UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

                  For the quarterly period ended March 31, 2008

                                       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: 0-27210


                                  Zunicom, Inc.
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

                TEXAS                                     75-2408297
    (State or other jurisdiction of                    (I.R.S. Employer
     incorporation or organization)                   Identification No.)

  4315 West Lovers Lane, Dallas, Texas                       75209
(Address of principal executive offices)                  (Zip Code)

                                 (214) 352-8674
              (Registrant's telephone number, including area code)

                                      None
(Former name,former address and former fiscal year,if changed since last report)

           Securities registered pursuant to Section 12(b) of the Act:

                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, $0.01 Par Value
                          -----------------------------
                                (Title of Class)

                    Class A Preferred Stock, $1.00 Par Value
                    ----------------------------------------
                                (Title of Class)

         Units, consisting of one (1) share of Common Stock and one (1)
                        share of Class A Preferred Stock
               --------------------------------------------------
                                (Title of Class)

                                        1
<PAGE>
     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 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 [ ]

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a smaller reporting company.
See definitions of "large accelerated filer, "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer [
] Accelerated filer [ ] Non-accelerated filer [ ](Do not check if a smaller
reporting company) Smaller reporting company [X]

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act).                  Yes [ ] No [X]

     As of April 30, 2008, 9,957,196 shares of Common Stock were outstanding.


                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None


































                                        2


<PAGE>
                                  Zunicom, Inc.
                                      INDEX

                                                                      Page
                                                                      ----
PART I - Financial Information

Item 1.  Financial Statements

Unaudited Consolidated Balance Sheet at March 31, 2008
and audited Consolidated Balance Sheet at December 31, 2007. . . . .   4

Unaudited Consolidated Statements of Operations for the
three months ended March 31, 2008 and 2007 . . . . . . . . . . . . . . 6

Unaudited Consolidated Statements of Cash Flows for the
three months ended March 31, 2008 and 2007 . . . . . . . . . . . . . . 7

Notes to Unaudited Consolidated Financial Statements . . . . . . . . . 9

Item 2.  Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . . . . . . . . . .  16

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.  18

Item 4.  Controls and Procedures. . . . . . . . . . . . . . . . . .   19


PART II - Other Information

Item 1.  Legal Proceedings . . . . . . . . . . . . . . . . . . . . .  19

Item 6.  Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . .  19

Signature. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  21

Certifications




















                                        3
<PAGE>
PART  I  -  FINANCIAL  INFORMATION
----------------------------------
Item  1.  Financial  Statements

                          ZUNICOM, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS


                                                March 31, 2008 December 31,2007
                                                 (unaudited)      (audited)
                                                -------------- ----------------
CURRENT ASSETS
 Cash and cash equivalents                       $    644,615  $     165,276
 Restricted cash (1)                                  432,740        351,000
 Accounts receivable - trade, net of
   allowance for doubtful accounts
   of $6,300 and $6,300                                    66         11,278
 Interest receivable from unconsolidated
   investee                                            10,578         10,578
 Note receivable from unconsolidated
   investee - Current portion                       1,096,875        731,250
 Inventories - finished goods                          18,861         21,595
 Prepaid expenses and other current assets             33,838         56,854
                                                 ------------  -------------
    Total current assets                            2,237,573      1,347,831

PROPERTY AND EQUIPMENT
 Business center equipment                            611,744        666,142
 Machinery and equipment                              447,506        719,615
 Computer equipment                                   147,107        146,709
 Furniture and fixtures                                30,097         30,097
 Leasehold improvements                                12,377         12,377
                                                 ------------  -------------
    Total property and equipment                    1,248,831      1,574,940

 Less accumulated depreciation and amortization    (1,122,079)    (1,426,095)
                                                 ------------  -------------
    Net property and equipment                        126,752        148,845
                                                 ------------  -------------
NOTES RECEIVABLE FROM UNCONSOLIDATED INVESTEE       4,753,125      5,118,750

INVESTMENT IN UNCONSOLIDATED INVESTEE               7,643,014      7,420,119
                                                 ------------  -------------
TOTAL ASSETS                                       14,760,464  $  14,035,545
                                                 ============  =============

(1) See Note I Commitments - Note Subordination in the footnotes to our
consolidated financial statements.




            The accompanying footnotes are an integral part of these
                       consolidated financial statements.

                                        4
<PAGE>
                          ZUNICOM, INC. AND SUBSIDIARY
                UNAUDITED CONSOLIDATED BALANCE SHEETS - Continued

                      LIABILITIES AND STOCKHOLDERS' EQUITY


                                                March 31, 2008 December 31,2007
                                                 (unaudited)      (audited)
                                                -------------- ----------------
CURRENT LIABILITIES
 Accounts payable                                     250,526         239,159
 Accrued liabilities                                  119,455         141,827
 Dividends payable                                      6,044           5,579
                                                -------------   -------------
    Total current liabilities                         376,025         386,565
                                                -------------   -------------
NON-CURRENT DEFERRED TAX LIABILITY                  4,330,783       4,068,011
                                                -------------   -------------
TOTAL LIABILITIES                                   4,706,808       4,454,576
                                                -------------   -------------
STOCKHOLDERS' EQUITY

Preferred stock - $1.00 par value,
  1,000,000 shares authorized; 61,988 and
  61,988 Class A Preferred Shares issued
  and outstanding; liquidation preference
  of $325,437 as of March 31, 2008                     61,988          61,988
Common stock - $0.01 par value; 50,000,000
  shares authorized; 8,946,000 and
   8,891,394 shares issued and out-
   standing                                            99,571          99,571
Additional paid-in capital                          9,140,853       9,089,234
Retained earnings                                     751,244         330,176
                                                -------------   -------------
      Total stockholders' equity                   10,053,656       9,580,969
                                                -------------   -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY         14,760,464      14,035,545
                                                =============   =============















            The accompanying footnotes are an integral part of these
                       consolidated financial statements.


                                        5


<PAGE>
                          ZUNICOM, INC. AND SUBSIDIARY
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
               For the Three Months Ended March 31, 2008 and 2007

                                                         2008          2007
REVENUES                                           -------------- -------------
   Service revenue                                 $     271,919  $    385,852

COST OF REVENUES
   Direct servicing costs                                 82,971       110,566
                                                   -------------  ------------
GROSS PROFIT                                             188,948       275,286

OPERATING EXPENSES
   Selling, general and administrative                   442,787       443,920
   Depreciation and amortization of
     property and equipment                               27,956        33,168
                                                   -------------  ------------
     Total operating expenses                            470,743       477,088
                                                   -------------  ------------
(LOSS) FROM OPERATIONS                                  (281,795)     (201,802)

OTHER INCOME (EXPENSES)
   Interest income (expense) net, including
    $86,548 and $86,548 from related parties              90,979       157,620
   Equity in earnings of investee                        213,259       147,184
   Gain on equity transactions of investee                 9,635        18,515
   Gain on sale of assets - net                          663,446             -
   Other, net                                             (5,640)       (8,910)
                                                   -------------  ------------
     Total other income (expenses)                       971,679       314,409
                                                                  ------------
INCOME BEFORE PROVISION FOR INCOME TAXES                 689,884       112,607
                                                   -------------  ------------
PROVISION FOR INCOME TAXES                              (262,772)           -
                                                   -------------  ------------
NET INCOME                                         $     427,112  $    112,607
                                                   =============  ============
Net income attributable to common stockholders     $     421,068  $    104,096
                                                   =============  ============
Net income per share attributable to common
    stockholders
   Basic                                           $        0.04  $       0.01
                                                   =============  ============
   Diluted                                         $        0.04  $       0.01
                                                   =============  ============
Cash dividends per share                           $           -  $       0.80
                                                   =============  ============
Number of weighted average shares of common
    stock outstanding
   Basic                                               9,957,196     8,904,343
                                                   =============  ============
   Diluted                                            10,081,172     9,229,641
                                                   =============  ============

            The accompanying footnotes are an integral part of these
                       consolidated financial statements.
                                        6
<PAGE>

                          ZUNICOM, INC. AND SUBSIDIARY
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
               For The Three Months Ended March 31, 2008 and 2007

                                                         2008          2007
                                                   -------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                         $     427,112  $    112,607
Adjustments to reconcile net income to net
   cash used in operating activities:
 Depreciation and amortization of property
   and equipment                                          27,956        33,168
 Write off of property and equipment                                     3,605
 Gain on equity transactions of investee                  (9,635)      (18,515)
 Equity in earnings of investee                         (213,259)     (147,184)
 Non-cash stock-based compensation                        51,619        38,986
 Provision for income taxes                              262,772             -
 Sale of intangible asset                               (666,667)            -
 Change in operating assets and liabilities:
 Accounts receivable - trade                              11,212         8,342
 Accounts receivable - other                                   -        (2,925)
 Inventories                                               2,734         2,615
 Prepaid expenses and other current assets                23,019        33,562
 Other assets                                                  -
 Accounts payable                                         11,362       (35,840)
 Accrued liabilities                                     (22,372)     (194,698)
 Dividends payable                                           465             -
 Due to investee                                                      (186,619)
                                                   -------------  ------------
 Net cash used in operating
   activities                                            (93,682)     (352,896)
                                                   -------------  ------------
CASH FLOWS FROM INVESTING ACTIVITIES
 Purchase of property and equipment                       (5,862)      (12,751)
 Sale of intangible asset                                666,667             -
                                                   -------------  ------------
 Net cash provided by (used in) investing
   activities                                            660,805       (12,751)

CASH FLOWS FROM FINANCING ACTIVITIES
 Dividends paid on common stock                                -    (7,153,122)
 Dividends paid on preferred stock                        (6,044)
                                                   -------------  ------------
 Net cash used in financing
   activities                                             (6,044)   (7,153,122)
                                                   -------------  ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS     561,079    (7,158,769)
Cash and cash equivalents at beginning of period         516,276     8,259,709
                                                   -------------  ------------
Cash and cash equivalents at end of period             1,077,355       740,940
                                                   =============  ============


            The accompanying footnotes are an integral part of these
                       consolidated financial statements.

                                        7

<PAGE>
                          ZUNICOM, INC. AND SUBSIDIARY
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
               For The Three Months Ended March 31, 2007 and 2006
                                   (continued)
                                                         2008          2007
                                                   -------------- -------------
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid                                      $           -  $         99
                                                   =============  ============
Income taxes paid                                  $           -  $    230,000
                                                   =============  ============
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING
  AND FINANCING ACTIVITIES
   Dividends paid through issuance of common stock $           -  $      8,511
                                                   =============  ============
   Conversion of preferred stock to common stock   $           -  $     25,000
                                                   =============  ============





































            The accompanying footnotes are an integral part of these
                       consolidated financial statements.

                                        8
<PAGE>
                          ZUNICOM, INC. AND SUBSIDIARY
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - BASIS OF PRESENTATION

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial  information and in accordance with the  instructions to Form 10-Q and
Article  10 of  Regulation  S-X.  Accordingly,  they do not  include  all of the
information and footnotes required by generally accepted  accounting  principles
for complete financial statements.

In the opinion of management,  all adjustments  (consisting of normal  recurring
adjustments) considered necessary for a fair presentation have been included for
the three month  period  ended March 31,  2008.  The results for the three month
period ended March 31, 2008 are not  necessarily  indicative of the results that
may be expected for the year ended December 31, 2008. The unaudited consolidated
financial  statements included in this filing should be read in conjunction with
the  Company's  audited  consolidated  financial  statements  and notes  thereto
included in the Company's annual report on form 10-K for the year ended December
31, 2007.

In December 2006 the Company's  previously  wholly-owned  subsidiary,  Universal
Power Group,  Inc. ("UPG" or  "Universal"),  completed an  underwritten  initial
public offering which resulted in the Company's  ownership interest in UPG being
reduced from 100 percent to its present  ownership  interest of 40 percent.  The
Company consolidated UPG in its financial statements until December 31, 2006 and
currently accounts for UPG as an unconsolidated investee under the equity method
of accounting.  The Company has adopted the income  statement  gain  recognition
method of accounting  for issuances of a subsidiary's  stock in accordance  with
SEC Staff Accounting Bulletin No. 51.

Recent Accounting Pronouncements

The Company  adopted the  provisions  of Financial  Standards  Accounting  Board
Interpretation  No.  48,  "Accounting  for  Uncertainty  in  Income  Taxes  - an
Interpretation  of FASB Statement No. 109 ("FIN 48"), on January 1, 2007.  There
were no unrecognized tax benefits and,  accordingly,  there was no effect on the
Company's   financial  condition  or  results  of  operations  as  a  result  of
implementing FIN 48.

The  Company  files  income tax  returns in the U.S.  federal  jurisdiction  and
various  state and foreign  jurisdictions.  The Company is no longer  subject to
U.S.  federal tax examinations for years before 2003, and state tax examinations
for years before 2002.  Management  does not believe  there will be any material
changes in our unrecognized tax positions over the next 12 months.

The  Company's  policy is to  recognize  interest and  penalties  accrued on any
unrecognized  tax benefits as a component of income tax expense.  As of the date
of adoption of FIN 48,  there was no accrued  interest or  penalties  associated
with any  unrecognized  tax benefits,  nor was any interest  expense  recognized
during the three month period ended March 31, 2008.

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157").  SFAS 157 defines fair value,  establishes a framework for measuring fair


                                       9
<PAGE>
value in accordance with accounting  principles generally accepted in the United
States, and expands disclosures about fair value  measurements.  SFAS No. 157 is
effective  for  financial  statements  issued for fiscal years  beginning  after
November 15, 2007, with earlier application  encouraged.  Any amounts recognized
upon adoption as a cumulative  effect adjustment will be recorded to the opening
balance of retained  earnings in the year of  adoption.  The Company has not yet
determined  the  impact  of this  statement  on its  results  of  operations  or
financial condition.

In February 2007, the FASB issued  Statement of Financial  Accounting  Standards
No. 159, "The Fair Value Option for Financial  Assets and Financial  Liabilities
-- Including an amendment of FASB Statement No. 115," (SFAS 159).  This standard
allows a company to  irrevocably  elect fair value as the initial and subsequent
measurement  attribute for certain financial assets and financial liabilities on
a contract-by-contract basis, with changes in fair value recognized in earnings.
The provisions of this standard are effective as of the beginning of a reporting
entity's  first fiscal year  beginning  after  November 15, 2007. The Company is
currently  evaluating  what  effect the  adoption of SFAS 159 will have on their
financial statements.

In December 2007, the FASB issues SFAS 141(R),  Business Combinations.  SFAS 141
(R) provides  companies  with  principles  and  requirements  on how an acquirer
recognizes  and measures in its financial  statements  the  identifiable  assets
acquired,  liabilities assumed, and any noncontrolling  interest in the acquiree
as well as the recognition  and  measurement of goodwill  acquired in a business
combination.  SFAS 141(R) also requires  certain  disclosures to enable users of
the financial  statements  to evaluate the nature and  financial  effects of the
business combination. Acquisition costs associated with the business combination
will  generally be expensed as incurred.  SFAS 141(R) is effective  for business
combinations  occurring in fiscal years beginning after December 15, 2008, which
will require the Company to adopt these  provisions  for  business  combinations
occurring in fiscal 2010 and  thereafter.  Early  adoption of SFAS 141(R) is not
permitted.

In  December  2007,  the FASB  issued  SFAS  160,  Noncontrolling  Interests  in
Consolidated  financial  Statements - an amendment of ARB No. 51. This Statement
clarifies  that  a  noncontrolling  interest  in a  subsidiary  is an  ownership
interest  in the  consolidated  entity  that should be reported as equity in the
consolidated   financial   statements.   This  Statement  changes  the  way  the
consolidated  income  statement  is  presented  by  requiring  net  income to be
reported at amounts that include the amounts attributable to both the parent and
the  noncontrolling  interest and to disclose  those  amounts on the face of the
income  statement.  SFAS 160 is  effective  for  fiscal  years  beginning  after
December 15, 2008.  Early adoption of SFAS 160 is not permitted.  The Company is
currently  evaluating  the  impact  that  SFAS  160 will  have on its  financial
statements and disclosures.

In March  2008,  the FASB issued SFAS No.  161,  "Disclosures  about  Derivative
Instruments  and Hedging  Activities - an amendment to FASB  Statement No. 133".
SFAS  No.  161  is  intended  to  improve  financial  standards  for  derivative
instruments and hedging activities by requiring  enhanced  disclosures to enable
investors to better understand their effects on an entity's financial  position,
financial performance, and cash flows. Entities are required to provide enhanced
disclosures  about: (a) how and why an entity uses derivative  instruments;  (b)
how  derivative  instruments  and related  hedged items are  accounted for under


                                       10
<PAGE>
Statement  133  and  its  related   interpretations;   and  (c)  how  derivative
instruments  and related  hedged  items affect an entity's  financial  position,
financial performance,  and cash flows. It is effective for financial statements
issued for fiscal years  beginning after November 15,  2008, with early adoption
encouraged.  The Company is currently  evaluating  the impact of SFAS No. 161 on
its financial statements,  and the adoption of this statement is not expected to
have a material effect on the Company's financial statements.

NOTE B - ORGANIZATION

Zunicom,  Inc., ("Zunicom" or the "Company") was formed on January 10, 1992 as a
Texas corporation.  Zunicom's  consolidated  wholly-owned  subsidiary,  AlphaNet
Hospitality  Systems  Inc.  ("AlphaNet"),  is a provider of guest  communication
services  to the  hospitality  market.  Zunicom  holds  a 40  percent  ownership
interest in UPG, a  distributor  and supplier to a diverse and growing  range of
industries  of portable  power and  related  synergistic  products,  provider of
third-party logistics services and a custom battery pack assembler.

NOTE C - STOCK-BASED COMPENSATION

Stock-based  compensation  expense recognized in the statement of operations for
the three months ended March 31, 2008 includes  compensation  expense of $38,800
for fully  vested  stock  options  granted on March 10,  2008.  The  stock-based
compensation  for the three month  period  ending  March 31,  2007 was  $16,975,
representing stock options issued and fully vested in the first quarter of 2007.

As of March 31,  2008,  $162,842 of the  restricted  stock grant to our chairman
remains  unamortized and $342,010 of the restricted stock grant to UPG employees
remains unamortized.

   Valuation Assumptions

The fair  values of option  awards  were  estimated  at the grant  date  using a
Black-Scholes option pricing model with the following  assumptions for the three
months ended March 31, 2008 and 2007:


                                            For the Three Months Ended March 31,
                                                 2008                 2007
                                            --------------       -------------
Weighted average grant date fair value      $      0.388         $      1.56
Weighted average assumptions used:
   Expected dividend yield                          0.00%               0.00%
   Risk-free interest rate                          4.50%               4.60%
   Expected volatility                               131%                138%
   Expected life (in years)                            5                   5

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded  options  that have no vesting  restrictions  and are fully
transferable.  In addition,  option valuation models require the input of highly
subjective  assumptions  including the expected stock price volatility.  Because
the  Company's  employee  stock  options  have   characteristics   significantly
different from those of traded  options,  and because  changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its employee stock options.

                                       11
<PAGE>
Expected  volatility  is based on historical  volatility  and in part on implied
volatility.  The expected term considers the  contractual  term of the option as
well as historical exercise and forfeiture behavior. The risk-free interest rate
is based on the rates in effect on the grant date for U.S. Treasury  instruments
with maturities matching the relevant expected term of the award.

   Activity and Summary

Stock option activity under the 1999 and 2000 stock option plans was as follows:

                                                             Weighted Average
                                           Number of Shares   Exercise Price
                                           ----------------  -----------------
Options outstanding at December 31, 2007           425,000   $           0.95

      Granted                                      100,000   $           0.45

      Exercised                                         --   $             --

      Canceled, lapsed  or forfeited                    --   $             --
                                           ---------------
Options outstanding at March 31, 2007              525,000   $           0.85
                                           ===============

The following table summarizes stock options outstanding under the 1999 and 2000
stock option plans at March 31, 2008:

                        Options Outstanding      Options Exercisable
                -------------------------------- --------------------
                             Weighted
                              Average
                             Remaining  Weighted             Weighted
                 Number of  Contractual  Average  Number of   Average
Range of          Options      Life     Exercise   Options   Exercise
Exercise Prices Outstanding (in years)   Price   Exercisable  Price
--------------- ----------- ----------- -------- ----------- --------
$ 0.90              400,000         2.4 $   0.90     400,000 $   0.90

$ 1.75               25,000         9.8 $   1.75      25,000 $   1.75

$ 0.45              100,000         5.0 $   0.45     100,000 $   0.45
                ----------- ----------- -------- ----------- --------
$ 0.45 - $ 1.75     525,000         3.2 $   0.85     425,000 $   0.85
                =========== =========== ======== =========== ========

At March 31, 2008, the aggregate intrinsic value of options outstanding was $0.0
and the aggregate intrinsic value of options exercisable was $0.0. The aggregate
intrinsic  value is calculated as the  difference  between the exercise price of
the  underlying  awards and the quoted price of the  Company's  common stock for
those awards that have an exercise price  currently  below the quoted price.  At
March 31, 2008, all outstanding options were fully vested.






                                       12
<PAGE>
RESTRICTED STOCK

On June 25, 2007, the Board of Directors of Zunicom  approved a grant of 996,940
restricted shares of Zunicom's common stock to our chairman and certain officers
and  employees of UPG.  Several of the  officers  and  employees of UPG had been
officers  and  employees  of  Zunicom  prior  to the  deconsolidation  of UPG in
December  2006.  The Company  attributed  a value of $205,801 to the  restricted
stock  granted to our chairman and $377,392 to the  restricted  stock granted to
the officers and employees of UPG. The grant was made in recognition of past and
future  performance  especially  with regard to the initial  public  offering of
UPG's common stock in which  Zunicom was able to sell  $1,000,000  shares of UPG
common stock  resulting in an $0.80 dividend to  shareholders  paid in the first
quarter of 2007.  The  restricted  stock vests in full on June 25, 2011,  and is
subject to certain  restrictions and obligations up to the point of vesting. The
stock will not be  registered  and will be held in escrow for the benefit of the
grantee until the vesting  date.  Our chairman  relinquished  options on 400,000
shares of Zunicom  common stock.  These  options  remain  outstanding,  however,
should our Chairman choose to exercise these options, he will forfeit all rights
to the  restricted  stock.  The  officers  and  employees of UPG held options on
653,000 shares of Zunicom common stock which lapsed after the deconsolidation of
UPG.

In accordance with FASB 123R, we accounted for the grant of restricted shares to
our  chairman  as  stock  based  compensation.  We  accounted  for the  grant of
restricted  shares to UPG officers and employees as a contribution of capital in
accordance  with  EITF  00-12,   "Accounting  by  an  Investor  for  Stock-Based
Compensation  Granted  to  Employees  of an  Equity  Method  Investor."  We will
amortize  60% of that  capital  contribution  as  additional  equity in earnings
(loss) of the investee over the vesting period. The Company concluded that it is
reasonable to discount the value of these  restricted  shares by 29.52%.  Of the
29.52%  discount,  the Company  considers  the risk of  forfeiture to be 10% and
illiquidity  to be 19.52%.  The Company  applied this discount to the grant date
market  value  of a  freely  tradable  share to  arrive  at the fair  value of a
restricted share.


NOTE D - NET INCOME PER SHARE

Basic net income per share is computed by dividing  net income  decreased by the
preferred stock dividends of $6,044 and $8,511 for the three months ending March
31, 2008 and 2007, respectively, by the weighted average number of common shares
outstanding for the period.

Diluted net income per share is computed by dividing net income decreased by the
preferred  stock  dividends by the weighted  average number of common shares and
common stock equivalents  outstanding for the period. The Company's common stock
equivalents include all common stock issuable upon conversion of preferred stock
and the exercise of outstanding stock options and warrants.

The dilutive  effect of 525,000 options has not been included in the computation
of dilutive net income per share for the three months ended March 31, 2008.  The
options are "out of the money,"  i.e. the market price of the stock is below the
strike price of the options.  The  dilutive  effect of 400,000  options has been
included  in the  computation  of  dilutive  net  income per share for the three



                                       13

<PAGE>
months ended March 31, 2007.  25,000  options and the "as-if"  conversion of the
preferred  stock into 123,976 shares of common stock have been excluded from the
diluted loss per share  computation for the three months ended March 31, 2007 as
they are anti-dilutive.

NOTE E - UNCONSOLIDATED SUBSIDIARY - INVESTEE

The  Company's  investment  in UPG is accounted  for under the equity  method of
accounting  for the three month period ended March 31, 2008 and 2007.  Following
is a summary of  financial  information  of UPG for the three months ended March
31, 2008 and 2007:

                                                   Three Months Ended March 31,
                                                   ----------------------------
                                                         ($ in thousands)
                                                        2008           2007
                                                   -------------  -------------
Net revenues                                       $     29,524   $     23,540
Cost of revenues                                         25,050         20,099
Gross profit                                              4,474          3,441
Operating expenses                                        3,300          2,637
Income from operations                                    1,174            804
Interest expense                                           (254)          (367)
Other income                                                  -            173
Income from operations before income tax provision          920            610
Income tax provision                                       (363)          (242)
                                                   ------------   ------------
Net income                                         $        557   $        368
                                                   ============   ============

Following is a summary of the balance  sheets for UPG for the three months ended
March 31, 2008 and 2007.

                                                   Three Months Ended March 31,
                                                   ----------------------------
                                                         ($ in thousands)
                                                        2008           2007
                                                   -------------  -------------
Current assets                                            48,043         47,643
Noncurrent assets                                          1,696          1,767
Current liabilities                                       26,570         26,430
Noncurrent liabilities                                     4,933          5,325
Shareholders' equity                                      18,236         17,656

At March 31, 2008 the  carrying  value of the  Company's  investment  in UPG was
$7,643,014.  The market value of the 2,000,000  shares of UPG's common stock the
Company owns was  approximately  $6,460,000 based on the closing price per share
at March 31, 2008 of $3.23.

NOTE F - RELATED PARTY NOTE

The Company holds two unsecured  promissory notes from UPG, one in the amount of
$3,000,000  and a  second  note in the  amount  of  $2,850,000  for a  total  of
$5,850,000.  Both notes are dated  December  20,  2006 and carry the same terms.
These terms provide for quarterly  interest  payments at an annual interest rate


                                       14
<PAGE>
of 6% and principal payments in 16 equal quarterly installments of $365,625 each
beginning September 20, 2008. As of March 31, 2008,  $1,096,875 of the principal
payment is classified as current, leaving $4,753,125 classified as long term.


NOTE G - SHAREHOLDERS' EQUITY

During the three months ended March 31, 2008,  the Company paid a cash  dividend
of $6,044 to the holders of its class A Preferred Stock.

During the three months ended March 31, 2007,  the Company paid a cash  dividend
of $0.80 per share, totaling $7,153,122 to shareholders of its common stock. The
dividend was paid on March 23, 2007  primarily  from proceeds  received from the
sale of  1,000,000  shares of common stock of UPG that the Company sold in UPG's
IPO. During the same period, the Company paid dividends of $8,511 to the holders
of its class A  Preferred  Stock  through the  issuance  of 4,606  shares of the
Company's common stock. Also during this period,  certain preferred stockholders
converted  25,000  shares of the Company's  class A Preferred  Stock into 50,000
shares of the Company's common stock.

NOTE H - LEGAL PROCEEDINGS

The  Company  is  subject  to legal  proceedings  and  claims  that arise in the
ordinary  course of  business.  Management  does not believe that the outcome of
these matters will have a material adverse effect on the Company's  consolidated
financial position,  operating results, or cash flows. However,  there can be no
assurance that such legal  proceedings  will not have a material  impact.  As of
March 31, 2008, the Company is not subject to any ongoing legal proceedings.

NOTE I - COMMITTMENTS

NOTE SUBORDINATION

In 2006,  UPG (then a wholly owned  subsidiary  of the  Company)  obtained a $16
million line of credit from Compass Bank  (guaranteed  by the Company ) that was
to expire on May 5, 2007,  but was extended for 45 days.  On July 31, 2007,  the
bank terminated the Company's guaranty of UPG bank indebtedness.

On July  27,  2007,  (UPG  now  only  40%  owned  by the  Company)  a  purported
subordination  agreement  with the bank was signed that provides for the Company
(i) to subordinate its $5,850,000 UPG notes to any Compass Bank loan and (ii) to
hold in trust for the benefit of the bank the  principal  and interest  payments
received by the Company from UPG on the UPG notes  payable to the  Company.  The
Company is seeking rescission of this subordination agreement by the bank. Until
the issue is  resolved,  the Company will account for all payments by UPG on the
notes as  "restricted  cash."  The  Company is  advised  that UPG  secured a $30
million line of credit  agreement with Compass Bank and has an outstanding  loan
under the line.

LEASES

During  the  second  quarter of 2007,  AlphaNet  moved into new office  space in
Toronto,  reducing its occupancy  cost. The lease commenced on March 1, 2007 and
will end on April  30,  2009.  AlphaNet  leases  certain  equipment  located  at
customer sites as part of its Office(TM)  product.  The following table presents
the Company's commitments on those leases as of March 31, 2008.

                                       15
<PAGE>
    Lease        2008       2009      2010      Total
    -----        ----       ----      ----      -----
Office Space $  62,406  $  27,736  $      -  $   90,142
Equipment       27,947     11,562     3,736      43,245
             ---------  ---------  --------  ----------
Total        $  90,353  $  39,298 $   3,736  $  133,387

NOTE J - SALE OF INTANGIBLE ASSET

Pursuant to a purchase  agreement  dated January 28, 2008, the Company sold to a
third party two patents which it does not require to conduct its  business.  The
Company received net proceeds of $666,667 after commissions.  Those proceeds are
included as gain on sale of assets - net in the Company's Unaudited Consolidated
Statement of Operations for the three months ended March 31, 2008.


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

The  following  discussion  and  analysis  should  be read in  conjunction  with
Zunicom's Unaudited  Consolidated Interim Financial Statements and notes thereto
included  elsewhere  in this Form 10-Q.  Except for the  historical  information
contained  herein,  the  discussion in this Form 10-Q contains  certain  forward
looking statements that involve risks and  uncertainties,  such as statements of
Zunicom's  plans,  objectives,   expectations  and  intentions.  The  cautionary
statements  made in this Form 10-Q  should  be read as being  applicable  to all
related forward-looking statements wherever they appear in this Form 10-Q. These
statements  include,  without  limitation,  statements  concerning the potential
operations and results of the Company described below.  Zunicom's actual results
could differ  materially from those discussed here.  Factors that could cause or
contribute  to such  differences  include,  without  limitation,  those  factors
discussed  herein and in Zunicom's Annual Report on Form 10-K for the year ended
December 31, 2007.

RESULTS OF OPERATIONS

Currently,  the  operations  of Zunicom are conducted  through its  wholly-owned
subsidiary, AlphaNet.

REVENUES

For the three month  period ended March 31,  2008,  Zunicom,  through its wholly
owned subsidiary  Alphanet,  had consolidated  revenues of $271,919  compared to
385,852  for the same period in 2007,  a decrease  of $113,933 or 29.5%.  Of the
$113,933  decrease in revenue,  $15,623 is due to the decline of the  InnFax(TM)
product driven by the competition of in-room  internet  service.  The InnFax(TM)
product was  discontinued as of December 31, 2007. The remaining  $98,310 of the
revenue  decrease  is  due  principally  to a  decline  in  the  number  of  new
installations of the Office(TM) product and decreased renewals.

COST OF REVENUES

For the three month period ended March 31, 2008, Zunicom's  consolidated cost of
revenues is $82,971 compared to $110,566 for the same period in 2007, a decrease
of $27,595 or 24.9%. Of the $27,595 difference, $14,715 is due to the


                                       16

<PAGE>
decline in the direct servicing costs of AlphaNet's InnFax(TM) product. The
remaining $12,880 difference is due to the decline in direct servicing costs for
the Office(TM) product principally in the areas of repairs and maintenance,
installation costs and licensing consistent with the decrease in new
installations.

OPERATING EXPENSES

For the three month period ended March 31, 2008, Zunicom's consolidated
operating expenses, consisting of selling, general and administrative expenses
and depreciation and amortization of property and equipment decreased to
$470,743 compared to $477,088 for the same period in 2007, a decrease of $6,345
or 1.3%. The decrease of $6,345 is due to a decrease in operating expenses of
AlphaNet of $25,749 and an increase in Zunicom's expenses of $19,404.

AlphaNet's selling, general and administrative expenses for the three month
period ending March 31, 2008 were $261,575 compared to $287,324 for the same
period in 2007, a decrease of $25,749 or 9.0%. The decrease is primarily
attributable to decreased occupancy costs due to the relocation of the Toronto
office, and decreased taxes and professional fees.

Zunicom's selling, general and administrative expenses for the three month
period ending March 31, 2008 were $209,168 compared to $189,764 for the same
period in 2007, an increase of $19,404 or 10.2%. The increase is attributable to
decreased legal and accounting fees which were higher in 2007 due to expenses
related to the deconsolidation of UPG offset by an increase in stock based
compensation.

For the three month period ending March 31, 2008, the Company recorded $27,956
in depreciation and amortization expense compared to $33,168 in 2007. The
decrease is principally due to declining equipment purchases in AlphaNet
consistent with the decline in the Office(TM) product.

OTHER INCOME / EXPENSE

Zunicom's consolidated interest income for the three month period ended March
31, 2008 was $90,979 compared to interest income of $157,620 for the same period
in 2007, a decrease of $66,641, or 42.3%. The decrease is due to the decrease in
interest bearing cash balances from the payment of the $0.80 cash dividend on
March 23, 2007. Interest income consists of interest on the UPG notes plus
interest on bank cash balances.

Equity in earnings of investee of $213,259 and gain on equity transactions of
investee of $9,635, respectively, represent Zunicom's share of UPG's net income
for the three month period ended March 31, 2008 and changes in equity of UPG,
both recorded in accordance with the equity method of accounting for an
unconsolidated investee.

Gain on sale of assets for the three months ended March 31, 2008, is $666,667 in
proceeds from the sale of two patents no longer required by the Company offset
by loss on disposal of AlphaNet equipment.





                                       17
<PAGE>
LIQUIDITY

Zunicom, on a consolidated basis, had cash and cash equivalents of $1,077,355 at
March 31, 2008. Of that total, $432,740 is restricted pursuant to a
subordination agreement with the bank that provides a line of credit to UPG. See
note I Commitments, above.

Net cash used in operations was $93,682 for the three month period ended March
31, 2008. The cash used in operating activities is primarily attributable to net
income of $427,112, depreciation and amortization of $27,956, stock based
compensation of $51,619, and increases in prepaid expenses and other current
assets of $36,965, offset by equity in earnings of UPG of $213,259, gain on
equity transactions of UPG of $9,635, a net decrease in payables and accrued
liabilities of $10,545 and a decrease from the sale of the intangible asset of
$666,667 which is not an operating activity.

Net cash provided by investing activities for the three-month period ended March
31, 2008, related to purchases of property and equipment and the sale of the
intangible asset, was $660,805.

Net cash used in financing activities for the three-month period ended March 31,
2008 was $6,044 representing payment of a cash dividend on the Company's
preferred stock.

In 2006, UPG (then a wholly owned subsidiary of the Company) obtained a $16
million line of credit from Compass Bank (guaranteed by the Company ) that was
to expire on May 5, 2007, but was extended for 45 days. On July 31, 2007, the
bank terminated the Company's guaranty of UPG bank indebtedness.

On July 27, 2007, (UPG now only 40% owned by the Company) a purported
subordination agreement with the bank was signed that provides for the Company
(i) to subordinate its $5,850,000 UPG notes to any Compass Bank loan and (ii) to
hold in trust for the benefit of the bank the principal and interest payments
received by the Company from UPG on the UPG notes payable to the Company. The
Company is seeking rescission of this subordination agreement by the bank. Until
the issue is resolved, the Company will account for all payments by UPG on the
notes as "restricted cash." The Company is advised that UPG secured a $30
million line of credit agreement with Compass Bank and has an outstanding loan
under the line.

Zunicom management believes that cash on hand and the proceeds of the sale of
patents on January 28, 2008 will be sufficient to meet its operational needs
over the next year.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Exchange

Our customers are primarily located in the U.S. and a few customers in Canada.
Our exchange rate risk between the US and Canadian dollar is minimal because we
conduct so little business in Canada. In addition, the aggregate impact of any
likely exchange rate fluctuations would be immaterial as most payments are made
in U.S. dollars. We have not used derivative instruments to hedge our foreign
exchange risks though we may choose to do so in the future.



                                       18
<PAGE>
Interest Rates

We currently  have no direct  borrowings and therefore are not exposed to market
rate risk for changes in interest rates. In addition, our notes receivable from
UPG are at fixed rates of interest.

ITEM 4. CONTROLS AND PROCEDURES

The Company's management, including the Company's principal executive officer
and principal financial officer, has evaluated the effectiveness of the
Company's disclosure controls and procedures (as defined in Rules 13(a) - 15(e)
and 15(d) - 15(e) under the Securities Exchange Act of 1934) as of the three
months ended March 31, 2008. Based upon that evaluation, the Company's principal
executive officer and principal financial officer have concluded that the
disclosure controls and procedures were effective as of March 31, 2008 to insure
that the information required to be disclosed by us in the reports filed or
submitted by us under the Securities Exchange Act of 1934, as amended, was
recorded, processed, summarized or reported within the time periods specified in
the rules and regulations of the SEC, and included controls and procedures
designed to ensure that information required to be disclosed by us in such
reports was accumulated and communicated to management, including our principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding required disclosures.

There were no changes in the Company's internal control over financial reporting
that occurred during the Company's last fiscal quarter that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.


PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None

Item 6. Exhibits.

a.     The following exhibits are filed as part of this report or incorporated
       herein as indicated.

          3.1 Articles of Incorporation, as amended (incorporated by reference
          to the Company's Registration Statement on Form SB-2, Commission File
          No. 33-98662, filed on October 30, 1995 and amended on January 5, 1996
          and January 23, 1996).

          3.2 Certificate of Designation (incorporated by reference to the
          Company's Registration Statement on Form SB-2, Commission File No.
          33-98662, filed on October 30, 1995 and amended on January 5, 1996 and
          January 23, 1996).

          3.2A Amended Certificate of Designation (incorporated by reference to
          the Company's Registration Statement on Form SB-2, Commission File
          No.33-98662, filed on October 30, 1995 and amended on January 5, 1996
          and January 23, 1996).


                                       19
<PAGE>
          3.3 Bylaws (incorporated by reference to the Company's Registration
          Statement on Form SB-2, Commission File No. 33-98662, filed on October
          30, 1995 and amended on January 5, 1996 and January 23, 1996).

          10.1 Amended and Restated Creditors Subordination Agreement
          (incorporated by reference to the Company's Form 10K for fiscal year
          ended December 31, 2007, Commission File No. 0-27210, filed on March
          31, 2008).

          31.1 Certification related to Quarterly Report Form 10-Q disclosures.

          31.2 Certification related to Quarterly Report Form 10-Q disclosures

          32.1 Certification pursuant to Rule 13a-14(b) of the Exchange Act and
          18 U.S.C. Section 1350, as enacted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2003.

          32.2 Certification pursuant to Rule 13a-14(b) of the Exchange Act and
          18 U.S.C. Section 1350, as enacted pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2003.





































                                       20
<PAGE>

                                    Signature
                                    ---------

     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.



                                       Zunicom, Inc.
                                       -----------------------------
                                       (Registrant)

Date:  May 14, 2008                    /s/ John C. Rudy
                                       --------------------------------
                                       John C. Rudy
                                       Chief Financial Officer
                                       (principal financial officer)






































                                       21