----

----

|  CLEARONE COMMUNICATIONS, INC.                          |
|--------------------------------------------------------------|
|  (Exact name of registrant as specified in its charter) |

| Utah                                                           |   | 87-0398877                              |
|----------------------------------------------------------------|--------|-----------------------------------------|
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. employer identification number) |

| 5225 Wiley Post Way, Suite 500, Salt Lake City, Utah |   | 84116      |
|------------------------------------------------------|--------|------------|
| (Address of principal executive offices)             |   | (Zip Code) |

| (801) 975 - 7200                                           |
|------------------------------------------------------------|
|  (Registrant's telephone number, including area code) |

| Larger Accelerated Filer [ ]                                                       | Accelerated Filer  [ ]          |
|------------------------------------------------------------------------------------|-------------------------------------------|
| Non-Accelerated Filer  [ ] (Do not check if a smaller reporting company) | Smaller Reporting Company   [x] |

----

----

CLEAR

| Item Number |                                                                                              | Page No. |
|-------------|---------------------------------------------------------------------------------------------------|----------|
| PART I      | FINANCIAL INFORMATION                                                                             |     |
| Item 1      | Condensed Consolidated Financial Statements:                                                      |     |
|        | Balance Sheets as of March 31, 2010 and December 31, 2009                                         | 1        |
|        | Statements of Operations for the quarters ended March 31, 2010 and 2009                           | 2        |
|        | Statements of Cash Flows for the the quarters ended March 31, 2010 and 2009                       | 3        |
|        | Notes to Condensed Consolidated Financial Statements                                              | 4        |
| Item 2      |  Management’s Discussion and Analysis of Financial Condition and Results of Operations | 7        |
| Item 3      |  Quantitative and Qualitative Disclosures About Market Risk                                  | 13       |
| Item 4T     |  Controls and Procedures                                                                     | 13       |
| PART II     | OTHER INFORMATION                                                                                 |     |
| Item 1      | Legal Proceedings                                                                                 | 14       |
| Item 1A     | Risk Factors                                                                                      | 14       |
| Item 2      | Unregistered Sales of Equity Securities and Use of Proceeds                                       | 14       |
| Item 3      | Defaults Upon Senior Securities                                                                   | 14       |
| Item 4      | Removed and Reserved                                                                              | 14       |
| Item 5      | Other Information                                                                                 | 14       |
| Item 6      | Exhibits                                                                                          | 14       |
| Signatures  |                                                                                              | 14       |

----

Table of Contents

CLEARONE

|                                                                                                                                         |   | Unaudited           |    |   | Audited                |   |
|----------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------|---------|--------|------------------------|--------|
|                                                                                                                                         |   | As ofMarch 31, 2010 |    |   | As ofDecember 31, 2009 |   |
| ASSETS                                                                                                                                       |   |                |    |   |                   |   |
| Current assets:                                                                                                                              |   |                |    |   |                   |   |
| Cash and cash equivalents                                                                                                                    |   | $                   | 9,428   |   |                   | $      | 9,494 |   |
| Receivables, net of allowance for doubtful accounts of $103 and $103, respectively                                                           |   |                | 6,636   |   |                   |   | 6,571 |   |
| Inventories, net                                                                                                                             |   |                | 6,468   |   |                   |   | 6,236 |   |
| Deferred income taxes                                                                                                                        |   |                | 3,152   |   |                   |   | 3,128 |   |
| Prepaid expenses and other assets                                                                                                            |   |                | 760     |   |                   |   | 1,609 |   |
| Total current assets                                                                                                                         |   |                | 26,444  |   |                   |   | 27,038 |   |
|                                                                                                                                         |   |                |    |   |                   |   |   |   |
| Long-term inventories, net                                                                                                                   |   |                | 5,172   |   |                   |   | 6,412 |   |
| Property and equipment, net                                                                                                                  |   |                | 3,059   |   |                   |   | 3,246 |   |
| Intangibles, net                                                                                                                             |   |                | 3,008   |   |                   |   | 3,095 |   |
| Goodwill                                                                                                                                     |   |                | 726     |   |                   |   | 726 |   |
| Long-term deferred tax asset                                                                                                                 |   |                | 1,093   |   |                   |   | 1,037 |   |
| Other assets                                                                                                                                 |   |                | 21      |   |                   |   | 21 |   |
| Total assets                                                                                                                                 |   | $                   | 39,523  |   |                   | $      | 41,575 |   |
|                                                                                                                                         |   |                |    |   |                   |   |   |   |
| LIABILITIES AND SHAREHOLDERS' EQUITY                                                                                                         |   |                |    |   |                   |   |   |   |
| Current liabilities:                                                                                                                         |   |                |    |   |                   |   |   |   |
| Accounts payable                                                                                                                             |   |                | 1,586   |   |                   |   | 2,304 |   |
| Accrued liabilities                                                                                                                          |   |                | 2,131   |   |                   |   | 1,768 |   |
| Current maturities of long-term debt                                                                                                         |   |                | — |   |                   |   | 2,000 |   |
| Deferred product revenue                                                                                                                     |   |                | 4,836   |   |                   |   | 4,707 |   |
| Total current liabilities                                                                                                                    |   |                | 8,553   |   |                   |   | 10,779 |   |
|                                                                                                                                         |   |                |    |   |                   |   |   |   |
| Deferred rent                                                                                                                                |   |                | 428     |   |                   |   | 466 |   |
| Other long-term liabilities                                                                                                                  |   |                | 1,152   |   |                   |   | 1,232 |   |
| Total liabilities                                                                                                                            |   |                | 10,133  |   |                   |   | 12,477 |   |
|                                                                                                                                         |   |                |    |   |                   |   |   |   |
| Shareholders' equity:                                                                                                                        |   |                |    |   |                   |   |   |   |
| Common stock, par value $0.001, 50,000,000 shares authorized, 8,929,244  and 8,929,134 shares issued and outstanding, respectively |   |                | 9       |   |                   |   | 9 |   |
| Additional paid-in capital                                                                                                                   |   |                | 38,885  |   |                   |   | 38,810 |   |
| Accumulated deficit                                                                                                                          |   |                | (9,504  | )      |                   |   | (9,721 | ) |
| Total shareholders' equity                                                                                                                   |   |                | 29,390  |   |                   |   | 29,098 |   |
| Total liabilities and shareholders' equity                                                                                                   |   | $                   | 39,523  |   |                   | $      | 41,575 |   |

----

Table of Contents

CLEAR

|                                        |   | Quarter endedMarch 31, 2010 |      |   | Quarter endedMarch 31, 2009 |   |
|---------------------------------------------|--------|-----------------------------|-----------|--------|-----------------------------|--------|
| Revenue                                     |   | $                           | 8,356     |   |                        | $      | 7,602 |   |
| Cost of goods sold                          |   |                        | 3,161     |   |                        |   | 3,549 |   |
| Gross profit                                |   |                        | 5,195     |   |                        |   | 4,053 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Operating expenses:                         |   |                        |      |   |                        |   |   |   |
| Sales and marketing                         |   |                        | 1,902     |   |                        |   | 1,690 |   |
| Research and product development            |   |                        | 1,904     |   |                        |   | 1,810 |   |
| General and administrative                  |   |                        | 932       |   |                        |   | 123 |   |
| Total operating expenses                    |   |                        | 4,738     |   |                        |   | 3,623 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Operating income                            |   |                        | 457       |   |                        |   | 430 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Other (expense) income, net                 |   |                        | (132      | )      |                        |   | 60 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Income before income taxes                  |   |                        | 325       |   |                        |   | 490 |   |
| Provision for income taxes                  |   |                        | (108      | )      |                        |   | (130 | ) |
| Net income                                  |   | $                           | 217       |   |                        | $      | 360 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Basic earnings per common share             |   | $                           | 0.02      |   |                        | $      | 0.04 |   |
| Diluted earnings per common share           |   | $                           | 0.02      |   |                        | $      | 0.04 |   |
|                                        |   |                        |      |   |                        |   |   |   |
| Basic weighted average shares outstanding   |   |                        | 8,929,174 |   |                        |   | 8,914,000 |   |
| Diluted weighted average shares outstanding |   |                        | 9,036,225 |   |                        |   | 9,032,383 |   |

----

Table of Contents

CLEARONE COMMUNICATIONS

|                                                                                 |   | Quarter endedMarch 31, 2010 |    |   | Quarter endedMarch 31, 2009 |   |
|--------------------------------------------------------------------------------------|--------|-----------------------------|---------|--------|-----------------------------|--------|
| Cash flows from operating activities:                                                |   |                        |    |   |                        |   |
| Net income                                                                           |   | $                           | 217     |   |                        | $      | 360 |   |
| Adjustments to reconcile net income to net cash provided by (used in) operations:    |   |                        |    |   |                        |   |   |   |
| Depreciation and amortization expense                                                |   |                        | 290     |   |                        |   | 181 |   |
| Stock-based compensation                                                             |   |                        | 75      |   |                        |   | 158 |   |
| Write-off of inventory                                                               |   |                        | 85      |   |                        |   | 266 |   |
| Loss on disposal of assets and fixed asset write-offs                                |   |                        | 111     |   |                        |   | — |   |
| Provision for doubtful accounts                                                      |   |                        | — |   |                        |   | 8 |   |
| Changes in operating assets and liabilities:                                         |   |                        |    |   |                        |   |   |   |
| Receivables                                                                          |   |                        | (65     | )      |                        |   | 1,833 |   |
| Deferred income taxes                                                                |   |                        | (80     | )      |                        |   | 200 |   |
| Note receivable                                                                      |   |                        | — |   |                        |   | 9 |   |
| Inventories                                                                          |   |                        | 923     |   |                        |   | (1,444 | ) |
| Prepaid expenses and other assets                                                    |   |                        | 499     |   |                        |   | (88 | ) |
| Accounts payable                                                                     |   |                        | (718    | )      |                        |   | 1,210 |   |
| Accrued liabilities                                                                  |   |                        | 363     |   |                        |   | (1,517 | ) |
| Income taxes                                                                         |   |                        | — |   |                        |   | (584 | ) |
| Deferred product revenue                                                             |   |                        | 129     |   |                        |   | (774 | ) |
| Other assets/liabilities, net                                                        |   |                        | (80     | )      |                        |   | — |   |
| Net cash provided by (used in) operating activities                                  |   |                        | 1,749   |   |                        |   | (182 | ) |
|                                                                                 |   |                        |    |   |                        |   |   |   |
| Cash flows from investing activities:                                                |   |                        |    |   |                        |   |   |   |
| Escrow proceeds received pursuant to NetStreams acquisition                          |   |                        | 350     |   |                        |   | — |   |
| Purchase of property and equipment                                                   |   |                        | (165    | )      |                        |   | (81 | ) |
| Sale of marketable securities                                                        |   |                        | — |   |                        |   | 8,728 |   |
| Net cash provided by (used in) investing activities                                  |   |                        | 185     |   |                        |   | 8,647 |   |
|                                                                                 |   |                        |    |   |                        |   |   |   |
| Cash flows from financing activities:                                                |   |                        |    |   |                        |   |   |   |
| Proceeds from the issuance of common stock - options                                 |   |                        | — |   |                        |   | 118 |   |
| Principal payments on long-term debt                                                 |   |                        | (2,000  | )      |                        |   | — |   |
| Tax benefit from stock options                                                       |   |                        | — |   |                        |   | 2 |   |
| Net cash provided by (used in) financing activities                                  |   |                        | (2,000  | )      |                        |   | 120 |   |
|                                                                                 |   |                        |    |   |                        |   |   |   |
| Net increase in cash and cash equivalents                                            |   |                        | (66     | )      |                        |   | 8,585 |   |
| Cash and cash equivalents at the beginning of the period                             |   |                        | 9,494   |   |                        |   | 2,323 |   |
| Cash and cash equivalents at the end of the period                                   |   | $                           | 9,428   |   |                        | $      | 10,908 |   |
|                                                                                 |   |                        |    |   |                        |   |   |   |
|                                                                                 |   |                        |    |   |                        |   |   |   |
| Supplemental disclosure of cash flow information:                                    |   |                        |    |   |                        |   |   |   |
| Cash paid for interest                                                               |   | $                           | 61      |   |                        | $      | — |   |
| Cash paid for income taxes                                                           |   |                        | 3       |   |                        |   | 723 |   |
|                                                                                 |   |                        |    |   |                        |   |   |   |
| Supplemental disclosure of non-cash activities:                                      |   |                        |    |   |                        |   |   |   |
| Exchanged accounts receivable from a vendor with accounts payable to the same vendor |   | $                           | — |   |                        | $      | 205 |   |
| Unrealized loss on marketable securities, net of tax of $0 and $26              |   |                        | — |   |                        |   | (44 | ) |

----

Table of Contents

CLEARONE COMMUNICATIONS

| Decrease in Receivables                     |   | $      | (91 | )  |
|---------------------------------------------|--------|--------|-----|---------|
| Decrease in Deferred income taxes - Current |   |   | (1  | )  |
| Increase in Long-term deferred tax asset    |   |   | 35  |    |
| Increase in Goodwill                        |   | $      | (57 | )  |

|                                |   | Estimated useful lives (Years) |   |   | Gross  |    |   | Accumulated amortization |   |    | Net    |   |
|-------------------------------------|--------|--------------------------------|--------|--------|--------|---------|--------|--------------------------|--------|---------|--------|--------|
| Tradename                           |   |                           | 7      |   |   | $       | 435    |                     |   | $       | 25     |   |   | $ | 410 |   |
| Patents and Technological Know-how  |   |                           | 10     |   |   |    | 2,070  |                     |   |    | 87     |   |   |   | 1,983 |   |
| Proprietary Software                |   |                           | 3      |   |   |    | 215    |                     |   |    | 30     |   |   |   | 185 |   |
| Other                               |   |                           | 5      |   |   |    | 49     |                     |   |    | 19     |   |   |   | 30 |   |
|                                |   |                           |   |   |   |    | 2,769  |                     |   |    | 161    |   |   |   | 2,608 |   |
| In-process Research and Development |   | Indefinite                     |   |   |   | 400     |   |                     |   | -       |   |   |   | 400 |   |
| Total                               |   |                           |   |   |   | $  | 3,169  |                     |   | $  | 161    |   |   | $  | 3,008 |   |

----

Table of Contents

CLEARONE COMMUNICATIONS

|           |   | As ofMarch 31, 2010 |   |   | As ofDecember 31, 2009 |   |
|----------------|--------|---------------------|--------|--------|------------------------|--------|
| Current:       |   |                |   |   |                   |   |
| Raw materials  |   | $                   | 349    |   |                   | $      | 453 |   |
| Finished goods |   |                | 6,119  |   |                   |   | 5,783 |   |
|           |   | $                   | 6,468  |   |                   | $      | 6,236 |   |
|           |   |                |   |   |                   |   |   |   |
| Long-term:     |   |                |   |   |                   |   |   |   |
| Raw materials  |   | $                   | 1,127  |   |                   | $      | 1,056 |   |
| Finished goods |   |                | 4,045  |   |                   |   | 5,356 |   |
|           |   | $                   | 5,172  |   |                   | $      | 6,412 |   |

|                       |   | Quarter endedMarch 31, 2010 |   |   | Quarter endedMarch 31, 2009 |   |
|----------------------------|--------|-----------------------------|--------|--------|-----------------------------|--------|
| Cost of Goods Sold         |   | $                           | -      |   |                        | $      | - |   |
| Sales and Marketing        |   |                        | 11     |   |                        |   | 25 |   |
| Research and Development   |   |                        | 7      |   |                        |   | 7 |   |
| General and Administrative |   |                        | 57     |   |                        |   | 124 |   |
|                       |   | $                           | 75     |   |                        | $      | 156 |   |

----

Table of Contents

CLEARONE COMMUNICATIONS

|                                                     |   | Quarter endedMarch 31, 2010 |   |   | Quarter endedMarch 31, 2009 |   |
|----------------------------------------------------------|--------|-----------------------------|--------|--------|-----------------------------|--------|
| Balance at the beginning of the period                   |   | $                           | 29,098 |   |                        | $      | 28,131 |   |
| Net Income during the period                             |   |                        | 217    |   |                        |   | 360 |   |
| Stock based compensation                                 |   |                        | 75     |   |                        |   | 156 |   |
| Exercise of stock options                                |   |                        | -      |   |                        |   | 124 |   |
| Unrealized loss on marketable securities net of tax, $26 |   |                        | -      |   |                        |   | (44 | ) |
| Balance at end of the period                             |   | $                           | 29,390 |   |                        | $      | 28,727 |   |

|                                              |   | Quarter endedMarch 31, 2010 |   |   | Quarter endedMarch 31, 2009 |   |
|---------------------------------------------------|--------|-----------------------------|--------|--------|-----------------------------|--------|
| Interest income                                   |   | $                           | 23     |   |                        | $      | 41 |   |
| Interest expense                                  |   |                        | (51    | )      |                        |   | - |   |
| Gain (loss) on disposal of property and equipment |   |                        | (111   | )      |                        |   | - |   |
| Other                                             |   |                        | 7      |   |                        |   | 19 |   |
|                                              |   | $                           | (132   | )      |                        | $      | 60 |   |

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

|                             |   | Quarter endedMarch 31, 2010 |   |   | Quarter endedMarch 31, 2009 |   |   | VarianceFavorable (Unfavorable) |   |
|----------------------------------|--------|-----------------------------|--------|--------|-----------------------------|--------|--------|---------------------------------|--------|
|                             |   | Amount                      |   |   | % ofRevenue                 |   |   | Amount                          |   |   | % ofRevenue |   |   | Amount |   |   | % |   |
| Revenue                          |   | $                           | 8,356  |   |                        |   | 100.0  | %                               |   | $ | 7,602 |   |   |   | 100.0 | % |   | $ | 754 |   |   |   | 9.9 | % |
| Cost of goods sold               |   |                        | 3,161  |   |                        |   | 37.8   | %                               |   |   | 3,549 |   |   |   | 46.7 | % |   |   | 388 |   |   |   | 10.9 | % |
| Gross profit                     |   |                        | 5,195  |   |                        |   | 62.2   | %                               |   |   | 4,053 |   |   |   | 53.3 | % |   |   | 1,142 |   |   |   | 28.2 | % |
| Sales and marketing              |   |                        | 1,902  |   |                        |   | 22.8   | %                               |   |   | 1,690 |   |   |   | 22.2 | % |   |   | (212 | ) |   |   | -12.5 | % |
| Research and product development |   |                        | 1,904  |   |                        |   | 22.8   | %                               |   |   | 1,810 |   |   |   | 23.8 | % |   |   | (94 | ) |   |   | -5.2 | % |
| General and administrative       |   |                        | 932    |   |                        |   | 11.2   | %                               |   |   | 123 |   |   |   | 1.6 | % |   |   | (809 | ) |   |   | -657.7 | % |
| Operating income                 |   |                        | 457    |   |                        |   | 5.5    | %                               |   |   | 430 |   |   |   | 5.7 | % |   |   | 27 |   |   |   | 6.3 | % |
| Other (expense) income, net      |   |                        | (132   | )      |                        |   | -1.6   | %                               |   |   | 60 |   |   |   | 0.8 | % |   |   | (192 | ) |   |   | -320.0 | % |
| Income before income taxes       |   |                        | 325    |   |                        |   | 3.9    | %                               |   |   | 490 |   |   |   | 6.4 | % |   |   | (165 | ) |   |   | -33.7 | % |
| Provision for income taxes       |   |                        | (108   | )      |                        |   | -1.3   | %                               |   |   | (130 | ) |   |   | -1.7 | % |   |   | 22 |   |   |   | -16.9 | % |
| Net income                       |   | $                           | 217    |   |                        |   | 2.6    | %                               |   | $ | 360 |   |   |   | 4.7 | % |   | $ | (143 | ) |   |   | -39.7 | % |

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

|                        |   | As ofMarch 31, 2010 |   |   | As ofDecember 31, 2009 |    |
|-----------------------------|--------|---------------------|--------|--------|------------------------|---------|
| Deferred Revenue            |   | $                   | 4,836  |   |                   | $       | 4,707 |   |
| Deferred Cost of Goods Sold |   |                | 2,034  |   |                   |    | 1,846 |   |
| Deferred Gross Profit       |   | $              | 2,802  |   |                   | $  | 2,861 |   |

----

Table of Contents

CLEARONE COMMUNICATIONS

MANAGEMENT'

----

Table of Contents

CLEARONE COMMUNICATIONS

Item 3.   QUANTITATIVE 

Item 4T.   

----

Table of Contents

CLEARONE COMMUNICATIONS

Item 1. 

Item 1A. 

Item 2.   UNREGISTERED 

Item 3.   DEFAULTS 

Item 4.   REMOVED 

Item 5.   OTHER 

Item 6.   EXHIBITS

| Exhibit No. |   |  Title of Document                                  |
|-------------|--------|----------------------------------------------------------|
| 31.1        |   | Section 302 Certification of Chief Executive Officer     |
| 31.2        |   | Section 302 Certification of Principal Financial Officer |
| 32.1        |   | Section 906 Certification of Chief Executive Officer     |
| 32.2        |   | Section 906 Certification of Principal Financial Officer |

SIGNA

| ClearOne Communications, Inc., a Utah corporation |
|---------------------------------------------------|
|                                              |   |   |
|                                              |   |   |
|                                              |   |   |
| May 17, 2010                                      | By: | /s/ Zeynep Hakimoglu |
|                                              |   | Zeynep Hakimoglu |
|                                              |   | Chief Executive Officer |
|                                              |   | (Principal Executive Officer) |
|                                              |   |   |
|                                              |   |   |
|                                              |   |   |
| May 17, 2010                                      | By: | /s/ Narsi Narayanan |
|                                              |   | Narsi Narayanan |
|                                              |   | Vice President of Finance |
|                                              |   | (Principal Financial and Accounting Officer) |

----