U.S. SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549



                                    FORM 10-Q


              /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1998
                                       OR


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

         FOR THE TRANSITION PERIOD FROM ______________ TO ______________

                        COMMISSION FILE NUMBER: 000-23709

                                DOUBLECLICK INC.
             (Exact Name of Registrant as Specified in its Charter)


          DELAWARE                                        13-3870996
(State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                       Identification Number)


                          41 MADISON AVENUE, 32ND FLOOR
                            NEW YORK, NEW YORK 10010
              (Address of Principal Executive Officer and Zip Code)

                                 (212) 683-0001
              (Registrant's Telephone Number, Including Area Code)


    Check whether the registrant:  (1) filed all reports required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act during the  preceeding  12
months (or for such shorter period that the Registrant was required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes /X/ No / /

    As of September 30, 1998,  there were 16,626,919  shares of the registrant's
common stock outstanding.



<PAGE>

<TABLE>
<CAPTION>




                                                                                                PAGE
PART I                             FINANCIAL INFORMATION                                       NUMBER
                                                                                               ------


<S>        <C>                                                                                 <C>
ITEM 1:    Consolidated Financial Information:

           Consolidated Balance Sheet as of December 31, 1997 and September 30, 1998
           (unaudited with respect to September 30, 1998) ........................................3

           Unaudited Consolidated Statement of Operations for the three and nine
           months ended September 30, 1997 and 1998...............................................4

           Unaudited Consolidated Statement of Cash Flows for the nine months
           ended September 30, 1997 and 1998.......................................... ...........5

           Notes to Unaudited Consolidated Financial Statements.................. ................6

ITEM 2:    Management's Discussion and Analysis of Financial Condition and
           Results of Operations................................................. ................9

PART II    OTHER INFORMATION

ITEM 1:    Legal Proceedings..................................................... ................23

ITEM 2:    Changes in Securities and Use of Proceeds............................. ................23

ITEM 3:    Defaults Upon Senior Securities....................................... ................24

ITEM 4:    Submission of Matters to a Vote of Security Holders................... ................24

ITEM 5:    Other Information..................................................... ................24

ITEM 6:    Exhibits and Reports on Form 8-K...................................... ................24

ITEM 7:    Signatures........................................................... .................25

</TABLE>




                                                                  2

<PAGE>


                              DOUBLECLICK INC.

                         CONSOLIDATED BALANCE SHEET
               (Unaudited with respect to September 30, 1998)

<TABLE>
<CAPTION>
                                                                     December 31,            September 30,
                                                                        1997                    1998
                                                                        ----                    ----

<S>                                                                  <C>                    <C>
                                   ASSETS

Current assets:
Cash and cash equivalents ...........................................$ 2,671,845            $ 38,587,883
Short-term investments ..............................................  5,874,229              11,325,133
Accounts receivable, less allowances of $1,292,143 at
   December 31, 1997 and $2,511,709 at September 30, 1998 ...........  9,909,188              20,932,059
Prepaid expenses and other current assets ...........................    355,841                 635,177
                                                                         --------                -------
     Total current assets ........................................... 18,811,103              71,480,252

Property and equipment, net .........................................  1,997,326               7,578,772
Investments, at cost ................................................    254,926                 632,651
Other assets ........................................................     98,574                 510,682
                                                                          -------                -------
     Total assets ................................................. $ 21,161,929            $ 80,202,357
                                                                    -------------           ------------

                    LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable ................................................... $ 8,142,429            $ 13,110,387
Accrued expenses ...................................................   2,828,474               6,256,678
Deferred revenues ..................................................      91,061               1,145,050
Deferred license and service fees ..................................     237,500                 420,833
                                                                         --------                -------
     Total current liabilities .....................................  11,299,464              20,932,948

Deferred license and service fees ..................................     462,500                 238,542
Capital lease obligations                                                      -                 256,813

Stockholders' equity:
Convertible preferred stock, par value $0.001; 40,000 shares
   authorized; issued and outstanding 40,000 at December 31, 1997 ..          40                       -
Common stock, par value $0.001; 40,000,000 shares authorized;
   issued and outstanding 6,118,972 at December 31, 1997;
   16,626,919 at Sepember 30, 1998 ..................................      6,119                  16,627
Additional paid-in capital .......................................... 46,996,328             109,615,615
Cumulative translation adjustment ...................................     (1,271)                 57,649
Deferred compensation ............................................... (1,056,773)               (554,301)
Unrealized loss on marketable securities ............................          -                  (1,605)
Accumulated deficit .................................................(36,544,478)            (50,359,931)
                                                                     ------------            ------------
     Total stockholders' equity .....................................  9,399,965              58,774,054
                                                                       ----------             ----------
     Total liabilities and stockholders' equity ................... $ 21,161,929            $ 80,202,357
                                                                    =============           ============
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements
                                       3
<PAGE>

                                DOUBLECLICK INC.
            UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS


<TABLE>
<CAPTION>


                                                 Three Months Ended                          Nine Months Ended
                                    ---------------------------------------------------------------------------------------
                                     September 30, 1997     September 30, 1998    September 30, 1997   September 30, 1998
                                     ------------------     ------------------    ------------------   ------------------

<S>                                           <C>                   <C>                  <C>                  <C>
Revenues .................................... $ 8,189,482           $ 20,776,701         $ 19,657,224         $ 51,073,631
Cost of revenues ............................   5,559,541             13,970,129           13,047,902           34,538,696
                                                ----------            -----------          -----------          ----------
   Gross profit ............................    2,629,941              6,806,572            6,609,322           16,534,935
                                                ----------             ----------           ----------          ----------

Operating expenses
   Sales and marketing .....................    2,561,993              7,608,389            6,606,236           20,116,962
   General and administrative ..............    1,836,274              2,854,854            3,607,248            7,824,934
   Product development .....................      502,094              1,777,559            1,014,792            4,356,883
                                                  --------             ----------           ----------           ---------
     Total operating expenses ..............    4,900,361             12,240,802           11,228,276           32,298,779
                                                ----------            -----------          -----------          ----------

Loss from operations .......................   (2,270,420)            (5,434,230)          (4,618,954)         (15,763,844)

Interest income ............................      214,363                720,214              130,149            1,996,851
Interest Expense ...........................       84,213                     -               123,638               48,460
                                                   -------                    --              --------              ------


Net loss ................................... $ (2,140,270)          $ (4,714,016)        $ (4,612,443)       $ (13,815,453)
                                             =============          =============        =============       ==============

Basic and diluted net loss per share ......  $ (0.19)               $ (0.28)             $ (0.40)             $ (0.88)
                                             --------               --------             --------             --------
Weighted average shares
   used in basic and diluted net
   loss per share calculation .............  11,447,042             16,565,517           11,430,500           15,750,739
                                            -----------            -----------          -----------          ----------

</TABLE>


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

                                       4
<PAGE>

                                DOUBLECLICK INC.

                 UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>


                                                                                     Nine Months Ended
                                                                     --------------------------------------------------
                                                                        September 30, 1997       September 30, 1998
                                                                        ------------------       ------------------

<S>                                                                         <C>                      <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss ............................................................     $ (4,612,443)           $ (13,815,453)
   Adjustments to reconcile net loss to cash used
   in operating activities:
     Depreciation and amortization .....................................          236,320                1,334,173
     Amortization of deferred compensation .............................          197,999                  502,472
     Provision for bad debts and advertiser rebates ....................          633,607                1,219,566
     Changes in operating assets and liabilities:
       Accounts receivable .............................................       (3,631,215)             (12,242,437)
       Prepaid expenses and other assets ...............................         (109,640)                (414,695)
       Accounts payable ................................................        3,587,883                4,967,958
       Accrued expenses ................................................        1,051,548                3,428,204
       Deferred revenues ...............................................         580,909                1,013,364
                                                                                  --------               ---------
          Net cash used in operating activities ........................       (2,065,032)             (14,006,848)
                                                                               -----------             ------------

CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases, sales and maturities of short-term investments, net ......       (8,099,686)              (5,449,427)
   Investments .........................................................         (254,926)                (377,725)
   Other Assets ........................................................                -                 (279,831)
   Purchases of property and equipment .................................       (1,451,129)              (6,646,055)
                                                                               -----------              -----------
          Net cash used in investing activities ........................       (9,805,741)             (12,753,038)
                                                                               -----------             ------------

CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds from initial public offering, net ..........................                -               62,560,222
   Proceeds from exercise of common stock options ......................           16,599                   69,533
   Proceeds from issuance of preferred stock, net ......................       39,831,994                        -
   Redemption of common stock ..........................................      (25,000,343)                       -
   Advances from related party .........................................        3,048,096                        -
   Payments under capital lease obligation .............................                -                  (12,751)
   Repayment of advances from related party ............................       (1,385,832)                      -
                                                                               -----------                      -
          Net cash provided by financing activities ....................       16,510,514               62,617,004
                                                                               -----------              ----------

Effect of cumulative translation adjustment ............................               -                    58,920
                                                                                       --                   ------

Net increase in cash and cash equivalents ..............................        4,639,741               35,916,038
Cash and cash equivalents at beginning of period .......................               -                 2,671,845
                                                                                       --                ---------

Cash and cash equivalents at end of period .............................      $ 4,639,741             $ 38,587,883
                                                                              ============            ============

Noncash Investing Activities:
   Acquisition of property and equipment under capital lease ...........             $ -                 $ 269,564
                                                                                     ====                =========

</TABLE>

              The accompanying notes are an integral part of these
                       consolidated financial statements
                                       5
<PAGE>



                                DOUBLECLICK INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1--SUMMARY OF OPERATIONS SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF OPERATIONS

    DoubleClick  Inc.  (together  with its  subsidiaries,  the  "Company")  is a
leading provider of comprehensive Internet advertising solutions for advertisers
and Web  publishers  worldwide.  The Company's  technology  and media  expertise
enable it to dynamically deliver highly targeted,  measurable and cost-effective
Internet  advertising  for  advertisers  and to increase ad sales and improve ad
space inventory  management for Web  publishers.  The Company was organized as a
Delaware corporation on January 23, 1996 and commenced operations on that date.

BASIS OF PRESENTATION

    The unaudited  consolidated financial statements included herein include the
accounts of the  Company  and its wholly  owned  subsidiaries.  All  significant
intercompany transactions and balances have been eliminated. Investments in less
than 20%  owned  business  partners,  for which  the  Company  does not have the
ability  to  exercise   significant   influence  and  there  is  not  a  readily
determinable   market  value,  are  accounted  for  using  the  cost  method  of
accounting.  Dividends and other  distributions  of earnings from investees,  if
any, are included in income when declared.

    The  consolidated  balance sheet as of September 30, 1998, the  consolidated
statement of operations  for the three and nine months ended  September 30, 1997
and 1998, and the consolidated statement of cash flows for the nine months ended
September  30,  1997 and 1998 have been  prepared  by the  Company,  and are not
audited.  In the opinion of  management,  all  adjustments  (which  include only
normal  recurring   adjustments)  necessary  to  present  fairly  the  financial
position, results of operations and cash flows at September 30, 1998 and for all
periods presented have been made. The consolidated balance sheet at December 31,
1997 has been derived from the audited financial statements at that date.

     Certain  prior period  amounts  have been  restated to conform with current
period presentation.

    Certain information and footnote  disclosures normally included in financial
statements prepared in accordance with generally accepted accounting  principles
have  been  condensed  or  omitted  pursuant  to  the  Securities  and  Exchange
Commission's rules and regulations.

    The  unaudited   consolidated   financial   statements  should  be  read  in
conjunction with the Company's audited consolidated financial statements and the
notes  thereto as included in the Company's  Registration  Statement on Form S-1
filed with the  Securities  and Exchange  Commission  on December  16, 1997,  as
amended with the Securities and Exchange  Commission  through  February 19, 1998
and its periodic filings with the Securities and Exchange Commission thereafter.
The results of operations for the three and nine months ended September 30, 1998
are not necessarily  indicative of the results to be expected for any subsequent
quarter or the entire year ending December 31, 1998.

MANAGEMENT'S 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,
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results may differ from those estimates.

                                        6


<PAGE>


                                DOUBLECLICK INC.

       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)

NOTE 1--SUMMARY OF OPERATIONS SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)

FINANCIAL  INSTRUMENTS AND CONCENTRATIONS OF CREDIT RISK

    Financial  instruments that  potentially  subject the Company to credit risk
consist primarily of cash and cash equivalents, short-term investments and trade
receivables.

    The Company performs  ongoing credit  evaluations of its advertiser and DART
Service  customers  and  generally  does  not  require  collateral.   No  single
advertiser or DART Service  customer  represented  more than 10% of revenues for
the three and nine months ended  September  30, 1998.  The Company is subject to
concentrations  of credit risk and interest rate risk related to its  short-term
investments.  The  Company's  credit risk is managed by  limiting  the amount of
investments  placed with any one issuer,  investing in money market funds, short
term  commercial  paper,  and A1 rated  corporate  bonds with an average days to
maturity of 47 days as of September 30, 1998.

BASIC AND DILUTED NET LOSS PER SHARE

    Basic net loss per share is computed by dividing  the net loss by the sum of
the  weighted  average  number of shares of common  stock  including  the shares
resulting from the conversion of the Convertible  Preferred Stock as though such
conversion  occurred at the  beginning of the earliest  period  presented,  less
shares assumed to have been redeemed in connection with the  recapitalization of
the Company in June 1997, as though such  recapitalization  also occurred at the
beginning of the earliest period presented. Options to purchase shares of common
stock could  potentially  dilute basic earnings per share in the future and have
not been included in the computation of diluted net loss per share because to do
so would have been antidilutive for the periods presented.

NEW ACCOUNTING PRONOUNCEMENTS

    In June 1997, the FASB issued SFAS No. 131,  Disclosure About Segments of an
Enterprise and Related  Information  (Statement 131).  Statement 131 establishes
standards for the way that public business  enterprises report information about
operating segments.  It also establishes standards for related disclosures about
products and services,  geographic areas and major  customers.  Statement 131 is
effective  for fiscal years  beginning  after  December 15, 1997. In the initial
year of application, comparative information for earlier years must be restated.
The Company is currently  evaluating its  reportable  segments and the impact of
the new standard.

NOTE 2--PROPERTY AND EQUIPMENT

         Property and  equipment  are stated at cost.  Depreciation  is provided
using the  straight-line  method over the  estimated  useful life of the assets.
Leasehold  improvements  are  amortized  over the  estimated  useful life of the
assets.  Leasehold improvements are amortized over their estimated useful lives,
or the term of leases, whichever is shorter. <TABLE> <CAPTION>

                                                                          ESTIMATED    DECEMBER 31,    SEPT 30,
                                                                         USEFUL LIFE       1997          1998
                                                                         ------------  ------------  ------------
<S>                                                                         <C>         <C>          <C>
Computer Equipment and Software........................................     1-3 years   $1,768,509   $  7,176,080
Furniture and Fixtures.................................................       5 years      273,856        928,016
Leasehold Improvements.................................................     1-5 years      389,708      1,297,351
                                                                                       ------------  ------------
                                                                                         2,432,073      9,401,447
Less accumulated depreciation and amortization.........................                    434,747      1,822,675
                                                                                       ------------  ------------
                                                                                        $1,997,326   $  7,578,772
                                                                                       ------------  ------------

</TABLE>



                                        7

<PAGE>


                                DOUBLECLICK INC.

       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
NOTE 3--STOCKHOLDERS' EQUITY

    In  February  1998,  the Company  completed  an initial  public  offering of
4,025,000  shares of the Company's  common  stock.  Proceeds to the Company from
this initial public offering totaled approximately $62.5 million net of offering
costs of  approximately  $1.1  million.  Upon the closing of the initial  public
offering,  the Company's  convertible  preferred  stock converted into 6,234,434
shares of common stock.  Options to purchase 248,513 shares of common stock were
exercised during the nine months ended September 30, 1998.





                                        8




<PAGE>

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

    THE  FOLLOWING   DISCUSSION  OF  THE  FINANCIAL  CONDITION  AND  RESULTS  OF
OPERATIONS OF THE COMPANY CONTAINS FORWARD-LOOKING STATEMENTS RELATING TO FUTURE
EVENTS AND THE FUTURE  PERFORMANCE  OF THE COMPANY WITHIN THE MEANING OF SECTION
27A OF THE SECURITIES ACT OF 1993, AS AMENDED, AND SECTION 21E OF THE SECURITIES
EXCHANGE  ACT  OF  1934,  AS  AMENDED.  STOCKHOLDERS  ARE  CAUTIONED  THAT  SUCH
STATEMENTS  INVOLVE RISKS AND  UNCERTAINTIES.  THE COMPANY'S  ACTUAL RESULTS AND
TIMING OF CERTAIN EVENTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN THESE
FORWARD-LOOKING  STATEMENTS AS A RESULT OF CERTAIN FACTORS,  INCLUDING,  BUT NOT
LIMITED TO, THOSE SET FORTH UNDER "RISK FACTORS THAT MAY AFFECT FUTURE  RESULTS"
AND ELSEWHERE IN THIS REPORT AND IN THE COMPANY'S OTHER PUBLIC FILINGS MADE WITH
THE SECURITIES AND EXCHANGE COMMISSION.

OVERVIEW

    DoubleClick  is a leading  provider of  comprehensive  Internet  advertising
solutions for  advertisers  and Web  publishers.  The Company  currently has two
primary product lines, each offering distinct  Internet  advertising  solutions:
(i) the  DoubleClick  Network,  launched  in March  1996,  includes  DoubleClick
Direct, an Internet direct marketing  solution  introduced on a limited basis in
September 1997, and  DoubleClick  Local,  an Internet  advertising  solution for
regional and local advertisers; and (ii) DoubleClick's DART Service, marketed to
Web publishers on a stand-alone  basis since January 1997, and a version for Web
advertisers  introduced  in October  1998 as part of the Closed  Loop  Marketing
solutions  suite of products  designed to provide  Internet  advertisers  and ad
agencies  real-time,  in-depth  abilities to control  delivery,  measurement and
analysis of their online marketing  campaigns.  The DoubleClick Network and DART
Service  are  available  to Web  publishers  and  advertisers  in  international
markets.  DoubleClick's  proprietary DART technology,  which dynamically matches
and delivers ads to a target audience within  milliseconds,  is the platform for
all of the Company's solutions.

    The Company  completed its initial  public  offering of 4,025,000  shares of
Common Stock, inclusive of 525,000 shares from the exercise of the underwriters'
over-allotment  option, at a price of $17.00 per share on February 25, 1998. The
net proceeds of  approximately  $62.5 million from the initial  public  offering
were  added  to the  working  capital  of the  Company.  Pending  use of the net
proceeds,  the Company has invested such funds in short-term,  interest  bearing
investment grade obligations.

     The Company was founded in January 1996 by Kevin J. O'Connor, the Company's
Chief  Executive  Officer,  Dwight A. Merriman,  the Company's  Chief  Technical
Officer,  and the  DoubleClick  Division of Poppe Tyson, a subsidiary of Bozell,
Jacobs,  Kenyon & Eckhardt,  Inc. ("Poppe Tyson"). The Company has grown from 13
employees as of March 31, 1996 to 373 employees as of September 30, 1998.

     Beginning in the fourth quarter of 1996, substantially all of the Company's
revenues  have been derived from the  DoubleClick  Network.  The Company  offers
advertising on the DoubleClick  Network to third party  advertisers with pricing
determined  on a CPM (cost per  thousand ads  delivered)  basis.  Discounts  are
offered  based on a variety of factors,  including the duration and gross dollar
amount of  advertising  campaigns.  Advertisements  delivered by the Company are
typically  sold  pursuant to  purchase  order  agreements,  which are subject to
cancellation.  The  Company's  revenues are received  from the  advertiser  that
orders the ad, and the  Company  pays the Web  publisher  on whose Web site such
advertisement  is delivered a service fee  calculated  as a  percentage  of such
revenues,  which  amount  is  included  in  cost of  revenues.  The  Company  is
responsible  for billing and  collecting  for ads  delivered on the  DoubleClick
Network,  including  DoubleClick  Local and  DoubleClick  Direct,  and typically
assumes the risk of non-payment from advertisers. In addition, the Company earns
service  fees for  providing  the DART  Service  to Web  publishers  and also to
Internet  advertisers and agencies  through the Closed Loop Marketing  Solutions
suite  of   products.   DoubleClick   Direct   advertising   is   priced   on  a
"cost-per-click",  "cost-per-lead"  and  "cost-per-sale  or download"  basis. To
date, revenues from DoubleClick's DART Service,  DoubleClick Direct, DoubleClick
Local , Closed Loop Marketing  Solutions and  international  operations have not
been significant.

                                        9

<PAGE>

     Advertising revenues are recognized in the period that the advertisement is
delivered, provided that no significant obligations remain and collection of the
resulting   receivable   is  probable.   The  Company  also  sells   sponsorship
advertising,  which involves a greater degree of integration  among the Company,
the advertiser and the Web sites on the DoubleClick Network.  These sponsorships
are  typically  priced  based on the length of time that the  sponsorship  runs,
rather  than a CPM basis.  Revenues  relating  to  sponsorship  advertising  are
recognized ratably over the sponsorship period.

    The Company  expects that revenues  generated from the  DoubleClick  Network
will continue to account for a substantial portion of the Company's revenues for
the foreseeable future. Moreover, ads delivered on Web sites of the top four Web
publishers  in the  DoubleClick  Network,  including  AltaVista,  accounted  for
approximately  60.3%  of the  Company's  revenues  for  the  nine  months  ended
September 30, 1998. The Company typically enters into short-term  contracts with
Web publishers for inclusion of their Web sites in the DoubleClick  Network. The
failure to successfully market the DoubleClick  Network, the loss of one or more
of the Web sites  which  account  for a  significant  portion  of the  Company's
revenues from the DoubleClick  Network,  or any reduction in traffic on such Web
sites could have a material adverse effect on the Company's business, results of
operations and financial condition.

    In December  1996,  the  Company  entered  into an  agreement  with  Digital
Equipment Corporation  ("Digital") (acquired by Compaq Computer Corp. ("Compaq")
in June 1998) to be the exclusive  third-party  provider of advertising services
on specified  pages within the AltaVista Web site.  The agreement was amended on
January 7, 1998 to extend the term through December 1999 and to provide that the
agreement  would  survive a change of control of AltaVista or Digital,  although
notwithstanding either such provision,  either party may terminate the agreement
upon 90 days' prior written  notice.  The Company has ongoing  discussions  with
Compaq regarding the Company's  relationship  and agreement with AltaVista.  The
timing  and  outcome  of such  discussions  are  uncertain.  As a result of such
discussions,  Compaq may elect, or notify the Company of its intention to elect,
to terminate the agreement or demand  concessions or contractual  terms that are
less favorable to the Company than the existing agreement. The loss of AltaVista
as part of the DoubleClick  Network,  any reduction in traffic on or through the
AltaVista Web site, the termination of AltaVista's  contract with the Company or
the  negotiation  of new terms to the agreement  that are less  favorable to the
Company would have a material adverse effect on the Company's business,  results
of operations and financial condition.  Compaq may also change or limit the type
of  advertisers  that are  acceptable  for the AltaVista  Web site,  which could
materially and adversely impact advertising revenues. Any development materially
affecting  the  business or  financial  condition of  AltaVista,  including  any
consequences  of the  acquisition  by Compaq,  the sale of  AltaVista to a third
party, or the entering into of a strategic  relationship with a third party with
a dedicated ad sales force could have a material adverse effect on the Company's
business, results of operations and financial condition.

    DoubleClick  pays  AltaVista a service fee calculated as a percentage of the
revenues derived from the delivery of advertisements on or through the AltaVista
Web site. Revenues from advertisements delivered on or through the AltaVista Web
site were $9.2 million, or 44.4% of the Company's revenues and $24.4 million, or
47.8% of the  Company's  revenues for the three and nine months ended  September
30, 1998,  respectively.  No other web site or publisher accounted for more than
10% of the  Company's  revenue for the three or nine months ended  September 30,
1998.

    The Company has incurred  significant losses since its inception,  and as of
September 30, 1998 had an accumulated  deficit of $50.3 million,  of which $25.3
million related to cumulative losses and $25.0 million related to the redemption
of shares of Common  Stock from  certain  stockholders  in  connection  with the
recapitalization of the Company that occurred simultaneously with the completion
of a private  placement of the  Company's  securities in June 1997. In addition,
the Company recorded  deferred  compensation of $1.5 million,  which represented
the  difference  between the  exercise  price and the fair  market  value of the
Company's  Common  Stock  issuable  upon the exercise of certain  stock  options
granted to employees.  The deferred  compensation  is being  amortized  over the
vesting  periods of the  related  options.  Of the total  deferred  compensation
amount,  $0.9 million has been  amortized as of September 30, 1998.  The Company
believes that  period-to-period  comparisons  of its  operating  results are not
meaningful  and that the results for any period  should not be relied upon as an
indication of future performance. The Company currently expects to significantly
increase  its  operating  expenses  in order to expand  its sales and  marketing
operations,  to continue to expand  internationally,  to upgrade and enhance its
DART  technology and to market and support its  solutions.  As a result of these
factors,  there can be no assurance that the Company will not incur  significant
losses on a quarterly and annual basis for the foreseeable future.





                                       10

<PAGE>

REVENUES

    Revenues  increased  $12.6  million  from $8.2  million for the three months
ended September 30, 1997 to $20.8 million, or 153.7%, for the three months ended
September 30, 1998.  Revenues increased $31.4 million from $19.7 million for the
nine months ended September 30, 1997 to $51.1 million,  or 159.8%,  for the nine
months  ended  September  30, 1998.  The increase in revenues,  both in absolute
dollars and as a percentage of revenues, was due primarily to an increase in the
number of advertisers and ads delivered on the DoubleClick Network, particularly
ads  delivered  on or through  the  AltaVista  Web site.  Revenues  earned  from
advertisements delivered on or through the AltaVista Web site were $9.2 million,
or 44.4% of revenues and $24.4  million,  or 47.8% of revenues for the three and
nine months ended September 30, 1998, respectively,  compared to 50.1% and 42.8%
of  revenues  for  the  three  and  nine  months  ended   September   30,  1997.
Approximately  $3.0 million of revenues for the nine months ended  September 30,
1998  resulted  from  sales of  inventory  on the  AltaVista  Web site which was
derived from an  arrangement  between  AltaVista and another  search engine that
expired  on June  30,  1998,  and is  therefore  non-recurring.  AltaVista  is a
significant  part of the  DoubleClick  Network.  No other Web site accounted for
more than 10.0% of revenues  for the three or nine months  ended  September  30,
1998,  and no one  advertiser  accounted  for 10.0% of revenues  during the same
periods. To date, the Company has not derived significant revenues from its DART
Service,  DoubleClick Direct, DoubleClick Local, Closed Loop Marketing Solutions
or international operations.

COST OF REVENUES

    Cost of revenues  consists  primarily of service fees paid to Web publishers
for ads delivered to the Web sites on the DoubleClick Network.  Cost of revenues
also includes other costs of delivering  advertisements,  including depreciation
of the ad delivery system and Internet access costs.  Gross margin was 32.1% and
32.8% for the three months ended September 30, 1997 and 1998, respectively.  The
increase in gross margin for the quarter  ended  September  30, 1998 compared to
the quarter  ended  September  30, 1997 is primarily  due to an increase in DART
service revenue,  which achieves a higher gross margin, as a percentage of total
revenue during such period. Gross margin was 33.6% and 32.4% for the nine months
ended September 30, 1997 and 1998, respectively.  Gross margin decreased for the
nine months ended  September 30, 1998  compared to September 30, 1997  primarily
due to a decrease in the Company's  revenue from the sale of advertisements on a
commission  basis as a percentage of the Company's total revenue.  To the extent
revenues from its DART service  increase as a percentage of total revenues,  the
Company anticipates that its gross margin will increase.

OPERATING EXPENSES

    SALES AND  MARKETING.  Sales and  marketing  expenses  consist  primarily of
salaries, commissions, advertising, maintenance of the Company's Web site, trade
show expenses,  seminars and costs of marketing  materials.  Sales and marketing
expenses increased $5.0 million, or 197%, from $2.6 million for the three months
ended  September  30, 1997,  or 31.3% of  revenues,  to $7.6 million or 36.6% of
revenue for the three  months ended  September  30,  1998.  Sales and  marketing
expenses  increased  $13.5  million,  or 204.5%,  from $6.6 million for the nine
months ended September 30, 1997, or 33.6% of revenues, to $20.1 million or 39.4%
of revenue  for the nine  months  ended  September  30,  1998.  The  increase in
absolute dollars was primarily  attributable to the increase in sales personnel,
commissions  associated  with the increase in revenues,  costs  associated  with
expanding  international   operations,   and  costs  related  to  the  continued
development  and   implementation  of  the  Company's   marketing  and  branding
campaigns.  The  increase in sales and  marketing  expenses as a  percentage  of
revenues  resulted from such expenses  increasing  more rapidly than revenues as
the  Company  continued  to build its sales and  marketing  infrastructure.  The
Company  expects sales and marketing  expenses to increase on an absolute dollar
basis but decrease as a percentage of revenues as the Company  hires  additional
personnel,  expands into new markets and  continues  to promote the  DoubleClick
brand.

    GENERAL AND  ADMINISTRATIVE.  General and  administrative  expenses  consist
primarily of compensation and professional service fees and related supplies and
materials. General and administrative expenses increased $1.0 million, or 55.5%,
from $1.8  million for the three months ended  September  30, 1997,  or 22.4% of
revenues,  to $2.9  million  or 13.7% of  revenues  for the three  months  ended
September 30, 1998. General and administrative  expenses increased $4.2 million,
or 116.9%,  from $3.6 million for the nine months ended  September  30, 1997, or
18.4% of  revenues,  to $7.8  million or 15.3% of  revenues  for the nine months
ended  September 30, 1998. The increase in absolute  dollars from the prior year
nine month  period was  primarily  the result of expenses  related to  increased
personnel  and  professional  service  fees.  The  Company  expects  general and
administrative  expenses to increase on an absolute dollar basis but decrease as
a percentage  of revenues as the Company hires  additional  personnel and incurs
additional  costs related to the growth of its business and its  operations as a
public company.
                                       11

<PAGE>

    PRODUCT  DEVELOPMENT.  Product  development  expenses  consist  primarily of
compensation and consulting expenses and enhancements to the DART technology. To
date,  all product  development  costs have been  expensed as incurred.  Product
development  expenses increased $1.3 million,  or 254.0%,  from $0.5 million for
the three months ended September 30, 1997, or 6.1% of revenues,  to $1.8 million
or 8.6% of revenue  for the three  months  ended  September  30,  1998.  Product
development  expenses increased $3.3 million,  or 329.3%,  from $1.0 million for
the nine months ended  September 30, 1997, or 5.2% of revenues,  to $4.4 million
or 8.5% of revenue for the nine months ended September 30, 1998. The increase in
absolute dollars was due primarily to increases in product development personnel
and  consulting  expenses.  The  increase in product  development  expenses as a
percentage of revenues resulted from such expenses  increasing more rapidly than
revenues  as the  Company  continued  the  development  of its DART  technology,
DoubleClick Direct,  DoubleClick Local and Closed Loop Marketing Solutions.  The
Company believes that continued investment in product development is critical to
attaining its strategic objectives and, as a result, expects product development
expenses to increase on an absolute dollar basis but remain relatively  constant
as a percentage of revenues.

    INTEREST INCOME (EXPENSE)

    Net interest income increased  $590,063 from net interest income of $130,150
for the three months ended September 30, 1997 to net interest income of $720,213
for the three months ended  September 30, 1998.  Net interest  income  increased
$1,941,879  from  net  interest  income  of  $6,511  for the nine  months  ended
September  30, 1997 to net  interest  income of  $1,948,390  for the nine months
ended September 30, 1998. The increase in interest income was attributable to an
increase in cash, cash equivalents and short-term investments as a result of the
net proceeds  received by the Company from its initial public offering of Common
stock in February  1998.  Interest  income in future  periods may fluctuate as a
result of  fluctuations  in average cash balances  maintained by the Company and
changes in the market rate of its investments.

    NET LOSS

    The Company's net loss increased $2.6 million,  or $.09 per share, from $2.1
million for the three months ended  September 30, 1997,  or $0.19 per share,  to
$4.7 million for the three months ended September 30, 1998, or $0.28 per share.

    The Company's net loss increased $9.2 million,  or $.48 per share, from $4.6
million for the nine months ended  September  30, 1997,  or $0.40 per share,  to
$13.8 million for the nine months ended  September 30, 1998, or $0.88 per share.
The  increase  in the net loss was  primarily  due to the  hiring of  additional
personnel,  particularly in sales and marketing,  and product  development.  The
Company  expects to hire  additional  personnel  and  increase  its spending for
marketing and other infrastructure needs.

LIQUIDITY AND CAPITAL RESOURCES

    Since its  inception,  the Company has financed its  operations  through the
private placement of equity securities, borrowings from a related party, and its
initial public offering. In June 1997, the Company completed a private placement
of  equity  securities  to new  investors  and  received  $39.8  million  in net
proceeds,  of which $25.0 million was used to redeem shares of Common Stock from
certain  stockholders.  On December 30, 1997,  $5,000,000 in  borrowings  from a
related party pursuant to a Convertible Promissory Note (the "Convertible Note")
was converted  into 779,302  shares of the Company's  Common Stock.  In February
1998, the Company received net proceeds of approximately  $62.5 million from the
initial public offering of 4,025,000  shares of the Company's  Common Stock at a
price of $17.00 per share.

    Net cash used in operating activities was $2.1 million and $14.0 million for
the nine months ended  September 30, 1997 and 1998,  respectively.  Cash used in
operating  activities for the nine months ended September 30, 1998 resulted from
net  operating  losses and  increases in accounts  receivable  and other current
assets,  which were partially offset by increases in accounts  payable,  accrued
expenses and deferred revenues.

    Net cash used in investing activities was $9.8 million and $12.8 million for
the nine months ended  September 30, 1997 and 1998,  respectively.  Cash used in
investing  activities for the nine months ended September 30, 1998 resulted from
purchases of property and equipment,  Investments, and the acquisition of assets
of Soussy,  a  Quebec-based  network of French  web sites,  partially  offset by
proceeds  provided  by  the  purchases,   sales  and  maturities  of  short-term
investments, net.


                                       12

<PAGE>

    Net cash  provided  by  financing  activities  was $16.5  million  and $62.6
million for the nine months  ended  September  30, 1997 and 1998,  respectively.
Cash provided by financing  activities  for the nine months ended  September 30,
1998 consisted  primarily of net proceeds  received by the Company in connection
with the closing of its initial public offering in February 1998.

    As of  September  30, 1998,  the Company had $38.6  million of cash and cash
equivalents and $11.3 million in short-term investments. The Company's principal
commitments consisted of obligations under operating and capital leases.

    Although the Company has no material  commitments for capital  expenditures,
management  anticipates  that it will  experience a substantial  increase in its
capital  expenditures  and lease  commitments  consistent  with its  anticipated
growth in  operations,  infrastructure  and  personnel.  The  Company  currently
anticipates  that it will  continue  to  experience  significant  growth  in its
operating  expenses for the foreseeable  future and that its operating  expenses
will be a material use of the Company's  cash  resources.  The Company  believes
that the existing cash and cash  equivalents and short-term  investments will be
sufficient to meet its  anticipated  cash needs for working  capital and capital
expenditures for at least the next twelve months.

YEAR 2000 COMPLIANCE

    Many currently installed computer systems and software products are coded to
accept or recognize only two digit entries in the date code field. These systems
and software products will need to accept four digit entries to distinguish 21st
century dates from 20th century  dates.  As a result,  computer  systems  and/or
software  used  by many  companies  and  governmental  agencies  may  need to be
upgraded to comply with such Year 2000  requirements  or risk system  failure or
miscalculations causing disruptions of normal business activities.

     State of Readiness.  The Company has made a  preliminary  assessment of the
Year 2000 readiness of its information technology ("IT") systems,  including the
hardware  and  software  that  enable the  Company to provide  and  deliver  its
solutions, and its non-IT systems. The Company's assessment plan consists of (i)
quality  assurance  testing of its  internally  developed  proprietary  software
incorporated   in  its  solutions   ("Solutions   Software");   (ii)  contacting
third-party  vendors and licensors of material  hardware,  software and services
that are both directly and  indirectly  related to the delivery of the Company's
solutions  to its web  publisher  and  advertiser  customers;  (iii)  contacting
vendors of material  non-IT  systems;  (iv)  assessment of repair or replacement
requirements; (v) repair or replacement; (vi) implementation; and (vii) creation
of contingency  plans in the event of Year 2000  failures.  The Company plans to
perform  a Year 2000  simulation  on its  Solutions  Software  during  the first
quarter of 1999 to test system readiness.  Based on the results of its Year 2000
simulation  test,  the  Company  intends  to  revise  the code of its  Solutions
Software as  necessary  to improve  the Year 2000  compliance  of its  Solutions
Software.  The  Company  has been  informed  by many of its  vendors of material
hardware and software components of its IT systems that the products used by the
Company are currently Year 2000  compliant.  The Company will require vendors of
its other material hardware and software components of its IT systems to provide
assurances  of their Year 2000  compliance,  and plans to complete  this process
during  the  first  half  of  1999.  The  Company  is  currently  assessing  the
materiality  of its  non-IT  systems  and  will  seek  assurances  of Year  2000
compliance  from  providers of material  non-IT  systems.  Until such testing is
complete and such vendors and providers are  contacted,  the Company will not be
able to completely  evaluate  whether its IT systems or non-IT systems will need
to be revised or replaced.

    Costs.  To date, the Company has not incurred any material  expenditures  in
connection with identifying or evaluating Year 2000 compliance  issues.  Most of
its  expenses  have  related to, and are  expected to continue to relate to, the
operating  costs  associated  with time  spent by  employees  in the  evaluation
process and Year 2000 compliance  matters  generally.  At this time, the Company
does not possess the  information  necessary to estimate the potential  costs of
revisions to its  Solutions  Software  should such  revisions be required or the
replacement  of third-party  software,  hardware or services that are determined
not to be Year 2000  compliant.  Although the Company does not  anticipate  that
such expenses will be material, such expenses, if higher than anticipated, could
have a material adverse effect on the Company's business,  results of operations
and financial condition.

    Risks.  The  Company  is not  currently  aware of any Year  2000  compliance
problems  relating to Solutions  Software or its IT or non-IT systems that would
have a material adverse effect on the Company's business,  results of operations
and financial  condition,  without taking into account the Company's  efforts to
avoid or fix such problems.  There can be no assurance that the Company will not
discover  Year 2000  compliance  problems in its  Solutions  Software  that will
require

                                       13

<PAGE>

substantial revisions.  In addition,  there can be no assurance that third-party
software,  hardware or  services  incorporated  into its  material IT and non-IT
systems  will not need to be revised  or  replaced,  all of which  could be time
consuming  and  expensive.  The  failure  of the  Company  to fix its  Solutions
Software or to fix or replace  third-party  software,  hardware or services on a
timely basis could result in lost revenues,  increased operating costs, the loss
of  customers  and  other  business  interruptions,  any of which  could  have a
material  adverse  effect on the Company's  business,  results of operations and
financial  condition.  Moreover,  the failure to  adequately  address  Year 2000
compliance issues in its Software Solutions, and its IT and non-IT systems could
result in claims of mismanagement,  misrepresentation  or breach of contract and
related litigation, which could be costly and time-consuming to defend.

In  addition,  there can be no assurance  that  governmental  agencies,  utility
companies,  Internet access companies,  third-party service providers and others
outside the Company's  control will be Year 2000 compliant.  The failure by such
entities to be Year 2000 compliant could result in a systemic failure beyond the
control of the  Company,  such as a prolonged  Internet,  telecommunications  or
electrical  failure,  which could also prevent the Company from  delivering  its
services to its  customers,  decrease the use of the  Internet or prevent  users
from accessing the Web sites of the Company's publisher  customers,  which could
have a material adverse effect on the Company's business,  results of operations
and financial condition.

    Contingency  Plan. As discussed  above, the Company is engaged in an ongoing
Year 2000  assessment  and has not yet  developed  any  contingency  plans.  The
results of the Company's Year 2000 simulation testing and the responses received
from  third-party  vendors and service  providers  will be taken into account in
determining the nature and extent of any contingency plans.


RISK FACTORS THAT MAY AFFECT FUTURE RESULTS

    THIS REPORT CONTAINS  FORWARD-LOOKING  STATEMENTS  RELATING TO FUTURE EVENTS
AND THE FUTURE  PERFORMANCE  OF THE COMPANY WITHIN THE MEANING OF SECTION 27A OF
THE  SECURITIES  ACT OF 1993,  AS AMENDED,  AND  SECTION  21E OF THE  SECURITIES
EXCHANGE  ACT  OF  1934,  AS  AMENDED.  STOCKHOLDERS  ARE  CAUTIONED  THAT  SUCH
STATEMENTS  INVOLVE RISKS AND  UNCERTAINTIES.  THE COMPANY'S  ACTUAL RESULTS AND
TIMING OF CERTAIN EVENTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN THESE
FORWARD-LOOKING  STATEMENTS AS A RESULT OF CERTAIN FACTORS,  INCLUDING,  BUT NOT
LIMITED  TO,  THOSE SET FORTH  BELOW AND  ELSEWHERE  IN THIS  REPORT  AND IN THE
COMPANY'S OTHER PUBLIC FILINGS MADE WITH THE SECURITIES AND EXCHANGE COMMISSION.

EXTREMELY LIMITED OPERATING HISTORY; HISTORY OF LOSSES;
ANTICIPATION OF   CONTINUED LOSSES

    The Company  was  incorporated  in January  1996 and its  prospects  must be
considered  in  light  of  the  risks,  expenses  and  difficulties   frequently
encountered   by  companies   with  extremely   limited   operating   histories,
particularly  companies in the new and rapidly evolving markets for the Internet
and Internet services,  including the Internet  advertising market. There can be
no  assurance  that the Company will be  successful  in  addressing  such risks.
Although  the  Company  has  experienced   revenue  growth  in  recent  periods,
historical growth rates may not be sustained and are not necessarily  indicative
of future operating  results.  Given the level of planned  operating and capital
expenditures,  the Company  anticipates that it will continue to incur operating
losses at least through 1999.  There can be no assurance that  operating  losses
will not increase in the future or that the Company will ever achieve or sustain
profitability.  To the extent that  revenues do not grow at  anticipated  rates,
that increases in operating expenses precede or are not subsequently followed by
commensurate  increases  in  revenues  or that the  Company  is unable to adjust
operating  expense  levels  accordingly,  the  Company's  business,  results  of
operations and financial condition will be materially and adversely affected.

DEPENDENCE ON ALTAVISTA

    Revenues from advertisements  delivered on or through the AltaVista Web site
represented  44.7% of the  Company's  revenues  for the year ended  December 31,
1997,  and 44.4% and 47.8% of the  Company's  revenues  for the three months and
nine months  ended  September  30, 1998,  respectively.  In December  1996,  the
Company entered into an agreement with Digital (acquired by Compaq in June 1998)
to be the exclusive third-party provider of advertising services on

                                       14

<PAGE>

specified  pages within the  AltaVista  Web site.  The  agreement was amended on
January 7, 1998 to extend the term through December 1999 and to provide that the
agreement  would survive a change of control of AltaVista or Digital,  although,
notwithstanding either such provision,  either party may terminate the agreement
upon 90 days' prior written  notice.  The Company has ongoing  discussions  with
Compaq  regarding the Company's  relationship  and agreement  with AltaVista The
timing  and  outcome  of such  discussions  are  uncertain.  As a result of such
discussions,  Compaq may elect, or notify the Company of its intention to elect,
to terminate the agreement or demand  concessions or contractual  terms that are
less favorable to the Company than the existing agreement. The loss of AltaVista
as part of the DoubleClick  Network,  any reduction in traffic on or through the
AltaVista Web site, the termination of AltaVista's  contract with the Company or
the  negotiation  of new terms to the agreement  that are less  favorable to the
Company would have a material adverse effect on the Company's business,  results
of operations and financial condition.  Compaq may also change or limit the type
of  advertisers  that are  acceptable  for the AltaVista  Web site,  which could
materially  and  adversely  impact  advertising  revenues.   In  addition,   any
development   materially  affecting  the  business  or  financial  condition  of
AltaVista,  including any consequences of the acquisition by Compaq, the sale of
AltaVista to a third party,  or the  entering  into of a strategic  relationship
with a third  party  with a  dedicated  ad sales  force,  could  have a material
adverse  effect on  AltaVista's  business  or the  Company's  relationship  with
AltaVista.

WEB PUBLISHER CONCENTRATION

    Ads  delivered  on the Web  sites  of the top  four  Web  publishers  on the
DoubleClick Network,  including AltaVista,  accounted for approximately 60.3% of
the  Company's  revenues  for the  nine  months  ended  September  30,  1998 and
approximately  61.2% of the Company's  revenues for the year ended  December 31,
1997. The Company anticipates that a substantial portion of the Company's future
revenues will be derived from ads delivered on the Web sites of a limited number
of Web publishers.  The Company typically enters into short-term  contracts with
Web publishers for inclusion of their Web sites in the DoubleClick  Network. The
loss of one or more of the Web sites which account for a significant  portion of
the Company's revenues from the DoubleClick  Network or any reduction in traffic
on such  Web  sites  could  have a  material  adverse  effect  on the  Company's
business,  results of operations and financial condition.  In addition, the loss
of such Web sites may result in the loss of advertisers  or Web publishers  from
the  DoubleClick  Network,  which  could have a material  adverse  effect on the
Company's  business,  results of operations and financial  condition.  Given the
short-term  nature of the Company's  contracts,  the Company may, in the future,
have to negotiate a new contract or renewal which may have terms that are not as
favorable to the Company as its existing contract, and such renegotiations could
have a material adverse effect on the Company's business,  results of operations
and financial condition.

RELIANCE ON THE DOUBLECLICK NETWORK

    Since the third  quarter of 1996,  the  Company's  DoubleClick  Network  has
accounted  for  substantially  all  of  the  Company's  revenues.  Although  the
Company's  solutions  include the  DoubleClick  DART  Service  and the  recently
introduced  Closed Loop Marketing  solutions,  the Company expects that revenues
generated from advertisements  delivered to Web sites on the DoubleClick Network
will continue to account for a substantial portion of the Company's revenues for
the  foreseeable  future.  The  DoubleClick  Network  consists of Web sites of a
limited  number  of Web  publishers  that  have  contracted  for  the  Company's
solutions pursuant to short-term agreements. There can be no assurance that such
Web publishers will remain associated with the DoubleClick Network, that the Web
sites on the DoubleClick  Network will maintain  consistent or increasing levels
of traffic over time, or that the Company will be able to timely or  effectively
replace  any  exiting  DoubleClick  Network  Web site with  other Web sites with
comparable traffic patterns and user demographics. The failure of the Company to
successfully  market the DoubleClick  Network or the failure of the Web sites on
the DoubleClick  Network to maintain  consistent or increasing levels of traffic
would have a  material  adverse  effect on the  Company's  business,  results of
operations and financial condition.

POTENTIAL FLUCTUATIONS IN QUARTERLY OPERATING RESULTS

    The Company's  results of  operations  may  fluctuate  significantly  in the
future  as a result of a  variety  of  factors,  many of which  are  beyond  the
Company's control.  These factors include the addition or loss of advertisers or
Web publishers that utilize the Company's  solutions,  the level of user traffic
and  number  of  available  impressions  on or  through  the  Web  sites  on the
DoubleClick  Network,  changes in  service  fees  payable by the  Company to Web
publishers,  the  introduction  of new  Internet  advertising  solutions  by the
Company or its  competitors,  the amount and timing of capital  expenditures and
other costs  relating to the expansion of the Company's  operations,  the timing
and number of new hires, the mix of solutions


                                       15

<PAGE>

provided,  the mix of domestic and  international  revenues,  the  incurrence of
costs relating to acquisitions,  demand for, and market  acceptance of, Internet
advertising,  seasonal  trends in  Internet  usage and  advertising  placements,
advertisers' budgeting cycles, the commitment of advertising budgets to Internet
advertising,  changes in pricing  models for Internet  advertising,  and general
economic conditions.

    For  the  foreseeable  future,  the  Company's  revenues  will  be  directly
contingent  on the level of user  traffic  and  advertising  activity on the Web
sites on the DoubleClick Network in a given period. Accordingly, future revenues
and results of  operations  are  difficult  to  forecast.  The Company  plans to
continue to significantly  increase its operating  expenses in order to increase
its sales and marketing operations,  to continue to expand  internationally,  to
upgrade and enhance its DART technology and to market and support its solutions.
To the extent that such  expenses  precede or are not  subsequently  followed by
increased revenues, the Company's business,  results of operations and financial
condition would be materially and adversely affected.  The Company may be unable
to adjust  spending in a timely manner to compensate for any unexpected  revenue
shortfall,  and  any  significant  shortfall  in  revenues  in  relation  to the
Company's  expectations  would have a material  adverse  effect on the Company's
business, results of operations and financial condition.

    The Company has been,  and expects in the future to be,  subject to seasonal
fluctuations  in the amount of Internet  advertising  revenues  generated by the
Company,  as  advertisers  historically  spend less  during  the first  calendar
quarter of each year.  Additional  seasonal  patterns  in  Internet  advertising
spending and other seasonal fluctuations may emerge as the market matures.

    Due  to  all  of  the   foregoing   factors,   the  Company   believes  that
period-to-period  comparisons of its results of operations  are not  necessarily
meaningful and should not be relied upon as  indications of future  performance.
Furthermore it is possible that in some future quarters the Company's results of
operations may fall below the expectations of securities analysts and investors.
In such event,  the trading price of the Company's  Common Stock would likely be
materially and adversely affected.

MANAGEMENT OF GROWTH

    The Company  has  experienced  rapid  growth in its  operations.  This rapid
growth has placed, and is expected to continue to place, a significant strain on
the Company's managerial,  operational and financial resources.  The Company has
grown from 13  employees  as of March 31, 1996 to 373  employees as of September
30, 1998. The Company  expects that the number of its employees will continue to
increase  for  the  foreseeable  future.  There  can be no  assurance  that  the
Company's  systems,  procedures,  or  controls  will be  adequate to support the
Company's expanding operations, or that the Company's management will be able to
achieve the rapid execution  necessary to  successfully  offer its solutions and
implement its business plan.  The Company's data center is currently  located in
the  Company's  executive  offices  in  New  York,  New  York.  The  Company  is
considering  relocating its data  operations into a new facility in the New York
City  metropolitan  area. The inability to  successfully  manage such relocation
would  have a  material  adverse  effect on the  Company's  business,  financial
condition and results of operations.  The Company's future results of operations
will also depend on its ability to expand its sales and  marketing  and customer
support organizations both domestically and internationally.  The failure of the
Company to manage its growth effectively would have a material adverse effect on
the  Company's  business,   results  of  operations  and  financial   condition.
Furthermore,  the  Company's  future  performance  may  depend on the  Company's
ability to integrate any acquired business, technologies,  services or products,
which,  even if successful,  may take a significant  period of time and expense,
and may place a significant strain on the Company's resources. If the Company is
unable to manage any such  acquisition-based  growth effectively,  the Company's
business,  results of  operations  and  financial  condition  will be materially
adversely affected.

DEVELOPING MARKET; UNPROVEN ACCEPTANCE AND EFFECTIVENESS OF WEB ADVERTISING

    The market for Internet  advertising has only recently begun to develop,  is
rapidly  evolving  and  is  characterized  by an  increasing  number  of  market
entrants.  As is typical  in the case of a new and  rapidly  evolving  industry,
demand and market acceptance for recently  introduced  products and services are
subject  to a high level of  uncertainty.  Since the  Company  expects to derive
substantially  all of its  revenues  in the  foreseeable  future  from  Internet
advertising solutions,  the future success of the Company is highly dependent on
the increased use of the Internet as an advertising  medium.  The Internet as an
advertising  medium has not been  available  for a sufficient  period of time to
gauge its effectiveness as compared with traditional advertising media.

                                       16


<PAGE>

     Most of the  Company's  current or  potential  advertising  customers  have
limited or no experience using the Internet as an advertising  medium,  have not
devoted a  significant  portion of their  advertising  expenditures  to Internet
advertising and may not find Internet  advertising to be effective for promoting
their products and services  relative to advertising on traditional  media.  The
adoption of  Internet  advertising,  particularly  by those  entities  that have
historically  relied  upon  traditional  media  for  advertising,  requires  the
acceptance of a new way of conducting  business and exchanging  information.  In
addition,  most of the Company's  current and potential Web publisher  customers
have  limited  or  no  experience  in  generating  revenues  from  the  sale  of
advertising space on their Web sites.  There can be no assurance that the market
for Internet  advertising will continue to emerge or become sustainable.  If the
market fails to develop or develops  more slowly than  expected,  the  Company's
business,  results of operations and financial condition could be materially and
adversely affected.

    There  are  no  widely  accepted   standards  for  the  measurement  of  the
effectiveness of Internet  advertising,  and there can be no assurance that such
standards  will  develop  sufficiently  to  support  Internet  advertising  as a
significant  advertising  medium.  There  also  can  be no  assurance  that  the
Company's  advertising  customers will accept the Company's or other third-party
measurements  of impressions  on the Web sites of Web  publishers  utilizing the
Company's  solutions,  or that such  measurements  will not contain  errors.  In
addition,  the  effectiveness  of Internet  advertising  is  dependent  upon the
accuracy   of   information   contained   in  the   databases   used  to  target
advertisements.   Like  any  database,  there  can  be  no  assurance  that  the
information in the Company's  database will be accurate or that advertisers will
be willing to have  advertisements  targeted  by any  database  containing  such
potential inaccuracies.

    Further,  there can be no assurance  that  advertisers  will  determine that
banner advertising,  the delivery of which currently comprises substantially all
of the Company's revenues, is an effective or attractive advertising medium, and
there can be no assurance  that the Company will  effectively  transition to any
other  forms of Internet  advertising  should  they  develop and achieve  market
acceptance.   Moreover,   "filter"  software  programs  that  limit  or  prevent
advertising  from  being  delivered  to a Web  user's  computer  are  available.
Widespread  adoption of such  software  by users  could have a material  adverse
effect upon the commercial viability of Internet advertising, which would have a
material  adverse  effect on the Company's  business,  results of operations and
financial condition.

PRIVACY CONCERNS

    The Company's DART technology uses cookies to limit the frequency with which
an ad is shown to the user.  Cookies are bits of information keyed to a specific
server,  file  pathway or  directory  location  that are stored on a user's hard
drive and passed to a Web site's  server  through the user's  browser  software.
Cookies can be placed on the user's hard drive  without the user's  knowledge or
consent, but are also removable by the user at any time through the modification
of  the  user's  browser  settings.  Due  to  privacy  concerns,  some  Internet
commentators,  advocates and governmental  bodies have suggested that the use of
cookies be limited or  eliminated.  In  addition,  certain  currently  available
Internet  browsers allow a user to delete cookies or prevent  cookies from being
stored on the user's hard  drive.  Any  reduction  or  limitation  in the use of
cookies  could limit the  effectiveness  of ad targeting by the  Company's  DART
technology.

     The European Union has recently adopted a directive addressing data privacy
that may result in limitations on the collection and use of certain  information
regarding  Internet users.  These limitations may limit the Company's ability to
target  advertising  or collect  and  utilize  information  in certain  European
countries.  Since the  implementing  regulations  have not been  adopted at this
time, the impact of the directive can not yet be determined.

UNPROVEN BUSINESS MODEL

    The Company's  business  model is to generate  revenues  solely by providing
Internet  advertising  solutions to advertisers and Web  publishers.  The profit
potential of the Company's  business  model is unproven,  and, to be successful,
the Company must, among other things,  develop and market solutions that achieve
broad market  acceptance  by  advertisers  and Web  publishers.  There can be no
assurance that Internet advertising,  in general, or the Company's solutions, in
particular,  will achieve  broad market  acceptance.  The  Company's  ability to
generate  significant  revenues from  advertisers  will depend,  in part, on the
development  of a large  base  of Web  publishers  that  utilize  the  Company's
solutions and have Web sites with  adequate  available ad space  inventory,  and
whose   Web  sites   generate   sufficient   user   traffic   with   demographic
characteristics that are attractive to such advertisers.  Furthermore,  there is
intense  competition  among  sellers of  Internet  advertising  and a variety of
related  pricing  models have  developed,  making it difficult to project future
levels  of  advertising  revenues  and  applicable  gross  margins  that  can be
sustained  by the  Company or the  Internet  advertising  industry  in  general.
Accordingly, no assurance can be given that the Company's business model will be
successful or that it can sustain revenue growth and maintain  sufficient  gross
margins.
                                       17

<PAGE>

    Market acceptance of the Company's new products, including DoubleClick Local
and Closed Loop Marketing  solutions,  will depend on the continued emergence of
Internet commerce and market demand for the services.  There can be no assurance
that the market for the  Company's  new products will develop or that demand for
the Company's new products will emerge or become sustainable.


RISK OF SYSTEM FAILURE; YEAR 2000 COMPLIANCE

    Many currently installed computer systems and software products are coded to
accept or recognize only two digit entries in the date code field. These systems
and software products will need to accept four digit entries to distinguish 21st
century dates from 20th century  dates.  As a result,  computer  systems  and/or
software  used  by many  companies  and  governmental  agencies  may  need to be
upgraded to comply with such Year 2000  requirements  or risk system  failure or
miscalculations causing disruptions of normal business activities.

     State of Readiness.  The Company has made a  preliminary  assessment of the
Year 2000 readiness of its information technology ("IT") systems,  including the
hardware  and  software  that  enable the  Company to provide  and  deliver  its
solutions, and its non-IT systems. The Company's assessment plan consists of (i)
quality  assurance  testing of its  internally  developed  proprietary  software
incorporated   in  its  solutions   ("Solutions   Software");   (ii)  contacting
third-party  vendors and licensors of material  hardware,  software and services
that are both directly and  indirectly  related to the delivery of the Company's
solutions  to its web  publisher  and  advertiser  customers;  (iii)  contacting
vendors of material  non-IT  systems;  (iv)  assessment of repair or replacement
requirements; (v) repair or replacement; (vi) implementation; and (vii) creation
of contingency  plans in the event of Year 2000  failures.  The Company plans to
perform  a Year 2000  simulation  on its  Solutions  Software  during  the first
quarter of 1999 to test system readiness.  Based on the results of its Year 2000
simulation  test,  the  Company  intends  to  revise  the code of its  Solutions
Software as  necessary  to improve  the Year 2000  compliance  of its  Solutions
Software.  The  Company  has been  informed  by many of its  vendors of material
hardware and software components of its IT systems that the products used by the
Company are currently Year 2000  compliant.  The Company will require vendors of
its other material hardware and software components of its IT systems to provide
assurances  of their Year 2000  compliance,  and plans to complete  this process
during  the  first  half  of  1999.  The  Company  is  currently  assessing  the
materiality  of its  non-IT  systems  and  will  seek  assurances  of Year  2000
compliance  from  providers of material  non-IT  systems.  Until such testing is
complete and such vendors and providers are  contacted,  the Company will not be
able to completely  evaluate  whether its IT systems or non-IT systems will need
to be revised or replaced.

    Costs.  To date, the Company has not incurred any material  expenditures  in
connection with identifying or evaluating Year 2000 compliance  issues.  Most of
its  expenses  have  related to, and are  expected to continue to relate to, the
operating  costs  associated  with time  spent by  employees  in the  evaluation
process and Year 2000 compliance  matters  generally.  At this time, the Company
does not possess the  information  necessary to estimate the potential  costs of
revisions to its  Solutions  Software  should such  revisions be required or the
replacement  of third-party  software,  hardware or services that are determined
not to be Year 2000  compliant.  Although the Company does not  anticipate  that
such expenses will be material, such expenses, if higher than anticipated, could
have a material adverse effect on the Company's business,  results of operations
and financial condition.

    Risks.  The  Company  is not  currently  aware of any Year  2000  compliance
problems  relating to Solutions  Software or its IT or non-IT systems that would
have a material adverse effect on the Company's business,  results of operations
and financial  condition,  without taking into account the Company's  efforts to
avoid or fix such problems.  There can be no assurance that the Company will not
discover  Year 2000  compliance  problems in its  Solutions  Software  that will
require  substantial  revisions.  In addition,  there can be no  assurance  that
third-party software, hardware or services incorporated into its material IT and
non-IT  systems will not need to be revised or  replaced,  all of which could be
time  consuming and  expensive.  The failure of the Company to fix its Solutions
Software or to fix or replace  third-party  software,  hardware or services on a
timely basis could result in lost revenues,  increased operating costs, the loss
of  customers  and  other  business  interruptions,  any of which  could  have a
material  adverse  effect on the Company's  business,  results of operations and
financial  condition.  Moreover,  the failure to  adequately  address  Year 2000
compliance issues in its Software Solutions, and its IT and non-IT systems could
result in claims of mismanagement,  misrepresentation  or breach of contract and
related litigation, which could be costly and time-consuming to defend.



                                       18

<PAGE>

     In addition, there can be no assurance that governmental agencies,  utility
companies,  Internet access companies,  third-party service providers and others
outside the Company's  control will be Year 2000 compliant.  The failure by such
entities to be Year 2000 compliant could result in a systemic failure beyond the
control of the  Company,  such as a prolonged  Internet,  telecommunications  or
electrical  failure,  which could also prevent the Company from  delivering  its
services to its  customers,  decrease the use of the  Internet or prevent  users
from accessing the Web sites of the Company's publisher  customers,  which could
have a material adverse effect on the Company's business,  results of operations
and financial condition.

    Contingency  Plan. As discussed  above, the Company is engaged in an ongoing
Year 2000  assessment  and has not yet  developed  any  contingency  plans.  The
results of the Company's Year 2000 simulation testing and the responses received
from  third-party  vendors and service  providers  will be taken into account in
determining the nature and extent of any contingency plans.

COMPETITION

    The markets for Internet  advertising and related  products and services are
intensely  competitive and such competition is expected to continue to increase.
There  are no  substantial  barriers  to entry in this  market  and the  Company
believes that its ability to compete depends upon many factors within and beyond
its control,  including  the timing and market  acceptance  of new solutions and
enhancements to existing solutions developed by the Company and its competitors,
customer service and support,  sales and marketing efforts, and the ease of use,
performance, price and reliability of the Company's solutions.

    The  Company  competes  for  Internet  advertising  revenues  with large Web
publishers  and Web search engine  companies,  such as America  Online,  Yahoo!,
Excite,  Lycos and Infoseek.  Further,  the DoubleClick  Network competes with a
variety of Internet advertising networks, including 24/7 Media. In marketing the
DoubleClick  Network and its DART  Service to Web  publishers,  the Company also
competes with providers of ad servers and related services, including NetGravity
and AdForce.  The Company  also  encounters  competition  from a number of other
sources,   including  content  aggregation   companies,   companies  engaged  in
advertising  sales  networks,  advertising  agencies,  and other companies which
facilitate Internet advertising.  Many of the Company's existing competitors, as
well as a number of potential new competitors,  have longer operating histories,
greater  name  recognition,  larger  customer  bases and  significantly  greater
financial, technical and marketing resources than the Company. As a result, they
may be able to respond more quickly to new or emerging  technologies and changes
in customer  requirements,  or to devote greater  resources to the  development,
promotion  and sale of their  products  and  services  than  the  Company.  Such
competitors may be able to undertake more extensive marketing  campaigns,  adopt
more aggressive  pricing  policies and make more attractive  offers to potential
employees,  strategic partners,  advertisers and Web publishers.  Further, there
can be no assurance  that the Company's  competitors  will not develop  Internet
products or services  that are equal or superior to the  solutions  developed by
the  Company  or that  achieve  greater  market  acceptance  than the  Company's
solutions. The Company also expects that competition may increase as a result of
industry  consolidation.  In addition,  current and potential  competitors  have
established or may establish cooperative  relationships among themselves or with
third  parties to increase the ability of their  products or services to address
the needs of the Company's prospective  advertising and Web publisher customers.
Accordingly,  it is possible that new competitors or alliances among existing or
potential  competitors may emerge and rapidly acquire  significant market share.
Increased  competition  is likely to result in price  reductions,  reduced gross
margins and loss of market  share,  any of which  would have a material  adverse
effect on the Company's business, results of operations and financial condition.
There can be no assurance that the Company will be able to compete  successfully
against existing or potential competitors or that competitive pressures will not
have a material adverse effect on the Company's business,  results of operations
and financial condition.

    The Internet, in general, and the Company, in particular,  also must compete
for  a  share  of  advertisers'  total  advertising   budgets  with  traditional
advertising media such as television, radio, cable and print. To the extent that
the  Internet is perceived to be a limited or  ineffective  advertising  medium,
advertisers  may  be  reluctant  to  devote  a  significant   portion  of  their
advertising  budget to  Internet  advertising,  which  could limit the growth of
Internet  advertising and would have a material  adverse effect on the Company's
business, results of operations and financial condition.





                                       19


<PAGE>

RISKS RELATED TO ACQUISITIONS AND INVESTMENTS

    A key component of the Company's  growth strategy may be the acquisition of,
or investments in, complementary businesses, technologies, services or products.
The successful  implementation of this strategy depends on the Company's ability
to identify suitable acquisition or investment candidates,  acquire or invest in
such  businesses,  technologies,  services or products on acceptable  terms and,
with respect to acquisitions, integrate their operations successfully with those
of the Company. From time to time, the Company has entered into discussions with
various  companies  regarding   acquisition  of,  and/or  investment  in,  their
respective businesses,  technologies, services or products. However, the Company
has no present  understandings,  commitments  or agreements  with respect to any
material  acquisition  of, or  investment  in, other  businesses,  technologies,
services of products. There can be no assurance that the Company will be able to
identify suitable acquisition or investment  candidates or that the Company will
be able to acquire or make an investment in such candidates on acceptable terms.
In addition,  competition for these  acquisition  and investment  targets likely
could also result in increased prices of acquisition and investment  targets and
a diminished pool of businesses,  technologies,  services and products available
for  acquisition  or  investment.  Acquisitions  also  involve a number of other
risks,  including  adverse effects on the company's  reported  operating results
from increases in goodwill amortization,  acquired in-process technology,  stock
compensation  expense and increased  compensation  expense  resulting from newly
hired employees, the diversion of management attention,  potential disputes with
the  sellers  of one or more  acquired  businesses,  technologies,  services  or
products and the possible failure to retain key acquired personnel. Furthermore,
any acquired business could significantly underperform relative to the Company's
expectations.  For all  these  reasons,  the  Company's  pursuit  of an  overall
acquisition and investment strategy or any individual  acquisition or investment
may have a  material  adverse  effect  on the  Company's  business,  results  of
operations  and financial  condition.  To the extent the Company  chooses to use
cash consideration for acquisitions or investments,  the Company may be required
to  obtain  additional  financing,  and  there  can be no  assurance  that  such
financing will be available on favorable terms, if at all. As the Company issues
stock to complete acquisitions,  existing stockholders will experience ownership
dilution.

DEPENDENCE ON KEY PERSONNEL

    The  Company's  future  success  depends,  in  significant  part,  upon  the
continued service of its key technical,  sales and senior management  personnel,
particularly  Kevin J.  O'Connor,  Chief  Executive  Officer and Chairman of the
Board of Directors,  Kevin P. Ryan,  President and Chief  Operating  Officer and
Dwight A. Merriman,  Chief Technical  Officer,  none of whom has entered into an
employment  agreement with the Company.  The loss of the services of one or more
of the  Company's  key  personnel  could have a material  adverse  effect on the
Company's business, results of operations and financial condition. The Company's
future  success  also  depends on its  continuing  ability to attract and retain
highly qualified technical, sales and marketing, customer support, financial and
accounting,  and  managerial  personnel.  Competition  for such personnel in the
Internet  industry is intense,  and there can be no  assurance  that the Company
will be able to retain its key  personnel or that it can attract,  assimilate or
retain other highly qualified personnel in the future. The Company has from time
to time in the past  experienced,  and expects to continue to  experience in the
future,   difficulty  in  hiring  and  retaining   candidates  with  appropriate
qualifications.

DEPENDENCE ON THE WEB INFRASTRUCTURE

    The Company's  success will depend,  in large part,  upon the maintenance of
the Web  infrastructure,  such as a reliable network backbone with the necessary
speed, data capacity and security,  and timely  development of enabling products
such as high speed modems,  for  providing  reliable Web access and services and
improved content.  To the extent that the Web continues to experience  increased
numbers of users, frequency of use or increased bandwidth requirements of users,
there can be no assurance that the Web  infrastructure  will continue to be able
to support the demands  placed on it or that the  performance  or reliability of
the Web will not be adversely affected.  Furthermore,  the Web has experienced a
variety of outages  and other  delays as a result of damage to  portions  of its
infrastructure, and such outages and delays could adversely affect the Web sites
of Web publishers  utilizing the Company's solutions and the level of traffic on
such Web sites on the DoubleClick  Network. In addition,  the Web could lose its
viability as a form of media due to delays in the development or adoption of new
standards and protocols (for example,  the  next-generation  Internet  protocol)
that can handle increased levels of activity. There can be no assurance that the
infrastructure or complementary  products or services necessary to establish and
maintain the Web as a viable  commercial  medium will be developed,  or, if they
are  developed,  that  the Web  will  become  a  viable  commercial  medium  for
advertisers.  If  the  necessary  infrastructure,   standards  or  protocols  or
complementary products,  services or facilities are not developed, or if the Web
does not become a viable commercial medium, the Company's  business,  results of
operations and financial condition will be materially and adversely affected.

                                       20

<PAGE>

Even if such infrastructure,  standards or protocols or complementary  products,
services or facilities are developed, there can be no assurance that the Company
will not be required  to incur  substantial  expenditures  in order to adapt its
solutions  to  changing or  emerging  technologies,  which could have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.   Moreover,   critical  issues  concerning  the  commercial  use  and
government regulation of the Internet (including security, cost, ease of use and
access, data privacy,  intellectual property ownership and other legal liability
issues)  remain  unresolved and could  materially and adversely  impact both the
growth of the Internet and the Company's  business,  results of  operations  and
financial condition.

DEPENDENCE ON PROPRIETARY RIGHTS; RISK OF INFRINGEMENT

    The Company  regards its  intellectual  property as critical to its success,
and the Company relies upon patent,  trademark,  copyright and trade secret laws
in the United States and other  jurisdictions to protect its proprietary rights.
The Company has filed three patent  applications  with the United  States Patent
and Trademark Office and one patent application pursuant to international treaty
to protect certain aspects of its technology. The Company pursues the protection
of its  trademarks  by applying to register the  trademarks in the United States
and  (based  upon  anticipated  use)  internationally,  and  is the  owner  of a
registration for the DOUBLECLICK trademark in the United States. There can be no
assurance  that  any  of  the  Company's   trademark   registrations  or  patent
applications  will be approved or granted  and, if they are  granted,  that they
will  not  be   successfully   challenged  by  others  or  invalidated   through
administrative  process  or  litigation.  Further,  if the  Company's  trademark
registrations  are  not  approved  or  granted  due to  the  prior  issuance  of
trademarks to third parties or for other reasons, there can be no assurance that
the Company would be able to enter into  arrangements with such third parties on
commercially  reasonable  terms  allowing  the  Company to  continue to use such
trademarks.  Patent, trademark, copyright and trade secret protection may not be
available in every country in which the Company's  solutions are  distributed or
made available. In addition, the Company seeks to protect its proprietary rights
through  the use of  confidentiality  agreements  with  employees,  consultants,
advisors and others. There can be no assurance that such agreements will provide
adequate  protection  for the Company's  proprietary  rights in the event of any
unauthorized  use or  disclosure,  that  employees of the Company,  consultants,
advisors  or  others  will  maintain  the  confidentiality  of such  proprietary
information,  or that such  proprietary  information  will not otherwise  become
known,  or be  independently  developed,  by  competitors.  The  Company's  DART
technology  collects  and  utilizes  data  derived  from  user  activity  on the
DoubleClick  Network  and the Web sites of Web  publishers  using the  Company's
solutions.  This data is used for ad targeting and  predicting  ad  performance.
Although  the  Company  believes  that it has the right to use such data and the
compilation  of such data in the Company's  database,  there can be no assurance
that any trade secret,  copyright or other protection will be available for such
information or that others will not claim rights to such  information.  Further,
pursuant to its contracts with Web publishers using the Company's solutions, the
Company is obligated to keep certain  information  regarding  the Web  publisher
confidential.

    The Company has licensed in the past, and expects that it may license in the
future,  elements of its trademarks,  trade dress and similar proprietary rights
to  third  parties,  including  in  connection  with  the  establishment  of its
international  business  relationships which may be controlled  operationally by
such third parties. While the Company attempts to ensure that the quality of its
brand is maintained by such business  partners,  no assurances can be given that
such partners will not take actions that could  materially and adversely  affect
the value of the Company's proprietary rights or the reputation of its solutions
and  technologies.  The  Company  currently  licenses  certain  aspects  of  its
predictive modeling  technologies from a third party. The failure by the Company
to maintain this  license,  or to find a  replacement  for such  technology in a
timely and  cost-effective  manner,  could have a material adverse effect on the
Company's business, results of operations and financial condition.

    Legal  standards  relating  to the  validity,  enforceability  and  scope of
protection of certain  proprietary  rights in  Internet-related  industries  are
uncertain  and still  evolving,  and no assurance  can be given as to the future
viability or value of any  proprietary  rights of the Company or other companies
within  the  industry.  There can be no  assurance  that the steps  taken by the
Company to protect its proprietary rights will be adequate or that third parties
will not infringe or misappropriate the Company's  proprietary  rights. Any such
infringement or misappropriation, should it occur, could have a material adverse
effect on the Company's business, results of operations and financial condition.
Furthermore,  there can be no assurance that the Company's  business  activities
will not infringe upon the proprietary  rights of others,  or that other parties
will not assert infringement  claims against the Company.  From time to time the
Company  has been,  and  expects  to  continue  to be,  subject to claims in the
ordinary course of its business, including claims of alleged infringement of the
trademarks  and  other  intellectual  property  rights of third  parties  by the
Company and its  business  partners.  Although  such claims have not resulted in
litigation or had a material adverse effect on the Company's  business,  results
of operations or financial

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<PAGE>

condition,  such claims and any  resultant  litigation,  should it occur,  could
subject the Company to  significant  liability  for damages and could  result in
invalidation of the Company's  proprietary  rights and, even if not meritorious,
could be  time-consuming  and  expensive  to  defend,  and  could  result in the
diversion of management  time and attention,  any of which could have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.

RISKS ASSOCIATED WITH TECHNOLOGICAL CHANGE

    The  market  in which the  Company  competes  is  characterized  by  rapidly
changing  technology,  evolving  industry  standards,  frequent  new product and
service  announcements,  introductions and  enhancements,  and changing customer
demands.  These market  characteristics are heightened by the emerging nature of
the Web and Internet advertising. Accordingly, the Company's future success will
depend on its ability to adapt to rapidly changing technologies,  its ability to
adapt its  solutions  to meet  evolving  industry  standards  and its ability to
continually  improve the performance,  features and reliability of its solutions
in response  to both  changing  customer  demands  and  competitive  product and
service  offerings.  The  failure of the Company to  successfully  adapt to such
changes in a timely manner could have a material adverse effect on the Company's
business, results of operations and financial condition.  Furthermore, there can
be no assurance  that the Company will not  experience  difficulties  that could
delay or prevent the successful design,  development,  testing,  introduction or
marketing of solutions,  or that any new solutions or  enhancements  to existing
solutions will adequately  meet the  requirements of its current and prospective
customers  and  achieve  any degree of  significant  market  acceptance.  If the
Company is unable, for technological or other reasons,  to develop and introduce
new  solutions or  enhancements  to existing  solutions in a timely manner or in
response to changing  market  conditions  or  customer  requirements,  or if its
solutions or enhancements  contain errors or do not achieve a significant degree
of  market  acceptance,  the  Company's  business,  results  of  operations  and
financial condition would be materially and adversely affected.

RISKS ASSOCIATED WITH INTERNATIONAL EXPANSION

    The Company has recently  commenced  operations in a number of international
markets and a component of the  Company's  strategy is to continue to expand its
international operations and international sales and marketing efforts. To date,
the Company has  limited  experience  in  developing  localized  versions of its
solutions   and  in   marketing,   selling  and   distributing   its   solutions
internationally.  There can be no  assurance  that the  Company  will be able to
successfully  market, sell and deliver its solutions in these markets. In Japan,
Iberoamerica  (Spain,  Portugal and Latin America),  Italy and Scandinavia,  the
Company  is  relying  on  its  business  partners  for  conducting   operations,
establishing  local networks,  aggregating Web publishers and coordinating sales
and marketing efforts.  The Company's agreements with its business partners have
terms ranging from two to four years. Accordingly, the Company's success in such
markets is directly  dependent on the success of its  business  partners in such
activities.  No  assurance  can be given  that such  business  partners  will be
successful or that such business partners will dedicate sufficient  resources to
the business  relationship.  The failure of the Company's  business  partners to
successfully  establish  operations  and sales  and  marketing  efforts  in such
markets could have a material adverse effect on the Company's business,  results
of operations and financial condition.

    There are certain risks inherent in doing business in international markets,
such as unexpected changes in regulatory  requirements,  potentially adverse tax
consequences,  export  restrictions,  export  controls  relating  to  encryption
technology,  tariffs  and other trade  barriers,  difficulties  in staffing  and
managing foreign  operations,  political  instability,  fluctuations in currency
exchange rates, and seasonal  reductions in business  activity during the summer
months in Europe and certain other parts of the world, any of which could have a
material adverse effect on the success of the Company's international operations
and,  consequently,  on  the  Company's  business,  results  of  operations  and
financial condition.

GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES

    Due to concerns arising in connection with the increasing popularity and use
of the Web, a number of laws and regulations may be adopted covering issues such
as user privacy, pricing,  characteristics,  acceptable Web site and advertising
content,  commercial activities,  taxation and quality of products and services.
Such  legislation  could  dampen  the  growth  in use of the Web  generally  and
decrease the acceptance of the Web as a  communications  and commercial  medium,
which could have a material adverse effect on the Company's business, results of
operations and financial condition. In addition,  because the growing popularity
and use of the Web has burdened the existing  telecommunications  infrastructure
and many areas with high Web use have begun to experience interruptions in phone
service, certain local telephone carriers have petitioned governmental bodies to
regulate  Internet  service  providers  ("ISPs")  and online  service  providers
("OSPs") in a manner similar to long distance  telephone  carriers and to impose
access fees on ISPs and OSPs. If any of these

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<PAGE>

petitions or the relief sought therein is granted, the costs of communicating on
the Web could increase substantially, potentially adversely affecting the growth
in use of the Web. Further,  due to the global nature of the Web, it is possible
that,  although  transmissions  relating to the Company's solutions originate in
the State of New York,  the  governments  of other  states or foreign  countries
might  attempt to regulate the  Company's  transmissions  or levy sales or other
taxes  relating to the  Company's  activities.  There can be no  assurance  that
violations  of local  laws will not be  alleged  or  charged by state or foreign
governments,  that the Company  might not  unintentionally  violate such laws or
that such laws will not be modified,  or new laws enacted, in the future. Any of
the foregoing developments could have a material adverse effect on the Company's
business, results of operations and financial condition.

CONTROL BY PRINCIPAL STOCKHOLDERS, OFFICERS AND DIRECTORS

    The directors and executive  officers and their affiliates  beneficially own
approximately  38.6%  of  the  outstanding  Common  Stock.  As a  result,  these
stockholders  may be  able  to  exercise  control  over  all  matters  requiring
stockholder  approval,  including  the  election of  directors  and  approval of
significant corporate transactions. This concentration of ownership may have the
effect of delaying or preventing a change in control of the Company.

SHARES ELIGIBLE FOR FUTURE SALE

    Sales of  significant  amounts of Common  Stock in the public  market or the
perception that such sales will occur could  materially and adversely affect the
market price of the Common  Stock or the future  ability of the Company to raise
capital through an offering of its equity securities.  A substantial  portion of
the shares of the Company's Common Stock  outstanding are restricted  securities
and are eligible for immediate sale in the public market without restriction. In
the event that all or a  significant  portion of the  stockholders  holding such
shares elect to sell their shares, the price of the Company's Common Stock could
be  materially  adversely  affected,  irrespective  of the  Company's  operating
performance.

POSSIBLE VOLATILITY OF STOCK PRICE

    Prior to the Company's  initial public offering in February 1998,  there was
no public market for the Company's Common Stock. Due to the factors noted above,
the  trading  price of the  Company's  Common  Stock is likely to continue to be
highly  volatile  and could be subject  to wide  fluctuations,  particularly  in
response to variations in quarterly  results of operations,  the gain or loss of
significant advertisers or Web publisher customers, changes in earning estimates
by analysts,  announcements of technological innovations or new solutions by the
Company or its competitors,  general conditions in Internet-related  industries,
the  respective  market prices of companies in  Internet-related  industries and
other  events or factors,  many of which are beyond the  Company's  control.  In
addition,  the stock market,  which has recently been at or near historic highs,
has experienced  extreme price and volume  fluctuations  which have affected the
market price for many companies in industries  similar or related to that of the
Company and which have been  unrelated  to the  operating  performance  of these
companies.  These market  fluctuations may have a material adverse effect on the
market price of the Company's  Common Stock. In the past,  following  periods of
volatility  in the market  price of a  company's  securities,  securities  class
action  litigation  has often  been  instituted  against  such a  company.  Such
litigation  could result in  substantial  costs and a diversion of  management's
attention  and  resources,  which  would have a material  adverse  effect on the
Company's business,  operating results and financial condition. In addition, the
possible sale of a significant number of shares of the Company's Common Stock by
the  holders  thereof may have an adverse  affect on the price of the  Company's
Common Stock.

                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

         NONE

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

    (a)  Changes in Securities:

         NONE


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<PAGE>

    (b)  Use of Proceeds

        On February 19, 1998, the Securities  and Exchange  Commission  declared
    effective  the  Company's  Registration  Statement  on Form  S-1  (File  No.
    333-42323).  Pursuant to this  Registration  Statement,  and the Abbreviated
    Registration  Statement  filed on February 19, 1998  pursuant to Rule 462(b)
    promulgated  under the Securities  Act of 1933, as amended,  on February 25,
    1998, the Company  completed the initial public offering of 4,025,000 shares
    of its Common Stock at an initial public  offering price of $17.00 per share
    (the  "Offering").  The  Offering  was managed by  Goldman,  Sachs & Co., BT
    Alex.Brown and Cowen & Company.  Proceeds to the Company,  after calculation
    of the  underwriters  discount and  commission,  from the  Offering  totaled
    approximately  $62.5 million net of offering costs of $1.1 million.  None of
    the expenses  incurred in the offering  were direct or indirect  payments to
    directors,  officers, general partners of the issuer or their associates, to
    persons owning ten percent or more of any class of equity  securities of the
    issuer  or to  affiliates  of the  issuer.  During  the  nine  months  ended
    September 30, 1998,  the Company used $26.8 million of the proceeds from the
    Offering toward general corporate purposes,  including working capital,  and
    toward the expansion of the Company's international operations and sales and
    marketing  capabilities.  None of these  expenses  were  direct or  indirect
    payments to  directors,  officers,  general  partners of the issuer or their
    associates,  to persons  owning  ten  percent or more of any class of equity
    securities of the issuer or to affiliates of the issuer.

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 REPORT ON FORM 8-K

        (a) The following exhibits are filed as part of this report:

           11.1 Statement re: Computation of Basic and Diluted Net Loss Per
       Share

           27.1 Financial Data Schedule

        (b) The  Company  did not file any  reports on Form 8-K during the three
    months ended September 30, 1998.







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<PAGE>

ITEM 7. SIGNATURES

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


                                DOUBLECLICK INC.

Date: November 10, 1998             By:             /s/ JEFFREY EPSTEIN
                                     -----------------------------------------
                                                  Jeffrey Epstein
                                         CHIEF FINANCIAL OFFICER (PRINCIPAL
                                                 FINANCIAL OFFICER)

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