
month period ended June 30, 1999 of 11% over the comparable period in 1998. This
growth was


16

<PAGE>   17


largely attributable to increased revenues from e-commerce sales on the
tonystone.com website which doubled in the second quarter of 1999 over the
first quarter of 1999. Importantly, the average license price on the Tony Stone
website was in line with the analog model.

PhotoDisc continued to perform strongly, increasing pro forma revenues by 30% in
the six months ended June 30, 1999 over the comparable period in 1998 and by 28%
in the three months ended June 30, 1999 over the comparable period in 1998.
Sales on the PhotoDisc website continued to account for the majority of sales
growth for the brand. E-commerce sales on the PhotoDisc website in the quarter
ended June 30, 1999 accounted for almost 45% of the brand's total sales - up
from 42% in the first quarter of this year.

Allsport increased pro forma revenues by 9% over the same period last year. At
June 30, 1999, Allsport had 1,050 subscribers on its website, an increase of 19%
over the number of subscribers at June 30, 1998. The brand also renewed all of
its existing contracts in the second quarter and signed a variety of new ones,
including Major League Baseball.

Whilst Art.com's revenues are not material in the context of the consolidated
financial statements, the business has performed well since acquisition,
particularly as it is essentially only six months old. User sessions on the
Art.com website increased 226% from 626,000 in the first quarter of 1999 to more
than 2.04 million in the second quarter of 1999. Unique users on the site
increased 118% from 370,000 in the first quarter of 1999 to 807,000 in the
second quarter of 1999 and registered users on the site grew 1,750% from 2,300
in the first quarter of 1999 to 42,700 in the second quarter of 1999.

GROSS PROFIT

The Company's gross profit margin was 73.3% for the six months ended June 30,
1999 and 73.1% for the quarter ended June 30, 1999. This represents an increase
from 70.3% in the six months to June 30, 1998 and 71.1% in the quarter ended
June 30, 1998. This increase reflects the increasing overall sales mix shift to
e-commerce as well as the higher gross margins being achieved at PhotoDisc and
Allsport. Margins in the second quarter of 1999 were lower than the first
quarter of 1999 primarily due to margins at Art.com being less than the
Company's other brands. Art.com was acquired in the second quarter of 1999.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses accounted for 56.8% and 58.4% of
sales in the six and three month periods to June 30, 1999 respectively ($60.8
million and $32.1 million respectively). For the equivalent periods ended June
30, 1998, selling, general and administrative expenses accounted for 53.0% and
53.7% of sales ($45.6 million and $25.8 million respectively). The increase in
selling, general and administrative expenses over 1998 was largely attributable
to continued and accelerated investment in advertising and marketing costs
associated with the new websites as well as increased investment in management,
new sales offices, and the creation of new products and new business systems.
The Company will continue to make the investment necessary to migrate
successfully from an analog to a digital platform. The acquisition of Art.com
accounted for approximately half of the increase in selling, general and
administrative expenses in the second quarter of 1999 over the second quarter of
1998.


17

<PAGE>   18

AMORTIZATION OF INTANGIBLES AND DEPRECIATION

Amortization of intangibles increased from $16.9 million in the six month period
ended June 30, 1998 to $27.0 million in the six month period ended June 30,
1999, an increase of 59.9%, and from $10.0 million in the three month period
ended June 30, 1998 to $16.8 million in the three month period ended June 30,
1999, an increase of 67.9%. This increase in amortization over 1998 arose from
goodwill relating to the acquisitions of PhotoDisc and Allsport in February 1998
and of Art.com in May 1999. Intangibles of $242.3 million, $50.5 million and
$122.2 million respectively, arose on consolidation of these acquisitions. A
substantial part of these intangibles, $364.1 million, has been attributed to
goodwill - of which $241.9 million is being amortized over 20 years and $122.2
million is being amortized over 3 years. Other intangibles of $51.0 million are
being amortized over periods varying from two to three years. Based on the
current structure of the Company, amortization for the full year ended December
31, 1999, is expected to be approximately $65 million.

Depreciation increased from $6.4 million in the six month period ended June 30,
1998 to $10.1 million in the six month period ended June 30, 1999, an increase
of 56.1%, and from $3.5 million in the three month period ended June 30, 1998 to
$5.5 million in the three month period ended June 30, 1999, an increase of
53.8%. The increase primarily arose from the acquisitions of PhotoDisc and
Allsport in February 1998, together with increased investment in capital
expenditure related to the development of Getty Images' digital strategy.
Capital expenditure was $17.9 million for six months ended June 30, 1999 and
$10.3 million in the quarter ended June 30, 1999.

NET EXCHANGE LOSSES

Getty Images' operating results are affected by exchange rate fluctuations to
the extent that it or a subsidiary has receivables or payables that are
denominated in a currency other than the local currency, as the exchange gains
or losses arising on the translation of these balances into local currency or on
the settlement of these transactions are recognized in the income statement of
the relevant company.

The Company's policy is to hedge a substantial majority of its contracted net
receivables and payables using a combination of forward exchange contracts and
foreign currency term loans. Net exchange losses were $371,000 in the first six
months of 1999 and $59,000 in the same period of 1998. Net exchange gains were
$20,000 and $296,000 for the quarter ended June 30, 1999 and June 30, 1998
respectively. These net losses and gains are largely unrealized and arise from
revaluation of currency balances residing in the Company's subsidiaries.

INCOME TAXES

The tax charge for the six and three month periods ended June 30, 1999 was $2.2
million and $0.7 million respectively. This compares with a tax charge of $0.4
million in the six months ended June 30, 1999 and a credit of $0.7 million in
the second quarter of 1998. Excluding the effect of the amortization of
intangibles, which is largely non tax deductible,




18

<PAGE>   19

the Company has accrued tax at an effective rate of tax for the six months
ended June 30, 1999 of 39.4%, compared to 36.1% for the same period last
year, after allowing for a tax credit of $2.2 million arising on the
non-recurring integration and restructuring costs in 1998.

NET LOSS

Net losses for the six and three month periods ended June 30, 1999 were $23.7
million and $15.8 million, respectively, compared to net losses of $20.1 million
and $14.9 million in the six and three month periods ended June 30, 1998.

EBITDA

EBITDA increased from $15.0 million in the six month period ended June 30, 1998
to $17.7 million in the six month period ended June 30, 1999, and decreased from
$8.4 million in the three month period ended June 30, 1998 to $8.1 million in
the three month period ended June 30, 1999, an increase of 18.4% in the six
month period and a decrease of 3.1% in the three month period. EBITDA decreased
from $9.6 million in the three month period ended March 31, 1999 to $8.1 million
in the three month period ended June 30, 1999 as a result of the acquisition of
Art.com which had negative EBITDA in the two months since acquisition of $2.6
million. Excluding the impact of the acquisition of Art.com, the operations of
Getty Images generated EBITDA for the second quarter of 1999 of $10.7 million,
representing an increase of 28.0% over the second quarter of 1998. EBITDA as a
percentage of sales in the second quarter of 1999, excluding Art.com, was 19.7%,
up from 17.4% in the second quarter of 1998. For the six months to June 30,
1999, EBITDA margin, excluding Art.com, was 19.1%, up from 17.4% in the
equivalent period last year.

YEAR 2000

The Year 2000 issue refers to the risk that systems, products and equipment
having date-sensitive components will not recognize the Year 2000 as a result of
computer programs using two digits rather than four to define the applicable
year. The use of non-Year 2000 compliant programs or the inability of the
Company to update its systems successfully may result in system failures,
miscalculations or errors causing disruption of operations, the corruption of
data or other business problems, including, among other things, a temporary
inability to process transactions and invoices, or engage in similar normal
business activities. In addition to the Company's computer systems, the Year
2000 issue may affect certain embedded systems (alarms, gates and time locks,
lighting, security, electrical supply control and backup equipment) and
communication systems (switchboards, fax machines and cellular telephones).

In addition to Year 2000 issues related to the Company's systems, Getty Images
may be adversely affected if the Company's key suppliers or other material third
party service providers are unable or fail to address the Year 2000 issue
adequately. Such suppliers can include infrastructure suppliers in areas such as
utilities, communications, transportation and other services. While the Company
is developing alternate power generation sources for its most sensitive systems,
the likelihood and effects of failures in infrastructure systems and in the
supply chain cannot be estimated.



19

<PAGE>   20

Getty Images developed the Year 2000 Compliance Program (the "Program") to
identify and mitigate Year 2000 issues in its information systems, facilities
and suppliers. The Program can be divided into three phases: (1) Evaluation
(identify issues, inventory the systems affected and develop solutions to
address the issues); (2) Implementation (deploy program and software changes and
complete necessary contingency plans); and (3) Testing (perform applications and
acceptance testing and certification).

The goals of the Program are to ensure that Getty Images and its business
divisions can continue to function at optimal levels up to and beyond December
31, 1999; to provide Getty Images' customers and partners with the Company's
services throughout the affected period and to ensure that key suppliers are
Year 2000 compliant and that there will be no disruption in the supply of
services and products to Getty Images.

The Chief Executive Officer of the Company, subject to the Board of Directors'
oversight, is responsible for the overall implementation of the Program and
ensuring that the Company becomes Year 2000 compliant by December 31, 1999.

The Senior Vice President of Planning is responsible for the day to day
management of the Program and reports directly to the Board of Directors of the
Company. A dedicated team has been assembled to implement the Program.

As of June 30, 1999, Getty Images had completed Phase 1 of the Program and had
completed the majority of Phases 2 and 3. The Company expects that the bulk of
its systems will be Year 2000 compliant by the end of the third quarter of 1999,
with the remainder compliant during the fourth quarter of 1999. Contingency
plans have been developed for any matter not resolved in 1999 that may have a
material negative impact on the Company's final Year 2000 readiness.

EVALUATION. The Company has inventoried all of its major hardware and software
platforms, as well as the relevant computer, embedded and communication systems,
which may be affected by the Year 2000 issue and assessed the needs of the
Company to become Year 2000 compliant. The Company has completed a review of the
Year 2000 issues faced by its material suppliers and evaluated the risks and
dependencies associated with such suppliers. The review of the Year 2000 issued
faced by licensees and agents has been completed.

IMPLEMENTATION. The Company is well advanced in its deployment of software and
hardware changes. Year 2000 compliance measures have been incorporated into all
new Web initiatives, becoming the standard within the Company for all new
contracts and have been incorporated into the Company's due diligence program
when evaluating potential acquisitions and partnerships.

In addition, the Company has developed its first stage contingency plan which
addresses the identification of alternative suppliers and distribution channels
and the implementation of manual systems if it becomes necessary. This will be
kept under review.


20

<PAGE>   21



TESTING. The Company will continue its testing of its computer, embedded and
communication systems as it completes the implementation of its software and
hardware changes.

Getty Images estimates that the expected total aggregate costs for its Year 2000
activities and related systems changes will be approximately $2.5 million, of
which approximately $2.2 million has been spent as of June 30, 1999.

RISKS RELATED TO THE YEAR 2000 ISSUE

Although the Company's efforts to be Year 2000 compliant are intended to
minimize the adverse effects of the Year 2000 issues on the Company's operations
and business, the actual effects of the Year 2000 issue will not be known until
2000. The failure by the Company and or its material suppliers to become Year
2000 compliant in a timely manner could have a material adverse effect on the
Company's business, results of operations and financial condition. The Company's
capital requirements may differ materially from the foregoing estimate as a
result of regulatory, technological and competitive developments in the
Company's industry.

The Year 2000 disclosure set forth above is intended to be a "Year 2000
statement" as such term is defined in the Year 2000 Information and Readiness
Disclosure Act of 1998 (the "Year 2000 Act") and, to the extent such disclosure
relates to Year 2000 processing of the Company or to products or services
offered by the Company, is intended to be a "Year 2000 readiness disclosure" as
such term is defined in the Year 2000 Act.

THE EURO CONVERSION

A new European currency was implemented in January 1999 to replace the separate
currencies of eleven Western European countries. This is requiring changes in
the Company's operations as it modifies systems and commercial arrangements to
deal with the new currency. Modifications are necessary in operations such as
payroll, benefits and pension systems, contracts with suppliers and customers
and internal financial reporting systems, and have a particularly significant
impact on the Company's European subsidiaries. Although a three-year transition
period is expected during which transactions may also be made in the old
currency, this is requiring dual currency processes for the Company's
operations. The Company has identified the issues involved and is developing and
implementing solutions. The Company does not expect the cost of this effort to
have a material effect on its business or results of operations. However, there
can be no assurance that all problems will be foreseen and corrected or that no
material disruption of the Company's business will occur.

LIQUIDITY AND CAPITAL RESOURCES

Getty Images' cash resources decreased by $1.8 million in the six months ended
June 30, 1999 compared to an increase of $6.9 million in the six months ended
June 30, 1998.

Net cash provided by operating activities amounted to $2.7 million in the six
months to June 30, 1999 compared to $5.2 million in the six months to June 30,
1998. The decrease is due to increased spend on marketing and advertising,
particularly at Art.com, and the production of contemporary stock photography
catalogs.


21

<PAGE>   22


Net cash used in investing activities in the six months ended June 30, 1999 was
$17.5 million, compared to $83.7 million in the same period last year. The
decrease primarily reflects the business acquisitions made in each period,
offset by increased investment in technology and related infrastructure. Net
cash provided by financing activities was $16.4 million, primarily as a result
of a $15 million short-term revolving credit facility obtained by the Company in
April 1999 to fund additional working capital requirements and the acquisition
of Art.com.


RECENT DEVELOPMENTS

On July 15, 1999, the Company announced an internal re-organization which will
arrange its seven distinct brands into four customer focused groups. These
customer focused groups will address the needs of the Company's four key
markets: creative professionals, editorial and press businesses, the emerging
and growing business user market and the consumer market. The Creative division
is composed of Tony Stone Images, PhotoDisc and Energy. The Editorial division
consists of Allsport, Liaison Agency and Hulton Getty. Art.com forms the
Consumer division and the newly acquired EyeWire will form the foundation of the
Business User division.

On August 9, 1999, the Company acquired all of the outstanding stock of EyeWire,
Inc., one of the largest providers of royalty-free photography, video, audio,
typefaces, software and other design resources to creative professionals and
business users.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Getty Images is exposed to a variety of risks, including changes in interest
rates affecting the return on its investments and foreign currency fluctuations.
In the normal course of business, the Company employs established policies and
procedures to manage its exposure to fluctuations in interest rates and foreign
currency values.

INTEREST RATE RISK

The Company's exposure to market rate risk for changes in interest rates relates
primarily to the Company's debt instruments, most of which are fixed-rate
borrowings.




22

<PAGE>   23

FOREIGN CURRENCY RISK

The Company has entered into forward foreign currency exchange contracts to
hedge its contracted net receivables denominated in foreign currencies. Getty
Images' functional currency is the US dollar. The forward foreign currency
contracts typically have a term of less than six months. All forward foreign
currency exchange contracts at June 30, 1999 are designated and accounted for as
hedges.

The criteria used by the Company for designating a contract as a hedge include
the contract's effectiveness in risk reduction and one-to-one matching to the
underlying transactions. Gains and losses on these contracts, relating to the
hedged risk, are recognized in income as incurred.

If an underlying hedged transaction is terminated earlier than initially
anticipated, the offsetting gain or loss on the related forward foreign exchange
contract would be recognized in income in the same period. In addition, since
the Company enters into forward contracts only as hedges, any change in currency
rates would not result in any material gain or loss, as any gain or loss on the
underlying foreign currency denominated balances would be offset by the loss or
gain on the forward contract.

The following tables present certain information regarding the Company's use of
financial instruments and should be read in conjunction with Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
Operations.



23

<PAGE>   24


INTEREST RATE RISK
(US DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                            MATURITIES
                                            ---------------------------------------------------------------------------
                                               1999          2000          2003         TOTAL          FAIR VALUE
                                                                                                      JUNE 30, 1999
DEBT INCLUDING CURRENT PORTION

<S>                                          <C>           <C>             <C>           <C>              <C>
Fixed rate                                                                 75,000        75,000           75,000
Average interest rate                                                      4.75%

Other borrowings                             15,333                                      15,333           15,333
Average interest rate                          6.30%
</TABLE>


FOREIGN EXCHANGE RISK
(CURRENCY AND US DOLLAR EQUIVALENTS IN THOUSANDS EXCEPT AVERAGE CONTRACTUAL
EXCHANGE RATE WHICH IS TO THE NEAREST SECOND DECIMAL POINT)

<TABLE>
<CAPTION>
                                                                    MATURITIES                      FAIR VALUE U.S.
                                                                                                   DOLLAR EQUIVALENT
                                                                                                     JUNE 30, 1999
                                                    --------------------------------------------
                                                                                 U.S. DOLLAR
                                                             1999                 EQUIVALENT

<S>                                                       <C>                       <C>                  <C>
Buy Pound Sterling/sell French Franc                          7,200                  1,178                 (20)
Average contractual exchange rate
  (French Franc/Pound Sterling)                                9.80

Buy Pound Sterling/sell Deutschmark                           3,700                  2,005                  (9)
Average contractual exchange rate
  (Deutschmark/Pound Sterling)                                 2.96

Buy Pound Sterling/sell Italian Lire                      1,050,000                    591                 (18)
Average contractual exchange rate
  (Italian Lire/Pound Sterling)                            2,850.16

Buy Pound Sterling/sell Japanese Yen                         24,000                    201                   2
Average contractual exchange rate
  (Japanese Yen/Pound Sterling)                              191.44

Buy Pound Sterling/sell Spanish Pesetas                      65,000                    422                  (9)
Average contractual exchange rate
  (Spanish Pesetas/Pound Sterling)                           246.84
</TABLE>


24

<PAGE>   25


There are further forward exchange contracts at June 30, 1999 that are together
considered immaterial. The US dollar equivalent maturity value of these are
$513,000. All foreign exchange risk contracts are foreign currency forward
exchange contracts between the indicated currency and the United Kingdom
Sterling (Pound Sterling).

Forward foreign exchange contracts between United Kingdom Sterling and German
Deutschmark, French Francs, Italian Lire, Spanish Pesetas and Japanese Yen
account for 41 percent, 24 percent, 12 percent, 9 percent and 4 percent
respectively of the Company's total US dollar equivalents in forward foreign
exchange contracts.




25

<PAGE>   26
                                    PART II.

                                OTHER INFORMATION

ITEM 2.           CHANGES IN SECURITIES AND USE OF PROCEEDS

During the quarter, the Company issued an aggregate of 4,252,271 shares of its
common stock pursuant to a merger in exchange for all of the outstanding
capital shares of Art.com held by 10 shareholders. The shares were issued
pursuant to an exemption by reason of Section 4(2) of the Securities Act of
1933. These exchanges were made without general solicitation or advertising.
Each purchaser represented that he, she or it was an accredited investor with
access to all relevant information necessary. The Company has filed a
Registration Statement on Form S-3 covering such securities (which is not
yet effective).

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

The Company's annual meeting of stockholders was held on May 4, 1999. The
following nominees were elected as directors, each to hold office until his or
her successor is elected and qualified, by the vote set forth below:

NOMINEE                           FOR                      WITHHELD

Christopher Sporborg           21,351,861                  3,544,121
Mark H. Getty                  24,680,334                    215,648

The proposal to ratify the appointment of PricewaterhouseCoopers as independent
auditors of the Company for the 1999 fiscal year was approved by the vote set
forth below:

FOR             AGAINST                ABSTAIN               BROKER NONVOTES
24,894           1,200                   471                        -

ITEM 5.           OTHER INFORMATION

On August 5, 1999, Getty Images acquired all of the outstanding stock of
EyeWire, Inc. in a stock for stock merger transaction. EyeWire, Inc. is an
entirely digital business that provides royalty-free photography, video, audio,
typefaces and other design resources to professionals and business users. The
merger and the transactions contemplated thereby were approved by the
stockholders of EyeWire, Inc. and the directors of Getty Images on August 3,
1999. Getty Images issued 1,850,000 shares of Getty Images common stock to the
former stockholders of EyeWire, Inc. in exchange for all of the issued and
outstanding capital stock of EyeWire, Inc. Required financial statements for
EyeWire, Inc. will be filed separately within 60 days of the filing of this
Report on Form 10-Q.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

EXHIBITS

Reference is made to the Index of Exhibits beginning on page 27 for a list of
all exhibits filed as a part of this report.

REPORTS FILED ON FORM 8-K

No report on Form 8-K has been filed during this quarter.


26
<PAGE>   27
                               GETTY IMAGES, INC.
                          QUARTERLY REPORT ON FORM 10-Q
                    FOR THE THREE MONTHS ENDED JUNE 30, 1999


                                INDEX TO EXHIBITS


<TABLE>
<CAPTION>
EXHIBIT NUMBER                              DESCRIPTION OF EXHIBIT

<S>                                 <C>
2.1 (1)                             Agreement and Plan of Merger, dated as of
                                    May 4, 1999, among Getty Images, Merger
                                    Sub and Art.com

3.1.1 (3)                           Amended and Restated Certificate of Incorporation
                                    of Getty Images

3.1.2 (2)                           Certificate of Amendment to the Certificate of
                                    Incorporation of Getty Images

3.2  (3)                            Bylaws of Getty Images

10.1.1 (1)                          Contingent Deferred Payment, Exhibit
                                    2.01(f)of Agreement and Plan of Merger

10.1.2 (1)                          Form of Registration Rights Agreement between
                                    Getty Images and each of the individual
                                    stockholders of Art.com

10.2                                Consent to sublease premises at Plaza
                                    Building, 701 North Thirty Fourth Street, Seattle,
                                    Washington, U.S.A.

27.1                                Financial Data Schedule
</TABLE>

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

(1)  Incorporated by reference from the Exhibits to the Form 10-Q dated
     May 17, 1999. (Exhibit number in the Form 10-Q is set forth in italics.)

(2)  Incorporated by reference from the Exhibits to the 8-K dated November 10,
     1998. (Exhibit number in the 8-K is set forth in italics.)

(3)  Incorporated by reference from the Exhibits to the Form S-4 Registration
     Statement No. 333-38777 of the Registrant. (Exhibit number in the
     Form S-4 is set forth in italics.)



27

<PAGE>   28


                                   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 thereunto duly authorized.

                                        GETTY IMAGES, INC.

                                             /s/ Christopher J. Roling
Date: AUGUST 16, 1999                   By:  ...................................
                                             Name:       Christopher J. Roling
                                             Title:      Chief Financial Officer



28