QUARTERLY REPORT ON FORM 10-Q
                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON D.C. 20549
                            _________________________

(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT
      OF 1934
      For the quarterly period ended June 30, 2002

                                       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: 1-12432


                      AMERICAN POWER CONVERSION CORPORATION
             (Exact name of Registrant as specified in its charter)


                   MASSACHUSETTS                        04-2722013
          (State or other jurisdiction of           (I.R.S. employer
           incorporation or organization)           identification no.)


             132 FAIRGROUNDS ROAD, WEST KINGSTON, RHODE ISLAND 02892
                                  401-789-5735
          (Address and telephone number of principal executive offices)


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

                        YES  [ X ]             NO  [   ]


   Registrant's Common Stock outstanding, $.01 par value, at August 8, 2002 -
                               196,036,000 shares

                                        1
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002


             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES

                                      INDEX


                                                                      Page No.

Part I - Financial Information:

 Item 1. Consolidated Condensed Financial Statements:
         Consolidated Condensed Balance Sheets -
         June 30, 2002 (Unaudited) and December 31, 2001                3 - 4

         Consolidated Condensed Statements of Income -
         Three Months and Six Months Ended
         June 30, 2002 and July 1, 2001 (Unaudited)                       5

         Consolidated Condensed Statements of Cash Flows -
         Three Months and Six Months Ended
         June 30, 2002 and July 1, 2001 (Unaudited)                       6

         Notes to Consolidated Condensed Financial Statements
         (Unaudited)                                                    7 - 13


 Item 2. Management's Discussion and Analysis of Financial
         Condition and Results of Operations                           13 - 22


 Item 3. Quantitative and Qualitative Disclosures
         About Market Risk                                                22

Part II - Other Information:

 Item 4.  Submission of Matters to a Vote of Security Holders          22 - 23

 Item 5.  Other Events                                                    23

 Item 6.  Exhibits and Reports on Form 8-K                                23

Signatures                                                                24

Exhibit Index                                                             25

                                        2
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002
PART I - CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

ITEM 1.  FINANCIAL STATEMENTS
<TABLE>
             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (In thousands)

                                     ASSETS
<CAPTION>

                                                June 30,      December 31,
                                                   2002              2001
                                             (Unaudited)
<S>                                            <C>               <C>
Current assets:
Cash and cash equivalents                      $240,409          $288,210
Short term investments (Note 5)                 284,018           104,868
Accounts receivable, less allowance
  for doubtful accounts of
  $18,438 in 2002 and $18,712 in 2001           224,515           263,595
Inventories:
  Raw materials                                 176,864           158,140
  Work-in-process and finished goods            124,174           192,496
Total inventories                               301,038           350,636

Prepaid expenses and
  other current assets                           23,810            15,935
Assets held-for-sale (Note 4)                     6,906                 -
Deferred income taxes                            42,242            44,255

Total current assets                          1,122,938         1,067,499

Property, plant and equipment:
  Land, buildings and improvements               66,028            71,166
  Machinery and equipment                       196,079           200,000
  Office equipment, furniture
    and fixtures                                 74,284            72,510
  Purchased software                             31,231            30,463

                                                367,622           374,139

Less accumulated depreciation
  and amortization                              180,110           164,154

Net property, plant and equipment               187,512           209,985

Goodwill (Note 3)                                56,388            56,388
Other intangibles, net (Note 3)                  67,121            73,100
Long term investments                            32,541                 -
Deferred income taxes                            10,548            10,924
Other assets                                      2,683             2,876

Total assets                                 $1,479,731        $1,420,772
</TABLE>

See accompanying notes to consolidated condensed financial statements.

                                        3
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002
<TABLE>
             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
                CONSOLIDATED CONDENSED BALANCE SHEETS (CONTINUED)
                     (In thousands except per share amount)

                      LIABILITIES AND SHAREHOLDERS' EQUITY

<CAPTION>

                                                June 30,      December 31,
                                                   2002              2001
                                             (Unaudited)
<S>                                             <C>               <C>
Current liabilities:
Accounts payable                                $71,106           $75,569
Accrued expenses                                 31,774            28,276
Accrued compensation                             27,087            21,640
Accrued sales and marketing programs             21,645            23,011
Deferred revenue                                 16,406            14,451
Income taxes payable                             25,349            20,131

Total current liabilities                       193,367           183,078

Deferred tax liability                           14,353            16,306

Total liabilities                               207,720           199,384

Shareholders' equity (Notes 7 and 8):
Common stock, $0.01 par value;
  authorized 450,000 shares;
  issued 196,282 shares in 2002
  and 196,025 shares in 2001                      1,963             1,960
Additional paid-in capital                      129,029           126,365
Retained earnings                             1,145,757         1,099,541
Treasury stock, 250 shares, at cost              (1,551)           (1,551)
Accumulated other comprehensive loss             (3,187)           (4,927)

Total shareholders' equity                    1,272,011         1,221,388

Total liabilities and shareholders' equity   $1,479,731        $1,420,772
</TABLE>

See accompanying notes to consolidated condensed financial statements.

                                        4
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002
<TABLE>
             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                    (In thousands except earnings per share)
<CAPTION>
                                    Six months ended        Three months ended
                                 June 30,      July 1,     June 30,      July 1,
                                    2002         2001         2002         2001
                                                   (Unaudited)
<S>                             <C>          <C>          <C>          <C>
Net sales (Notes 3 and 9)       $604,912     $711,113     $308,200     $355,988

Cost of goods sold               384,918      456,186      190,507      221,487

Gross profit                     219,994      254,927      117,693      134,501

Operating expenses:
Marketing, selling, general
  and administrative (Note 3)    130,243      150,324       64,091       75,642
Research and development          29,459       26,483       14,658       13,351

Total operating expenses         159,702      176,807       78,749       88,993

Operating income                  60,292       78,120       38,944       45,508

Other income, net                  4,346        8,584        2,515        3,162

Earnings before income taxes      64,638       86,704       41,459       48,670

Income taxes                      18,422       24,711       11,816       13,871

Net income                       $46,216      $61,993      $29,643      $34,799

Basic earnings per share           $0.24        $0.32        $0.15        $0.18

Basic weighted average
  shares outstanding             195,872      195,043      195,918      195,176

Diluted earnings per share         $0.23        $0.31        $0.15        $0.18

Diluted weighted average
  shares outstanding             197,144      196,983      196,917      197,482
</TABLE>

See accompanying notes to consolidated condensed financial statements.

                                        5
<PAGE
                                                                       FORM 10-Q
                                                                   June 30, 2002
<TABLE>
             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                 (In thousands)
<CAPTION>
                                    Six months ended        Three months ended
                                 June 30,      July 1,     June 30,      July 1,
                                    2002         2001         2002         2001
                                                   (Unaudited)
<S>                              <C>          <C>          <C>          <C>
Cash flows from
  operating activities
Net income                       $46,216      $61,993      $29,643      $34,799
Adjustments to reconcile net
  income to net cash provided
  by operating activities:
Depreciation and amortization
  of property, plant and
  equipment                       20,138       19,342        9,174        9,466
Gain on sale of property,
  plant and equipment                  -       (1,337)           -            -
Amortization of goodwill and
  other intangibles                5,902        5,771        2,951        2,884
Provision for doubtful accounts    2,388        2,784          409        1,168
Provision for inventories          7,000        3,654        2,918        2,979
Deferred income taxes                436           86         (631)        (546)
Restructuring charges              3,877            -            -            -
Other non-cash items, net          1,740         (381)       1,848         (522)
Changes in operating assets
  and liabilities:
    Accounts receivable           36,692       (4,298)      10,468       17,608
    Inventories                   42,598      (78,210)      30,621      (35,715)
    Prepaid expenses and
      other current assets        (7,875)          59       (4,271)       3,314
    Other assets                     270         (172)         371           83
    Accounts payable              (4,463)       2,730       (8,559)       8,657
    Accrued expenses               9,534        6,503        7,100        1,051
    Income taxes payable           5,218         (726)         325       (1,659)
Net cash provided by
  operating activities           169,671       17,798       82,367       43,567

Cash flows from
  investing activities
Purchases of held-to-
  maturity securities           (310,607)     (13,853)    (181,451)      (4,853)
Maturities of held-to-
  maturity securities            119,345       25,000       93,950            -
Purchases of available-
  for-sale securities            (25,429)           -      (15,201)           -
Maturities of available-
  for-sale securities              5,000            -        5,000            -
Capital expenditures              (8,448)     (28,468)      (4,200)     (18,067)
Proceeds from sale of
  property, plant and
  equipment                            -        2,744            -            -
Net cash used in investing
  activities                    (220,139)     (14,577)    (101,902)     (22,920)

Cash flows from
  financing activities
Proceeds from issuances of
  common stock                     2,667        5,502        1,391        4,187
Net cash provided by
  financing activities             2,667        5,502        1,391        4,187

Net change in cash and cash
  equivalents                    (47,801)       8,723      (18,144)      24,834
Cash and cash equivalents at
  beginning of period            288,210      283,025      258,553      266,914
Cash and cash equivalents at
  end of period                 $240,409     $291,748     $240,409     $291,748

Supplemental cash flow
  disclosures
Cash paid during the period for:
Income taxes (net of refunds)    $10,940      $23,985      $11,524      $15,476
</TABLE>

NON-CASH TRANSACTIONS:  In the first quarter of 2002, APC recorded a
restructuring charge that included a non-cash component of $3,877 (Note 4).

See accompanying notes to consolidated condensed financial statements.

                                        6
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002



             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)


1.   Management Representation

The accompanying unaudited consolidated condensed financial statements should be
read in conjunction with the consolidated financial statements included in the
American Power Conversion Corporation, APC, Annual Report on Form 10-K for the
year ended December 31, 2001.  In the opinion of management, the accompanying
unaudited consolidated condensed financial statements contain all adjustments
(consisting of only normal recurring accruals) necessary to present fairly the
consolidated financial position and the consolidated results of operations and
cash flows for the interim periods.  The results of operations for the interim
periods are not necessarily indicative of results to be expected for the full
year.  Certain 2001 balances have been reclassified to conform with 2002
presentation.


2.   Principles of Consolidation

The consolidated financial statements include the financial statements of
American Power Conversion Corporation and its wholly-owned subsidiaries.  All
significant intercompany accounts and transactions are eliminated in
consolidation.


3.   Implementation of Recent Accounting Pronouncements

In consideration of guidance issued by the Financial Accounting Standards
Board's Emerging Issues Task Force in Issue No. 00-25, Vendor Income Statement
Characterization of Consideration Paid to a Reseller of the Vendor's Products,
Issue No. 00-14, Accounting for Certain Sales Incentives and Issue No. 01-09,
Accounting for Consideration Given by a Vendor to a Customer (Including a
Reseller of the Vendor's Products), certain customer promotional payments,
rebates and other discounts formerly classified as operating expenses have been
retroactively re-classified as a reduction of revenue.  These changes reduced
net sales and also reduced marketing, selling, general and administrative
expenses by $4.2 million and $8.6 million in the second quarters of 2002 and
2001, respectively, and $8.3 million and $13.1 million in the first six months
of 2002 and 2001, respectively.  This accounting change had no impact on
reported profit from operations, net income or earnings per share for any of the
periods presented.

In October 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 144, Impairment on Disposal of Long-Lived
Assets, effective for fiscal years beginning after December 15, 2001. APC
adopted Statement 144 on January 1, 2002.  During the first quarter of 2002, APC
announced its decision to consolidate its Philippines-based manufacturing
operations resulting in the closing of APC's manufacturing facility in the
province of Laguna.  In connection with this action as well as the closure of
manufacturing facilities in the U.S. and U.K., APC recorded $3.9 million of
asset impairment charges related to buildings and equipment during the first
quarter of 2002 of which $3.4 million and $0.5 million were classified in cost
of goods sold and operating expenses, respectively.  These impairment charges
have not been allocated to APC's operating segments, but rather have been
classified as indirect operating expenses for segment reporting consistent with
APC's classification for its internal financial reporting; also refer to Note 9.
At June 30, 2002, buildings and equipment held-for-sale of $6.9 million are
stated at the lower of their fair values less estimated selling costs or
carrying amounts, and depreciation is no longer recognized.  APC expects to
complete the sale of such buildings and equipment by the end of 2002.  Also
refer to Note 4.

                                        7
<PAGE>
3.   Implementation of Recent Accounting Pronouncements (cont.)

In July 2001, the Financial Accounting Standards Board finalized Statement of
Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets.
Statement 142 is required to be applied in fiscal years beginning after December
15, 2001 to all goodwill and other intangible assets recognized at that date,
regardless of when those assets were initially recognized.  APC adopted
Statement 142 on January 1, 2002.  With the adoption of Statement 142, APC
implemented the necessary reclassifications in order to conform to the new
criteria in Statement 141, Business Combinations, for recognition of intangible
assets apart from goodwill.

Statement 142 requires that companies no longer amortize goodwill and other
intangible assets with indefinite lives, but instead test goodwill impairment at
least annually or more frequently if impairment indicators arise.  Statement 142
also requires completion of a two-step transitional goodwill impairment test
within six months of the date of adoption.  In connection with completion of the
first step of its transitional analysis, APC has identified two reporting units
with goodwill, Large Systems and Small Systems; these reporting units are also
reportable segments.  APC has determined the carrying value of each reporting
unit by assigning the assets and liabilities, including existing goodwill and
other intangible assets, to these reporting units as of the date of adoption.
Completion of the first step of APC's analysis has indicated that there is
impairment in the carrying amount of its goodwill.  APC's goodwill is primarily
associated with its Large Systems segment which consists primarily of UPS, DC-
power systems, and precision cooling products for data centers, facilities, and
communication applications.  Conditions contributing to the goodwill impairment
include the ongoing softness in IT and communications market segments coupled
with lower corporate investment for these types of applications.  To the extent
that an indication of impairment exists, APC must perform a second test to
measure the amount of the impairment.  Determination of the amount of the
impairment charge is required to be completed by no later than the end of the
year of adoption of Statement 142.  APC is currently evaluating its goodwill and
other intangible assets with indefinite lives associated primarily with the
Large Systems segment.  Based on its preliminary analysis, APC anticipates
recording a non-cash charge in the third quarter of 2002 that could approximate
the current goodwill balance associated with the Large Systems segment of
approximately $50 million ($35 million on an after-tax basis).  Any charge will
be recognized as the cumulative effect of a change in accounting principle and
will have no effect on APC's operations or liquidity.

Statement 142 also provides for other intangible assets with definite useful
lives to be amortized over their respective estimated useful lives to their
estimated residual values and to be reviewed for impairment in accordance with
Statement 144, Impairment on Disposal of Long-Lived Assets.  APC's other
intangible assets consist principally of technology and licensed patent rights
relating to uninterruptible power supply technology.  With the adoption of
Statement 142, APC reduced the estimated useful lives of its other intangible
assets with definite useful lives from a weighted average life of approximately
15 years to a weighted average life of approximately 6 years.  There are no
expected residual values related to these intangible assets.  At June 30, 2002,
APC's other intangible assets were as follows:

       <TABLE>
       <CAPTION>
       In thousands                               June 30, 2002
                                             Gross
                                          Carrying       Accumulated
                                            Amount      Amortization
       <S>                                 <C>               <C>
       Amortized intangible assets
       Technology                          $80,642           $21,801
       Customer Lists                        8,900             2,870
       Tradenames                            3,157               907
       Total                               $92,699           $25,578
       </TABLE>

Aggregate amortization expense related to APC's other intangible assets for the
second quarter and first half of 2002 was $2.9 million and $5.9 million,
respectively.  Estimated aggregated amortization for each of the next five
succeeding fiscal years is $11.8 million for 2002, $11.7 million for 2003, $11.5
million for 2004, $11.5 million for 2005 and $11.5 million for 2006.

                                        8
<PAGE>
3.   Implementation of Recent Accounting Pronouncements (cont.)

The following summary reconciles reported second quarter and first half 2001 net
income to adjusted net income as if APC had adopted FAS 142 on January 1, 2001,
excluding the amortization of goodwill and reflecting the adjusted useful lives
of other intangible assets:

 <TABLE>
 <CAPTION>
 In thousands                          Six months ended     Three months ended
                                      June 30,    July 1,   June 30,    July 1,
                                         2002       2001       2002       2001
 <S>                                  <C>        <C>        <C>        <C>
 Reported net income                  $46,216    $61,993    $29,643    $34,799
 Add back: Goodwill amortization            -      1,530          -        765
 Adjust: Technology amortization            -     (1,240)         -       (613)
 Adjust: Customer lists amortization        -       (265)         -       (132)
 Adjust: Tradenames amortization            -       (103)         -        (51)
  Adjusted net income                 $46,216    $61,915    $29,643    $34,768
 </TABLE>

Had APC adopted FAS 142 effective January 1, 2001, there would have been no
impact on second quarter 2001 earnings per share of $0.18 or first half 2001
earnings per share of $0.31.


4.   Restructuring

During the first quarter of 2002, APC announced global headcount reductions of
approximately 17%.  These actions impacted personnel worldwide throughout a
broad range of functions within the organization, principally in the U.S., U.K.,
Ireland, and the Philippines.  The majority of these terminations were the
result of APC's recent decision to consolidate its Philippines-based
manufacturing operations resulting in the closing of APC's manufacturing
facility in the province of Laguna.  APC expects to fully implement these
actions during the third quarter of 2002.

In the first quarter of 2002, APC recorded $7.3 million of related restructuring
costs of which $4.8 million and $2.5 million were classified in cost of goods
sold and operating expenses, respectively.  These costs included the effects of
approximately 941 employee terminations, principally in the manufacturing area,
facilities closures and the related impairment of tangible assets.  These costs
have not been allocated to APC's operating segments, but rather have been
classified as indirect operating expenses for segment reporting consistent with
APC's classification for its internal financial reporting; also refer to Note 9.
At June 30, 2002, buildings and equipment held-for-sale of $6.9 million are
stated at the lower of their fair values less estimated selling costs or
carrying amounts, and depreciation is no longer recognized.  A summary of the
related restructuring liabilities during the first and second quarters of 2002
is outlined below.  APC expects all such restructuring liabilities at June 30,
2002 to be fully paid in cash by the end of 2002.

 <TABLE>
 <CAPTION>
 In thousands   Restructuring                                  Restructuring
                Liabilities at                                 Liabilities at
                  January 1,      Total    Non-cash    Cash       March 31,
                     2002        Charges    Charges   Payments      2002
 <S>                 <C>         <C>       <C>         <C>        <C>
 2002
 Activities:

 Employee
   terminations      $ --        $2,550    $    --     $(968)     $1,582

 Facilities
   closures            --         4,717     (3,877)       --         840

 Total               $ --        $7,267    $(3,877)    $(968)     $2,422
 </TABLE>

                                        9
<PAGE>
4.   Restructuring (cont.)

 <TABLE>
 <CAPTION>
 In thousands   Restructuring                                  Restructuring
                Liabilities at                                 Liabilities at
                  March 31,       Total    Non-cash    Cash       June 30,
                    2002         Charges    Charges   Payments      2002
 <S>               <C>            <C>        <C>       <C>        <C>
 2002
 Activities:

 Employee
   terminations    $1,582         $ --       $ --      $1,358     $  224

 Facilities
   closures           840                                  --        840

 Total             $2,422         $ --       $ --      $1,358     $1,064
 </TABLE>

In the second half of 2001, APC recorded $8.6 million of restructuring costs of
which $4.1 million and $4.5 million were classified in cost of goods sold and
operating expenses, respectively.  These costs were associated with
manufacturing downsizing actions primarily in Denmark and the U.K. and included
the effects of approximately 450 employee terminations, principally in the
manufacturing area, facilities closures and the related impairment of tangible
and intangible assets.  These costs have not been allocated to APC's operating
segments, but rather have been classified as indirect operating expenses for
segment reporting consistent with APC's classification for its internal
financial reporting; also refer to Note 9.  A summary of the related
restructuring liabilities during the first and second quarters of 2002 is
outlined below.  APC expects all such restructuring liabilities at June 30, 2002
to be fully paid in cash by no later than the end of 2002.

 <TABLE>
 <CAPTION>
 In thousands   Restructuring                                  Restructuring
                Liabilities at                                 Liabilities at
                  January 1,      Total    Non-cash    Cash       March 31,
                     2002        Charges    Charges   Payments      2002
 <S>                 <C>          <C>        <C>       <C>          <C>
 2001
 Activities:

 Employee
   terminations      $452         $ --       $ --      $(317)       $135

 Total               $452         $ --       $ --      $(317)       $135
 </TABLE>


 <TABLE>
 <CAPTION>
 In thousands   Restructuring                                  Restructuring
                Liabilities at                                 Liabilities at
                   March 31,     Total    Non-cash      Cash      June 30,
                     2002       Charges    Charges    Payments      2002
 <S>                 <C>          <C>        <C>       <C>          <C>
 2001
 Activities:

 Employee
   terminations      $135         $ --       $ --      $ 101        $ 34

 Total               $135         $ --       $ --      $ 101        $ 34
 </TABLE>

5.   Investments

APC classifies as short term its investments with original maturities greater
than three months and less than or equal to one year, and as long term its
investments with remaining maturities greater than one year.  At June 30, 2002,
short term investments consisted of U.S. Government agency, municipal,
corporate, and asset and mortgage backed securities, and long term investments
consisted of U.S. Government agency and corporate securities.  At December 31,
2001, short term investments consisted of corporate and municipal bonds; APC
held no long term investments at December 31, 2001.  Short term held-to-maturity
securities aggregated $238.5 million at June 30, 2002 and $79.8 million at
December 31, 2001. Long term held-to-maturity securities aggregated $32.5
million at June 30, 2002.  Held-to-maturity securities are carried at amortized
cost; the cost of such held-to-maturity securities approximates fair market
value and the unrealized holding gains or losses were not material.  Available-
for-sale securities aggregated $45.5 million at June 30, 2002 and $25.1 million
at December 31, 2001.  Available-for-sale securities are recorded at fair value
with net unrealized gains and losses reported, net of tax, in other
comprehensive income.  At June 30, 2002 and December 31, 2001, the gross
unrealized holding losses on available-for-sale securities were not material.
Management determines the appropriate classification of securities at the time
of purchase and re-evaluates such designation as of each balance sheet date.
Securities are classified as held-to-maturity when APC has the positive intent
and ability to hold such securities to maturity.

                                       10
<PAGE>
6.   Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted
average number of common shares outstanding during the period.  Diluted earnings
per share is computed by dividing net income by the weighted average number of
common shares and dilutive potential common shares outstanding during the
period.  Under the treasury stock method, the unexercised options are assumed to
be exercised at the beginning of the period or at issuance, if later.  The
assumed proceeds are then used to purchase common shares at the average market
price during the period.  Potential common shares for which inclusion would have
the effect of increasing diluted earnings per share (i.e., antidilutive) are
excluded from the computation.

 <TABLE>
 <CAPTION>
 In thousands                     Six months ended       Three months ended
                                June 30,     July 1,    June 30,     July 1,
                                   2002        2001        2002        2001
 <S>                            <C>         <C>         <C>         <C>
 Basic weighted average
   shares outstanding           195,872     195,043     195,918     195,176

 Net effect of dilutive
   potential common shares
   outstanding based on the
   treasury stock method
   using the average
   market price                   1,272       1,940         999       2,306


 Diluted weighted average
   shares outstanding           197,144     196,983     196,917     197,482

 Antidilutive potential
   common shares excluded from
   the computation above          7,787       6,797       9,093       6,720
 </TABLE>


7.   Shareholders' Equity

Changes in paid-in capital for the periods presented represent the issuances of
common stock resulting from the exercise of employee stock options.

On June 11, 2002, APC's shareholders voted to amend its 1997 Stock Option Plan
to increase the aggregate number of shares of Common Stock authorized for
issuance under the Plan from 24,000,000 shares to 33,500,000 shares.

                                       11
<PAGE>
8.   Comprehensive Income

The components of comprehensive income, net of tax, are as follows:

 <TABLE>
 <CAPTION>
 In thousands                     Six months ended       Three months ended
                                June 30,     July 1,    June 30,     July 1,
                                   2002        2001        2002        2001
 <S>                            <C>         <C>         <C>         <C>
 Net income                     $46,216     $61,993     $29,643     $34,799

 Other comprehensive income
  (loss), net of tax:
   Change in foreign currency
    translation adjustment        1,784        (381)      1,867        (522)
   Net unrealized loss on
    investments, net of
    income taxes                    (44)          -         (19)          -
   Other comprehensive
    income (loss)                 1,740        (381)      1,848        (522)

 Comprehensive income           $47,956     $61,612     $31,491     $34,277
 </TABLE>


9.   Operating Segment Information

Basis for presentation
APC operates primarily within one industry consisting of three reportable
operating segments by which it manages its business and from which various
offerings are commonly combined to develop a total solution for the customer.
These efforts primarily incorporate the design, manufacture and marketing of
power protection equipment and related software and accessories for computer,
communications and related equipment.  APC's three segments are:  Small Systems,
Large Systems and Other.  Each of these segments address global markets.  The
Small Systems segment develops power solutions principally for servers and
networking equipment commonly used in local area and wide area networks and for
personal computers and sensitive electronics; additional accessories and
software products are offered to enhance the management of these networks.  The
Large Systems segment produces large system solutions that principally provide
power and availability solutions for data centers, facilities and communications
equipment.  The Other segment principally provides Web-based informational,
product and selling services and notebook computer accessories, as well as
replacement batteries for APC's UPS products.

APC measures the profitability of its segments based on direct contribution
margin.  Direct contribution margin includes R&D, marketing and administrative
expenses directly attributable to the segments and excludes certain expenses
which are managed outside the reportable segments.  Costs excluded from segment
profit are indirect operating expenses, primarily consisting of selling and
corporate expenses, and income taxes.  Expenditures for additions to long-lived
assets are not tracked or reported by the operating segments, although
depreciation expense is allocated to and reported by the operating segments.

Summary operating segment information is as follows:

 <TABLE>
 <CAPTION>
 In thousands                    Six months ended         Three months ended
                              June 30,      July 1,     June 30,      July 1,
                                 2002         2001         2002         2001
 <S>                         <C>          <C>          <C>          <C>
 Segment net sales
 Small Systems               $490,050     $572,984     $247,488     $290,853
 Large Systems                 85,531      118,861       45,531       54,408
 Other                         25,897       16,538       13,300        9,111
 Total segment net sales      601,478      708,383      306,319      354,372
 Shipping and handling
   revenues                     3,434        2,730        1,881        1,616
 Total net sales             $604,912     $711,113     $308,200     $355,988
 </TABLE>

                                       12
<PAGE>
9.   Operating Segment Information (cont.)

Summary operating segment information is as follows (cont.):

 <TABLE>
 <CAPTION>
 In thousands                    Six months ended         Three months ended
                              June 30,      July 1,     June 30,      July 1,
                                 2002         2001         2002         2001
 <S>                         <C>          <C>          <C>          <C>
 Segment profits
 Small Systems               $196,905     $231,649     $ 99,675     $124,349
 Large Systems                (15,379)     (11,044)      (4,742)      (7,465)
 Other                         14,946       10,108        8,065        5,621
 Total segment profits        196,472      230,713      102,998      122,505
 Shipping and handling
   net costs                    7,767       11,835        4,284        5,550
 Indirect operating
   expenses                   128,413      140,758       59,770       71,447
 Other income, net              4,346        8,584        2,515        3,162
 Earnings before
   income taxes               $64,638      $86,704      $41,459      $48,670
 </TABLE>


10.  Litigation

APC is involved in various claims and legal actions arising in the ordinary
course of business.  APC does not believe that the ultimate disposition of these
matters will have a material adverse effect on its consolidated financial
position or results of operations or liquidity.



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


RESULTS OF OPERATIONS

Implementation of Recent Accounting Pronouncements
In consideration of guidance issued by the Financial Accounting Standards
Board's Emerging Issues Task Force in Issue No. 00-25, Vendor Income Statement
Characterization of Consideration Paid to a Reseller of the Vendor's Products,
Issue No. 00-14, Accounting for Certain Sales Incentives and Issue No. 01-09,
Accounting for Consideration Given by a Vendor to a Customer (Including a
Reseller of the Vendor's Products), certain customer promotional payments,
rebates and other discounts formerly classified as operating expenses have been
retroactively re-classified as a reduction of revenue.  These changes reduced
net sales and also reduced marketing, selling, general and administrative
expenses by $4.2 million and $8.6 million in the second quarters of 2002 and
2001, respectively, and $8.3 million and $13.1 million in the first six months
of 2002 and 2001, respectively.  This accounting change had no impact on
reported profit from operations, net income or earnings per share for any of the
periods presented.

In October 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 144, Impairment on Disposal of Long-Lived
Assets, effective for fiscal years beginning after December 15, 2001. We adopted
Statement 144 on January 1, 2002.  During the first quarter of 2002, we
announced our decision to consolidate our Philippines-based manufacturing
operations resulting in the closing of our manufacturing facility in the
province of Laguna.  In connection with this action as well as the closure of
manufacturing facilities in the U.S. and U.K., we recorded $3.9 million of asset
impairment charges related to buildings and equipment during the first quarter
of 2002 of which $3.4 million and $0.5 million were classified in cost of goods
sold and operating expenses, respectively.  At June 30, 2002, buildings and
equipment held-for-sale of $6.9 million are stated at the lower of their fair
values less estimated selling costs or carrying amounts, and depreciation is no
longer recognized.  Also refer to Note 4 of Notes to Consolidated Condensed
Financial Statements in Item 1 of this Report.

                                       13
<PAGE>
In July 2001, the Financial Accounting Standards Board finalized Statement of
Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets.
Statement 142 is required to be applied in fiscal years beginning after December
15, 2001 to all goodwill and other intangible assets recognized at that date,
regardless of when those assets were initially recognized.  We adopted Statement
142 on January 1, 2002.  With the adoption of Statement 142, we implemented the
necessary reclassifications in order to conform to the new criteria in Statement
141, Business Combinations, for recognition of intangible assets apart from
goodwill.

Statement 142 requires that companies no longer amortize goodwill and other
intangible assets with indefinite lives, but instead test goodwill impairment at
least annually or more frequently if impairment indicators arise.  Statement 142
also requires completion of a two-step transitional goodwill impairment test
within six months of the date of adoption.  In connection with completion of the
first step of our transitional analysis, we have identified two reporting units
with goodwill, Large Systems and Small Systems; these reporting units are also
reportable segments.  We have determined the carrying value of each reporting
unit by assigning the assets and liabilities, including existing goodwill and
other intangible assets, to these reporting units as of the date of adoption.
Completion of the first step of our analysis has indicated that there is
impairment in the carrying amount of our goodwill.  Our goodwill is primarily
associated with our Large Systems segment which consists primarily of UPS, DC-
power systems, and precision cooling products for data centers, facilities, and
communication applications.  Conditions contributing to the goodwill impairment
include the ongoing softness in IT and communications market segments coupled
with lower corporate investment for these types of applications.  To the extent
that an indication of impairment exists, we must perform a second test to
measure the amount of the impairment.  Determination of the amount of the
impairment charge is required to be completed by no later than the end of the
year of adoption of Statement 142.  We are currently evaluating our goodwill and
other intangible assets with indefinite lives associated primarily with the
Large Systems segment.  Based on our preliminary analysis, we anticipate
recording a non-cash charge in the third quarter of 2002 that could approximate
the current goodwill balance associated with the Large Systems segment of
approximately $50 million ($35 million on an after-tax basis).  Any charge will
be recognized as the cumulative effect of a change in accounting principle and
will have no effect on our operations or liquidity.

Statement 142 also provides for other intangible assets with definite useful
lives to be amortized over their respective estimated useful lives to their
estimated residual values and to be reviewed for impairment in accordance with
Statement 144, Impairment on Disposal of Long-Lived Assets.  Our other
intangible assets consist principally of technology and licensed patent rights
relating to uninterruptible power supply technology.  With the adoption of
Statement 142, we reduced the estimated useful lives of our other intangible
assets with definite useful lives from a weighted average life of approximately
15 years to a weighted average life of approximately 6 years.  There are no
expected residual values related to these intangible assets.  Aggregate
amortization expense related to our other intangible assets for the second
quarter and first half of 2002 was $2.9 million and $5.9 million, respectively.
Estimated aggregated amortization for each of the next five succeeding fiscal
years is $11.8 million for 2002, $11.7 million for 2003, $11.5 million for 2004,
$11.5 million for 2005 and $11.5 million for 2006.  Also refer to Note 3 of
Notes to Consolidated Condensed Financial Statements in Item 1 of this Report.

Revenues
Net sales were $308.2 million for the second quarter of 2002, a decrease of
13.4% compared to $356.0 million for the same period in 2001.  Net sales for the
first half of 2002 were $604.9 million compared to $711.1 million in 2001, a
decrease of 14.9%.  Our first half 2002 net sales were impacted by continued
softness in IT and communications market segments with general IT spending and
growth in core technology applications, such as PCs, down year-over-year.  Our
Small Systems business, which provides power protection, uninterruptible power
supply (UPS), and management products for the PC, server, and local area
networking markets, was negatively impacted in the first half of 2002 by
continued industry softness in the IT markets, weakening global economies, and
maturing markets.  Second quarter 2002 net sales of the Small Systems segment
represented 80.8% of total second quarter 2002 net sales and decreased 14.9%
year-over-year to $247.5 million.  First half 2002 net sales of the Small
Systems segment represented 81.5% of total first half 2002 net sales and
decreased 14.5% year-over-year to $490.1 million.  Our Large Systems segment,
consisting primarily of UPS, DC-power systems, and precision cooling products
for data centers, facilities, and communication applications, continued to be
negatively impacted in the first half of 2002 by lower corporate investment for
these types of applications.  Revenues in this segment represented 14.9% of
total second quarter 2002 net sales and were down year-over-year 16.3% to $45.5
million.  Revenues in this segment represented 14.2% of total first half 2002
net sales and were down year-over-year 28.0% to $85.5 million.  Net sales of the
Other segment, which consists primarily of notebook computer accessories,
replacement batteries and Web-based services, were $13.3 million for the second
quarter of 2002, up from $9.1 million for the same period in 2001, and were
$26.9 million for the first half of 2002, up from $16.5 million for the same
period last year.  This increase was driven primarily by the growth of notebook
computer accessories and replacement batteries for UPS hardware.

                                       14
<PAGE>
On a geographic basis, the Americas (North and Latin America) represented 57.8%
of total second quarter 2002 revenues and were down 17.9% over the same period
in 2001.  The Americas represented 57.2% of total first half 2002 revenues and
were down 20.7% over the same period last year.  Europe, the Middle East and
Africa (EMEA) represented 26.6% of total second quarter 2002 revenues and was
down 8.8% from the same period in 2001.  EMEA represented 25.9% of total first
half 2002 revenues and was down 5.0% from the same period last year.  Finally,
Asia was 15.6% of total second quarter revenues, decreasing 2.3% over the same
period in 2001.  Asia was 16.9% of total first half revenues, decreasing 6.6%
over the same period last year.  On a constant currency basis, EMEA was down
11.5% and Asia decreased 1.3% versus the second quarter of 2001, and EMEA was
down 5.4% and Asia decreased 2.8% versus the first half of 2001.

Cost of Goods Sold
Cost of goods sold was $190.5 million or 61.8% of net sales in the second
quarter of 2002 compared to $221.5 million or 62.2% in the second quarter of
2001.  Cost of goods sold was $384.9 million or 63.6% of net sales in the first
half of 2002 compared to $456.2 million or 64.2% in the first half of 2001.
Second quarter 2002 gross margin was 38.2% of sales, approximately 40 basis
points higher than the comparable period in 2001.  First half 2002 gross margin
was 36.4% of sales, approximately 60 basis points higher than the comparable
period last year.  The second quarter gross margin improvement resulted
primarily from improved manufacturing efficiencies related to our capacity
rationalization efforts and increasing average selling prices due to favorable
currency trends.  The first half year-over-year gross margin improvement
resulted principally from an overall segment mix shift away from the Large
Systems business to the more profitable Small Systems and Other businesses.  The
second quarter year-over-year gross margin erosion within the Small Systems
businesses reflected unfavorable pricing actions and mix changes partially
offset by increasing average selling prices due to favorable currency trends.
The first half year-over-year gross margins within the Small Systems businesses
benefited from favorable product mix within the segment as well as cost
improvements resulting from additional product transitions to low-cost
factories, partially offset by the impact of pricing actions.  The second
quarter year-over-year gross margin improvement within the Large Systems
businesses reflected lower manufacturing costs attributed to our cost
rationalization events from last year.  The first half year-over-year gross
margins within the Large Systems businesses continued to be adversely impacted
by continuing revenue decline and the resulting fixed manufacturing cost
inefficiencies.

Additionally, first half 2002 gross margins included the effects of
restructuring costs of $4.8 million taken during the first quarter of 2002.
These restructuring costs were associated with our first quarter 2002 global
headcount reductions of approximately 17%.  These charges were the result of
events or assessments that occurred during the first quarter of 2002 and
included the effects of employee terminations, facilities closures, and the
related impairment of tangible assets.  These actions impacted personnel
worldwide throughout a broad range of functions within the organization,
principally in the U.S., U.K., Ireland, and the Philippines.  The majority of
these terminations were the result of our recent decision to consolidate our
Philippines-based manufacturing operations resulting in the closing of our
manufacturing facility in the province of Laguna.  These costs have not been
allocated to our operating segments, but rather have been classified as indirect
operating expenses for segment reporting consistent with our classification for
internal financial reporting; also refer to Note 9 of Notes to Consolidated
Condensed Financial Statements in Item 1 of this Report.  We expect to fully
implement these restructuring actions during the third quarter of 2002.  We
anticipate annualized employment cost savings of approximately $10 million as a
result of these actions.  Due to the timing of the facilities closures and
contractual or regulatory obligations to certain workers, the financial benefits
of these actions will continue to phase in gradually during the remainder of
2002.  Also refer to Note 4 of Notes to Consolidated Condensed Financial
Statements in Item 1 of this Report.

                                       15
<PAGE>
Total inventory reserves at June 30, 2002 were $35.7 million compared to $32.9
million at December 31, 2001.  There were no inventory charges, other than our
standard provisioning, during the second quarter and first half of 2002.
Approximately $2.0 million and $2.1 million of inventories associated with a
third quarter 2001 charge for excess inventory related to specifically
identified finished goods and raw materials inventories were physically disposed
during the second and first quarters of 2002, respectively.  Disposition of the
remaining inventories is continuing into the third quarter of 2002; we
anticipate that all such excess inventory will be physically disposed by no
later than the end of 2002.  Our reserve estimate methodology involves
quantifying the total inventory position having potential loss exposure.  Loss
exposure generally results from several business factors, including product or
component discontinuance, unplanned changes in demand, product design changes,
and factory transitions.  Quantifying such loss exposure is the result of
combining the cost of inventories specifically identified as having little or no
opportunity for sale or use (thus available for physical disposition) plus the
cost of inventories having a high risk of no future sale or use based upon an
analysis of on-hand quantities compared to historical and anticipated future
sale or use.  We maintain an on-going business process for the physical
disposition of inventories previously identified.  Inventory write-offs occur at
the time of physical disposition.  Inventories, once reserved, are not written
back up as such reserve adjustments are considered to be a permanent decrease to
the cost basis of the excess or obsolete inventory.

Operating Expenses
Operating expenses include marketing, selling, general and administrative (SG&A)
and R&D expenses.

SG&A expenses were $64.1 million or 20.8% of net sales for the second quarter of
2002 compared to $75.6 million or 21.2% of net sales for the second quarter of
2001.  SG&A expenses were $130.2 million or 21.5% of net sales for the first
half of 2002 compared to $150.3 million or 21.1% of net sales for the first half
of 2001.  Total spending in the second quarter and first half of 2002 decreased
from comparable prior year levels due to focused efforts to control expenses
while improving the productivity and efficiency of our global resources and, to
a lesser degree, as a result of a decline in costs which are variable to
revenue.  These decreases were due principally to lower costs associated with
decreased staffing and operating expenses of our selling and marketing
functions, combined with lower advertising and promotional costs.  The allowance
for doubtful accounts at June 30, 2002 was 7.6% of accounts receivable, compared
to 6.6% at December 31, 2001.  Accounts receivable balances outstanding over 60
days represented 13.7% of total receivables at June 30, 2002, down from 18.2% at
December 31, 2001.  Such amounts reflect in part a growing portion of our
business originating in areas where longer payment terms are customary,
including a growing contribution from international markets.  In addition, we
have experienced slower payment cycles as a result of what we believe is tighter
fiscal management by our customers during the recent macro-economic downturn.
Our collection experience in certain countries has also been adversely impacted
by the devaluation of the local currency for customer obligations originally
denominated in U.S. dollars.  We continue to experience strong collection
performance.  Write-offs of uncollectable accounts represent less than 1% of net
sales.  A majority of international customer balances are covered by receivables
insurance.

R&D expenses were $14.7 million or 4.8% of net sales and $13.2 million or 3.8%
of net sales for the second quarters of 2002 and 2001, respectively.  R&D
expenses were $29.5 million or 4.9% of net sales and $26.5 million or 3.7% of
net sales for the first six months of 2002 and 2001, respectively.  The increase
in total R&D spending primarily reflects increased numbers of software and
hardware engineers and costs associated with new product development and
engineering support.

Other Income, Net and Income Taxes
Other income in the second quarter and first half of 2002 is comprised primarily
of interest income.  Other income in the second quarter of 2001 is comprised
primarily of interest income; other income in the first half of 2001 is
comprised primarily of interest income combined with a $1.3 million gain on the
sale of a building in Billerica, Massachusetts.  Although average cash balances
available for investment rose during the second quarter and first half of 2002,
interest income decreased substantially versus the comparable periods last year
due to lower short term interest rates during 2002.

Our effective income tax rate was approximately 28.5% for each of the quarters
and first six months ended June 30, 2002 and July 1, 2001, respectively.  This
rate reflects expected tax savings from the portion of taxable earnings being
generated from our operations in jurisdictions currently having a lower income
tax rate than the present U.S. statutory income tax rate.

                                       16
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

Working capital at June 30, 2002 was $929.6 million compared to $884.4 million
at December 31, 2001.  We have been able to increase our working capital
position as the result of continued positive operating results and despite
internally financing the long-term capital investment required to support our
operations.  Our cash, cash equivalents and short and long term investments
position increased to $557.0 million at June 30, 2002 from $393.1 million at
December 31, 2001.

Worldwide inventories were $301.0 million at June 30, 2002 compared to $350.6
million at December 31, 2001.  The decrease in inventories was principally due
to our continuing efforts to align our on-hand inventories with current and
anticipated demand.  There were no inventory charges, other than our standard
provisioning, during the second quarter and first half of 2002.  Approximately
$2.0 million and $2.1 million of inventories associated with a third quarter
2001 charge for excess inventory related to specifically identified finished
goods and raw materials inventories were physically disposed during the second
and first quarters of 2002.  Disposition of the remaining inventories is
continuing into the third quarter of 2002; we anticipate that all excess
inventory associated with the third quarter 2001 charge will be physically
disposed by no later than the end of 2002.  Inventory levels as a percentage of
quarterly sales were 97.7% in the second quarter of 2002, down from 112.8% in
the first quarter of 2002.

At June 30, 2002, we had $65.0 million available for future borrowings under an
unsecured line of credit agreement at a floating interest rate equal to the
bank's cost of funds rate plus 0.625% and an additional $6.0 million under
unsecured line of credit agreements with two additional banks at similar
interest rates.  No borrowings were outstanding under these facilities at June
30, 2002.  We had no significant financial commitments, other than those
required in the normal course of business, at June 30, 2002.

During the second quarter and first half of 2002, our capital expenditures
consisted primarily of manufacturing and office equipment, buildings and
improvements, and purchased software applications.  The nature and level of our
capital spending was primarily to improve manufacturing capabilities of
international operations as well as to fund building improvements in the U.S.
Substantially all of our net capital expenditures were financed from available
operating cash.  We had no material capital commitments at June 30, 2002.

We have agreements with the Industrial Development Authority of Ireland,
otherwise known as the IDA.  Under these agreements, we receive grant monies for
costs incurred for machinery, equipment and building improvements for our Galway
and Castlebar facilities.  These grants are equal to 40% and 60%, respectively,
of such costs up to a maximum of $13.1 million for Galway and $1.3 million for
Castlebar.  Such grant monies are subject to our meeting certain employment
goals and maintaining operations in Ireland until termination of the respective
agreements.

We believe that current internal cash flows together with available cash,
available credit facilities or, if needed, the proceeds from the sale of
additional equity, will be sufficient to support anticipated capital spending
and other working capital requirements for the foreseeable future.

Foreign Currency Activity
We invoice our customers in various currencies.  Realized and unrealized
transaction gains or losses are included in the results of operations and are
measured based upon the effect of changes in exchange rates on the actual or
expected amount of functional currency cash flows.

At June 30, 2002, our unhedged foreign currency accounts receivable, by
currency, were as follows:

              <TABLE>
              <CAPTION>
              In thousands           Foreign         US
                                    Currency       Dollars
              <S>                  <C>             <C>
              European Euros          32,908       $32,276
              Japanese Yen         1,600,553       $13,338
              Swiss Francs            19,636       $13,125
              British Pounds           5,394        $8,228
              </TABLE>

                                       17
<PAGE>
We also had non-trade receivables denominated in Irish Pounds of approximately
US$0.8 million, liabilities denominated in various European currencies of
approximately US$42.5 million, and liabilities denominated in Japanese Yen of
approximately US$4.2 million.

We continually review our foreign exchange exposure and consider various risk
management techniques, including the netting of foreign currency receipts and
disbursements, rate protection agreements with customers/vendors and derivatives
arrangements, including foreign exchange contracts.  We presently do not utilize
rate protection agreements or derivative arrangements.


CRITICAL ACCOUNTING POLICIES

The discussion and analysis of our financial condition and results of operations
are based upon our consolidated financial statements, which have been prepared
in accordance with accounting principles generally accepted in the United
States.  The preparation of these financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosure of contingent assets and
liabilities.  The U.S. Securities and Exchange Commission has defined critical
accounting policies as those that are both most important to the portrayal of
our financial condition and results and which require our most difficult,
complex or subjective judgments or estimates.  Based on this definition, we have
identified the policies below as critical to our business operations and the
understanding of our results of operations.  The impact and any associated risks
related to these policies on our business operations is discussed throughout
Management's Discussion and Analysis of Financial Condition and Results of
Operations where such policies affect our reported and expected financial
results.  For all financial statement periods presented, there have been no
material modifications to the application of these critical accounting policies
except as discussed under Revenue Recognition below.  For a detailed discussion
on the application of these and other accounting policies, also refer to Note 1
of Notes to Consolidated Financial Statements in Item 8 of American Power
Conversion Corporation's Annual Report on Form 10-K for the year ended December
31, 2001.

On an on-going basis, we evaluate the judgments and estimates underlying all of
our accounting policies, including those related to revenue recognition, product
returns, bad debts, inventories, impairment of long-lived assets, deferred tax
valuation allowances, restructuring reserves and contingencies, and litigation.
We base our estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources.  Materially
different results in the amount and timing of our actual results for any period
could occur if we made different judgments or utilized different estimates.
Actual results may differ from those estimates.

Our critical accounting policies are as follows:

Revenue Recognition
We follow very specific and detailed guidelines in measuring revenue; however,
certain judgments affect the application of our revenue policy.  Revenue results
are difficult to predict, and any shortfall in revenue or delay in recognizing
revenue could cause our operating results to vary significantly from quarter to
quarter.  In general, revenue is recognized when title has passed at the time of
delivery of product for all of our operating segments as stipulated by the
delivery terms for the sales transactions.  In addition, prior to revenue
recognition, we require persuasive evidence of the arrangement, that the price
is fixed or determinable, and that collectibility is reasonably assured.
Installation is not applicable for Small Systems and Other segment products
based on the nature of the products sold.  Generally, revenue associated with
Large Systems sales is also recognized at the time of delivery pursuant to the
delivery terms, as we do not perform installation.  Delivery terms vary, but
often include origin-based terms (e.g., FOB Shipping Point and Ex-works) and
destination-based terms (e.g., DDU/DDP (delivered duty unpaid/delivered duty
paid)).

Certain Large Systems product lines and, at times, one product line included in
the Small Systems segment require electrical hardwire installation or duct
installation which is performed by the customer or their contracted licensed
contractor/electrician.  Since we do not perform the installation, revenue
recognition at the time of delivery is proper as customer acceptance of the unit
is not required.  Also, payment by the customer is not contingent upon
installation of the product.

                                       18
<PAGE>
We offer additional services to customers depending on the type of product the
customer has purchased, including on-site services, installation consulting
services, remote monitoring services, power audit services and network
integration services.  Revenue is recognized at the time services are provided
or is deferred and recognized over the service period (where applicable).  The
fair value of these services are based upon the rates that we charge customers
in separately negotiated transactions and such services are not essential to the
functionality of the delivered product.

For all sales, except those completed over the Internet, we use a binding
purchase order as evidence of an arrangement.  For sales over the Internet, we
use a credit card authorization as evidence of an arrangement.  Sales through
certain customers are evidenced by a master agreement governing the relationship
together with binding purchase orders on a transaction by transaction basis.

Our arrangements do not generally include acceptance clauses.  However, if an
arrangement includes a customer specified acceptance provision, acceptance
generally occurs at our factory prior to delivery.  As we introduce new products
in 2002, particularly PowerStruXureT, we anticipate that installation and
customer acceptance provisions will become more common, and therefore
increasingly significant for determining delivery and performance and
consequently our entitlement to recognize revenue.

In consideration of guidance issued by the Financial Accounting Standards
Board's Emerging Issues Task Force in Issue No. 00-25, Vendor Income Statement
Characterization of Consideration Paid to a Reseller of the Vendor's Products,
Issue No. 00-14, Accounting for Certain Sales Incentives and Issue No. 01-09,
Accounting for Consideration Given by a Vendor to a Customer (Including a
Reseller of the Vendor's Products), certain customer promotional payments,
rebates and other discounts formerly classified as operating expenses have been
retroactively re-classified as a reduction of revenue.  These changes reduced
net sales and also reduced marketing, selling, general and administrative
expenses by $4.2 million and $8.6 million in the second quarters of 2002 and
2001, respectively, and $8.3 million and $13.1 million in the first six months
of 2002 and 2001, respectively.  This accounting change had no impact on
reported profit from operations, net income or earnings per share for any of the
periods presented.

Estimating Valuation Allowances and Accrued Liabilities - Allowances for Sales
Returns, Doubtful Accounts and Inventory Obsolescence, and Assessment of the
Probability of the Outcome of our Current Litigation
Significant management judgments that affect the application of our revenue
policy also include estimates of potential future product returns related to
current period product revenue.  We analyze historical returns, current economic
trends and channel inventories when evaluating the adequacy of the sales returns
and other allowances.  Significant management judgments and estimates must be
made and used in connection with establishing the sales returns and other
allowances in any accounting period.  Material differences may result in the
amount and timing of our revenue for any period if management made different
judgments or utilized different estimates.

We provide limited rights of return to distributors and retailers for our Small
Systems product lines.  We provide appropriate reserves for returns at the time
that related revenue is recognized based on historical patterns of returns and
contractual provisions in accordance with the provisions of SFAS 48 and SAB 101.
Returns of Large Systems products generally do not occur.  Historically, returns
have represented approximately 3% of gross sales and have not differed
significantly from prior estimates.

Similarly, we must make estimates of the uncollectability of our accounts
receivables.  Management specifically analyzes accounts receivable balances in
view of customer credit-worthiness, customer concentrations, historical bad
debts, current economic trends and changes in our customer payment terms when
evaluating the adequacy of the allowance for doubtful accounts.  A majority of
international customer balances are covered by receivables insurance.

                                       19
<PAGE>
Our inventory reserve estimate methodology involves quantifying the total
inventory position having potential loss exposure. Loss exposure generally
results from several business factors, including product or component
discontinuance, unplanned changes in demand, product design changes and factory
transitions.  Quantifying such loss exposure is the result of combining the cost
of inventories specifically identified as having little or no opportunity for
sale or use (thus available for physical disposition) plus the cost of
inventories having a high risk of no future sale or use based upon an analysis
of on-hand quantities compared to historical and anticipated future sale or use.
We maintain an on-going business process for the physical disposition of
inventories previously identified.  Inventory write-offs occur at the time of
physical disposition.  Inventories, once reserved, are not written back up as
such reserve adjustments are considered to be a permanent decrease to the cost
basis of the excess or obsolete inventory.  If actual market conditions are less
favorable than those projected by management, additional inventory write-downs
may be required.

We are, and may in the future become, involved in litigation involving our
business, products or operations.  For pending claims for which there is an
estimable range of loss greater than zero, we record the best estimate of
liability within the range.  If no point within the range is considered the best
estimate, we record the minimum estimated liability.  Because of uncertainties
related to the identifiable range of loss on any pending claims, we may be
unable to make a reasonable estimate of the liability that could result from an
unfavorable outcome.  As additional information becomes available, we assess the
potential liability related to our pending claims and revise our estimates.
Such revisions in our estimates of the potential liability could materially
impact our results of operation and financial position.  The litigation process
is uncertain and includes the risk of an unexpected, unfavorable result.  We may
be materially adversely impacted by any such litigation.

Valuation of Long-lived Tangible and Intangible Assets including Goodwill
We assess the impairment of long-lived tangible and intangible assets on an
ongoing basis and whenever events or changes in circumstances indicate that the
carrying value may not be recoverable.  Should our assessment suggest
impairment, we would determine recoverability based on an estimate of future
undiscounted cash flows resulting from our use of the asset and its eventual
disposition.  Factors we consider that could trigger an impairment review
include the following:

  - significant underperformance relative to expected historical or projected
      future operating results;
  - significant changes in the manner of our use of the acquired assets or the
      strategy for our overall business;
  - significant negative industry or economic trends; and
  - significant technological changes, which would render equipment and
      manufacturing processes, obsolete.

In July 2001, the Financial Accounting Standards Board finalized Statement of
Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets.
Statement 142 is required to be applied in fiscal years beginning after December
15, 2001 to all goodwill and other intangible assets recognized at that date,
regardless of when those assets were initially recognized.  We adopted Statement
142 on January 1, 2002.  With the adoption of Statement 142, we implemented the
necessary reclassifications in order to conform to the new criteria in Statement
141, Business Combinations, for recognition of intangible assets apart from
goodwill.  Statement 142 requires that companies no longer amortize goodwill and
other intangible assets with indefinite lives, but instead test goodwill
impairment at least annually or more frequently if impairment indicators arise.
Statement 142 also requires completion of a two-step transitional goodwill
impairment test within six months of the date of adoption.  In connection with
completion of the first step of our transitional analysis, we have identified
two reporting units with goodwill, Large Systems and Small Systems; these
reporting units are also reportable segments.  We have determined the carrying
value of each reporting unit by assigning the assets and liabilities, including
existing goodwill and other intangible assets, to these reporting units as of
the date of adoption.  Completion of the first step of our analysis has
indicated that there is impairment in the carrying amount of our goodwill.  Our
goodwill is primarily associated with our Large Systems segment which consists
primarily of UPS, DC-power systems, and precision cooling products for data
centers, facilities, and communication applications.  Conditions contributing to
the goodwill impairment include the ongoing softness in IT and communications
market segments coupled with lower corporate investment for these types of
applications.  To the extent that an indication of impairment exists, we must
perform a second test to measure the amount of the impairment.  Determination of
the amount of the impairment charge is required to be completed by no later than
the end of the year of adoption of Statement 142.  We are currently evaluating
our goodwill and other intangible assets with indefinite lives associated
primarily with the Large Systems segment.  Based on our preliminary analysis, we
anticipate recording a non-cash charge in the third quarter of 2002 that could
approximate the current goodwill balance associated with the Large Systems
segment of approximately $50 million ($35 million on an after-tax basis).  Any
charge will be recognized as the cumulative effect of a change in accounting
principle and will have no effect on our operations or liquidity.

                                       20
<PAGE>
Accounting for Income Taxes
As part of the process of preparing our consolidated financial statements, we
are required to estimate our income taxes in each of the jurisdictions in which
we operate.  This process involves estimating our actual current tax exposure
together with assessing temporary differences resulting from differing treatment
of items, such as deferred revenue, for tax and accounting purposes.  These
differences result in deferred tax assets and liabilities, which are included
within our consolidated balance sheet.  We must then assess the likelihood that
our deferred tax assets will be recovered from future taxable income.
Expectations about future taxable income incorporate numerous assumptions about
actions, elections and strategies to minimize income taxes in future years.  Our
ability to take such actions, make preferred elections and implement tax-
planning strategies may be adversely impacted by enacted changes in tax laws
and/or tax rates, as well as successful challenges by tax authorities resulting
from differing interpretations of tax laws and regulations.

To the extent we believe that recovery of deferred tax assets is not likely, we
must establish a valuation allowance.  To the extent we establish a valuation
allowance or increase this allowance in a period, we must include an expense
within the tax provision in the consolidated statements of income.  Significant
management judgment is required in determining our provision for income taxes,
our deferred tax assets and liabilities and any valuation allowance recorded
against our net deferred tax assets.  We recorded a valuation allowance of $1.7
million as of December 31, 2001, due to uncertainties related to our ability to
utilize some of our deferred tax assets, primarily consisting of net operating
losses generated in 2001 for the start up of Brazilian operations, before they
expire.  The valuation allowance is based on our estimates of taxable income by
jurisdiction in which we operate and the period over which our deferred tax
assets will be recoverable.  In the event that actual results differ from these
estimates or we adjust these estimates in future periods we may need to
establish an additional valuation allowance which could materially impact our
financial position and results of operations.  The net deferred tax asset as of
June 30, 2002 was $38.4 million, net of a valuation allowance of $1.7 million.

Recently Issued Accounting Standards
In July 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 146, Accounting for Costs Associated with
Exit or Disposal Activities, which requires companies to recognize costs
associated with exit or disposal activities when they are incurred rather than
at the date of a commitment to an exit or disposal plan.  Statement 146 is
required to be applied prospectively to exit or disposal activities initiated
after December 31, 2002; we will adopt this Statement on January 1, 2003.  The
adoption of this Statement is not expected to have a material impact on our
consolidated financial position or results of operations.

In August 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 143, Accounting for Asset Retirement
Obligations, which addresses financial accounting and reporting for obligations
associated with the retirement of tangible long-lived assets and the associated
asset retirement costs.  This Statement is effective for fiscal years beginning
after June 15, 2002; we will adopt this Statement on January 1, 2003.  The
adoption of this Statement is not expected to have a material impact on our
consolidated financial position or results of operations.

Factors That May Affect Future Results
This document contains forward-looking statements that involve risks and
uncertainties.  Our actual results could differ materially from those
anticipated in these forward looking statements as a result of certain factors,
including the risks faced by us described below and elsewhere in this document.

                                       21
<PAGE>
The factors that could cause actual results to differ materially include the
following:  The impact of new accounting rules, including Statement 142, and the
possibility that the anticipated 2002 charges for goodwill impairment may differ
from the current approximation; the extent to which we are able to execute our
planned job reductions and realize anticipated cost savings in resultant
productivity and efficiency improvements; impact on order management and
fulfillment, financial reporting and supply chain management processes as a
result of human error or our reliance on, or a failure or disruption of, or
latent defects in, a variety of computer systems, including Oracle 11i which
was implemented in the first quarter 2001; the impact on demand, component
availability and pricing, and logistics, and the disruption of Asian
manufacturing operations, that result from war, acts of terrorism or political
instability; ramp up, expansion and rationalization of global manufacturing
capacity; our ability to effectively align operating expenses and production
capacity with the current demand environment; general worldwide economic
conditions, and, in particular, the possibility that the PC and related markets
decline more dramatically than currently anticipated; growth rates in the power
protection industry and related industries, including but not limited to the
PC, server, networking, telecommunications and enterprise hardware industries;
competitive factors and pricing pressures; product mix changes and the potential
negative impact on gross margins from such changes; changes in the seasonality
of demand patterns; inventory risks due to shifts in market demand; component
constraints, shortages and quality; risk of nonpayment of accounts receivable;
the uncertainty of the litigation process including risk of an unexpected,
unfavorable result of current or future litigation; and the risks described
from time to time in our filings with the Securities and Exchange Commission.
We caution readers not to place undue reliance on any such forward-looking
statements, which speak only as of the date they are made.  We disclaim any
obligation to publicly update or revise any such statements to reflect any
change in our expectations or in events, conditions, or circumstances on which
any such statements may be based, or that may affect the likelihood that actual
results will differ from those set forth in the forward-looking statements.

For a discussion of these and other risk factors, please refer to Item 7
Management's Discussion and Analysis of Financial Condition and Results of
Operations included in our Annual Report on Form 10-K for the year ended
December 31, 2001.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We, in the normal course of business, are exposed to market risks relating to
fluctuations in foreign currency exchange rates.  The information required under
this section related to such risks is included in the Foreign Currency Activity
section of Management's Discussion and Analysis of Financial Condition and
Results of Operations in Item 2 of this Report and is incorporated herein by
reference.



PART II - OTHER INFORMATION

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

The Annual Meeting of Shareholders was held on June 11, 2002 at which
APC's shareholders approved the following:

(i)   by a vote of 164,087,010 shares in favor, 4,426,699 opposed, and
      1,430,598 abstaining, the number of directors was fixed at seven.
(ii)  the following persons (with vote results) were elected to serve
      another term as Directors of APC:

      <TABLE>
      <CAPTION>
                                      For           Withheld
      <S>                         <C>              <C>
      Rodger B. Dowdell, Jr.      151,324,078      18,620,229
      James D. Gerson             162,520,902       7,423,405
      John G. Kassakian           163,646,789       6,297,518
      John F. Keane, Sr.          162,325,268       7,619,039
      Emanuel E. Landsman         153,411,873      16,532,434
      Ervin F. Lyon               162,391,079       7,553,228
      Neil E. Rasmussen           153,580,913      16,363,394
      </TABLE>

(iii) by a vote of 142,038,814 shares in favor, 24,670,935 opposed, and
      3,234,558 abstaining, APC's 1997 Stock Option Plan was amended to
      increase the aggregate number of shares of Common Stock authorized
      for issuance under the Plan from 24,000,000 shares to 33,500,000
      shares.

                                       22
<PAGE>
PART II - OTHER INFORMATION (CONT.)


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (CONT.)

In addition, the following shareholder proposals were not approved:

(i)   by a vote of 31,038,883 shares in favor, 97,844,800 opposed, 3,250,191
      abstaining, and 37,810,433 broker non-votes, a shareholder proposal
      regarding the composition of APC's Board of Directors was not approved.
(ii)  by a vote of 25,387,238 shares in favor, 104,879,425 opposed, 1,867,211
      abstaining, and 37,810,433 broker non-votes, a shareholder proposal
      regarding auditor independence was not approved.
(iii) by a vote of 51,709,268 shares in favor, 78,660,701 opposed, 1,763,905
      abstaining, and 37,810,433 broker non-votes, a shareholder proposal
      regarding director independence was not approved.


ITEM 5.  OTHER EVENTS

At a meeting immediately following the Annual Meeting of Shareholders on June
11, 2002, APC's Board of Directors created a Nominating and Corporate Governance
Committee of the Board of Directors.  This committee is comprised entirely of
independent directors and has responsibility for overseeing the process by which
candidates are nominated for election to the Board of Directors and for other
general corporate governance matters.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(A)  Exhibits

Exhibit No. 3.01 Articles of Organization of APC, as amended, previously filed
                 as an exhibit to APC's Quarterly Report on Form 10-Q for the
                 fiscal quarter ended June 27, 1999 and incorporated herein by
                 reference (File No. 1-12432)
Exhibit No. 3.02 By-Laws of APC, as amended and restated, previously filed as
                 an exhibit to APC's Annual Report on Form 10-K for the fiscal
                 year ended December 31, 1998 and incorporated herein by
                 reference (File No. 1-12432)
Exhibit No. 4.1  1997 Stock Option Plan of APC, as amended and restated,
                 previously filed as Exhibit 4.3 to APC's Registration
                 Statement on Form S-8 filed on July 3, 2002 and incorporated
                 herein by reference (File No. 333-91994)
Exhibit No. 99.1 Certification of Rodger B. Dowdell, Jr., Chief Executive
                 Officer, pursuant to 18 U.S.C. Section 1350, as adopted
                 pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *
Exhibit No. 99.2 Certification of Donald M. Muir, Chief Financial Officer,
                 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
                 Section 906 of the Sarbanes-Oxley Act of 2002 *

* American Power Conversion Corporation has the originally signed certificate
  and will provide it to the Securities and Exchange Commission upon request.

(B)  Reports on Form 8-K

No reports on Form 8-K were filed by American Power Conversion Corporation
during the quarter ended June 30, 2002.

                                       23
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002


                                   SIGNATURES


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


                      AMERICAN POWER CONVERSION CORPORATION

                             Date:  August 14, 2002


                               /s/ Donald M. Muir

                                 Donald M. Muir
                             Chief Financial Officer
                  (Principal Accounting And Financial Officer)


                                       24
<PAGE>
                                                                       FORM 10-Q
                                                                   June 30, 2002



             AMERICAN POWER CONVERSION CORPORATION AND SUBSIDIARIES
                                  EXHIBIT INDEX


<TABLE>
<CAPTION>
Exhibit                                                                   Page
Number   Description                                                       No.
<S>      <C>                                                               <C>

3.01      Articles of Organization of APC, as amended, previously
          filed as an exhibit to APC's Quarterly Report on Form 10-Q
          for the fiscal quarter ended June 27, 1999 and incorporated
          herein by reference (File No. 1-12432)

3.02      By-Laws of APC, as amended and restated, previously
          filed as an exhibit to APC's Annual Report on Form 10-K
          for the fiscal year ended December 31, 1998 and incorporated
          herein by reference (File No. 1-12432)

4.1       1997 Stock Option Plan of APC, as amended and restated,
          previously filed as Exhibit 4.3 to APC's Registration
          Statement on Form S-8 filed on July 3, 2002 and incorporated
          herein by reference (File No. 333-91994)

99.1      Certification of Rodger B. Dowdell, Jr., Chief Executive         26
          Officer, pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

99.2      Certification of Donald M. Muir, Chief Financial                 27
          Officer, pursuant to 18 U.S.C. Section 1350, as adopted
          pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
</TABLE>

*American Power Conversion Corporation has the originally signed certificate
 and will provide it to the Securities and Exchange Commission upon request.

                                       25
<PAGE>
                                                           Exhibit 99.1


                                  CERTIFICATION



In connection with the Quarterly Report of American Power Conversion Corporation
(the "Company") on Form 10-Q for the period ending June 30, 2002 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), I,
Rodger B. Dowdell, Jr., Chairman, President and Chief Executive Officer of the
Company, certify, pursuant to 18 U.S.C.  1350, as adopted pursuant to  906 of
the Sarbanes-Oxley Act of 2002, that:

   (1)   The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

   (2)   The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.


/s/ Rodger B. Dowdell, Jr.

Rodger B. Dowdell, Jr.
Chairman, President & Chief Executive Officer
August 14, 2002

                                       26
<PAGE>
                                                                    Exhibit 99.2


                                  CERTIFICATION



In connection with the Quarterly Report of American Power Conversion Corporation
(the "Company") on Form 10-Q for the period ending June 30, 2002 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), I,
Donald M. Muir, Senior Vice President, Finance and Administration, Treasurer and
Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C.  1350,
as adopted pursuant to  906 of the Sarbanes-Oxley Act of 2002, that:

   (1)   The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

   (2)   The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.


/s/ Donald M. Muir

Donald M. Muir
Senior Vice President, Finance and Administration,
Treasurer and Chief Financial Officer

August 14, 2002

                                       27