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U.S. SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-QSB
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the quarterly period ended June 30, 2005
 o
    
    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 0-27689
 AMDL,
Inc.
  Delaware
    
    33-0413161(State or other jurisdiction
    
    (IRS Employerof incorporation or organization)
    
    Identification No.)
  
   
   
   þ o




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PAGEPART I  FINANCIAL INFORMATION
    
    
    2Item 1. Financial StatementsBalance Sheet at June 30, 2005 (unaudited)
    
    
    2Unaudited Statements of Operations for the three and six months ended June 30, 2005 and 2004
    
    
    3Unaudited Statements of Cash Flows for the six months ended June 30, 2005 and 2004
    
    
    4Notes to Condensed Financial Statements (unaudited)
    
    
    5Item 2. Managements Discussion and Analysis
    
    
    14Item 3. Controls and Procedures
    
    
    19PART II  OTHER INFORMATION
    
    
    20EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2
  1




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PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 AMDL, INC.
 
 BALANCE SHEET
 June 30,2005(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    1,601,814Inventories
    
    
    85,413Prepaid expenses and other current assets
    
    
    20,779Total current assets
    
    
    1,708,006Intellectual property, net
    
    
    1,608,333Equipment, net
    
    
    19,547Other assets
    
    
    5,757$
    3,341,643LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses
    
    $
    71,892Accrued payroll and related expenses
    
    
    102,077Total current liabilities
    
    
    173,969Commitments and contingenciesStockholders equity:Preferred stock, $0.001 par value; 10,000,000
shares authorized; no shares issued and
outstanding
    
    
    Common stock, $0.001 par value; 50,000,000 shares
authorized; 23,799,489 shares issued and
outstanding
    
    
    23,799Additional paid in capital
    
    
    30,593,379Prepaid consulting
    
    
    (126,900
    )Accumulated deficit
    
    
    (27,322,604
    )Total stockholders equity
    
    
    3,167,674$
    3,341,643
  2




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AMDL, INC.
 
 STATEMENTS OF OPERATIONS
(Unaudited)
 Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net revenues
    
    $
    16,550
    
    
    $
    23,516
    
    
    $
    39,425
    
    
    $
    148,018Cost of sales
    
    
    2,589
    
    
    
    6,256
    
    
    
    7,417
    
    
    
    62,654Gross profit
    
    
    13,961
    
    
    
    17,260
    
    
    
    32,008
    
    
    
    85,364Operating expenses:Research and development
    
    
    77,174
    
    
    
    106,700
    
    
    
    158,618
    
    
    
    189,576General and administrative
    
    
    551,813
    
    
    
    678,454
    
    
    
    1,052,770
    
    
    
    1,232,587628,987
    
    
    
    785,154
    
    
    
    1,211,388
    
    
    
    1,422,163Loss from operations
    
    
    (615,026
    )
    
    
    (767,894
    )
    
    
    (1,179,380
    )
    
    
    (1,336,799
    )Other income:Interest income
    
    
    8,450
    
    
    
    8,410
    
    
    
    17,826
    
    
    
    13,059Net loss
    
    $
    (606,576
    )
    
    $
    (759,484
    )
    
    $
    (1,161,554
    )
    
    $
    (1,323,740
    )Basic and diluted loss
per share
    
    $
    (0.03
    )
    
    $
    (0.03
    )
    
    $
    (0.05
    )
    
    $
    (0.06
    )Weighted average common
shares outstanding,
basic and diluted
    
    
    23,763,225
    
    
    
    21,849,479
    
    
    
    23,632,086
    
    
    
    21,574,811
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AMDL, INC.
 
 STATEMENTS
OF CASH FLOWS 
(Unaudited)
 Six Months EndedJune 30,2005
    
    2004Cash flows from operating activities:Net loss
    
    $
    (1,161,554
    )
    
    $
    (1,323,740
    )Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization
    
    
    53,520
    
    
    
    54,686Fair market value of common stock issued for services
    
    
    81,600
    
    
    
    192,383Fair market value of options and warrants issued for services
    
    
    9,250
    
    
    
    17,000Changes in operating assets and liabilities:Accounts receivable
    
    
    
    
    
    
    152,227Inventories
    
    
    (17,378
    )
    
    
    (9,358
    )Prepaid expenses and other current assets
    
    
    31,422
    
    
    
    9,317Accounts payable and accrued expenses
    
    
    (11,869
    )
    
    
    (131,306
    )Accrued payroll and related expenses
    
    
    20,465
    
    
    
    18,552Net cash used in operating activities
    
    
    (994,544
    )
    
    
    (1,020,239
    )Cash flows used in investing activities:Purchase of equipment
    
    
    (9,179
    )
    
    
    (789
    )Cash flows from financing activities:Proceeds from issuance of common stock,
net of offering costs of $295,766 in 2004
    
    
    
    
    
    
    1,830,074Proceeds from exercise of stock options
    
    
    
    
    
    
    162,303Net cash provided by financing activities
    
    
    
    
    
    
    1,992,377Net change in cash and cash equivalents
    
    
    (1,003,723
    )
    
    
    971,349Cash and cash equivalents at beginning of period
    
    
    2,605,537
    
    
    
    1,708,886Cash and cash equivalents at end of period
    
    $
    1,601,814
    
    
    $
    2,680,235Supplemental disclosure of cash flow information:Cash paid during the period for:Interest
    
    $
    
    
    
    $
    Income taxes
    
    $
    
    
    
    $
    
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AMDL, INC.
 
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
 NOTE 1  MANAGEMENTS REPRESENTATION
   NOTE 2  NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
  ®
 Going Concern
 $ ®
 ®
  Revenue Recognition
  5




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
 Advertising
  Research and Development
  Cash Equivalents
  Inventories
  Equipment
   Intangible Assets
   Impairment of Long-Lived Assets
  6




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
 Common Stock Issued for Services Rendered
  Risks and Uncertainties
 â
 ® ® ® ® ® ®
 ® ® ®
  Accounting for Stock-Based Compensation
  7




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
      8




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
 For the Three Months Ended
    
    For the Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net loss as reported
    
    $
    (606,576
    )
    
    $
    (759,484
    )
    
    $
    (1,161,554
    )
    
    $
    (1,323,740
    )Deduct: Total
stock-based employee
compensation under fair
value based method for
all awards, net of
related tax effects
    
    
    
    
    
    
    (2,800
    )
    
    
    (72,000
    )
    
    
    (934,400
    )Pro forma net loss
    
    $
    (606,576
    )
    
    $
    (762,284
    )
    
    $
    (1,233,554
    )
    
    $
    (2,258,140
    )Basic and diluted loss
per share  as reported
    
    $
    (0.03
    )
    
    $
    (0.03
    )
    
    $
    (0.05
    )
    
    $
    (0.06
    )Basic and diluted loss
per share  pro forma
    
    $
    (0.03
    )
    
    $
    (0.03
    )
    
    $
    (0.05
    )
    
    $
    (0.10
    )
 Basic and Diluted Loss Per Share
  Income Taxes
  Use of Estimates
  9




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
  Comprehensive Income
  Segments of an Enterprise and Related Information
  Concentration of Risk
 ®
  Recent Accounting Pronouncements
    10




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
   NOTE 3  STOCK ISSUANCES
 Non-Cash Financing Activities
  NOTE 4  STOCK OPTIONS AND WARRANTS
   11




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
    NOTE 5  COMMITMENTS AND CONTINGENCIES
 Litigation
   12




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AMDL, INC.
 NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
 For the Periods Ended June 30, 2005 and 2004
  Indemnities and Guarantees
  NOTE 6  SUBSEQUENT EVENTS
 Non-Cash Financing Activities
  13




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Liquidity and Capital Resources
   ® $ ®
 ® ®
  Critical Accounting Policies
   Allowance for Doubtful Accounts
 14




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Inventory
 Sales Allowances.
 Valuation of Intangibles
 Deferred Taxes
 Litigation
 15




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Results of Operations
 Three Months Ended June 30, 2005 Compared to Three Months Ended June 30, 2004
 Net Revenue ® ® ®
 ® ® ® ®
 ® ®
 Gross Profit ®
  Research and Development.
 General and Administrative Expenses
 16




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Interest Income.
 Net Loss and Loss from Operations.
 Six Months Ended June 30, 2005 Compared to Six Months Ended June 30, 2004
 Net Revenue ® ® ®
 ® ® ® ®
 ® ®
 Gross Profit ®
  Research and Development.
 General and Administrative Expenses
 17




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Interest Income.
 Net Loss and Loss from Operations.
 Assets and Liabilities
  ®
   Forward Looking Statements
  18




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Item 3. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Controls
  19




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PART II  OTHER INFORMATION
 Item 1. Legal Proceedings
  Item 2. Unregistered Sales of Equity Securities
     Item 3. Defaults Upon Senior Securities
  Item 4. Submission of Matters to a Vote of Security Holders
  Item 5. Other Information
  Item 6. Exhibits
  31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.1
    
    Certification Pursuant to 18 U.S.C. §1350 of Chief Executive Officer32.2
    
    Certification Pursuant to 18 U.S.C. §1350 of Chief Financial Officer
 20




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SIGNATURES
  AMDL, Inc.Dated:  August 5, 2005
    By:
    /s/ Gary L. DreherGARY L. DREHER, PresidentDated:  August 5, 2005
    By:
    /s/  Arthur S. RostenARTHUR S. ROSTEN, Chief Financial Officer 21




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EXHIBIT INDEX
  31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.1
    
    Certification Pursuant to 18 U.S.C. §1350 of Chief Executive Officer32.2
    
    Certification Pursuant to 18 U.S.C. §1350 of Chief Financial Officer
 22