SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, DC   20549
                                
                                
                            FORM 10-Q
                                
                                
(Mark One)
                                
    x  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934
                                
         For the quarterly period ended October 3, 1997
                                
                               OR
                                
       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

                                
                   Commission File No. 0-9919

                            PSC INC.
     (Exact name of Registrant as Specified in Its Charter)
                                
New York                                       16-0969362
(State or other jurisdiction of            (I.R.S. Employer
 incorporation or organization)             Identification No.)


675 Basket Road, Webster, New York                 14580
(Address of principal executive offices)        (Zip Code)

                         (716) 265-1600
      (Registrant's telephone number, including area code)

Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the 12  months  preceding
(or  for such shorter period that the registrant was required  to
file  such  reports),  and (2) has been subject  to  such  filing
requirements for the past 90 days.
Yes x          No

As of November 5, 1997,  there were 11,324,785 shares of common
stock outstanding.

                                
                    PSC Inc. AND SUBSIDIARIES
                                
                              INDEX

                                             PAGE NUMBER
PART I  FINANCIAL INFORMATION

     Item 1 -Financial Statements

          Consolidated Balance Sheets as of
          October 3, 1997 (Unaudited) and
          December 31, 1996                    3 - 4

          Consolidated Statements of Operations and
          Retained Earnings for the three
          and nine months ended:
          October 3, 1997 (Unaudited) and
          September 27, 1996 (Unaudited)       5 - 6

          Consolidated Statements of Cash Flows
          for the nine months ended:
          October 3, 1997 (Unaudited) and
          September 27, 1996 (Unaudited)           7

          Notes to Consolidated Financial
          Statements (Unaudited)              8 - 11

     Item 2 -Management's Discussion and
             Analysis of Financial Condition 
             and Results of Operations       12 - 14

PART II  OTHER INFORMATION

Item 1    -Legal Proceedings......................15

Item 2    -Changes in Securities..................15

Item 3    -Defaults upon Senior Securities........15

Item 4    -Submission of Matters to a Vote of 
           Security Holders.......................15

Item 5    -Other Information......................15

Item 6    -Exhibits and Reports on Form 8-K.......15




                 PART I - FINANCIAL INFORMATION

Item 1:   Financial Statements

                    PSC Inc. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                   (All amounts in thousands)
                                
                                 October 3, 1997   December 31, 1996
                                    (Unaudited)
ASSETS

CURRENT ASSETS
    Cash and cash equivalents           $  3,843     $ 10,838
    Accounts receivable, net of allowance
        for doubtful accounts of $1,476
        and $1,101, respectively          32,307       29,501
    Inventories                           18,670       18,306
    Prepaid expenses and other             1,906        1,244

   TOTAL CURRENT ASSETS                   56,726       59,889

PROPERTY, PLANT AND EQUIPMENT, net
    of accumulated depreciation of
    $11,580 and $8,225, respectively      36,243       35,612

DEFERRED TAX ASSETS                       23,696       24,773

INTANGIBLE AND OTHER ASSETS, net of 
  accumulated amortization of $11,377 
  and $6,238, respectively                58,997       63,087


TOTAL ASSETS                            $175,662     $183,361





SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.



                    PSC Inc. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                   (All amounts in thousands)
                           (Continued)

                                   October 3, 1997  December 31, 1996
                                     (Unaudited)

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
       Current portion of long-term debt     $ 11,904  $   9,459
       Accounts payable                        17,627     15,681
       Accrued expenses                         8,774     11,448
       Accrued payroll and related employee
         benefits                               4,548      7,509
       Accrued acquisition related restructuring 
         costs                                  1,778      4,009

     TOTAL CURRENT LIABILITIES                 44,631     48,106


LONG-TERM DEBT, less current maturities       102,765    117,994

OTHER LONG-TERM LIABILITIES                     2,499      1,960



SHAREHOLDERS' EQUITY
  Preferred shares, par value $.01;
   10,000 authorized, 110 and 0 shares issued
   and outstanding.  $11,000 aggregate 
   liquidation value                                1          -
  Common shares, par value $.01;
   40,000 authorized,11,273 and  11,161
   shares issued and outstanding                  112        112
  Additional paid-in capital                   65,766     54,891
  Retained earnings                           (38,679)   (39,432)
  Cumulative translation adjustment            (1,196)       (33)

  Less treasury stock, 39 shares
  repurchased, at cost                           (237)      (237)

     TOTAL SHAREHOLDERS' EQUITY                25,767     15,301

TOTAL LIABILITIES AND SHAREHOLDERS'
  EQUITY                                     $175,662   $183,361

SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.


                    PSC Inc. AND SUBSIDIARIES
   CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
        (All amounts in thousands, except per share data)
                           (Unaudited)

                                          Three Months Ended
                                        October 3, September 27,
                                           1997       1996
NET SALES                                 $53,191   $46,486

COST OF SALES                              31,024    26,203
     Gross profit                          22,167    20,283

OPERATING EXPENSES
     Engineering, research and development  3,108     3,655
     Selling, general and administrative   10,377    11,430
     Amortization of intangibles resulting
          from business acquisitions        1,674     1,447
     Acquisition related restructuring and
          other costs                           -    70,068
          Income/(loss) from operations     7,008   (66,317)

INTEREST AND OTHER INCOME /(EXPENSE):
     Interest expense                      (3,039)   (2,577)
     Interest income                           91       131
     Other income/(expense)                   (25)     (196)
                                           (2,973)   (2,642)
     Income/(loss) from continuing 
          operations before
          income tax provision/(benefit)    4,035   (68,959)

     Income tax provision/(benefit)         1,493   (25,515)
     Income/(loss) from continuing 
       operations                           2,542   (43,444)
     Discontinued operations:
     Loss from discontinued operations, 
       net of tax                               -      (114)
     Loss on disposal of discontinued 
       operations, net of tax                   -    (5,217)
     Total loss from discontinued operations    -    (5,331)
     Net income/(loss)                     $2,542  ($48,775)

NET INCOME/(LOSS) PER COMMON AND COMMON
        EQUIVALENT SHARE
     Primary:
       Continuing operations                $0.21    ($3.99)
       Discontinued operations                  -     (0.49)
       Net income/(loss)                    $0.21    ($4.48)

     Fully diluted:
       Continuing operations                $0.20    ($3.99)
       Discontinued operations                  -     (0.49)
       Net income/(loss)                    $0.20    ($4.48)


WEIGHTED AVERAGE NUMBER OF
    COMMON AND COMMON EQUIVALENT
    SHARES OUTSTANDING
     Primary                               11,838    10,895
     Fully diluted                         12,426    10,895

RETAINED EARNINGS/(ACCUMULATED DEFICIT):
     Retained earnings/(Accumulated deficit)
       beginning of period               ($41,221)   $8,194
     Net income/(loss)                      2,542   (48,775)
     Retained earnings/(Accumulated deficit),
       end of period                     ($38,679) ($40,581)

SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.


                    PSC Inc. AND SUBSIDIARIES
   CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
        (All amounts in thousands, except per share data)
                           (Unaudited)

                                          Nine Months Ended
                                        October 3, September 27,
                                            1997      1996
NET SALES                                 $154,728   $90,037

COST OF SALES                               91,947    52,034
     Gross profit                           62,781    38,003

OPERATING EXPENSES:
     Engineering, research and development   9,996     7,046
     Selling, general and administrative    33,917    24,456
     Severance and other costs               4,191         -
     Amortization of intangibles resulting
          from business acquisitions         5,022     1,893
     Acquisition related restructuring and
          other costs                            -    70,068
          Income/(loss) from operations      9,655   (65,460)

INTEREST AND OTHER INCOME /(EXPENSE):
     Interest expense                       (9,793)   (2,603)
     Interest income                           342       368
     Other income/(expense)                     83      (238)
                                            (9,368)   (2,473)
     Income/(loss) from continuing 
       operations before
       income tax provision/(benefit)          287   (67,933)

     Income tax provision/(benefit)            105   (25,135)
     Income/(loss) from continuing operations  182   (42,798)
     Discontinued operations:
     Gain/(loss) from discontinued operations,
       net of tax                              164      (114)
     Gain/(loss) on disposal of discontinued 
       operations, net of tax                  407    (5,217)
     Total gain/(loss) from discontinued 
       operations                              571    (5,331)
     Net income/(loss)                        $753  ($48,129)

NET INCOME/(LOSS) PER COMMON AND COMMON
        EQUIVALENT SHARE:
        Primary:
     Continuing operations                   $0.02    ($4.16)
     Discontinued operations                  0.05     (0.52)
     Net income/(loss)                       $0.07    ($4.68)

        Fully diluted:
     Continuing operations                   $0.01    ($4.16)
     Discontinued operations                  0.05     (0.52)
     Net income/(loss)                       $0.06    ($4.68)

WEIGHTED AVERAGE NUMBER OF
    COMMON AND COMMON EQUIVALENT
    SHARES OUTSTANDING
     Primary                                11,472    10,274
     Fully diluted                          12,148    10,274

RETAINED EARNINGS/(ACCUMULATED DEFICIT):
     Retained earnings/(Accumulated deficit)
       beginning of period                ($39,432)   $7,548
     Net income/(loss)                         753   (48,129)
     Retained earnings/(Accumulated 
       deficit), end of period            ($38,679) ($40,581)

SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.


                    PSC INC. and SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                   (All amounts in thousands)
                           (Unaudited)
                                             Nine Months Ended
                                          October 3, September 27,
                                            1997         1996
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net Income /(loss)                          $753    ($48,129)
   Adjustments to reconcile net income/(loss)
   to net cash provided by (used in) 
   operating activities:
     Depreciation and amortization         10,466       5,612
     Loss on disposition of assets            109       3,860
     Acquired research and development 
       write-off                                -      60,100
     (Gain)/loss on disposition of 
       discontinued operations               (407)      5,217
     Deferred tax assets                    1,077     (21,046)
     Decrease (increase) in assets:
      Accounts receivable                  (3,918)      2,065
      Inventories                            (366)     (2,318)
      Prepaid expenses and other             (218)     (5,281)
     Increase (decrease) in liabilities:
      Accounts payable                      2,094       2,314
      Accrued expenses                     (2,973)      4,085
      Accrued payroll and commissions      (2,983)        (86)
      Accrued acquisition related 
        restructuring costs                (3,090)      5,812

        Net cash provided by operating 
          activities                          544      12,205

CASH FLOWS FROM INVESTING ACTIVITIES:
 Capital expenditures, net                 (5,887)     (2,376)
 Additions to intangible and other assets     (63)     (2,005)
 Cash paid for acquisition of business          -      (7,134)
 Proceeds from sale of investments              -       4,167
        Net cash used in investing 
          activities                       (5,950)     (7,348)

CASH FLOWS FROM FINANCING ACTIVITIES:
 Additions to debt                          5,000           -
 Additions to long-term liabilities         1,938          67
 Principal repayments of long-term debt   (17,784)        (83)
 Payment of other long-term liabilities      (456)        (38)
 Issuance of preferred stock, net          10,212           -
 Exercise of stock options and sale of 
   common stock                               664       1,746
 Tax benefit from exercise or early 
   disposition of certain stock options         -          70
        Net cash (used in) provided by 
          financing activities               (426)      1,762

FOREIGN CURRENCY TRANSLATION               (1,163)       (188)

NET (DECREASE)/INCREASE IN CASH               
     AND CASH EQUIVALENTS                  (6,995)      6,431

CASH AND CASH EQUIVALENTS:
     Beginning of period                   10,838       5,538
     End of period                       $  3,843     $11,969

SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.


                    PSC Inc. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED October 3, 1997 and September 27, 1996
        (All amounts in thousands, except per share data)
                           (Unaudited)

(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   The  accompanying consolidated financial statements have  been
   prepared  by  the Company without audit.  In  the  opinion  of
   management,    these   financial   statements   include    all
   adjustments   necessary  to  present  fairly   the   Company's
   financial  position  as of October 3,  1997,  the  results  of
   operations  for  the three and nine months  ended  October  3,
   1997  and  September 27, 1996 and its cash flows for the  nine
   months  ended  October 3, 1997 and  September 27,  1996.   The
   results  of  operations for the three and  nine  months  ended
   October  3, 1997 are not necessarily indicative of the results
   to be expected for the full year.

   Certain  information  and  disclosures  normally  included  in
   financial  statements  prepared in accordance  with  generally
   accepted   accounting  principles  have  been   condensed   or
   omitted.   The  accompanying financial  statements  should  be
   read  in  conjunction with the financial statements and  notes
   thereto  included in the Company's December  31,  1996  annual
   report on Form 10-K.
   
   NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE

   The  Company  accounts for net income per  common  and  common
   equivalent   share  in  accordance  with  the  provisions   of
   Accounting Principles Board Opinion No. 15 (APB No.  15).   In
   March  1997,  Statement of Financial Accounting Standards  No.
   128  (SFAS  No. 128), "Earnings per Share" was  issued.   SFAS
   No.  128 replaces primary Earnings Per Share (EPS) with  basic
   EPS.   Basic  EPS  is  computed by dividing reported  earnings
   available  to  common stockholders by weighted average  shares
   outstanding.   No  dilution for common  share  equivalents  is
   included.   Fully  diluted EPS, now  called  diluted  EPS,  is
   still  required.  The Company is required to  adopt  SFAS  No.
   128  retroactively for periods ending after December 15, 1997.
   On  a  pro  forma  basis, basic EPS and diluted  EPS  were  as
   follows:

                                Three Months Ended  Nine Months Ended
                                  October 3, 1997     October 3, 1997
     Basic EPS:
        Continuing operations            $0.23           $0.02
        Discontinued operations              -            0.05
        Net income                       $0.23          $ 0.07
   
     Diluted EPS:
        Continuing operations            $0.21           $0.02
        Discontinued operations              -            0.05
        Net income                       $0.21           $0.07

  INVENTORIES

   Inventories  are  stated  at  the  lower  of  cost  (first-in,
   first-out  method)  or  market.   Elements  of  cost   include
   materials, labor and overhead and consist of the following:

                                 October 3, 1997   December 31, 1996
     Raw materials                    $10,338        $10,688
     Work-in-process                    4,101          3,547
     Finished goods                     4,231          4,071
                                      $18,670        $18,306


                    PSC Inc. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  FOR THE THREE MONTHS ENDED October 3, 1997 and  September 27, 1996
        (All amounts in thousands, except per share data)
                           (Unaudited)
                                
                                
 (2) LONG-TERM DEBT

   Long-term debt consists of the following:

                                 October 3, 1997      December 31, 1996
     Senior Term Loan A                $49,000           $55,000
     Senior Term Loan B                 24,250            25,000
     Senior revolving credit             6,530            12,500
     Subordinated term loan             29,472            29,428
     Subordinated promissory note        5,000             5,000
     Other                                 417               525
                                       114,669           127,453
     Less:  current maturities          11,904             9,459
                                      $102,765          $117,994
                                
(3)  SHAREHOLDERS' EQUITY

   In  September 1997, the Company completed a private  placement
   of  equity  with  Hydra  Investissements  S.A.,  a  Luxembourg
   corporation  (the Purchaser).  The Company issued  110  shares
   of  Series  A  Convertible Preferred  Shares.   The  Series  A
   Preferred Shares are convertible at anytime and at the  option
   of  the  holders of the Series A Preferred, into Common Shares
   of  the  Company.   The conversion price is $8.00  per  Common
   Share  or  one  share of Series A Preferred  for  12.5  Common
   Shares.   As  a result, the Purchaser beneficially owns  1,375
   Common  Shares  of  the  Company.  The  net  proceeds  to  the
   Company  from  the offering were $10.2 million.   The  Company
   used the proceeds for working capital purposes and to repay  a
   portion   of   its  senior  revolving  credit  facility.    In
   connection  with  the issuance of preferred stock,  a  warrant
   evidencing  the right to purchase an aggregate of  180  Common
   Shares  of  the  Company was issued to  the  Purchaser.   This
   warrant  has an exercise price of $8.00 per share and  may  be
   exercised between September 10, 1997 and September 10, 2001.
   
   During  the nine month period ended October 3, 1997, employees
   purchased  approximately 67 shares at $5.81  per  share  under
   the provisions of the Company's Employee Stock Purchase Plan.
   
   Changes  in  the  status of options under the Company's  stock
   option plans are summarized as follows:
   
                     January 1, 1997   Weighted   January 1, 1996    Weighted
                            to         Average          to            Average
                     October 3, 1997    Price      Dec. 31, 1996       Price
   Options outstanding
    at beginning of period     2,818    $8.33         2,138           $8.41
   Options granted             1,004     6.68           953            7.78
   Options exercised             (45)    6.08          (173)           6.27
   Options forfeited/canceled   (622)    9.03          (100)           8.06
   Options outstanding at
    end of period              3,155     7.70         2,818            8.33
   
   Number of options at end
    of period:
    Exercisable                1,607                  1,630
    Available for grant          399                    784

   
                                
                    PSC Inc. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED October 3, 1997 and September 27, 1996
        (All amounts in thousands, except per share data)
                           (Unaudited)


(4)  PRO FORMA RESULTS OF OPERATIONS

   The  following  unaudited  pro  forma  condensed  results   of
   operations  combine the operations of the Company  with  those
   of  PSC  Scanning,  Inc.  (formerly  Spectra-Physics  Scanning
   Systems,  Inc.), TxCOM S.A. and related businesses ("Spectra")
   as  adjusted  for  the acquisition on July  12,  1996  by  the
   Company  of certain of the assets and liabilities of  Spectra.
   The  pro forma results of operations are presented as  if  the
   acquisition was consummated on January 1, 1996.
   
   The pro forma information is presented after giving effect  to
   certain  adjustments for depreciation, amortization,  interest
   expense  and  related  income  tax  effects.   The  pro  forma
   results  do  not purport to be indicative of the results  that
   actually   would  have  been  achieved  during   the   periods
   indicated  and  are  not intended to be indicative  of  future
   results.
   
                   Pro Forma Three Months Ended  Pro Forma Nine Months Ended
                             September 27, 1996            September 27,1996
    Net sales                       $50,443                   $154,947
    Loss from operations            (66,119)                   (57,100)
    Loss from continuing operations (43,441)                   (41,425)
    Total loss from discontinued 
      operations                     (5,331)                    (5,331)
    Net loss                        (48,772)                   (46,756)

    Net loss per common and
    common equivalent share:
    Continuing operations            ($3.94)                    ($3.77)
    Discontinued operations           (0.48)                     (0.49)
    Net loss                         ($4.42)                    ($4.26)

    Weighted average shares 
      outstanding                    11,026                     10,974


(5)  DERIVATIVES

   The Company monitors its exposure to interest rate and foreign
currency exchange risk.  The Company has limited involvement with
derivative  financial  instruments and  does  not  use  them  for
trading purposes.  The Company uses derivative instruments solely
to reduce the financial impact of these risks.

  Interest Rate Risk:

  The Company has entered into interest rate swap agreements with
its  senior  lending banks in accordance with the  terms  of  the
senior  loans.   The  Company  uses  these  interest  rate   swap
agreements  to  reduce  its  exposure  to  variable  rates.   The
differentials  to be received or paid under these  interest  rate
swap agreements are recognized as a component of interest expense
in the consolidated income statement.

  Foreign Currency Exchange Rate Risk:

  The Company enters into forward foreign exchange contracts as a
hedge  against currency fluctuations              relating     to
net  foreign transactions and commitments denominated in  foreign
currencies.   The  foreign   exchange  contracts  generally  have
maturities  of approximately 30 days and require the  Company  to
exchange  foreign   currencies for U.S. dollars at  maturity,  at
rates  agreed  to at the inception of the contracts.   Gains  and
losses  on  forward  contracts are  offset  against  the  foreign
exchange  gains or losses on the underlying hedged  itemsand  are
recorded  as  a  component of Selling, General and Administrative
expenses in the consolidated income             statement.


Item 2:  Management's Discussion and Analysis of Financial
               Condition and Results of Operations

General

The   following  discussion  and  analysis  should  be  read   in
conjunction with the Consolidated Financial Statements and  Notes
to  Consolidated  Financial Statements of the Company's  December
31, 1996 annual report on Form 10-K.

Results of Operations:  Three Months ended October 3, 1997 and
September 27, 1996

Net  Sales.  Consolidated net sales during the three months ended
October  3, 1997 increased $6.7 million or 14% compared with  the
same  period  in 1996.  The increase is due to the  full  quarter
effect  of  Spectra product sales and increased sales volumes  of
the Company's QuickScan handheld scanner products.  International
net  sales increased 20% primarily due to the Spectra acquisition
and  represented  approximately 45% of net  sales  in  the  third
quarter  of 1997 versus 41% of net sales in the third quarter  of
1996.

Gross  Profit.  Consolidated gross profit during the three months
ended October 3, 1997 increased $1.9 million or 9% compared  with
the same period in 1996. The increased dollar amount is primarily
due  to the acquisition of Spectra and a change in the sales  mix
of  the  Company's handheld and fixed position scanner  products.
As  a  percentage of sales, gross profit decreased from 43.6%  to
41.7%  due  to  lower average selling prices in the handheld  and
fixed position product lines.

Engineering, Research and Development.  Engineering, Research and
Development  (ER&D) expenses decreased $0.5 million  or  15%,  as
compared  to the same period in 1996.  As a percentage of  sales,
ER&D  was  5.8% in the third quarter of 1997 versus 7.9%  of  net
sales  in the third quarter of 1996.  As a result of efficiencies
developed  due  to the integration of Spectra,  the  Company  has
reduced its ER&D expenses as a percentage of sales.

Selling,  General  and  Administrative.   Selling,  General   and
Administrative (SG&A) expenses decreased $1.1 million or  9%,  as
compared  to the same period in 1996.  As a percentage of  sales,
SG&A  was  19.5% in 1997 versus 24.6% in 1996.  As  a  result  of
efficiencies  developed due to the integration  of  Spectra,  the
Company has reduced its general and administrative expenses as  a
percentage  of sales.  In addition, the Company is now  operating
under  the  Symbol-Spectra license agreement  which  has  reduced
royalty expenses as a percentage of sales.

Acquisition  Related Restructuring and Other  Costs.  During  the
1994  fourth  quarter,  the Company recorded  a  one-time  pretax
restructuring charge of $3.0 million.  The charge related to  the
integration  of  the  Company's existing fixed  position  scanner
product  lines  with those of LazerData, which  was  acquired  in
December  1994.  The restructuring program in part, provided  for
employee  severance  and  benefit costs for  the  elimination  of
approximately 12 manufacturing and engineering support positions.
As   of   October  3,  1997,  all  positions  targeted   in   the
restructuring  program have been eliminated.  The amount  of  the
restructuring  accrual at October 3, 1997 was approximately  $0.2
million.   Restructuring actions will be substantially  completed
by  December  31,  1997.   There have been  no  reallocations  or
reestimates to date.

During  the  third quarter of 1996, the Company recorded  a  one-
time,   pretax  charge  of  $10.0  million  for   the   cost   of
restructuring its existing operations with those of Spectra which
was  acquired in July 1996.  The restructuring program  in  part,
provided  for  employee  severance  and  benefit  costs  for  the
elimination  of certain positions.  As of October  3,  1997,  all
positions  targeted  in  the  restructuring  program  have   been
eliminated.  The amount of the restructuring accrual  at  October
3,  1997  was approximately $1.7 million.  Restructuring  actions
will be substantially
completed by December 31, 1997.  There have been no reallocations
or reestimates to date.

Interest Expense.  Interest expense increased $0.5 million versus
the  comparable period in 1996.  The interest expense relates  to
the  debt incurred in connection with the acquisition of  Spectra
in July 1996.

Provision for Income Taxes.  The Company recorded a $1.5  million
tax  provision  in  1997 primarily due to an increase  in  pretax
income.   The Company's effective tax rate was 37% in  both  1997
and 1996.  The Company expects to record income tax expense at or
about the combined federal and state statutory tax rate in 1997.

Discontinued Operations.  During the third quarter of  1996,  the
Company adopted a plan to dispose of its TxCOM subsidiary.  TxCOM
was  acquired  as  part of the Spectra acquisition.   During  the
second  quarter of 1997, the Company completed the sale of  TxCOM
for  approximately  $1.0 million.  A gain of  approximately  $0.4
million, net of tax, was recorded.

Results of Operations:  Nine Months ended October 3, 1997 and
September 27, 1996

Net  Sales.  Consolidated net sales during the nine months  ended
October 3, 1997 increased $64.7 million or 72% compared with  the
same  period  in 1996.  The increase is due to the  inclusion  of
Spectra  product  sales  and  increased  sales  volumes  of   the
Company's QuickScan handheld scanner products.  International net
sales increased 132% primarily due to the Spectra acquisition and
represented approximately 45% of net sales in the nine months  of
1997 versus 32% of net sales in the first nine months of 1996.

Gross  Profit.  Consolidated gross profit during the nine  months
ended  October  3, 1997 increased $24.8 million or  65%  compared
with  the  same period in 1996.  The increased dollar  amount  is
primarily due to the acquisition of Spectra and a change  in  the
sales  mix  of the company's handheld and fixed position  scanner
products.  As a percentage of sales, gross profit decreased  from
42.2%  to  40.6%  due  to  lower average selling  prices  in  the
handheld and fixed position product lines.

Engineering, Research and Development.  Engineering, Research and
Development  (ER&D) expenses increased $3.0 million  or  42%,  as
compared to the same period in 1996.  The increased dollar amount
is primarily due to the inclusion of Spectra.  As a percentage of
sales, ER&D was 6.5% in 1997 versus 7.8% in 1996.  As a result of
efficiencies  developed due to the integration  of  Spectra,  the
Company has reduced its ER&D expenses as a percentage of sales.

Selling,  General  and  Administrative.   Selling,  General   and
Administrative (SG&A) expenses increased $9.5 million or 39%,  as
compared to the same period in 1996. The increased dollar  amount
is  primarily due to the inclusion of Spectra. As a percentage of
sales,  SG&A was 21.9% in 1997 versus 27.2% in 1996.  As a result
of  efficiencies developed due to the integration of Spectra, the
Company has reduced its general and administrative expenses as  a
percentage  of sales.  In addition, the Company is now  operating
under  the  Symbol-Spectra license agreement  which  has  reduced
royalty expenses as a percentage of sales.

Severance  and Other Costs.  During the second quarter  of  1997,
the Company recorded a one-time pretax charge of $4.2 million for
severance  and  other costs.  Of the total charge,  approximately
$2.3 million was associated with the Severance Agreement with the
former  CEO, $1.2 million was for employee severance and  benefit
costs for the elimination of approximately 30 positions including
several   senior   executives,   and   $0.7   million   for   the
centralization  of  research  and  development  efforts  and  the
relocation of manufacturing or certain product lines between  its
two manufacturing facilities.

Interest Expense.  Interest expense increased $7.2 million versus
the  comparable period in 1996.  The interest expense relates  to
the  debt incurred in connection with the acquisition of  Spectra
in July 1996.

Provision for Income Taxes.  The Company recorded a $0.1  million
tax  provision  in  1997 primarily due to an increase  in  pretax
income.   The Company's effective tax rate was 37% in  both  1997
and 1996.  The Company expects to record income tax expense at or
about the combined federal and state statutory tax rate in 1997.

Discontinued Operations.  During the third quarter of  1996,  the
Company adopted a plan to dispose of its TxCOM subsidiary.  TxCOM
was  acquired  as  part of the Spectra acquisition.   During  the
second  quarter of 1997, the Company completed the sale of  TxCOM
for  approximately  $1.0 million.  A gain of  approximately  $0.4
million, net of tax, was recorded.

Liquidity and Capital Resources:

Current assets decreased $3.2 million from December 31, 1996  due
to  a  decrease in cash offset in part by an increase to accounts
receivable.  Current liabilities decreased $3.5 million primarily
due  to  a  reduction in accrued expenses offset in  part  by  an
increase  in  accounts  payable.  As a  result,  working  capital
increased $0.3 million from December 31, 1996.

Property,  plant and equipment expenditures totaled $5.9  million
for  the  nine  months ended October 3, 1997 compared  with  $2.4
million  for the nine months ended September 27, 1996.  The  1997
expenditures primarily related to manufacturing equipment and new
product tooling.

The long-term debt to capital percentage was 80.0% at October  3,
1997  versus  88.5% at December 31, 1996.  At  October  3,  1997,
liquidity immediately available to the Company consisted of  cash
and  cash  equivalents of $3.8 million. In  connection  with  the
acquisition  of  Spectra during 1996, the  Company  obtained  new
credit facilities totaling $130.0 million.  The Company has $13.5
million  available on these facilities.  During the third quarter
of  1997, the preferred stock investment was utilized for working
capital  purposes and to reduce a portion of the senior revolving
credit  facility, thus, resulting in a decrease to the  long-term
debt  to capital percentage.  The Company believes that its  cash
resources  and  available credit facilities, in addition  to  its
operating cash flows, are sufficient to meet its requirements for
the next twelve months.



PART II:  OTHER INFORMATION

Item 1:   Legal Proceedings:

     The  descriptions  of the Company's legal  proceedings  with
     Symbol Technologies, Inc. ("Symbol"), set forth in Item 3 of
     the  Company's  Annual Report on Form 10-K  for  the  fiscal
     period  ended  December 31, 1996 (the "Litigation")  and  in
     Item  1  of the Company's Quarterly Report on Form 10-Q  for
     the  quarter  ended  April 4, 1997 (the "Arbitration"),  are
     incorporated herein by reference.  The Arbitration was  held
     during  the  week of July 21, 1997 and no decision  has  yet
     been rendered.

Item 2:   Changes in Securities:  None

Item 3:   Defaults upon Senior Securities:  None

Item 4:   Submission  of  Matters to a Vote of Security  Holders: None

Item 5:   Other Information:  None

Item 6:   Exhibits and Reports on Form 8-K
          (a)  Exhibits:  None
 
          (b)  Reports on Form 8-K:
          Report on Form 8-K, dated September 10, 1997



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.

                              PSC Inc.



DATE:  November 10, 1997   By: /s/Robert C.Strandberg
                           Robert C. Strandberg
                           President and Chief Executive Officer


DATE:  November 10, 1997   By: /s/ William J. Woodard
                           William J. Woodard
                           Vice President and Chief Financial Officer



DATE:  November 10, 1997   By: /s/ Michael J. Stachura
                           Michael J. Stachura
                           Vice President of Finance
                           (Principal Accounting Officer)