UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-QSB


[X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005.


[_]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
      ACT OF 1934.

          FOR THE TRANSITION PERIOD FROM ____________ TO _____________


                         Commission File Number 0-21931

                                 AMPLIDYNE, INC.
        (Exact name of small business issuer as specified in its charter)

                  DELAWARE                            22-3440510
                  --------                            ----------
       (State or other jurisdiction of             (I.R.S. Employer
        incorporation or organization)            Identification No.)

                               59 LaGrange Street
                            Raritan, New Jersey 08869
                    (Address of principal executive offices)

                                 (908) 253-6870
                           (Issuer's telephone number)


      Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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 ___


The number of shares outstanding of the Issuer's Common Stock, $.0001 Par Value,
as of May 18, 2005 was 10,376,500.
<PAGE>

                                 AMPLIDYNE, INC.
                                   FORM 10-QSB
                        THREE MONTHS ENDED MARCH 31, 2005

                                TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Item 1    Financial Statements (Unaudited):

          Balance Sheets...........................................1-2

          Statements of Operations...................................3

          Statement of Cash Flows....................................4

          Statement of Changes in Stockholder's Deficiency...........5

          Notes to Financial Statements...........................6-12

Item 2    Management's Discussion and Analysis of Financial
          Condition and Results of Operations....................13-15

Item 3.   Controls and Procedures...................................15


PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.........................................16

Item 2.   Change in Securities......................................16

Signatures..........................................................17

Certification.......................................................18

Exhibit 99.1........................................................19
<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                                 AMPLIDYNE, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>

 ASSETS
                                                                           March 31    December 31
                                                                             2005        2004
                                                                          ---------    ---------
<S>                                                                       <C>          <C>
CURRENT ASSETS
         Cash and cash equivalents                                        $  22,288    $ 122,234
         Accounts receivable, net of allowance for doubtful accounts of
           $264,000 and  $268,000 in 2005 and 2004, respectively             43,033       15,597
         Inventories                                                        337,101      309,633
         Prepaid expenses and other                                              --           --
                                                                          ---------    ---------

                  Total current assets                                      402,422      447,464
                                                                          ---------    ---------

PROPERTY AND EQUIPMENT - AT COST
         Machinery and equipment                                            565,629      565,629
         Furniture and fixtures                                              43,750       43,750
         Autos and trucks                                                    66,183       66,183
         Leasehold improvements                                               8,141        8,141
                                                                          ---------    ---------
                                                                            683,703      683,703
         Less accumulated depreciation and amortization                    (683,703)    (681,956)
                                                                          ---------    ---------
                                                                                 --        1,747
                                                                          ---------    ---------

SECURITY DEPOSITS AND OTHER NON-CURRENT ASSETS                                   --           --
                                                                          ---------    ---------

                                                                          $ 402,422    $ 449,211
                                                                          =========    =========
</TABLE>

Note: The balance sheet at December 31, 2004 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by accounting principles generally accepted in the Unites
States for complete financial statements.

    The accompanying notes are an integral part of these financial statements

                                       1
<PAGE>

                                 Amplidyne, Inc.
                                 BALANCE SHEETS

LIABILITIES AND STOCKHOLDERS' DEFICIENCY
<TABLE>
<CAPTION>
                                                                                     March 31       December 31,
                                                                                       2005            2004
                                                                                   ------------    ------------
<S>                                                                                      <C>             <C>
CURRENT LIABILITIES
         Secured note payable in connection with Phoenix investor
                  rescinded agreement - payment in default                               40,000          40,000
         Convertible notes payable pursuant to Lee financing
                  agreement, including temporary additional advance
                           by Lee of $98,000 at March 31, 2005 and
                                     $6,000 at December 31, 2004                        598,000         506,000
         Accounts payable (as restated) -- Note J                                       347,431         321,064
         Other convertible notes payable - payment default                               22,473          22,173
         Accrued expenses and other current liabilities (including
                  delinquent federal payroll taxes, penalties and interest
                           aggregating $115,705 at March 31, 2005 and
                                     $81,353 at December 31, 2004                       205,032         199,198
         Accrued settlement of litigation                                                95,000          95,000
         Advances from customers                                                         11,267          22,008
         Loans payable - officers                                                       370,448         368,706
                                                                                   ------------    ------------
                          Total current liabilities                                   1,689,651       1,574,149

OTHER COMMENTS - NOTE I


STOCKHOLDERS' (DEFICIENCY)
              Common stock - authorized, 25,000,000 shares of $.0001 par value;
                  shares 10,376,500 and 10,376,500 shares issued and outstanding
                  at March 31, 2005 and December 31,
                   2004, respectively (the Lee convertible notes payable are
                   convertible into Series C shares representing 80% of the
                   outstanding stock of the Company on a fully
                   diluted basis)                                                         1,038           1,038
         Additional paid-in capital                                                  22,503,014      22,503,014
         Accumulated deficit (as restated) -- Note J                                (23,791,281)    (23,628,990)
                                                                                   ------------    ------------
                                                                                     (1,287,229)     (1,124,938)
                                                                                   ------------    ------------

                                                                                   $    402,422    $    449,211
                                                                                   ============    ============
</TABLE>

Note: The balance sheet at December 31, 2004 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements.

    The accompanying notes are an integral part of these financial statements

                                       2
<PAGE>

                                 Amplidyne, Inc.
                            STATEMENTS OF OPERATIONS
                             Quarter Ended March 31

                                                         Quarter Ended
                                                            March 31
                                                      2005            2004
                                                  ------------    ------------

Net sales                                         $    142,593    $    315,367
Cost of goods sold                                     103,408         288,400
                                                  ------------    ------------

                  Gross profit                          39,185          26,967

Operating expenses
         Selling, general and administrative            99,252         213,004
         Research, engineering and development         101,873          79,526
                                                  ------------    ------------

                  Operating loss                      (161,940)       (265,563)

Nonoperating income (expenses)
         Interest income and other income                3,563              --
         Interest expense                                 (300)           (300)
         Federal tax penalties and interest             (3,000)             --
         Gain on sale of property and equipment             --           4,000
                                                  ------------    ------------

                  Loss before income taxes            (161,677)       (261,863)

Provision for income taxes                                 614           3,200
                                                  ------------    ------------

                  NET LOSS                        $   (162,291)   $   (265,063)
                                                  ============    ============

Net loss per share - basic and diluted            $      (0.02)   $      (0.03)
                                                  ============    ============

Weighted average number of shares outstanding       10,376,500      10,376,500
                                                  ============    ============

    The accompanying notes are an integral part of these financial statements


                                       3
<PAGE>

                                 Amplidyne, Inc.
                            STATEMENTS OF CASH FLOWS
                             Quarter Ended March 31
<TABLE>
<CAPTION>
                                                                                  Quarter Ended
                                                                                     March 31
                                                                                2005         2004
                                                                             ---------    ---------
<S>                                                                          <C>          <C>
Cash flows from operating activities:
Net Loss                                                                     $(162,291)   $(265,063)
                                                                             ---------    ---------
Adjustments to reconcile net loss to net cash used in operating activities
                  Depreciation and amortization                                  1,747       10,000
                  Gain of sale of property & equipment                              --       (4,000)
                  (Decrease) increase in allowance for doubtful accounts        (4,000)      28,260
                  Interest accrued on convertible promissory note                  300          300
                  Salary deferred, added to officer loans                        3,942       30,692
                  Changes in assets and liabilities
                           Accounts receivable                                 (23,436)     (76,882)
                           Inventories                                         (27,468)      29,306
                           Prepaid expenses and other assets                        --       12,307
                           Customer advances                                   (10,741)          --
                           Accounts payable and accrued expense                 32,201      155,108
                                                                             ---------    ---------
                                    Total adjustments                          (27,455)     185,091
                                                                             ---------    ---------
                   Net cash (used) for operating activities                   (189,746)     (79,972)
                                                                             ---------    ---------

Cash flows from investing activities:
         Proceeds on sale of property & equipment                                   --        4,000
         Purchase of property and equipment                                         --       (2,277)
                                                                             ---------    ---------
                  Net cash provided by investing activities                         --        1,723
                                                                             ---------    ---------

Cash flows from financing activities:
         Overdraft                                                                  --      (17,855)
         Officer loans                                                          (2,200)      17,000
         Advances pursuant to financing agreement (Note C. 2.)                  92,000       99,220
                                                                             ---------    ---------
                  Net cash provided by financing activities                     89,800       98,365
                                                                             ---------    ---------

                  NET INCREASE (DECREASE) IN CASH                              (99,946)      20,116

Cash at beginning of period                                                    122,234           --
                                                                             ---------    ---------

Cash at end of period                                                        $  22,288    $  20,116
                                                                             =========    =========

Supplemental disclosures of cash flow information:
         Cash paid for:    Interest                                          $      --    $      --
                           Income taxes                                      $     614    $   3,200
</TABLE>

    The accompanying notes are an integral part of these financial statements

                                       4
<PAGE>

                                 Amplidyne, Inc.
                      STATEMENT OF STOCKHOLDERS' DEFICIENCY
          Year Ended December 31, 2004 and Quarter Ended March 31, 2005

<TABLE>
<CAPTION>

                                                                          Preferred Stock                  Common Stock
                                                                      -------------------------     -------------------------
                                                                         Shares       Par Value        Shares       Par Value
                                                                      ----------      ---------      ----------     ---------
<S>                                                                   <C>            <C>            <C>            <C>
BALANCE AT DECEMBER 31, 2003 as originally reported                           --      $      --      10,376,500     $   1,038

Prior period adjustment -- write-off of accounts payable balances no
longer due, discovered in the first quarter of 2005 -- Note J
                                                                      ----------      ---------      ----------     ---------

Balance at December 31, 2003 as restated                                                             10,376,500         1,038

Net loss for the year ended December 31, 2004

Litigation settlement to be paid through the issuance of common stock
                                                                      ----------      ---------      ----------     ---------

BALANCE AT DECEMBER 31, 2004                                                  --             --      10,376,500         1,038

Net loss for the three months ended March 31, 2005
                                                                      ----------      ---------      ----------     ---------

BALANCE AT MARCH 31, 2005                                                     --       $     --      10,376,500     $   1,038
                                                                      ==========       ========      ==========     =========


                                                                       Additional
                                                                        Paid-In      Accumulated    Subscriptions
                                                                        Capital        Deficit       Receivable       Total
                                                                      ----------      ---------      ----------     ---------

BALANCE AT DECEMBER 31, 2003 as originally reported                  $22,494,854   $(22,930,175)     $       --     $(434,283)

Prior period adjustment -- write-off of accounts payable balances no
longer due, discovered in the first quarter of 2005 -- Note J                           135,846                       135,846
                                                                      ----------      ---------      ----------     ---------

Balance at December 31, 2003 as restated                              22,494,854    (22,794,329)                     (298,437)

Net loss for the year ended December 31, 2004                                          (834,661)                     (834,661)

Litigation settlement to be paid through the issuance of common stock     (8,160)                                      (8,160)
                                                                      ----------      ---------      ----------     ---------

BALANCE AT DECEMBER 31, 2004                                          22,503,014    (23,628,990)             --    (1,124,938)

Net loss for the three months ended March 31, 2005                                     (162,291)                     (162,291)
                                                                      ----------      ---------      ----------     ---------

BALANCE AT MARCH 31, 2005                                            $22,503,014   $(23,791,281)     $       --   $(1,287,229)
                                                                     ===========   ============      ==========   ===========
</TABLE>

    The accompanying notes are an integral part of these financial statements

                                       5
<PAGE>

                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

NOTE A  - ADJUSTMENTS

      In the opinion of management,  all adjustments,  consisting only of normal
recurring  adjustments  necessary  for  a  fair  statement  of  (a)  results  of
operations  for the three  month  periods  ended March 31, 2005 and 2004 (b) the
financial  position at March 31, 2005 (c) the  statements  of cash flows for the
three  month  period  ended  March 31,  2005 and 2004 , and (d) the  changes  in
stockholders'  deficiency  for the three month  period ended March 31, 2005 have
been made.  The results of operations  for the three months ended March 31, 2005
are not necessarily indicative of the results to be expected for the full year.

NOTE B  - UNAUDITED INTERIM FINANCIAL INFORMATION

      The  accompanying  unaudited  financial  statements  have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information.  Accordingly, they do not include all the information and footnotes
required by generally accepted accounting  principles for financial  statements.
For further  information,  refer to the audited  financial  statements and notes
thereto for the year ended  December  31, 2004  included in the  Company's  Form
10-KSB filed with the Securities and Exchange Commission on April 15, 2005.

      The Company's financial  statements have been presented on a going concern
basis,  which  contemplates  the  realization of assets and the  satisfaction of
liabilities  in the normal course of business.  The liquidity of the Company has
been adversely  affected in recent years by significant  losses from operations.
As further  discussed in Note F, the Company incurred losses of $162,291 for the
three months ended March 31,  2005,  has limited cash  reserves and has seen its
working capital  decline by $160,544 to a deficiency of  $(1,287,229)  since the
beginning of the fiscal year. Current liabilities exceed cash and receivables by
$1,624,330 indicating that the Company will have substantial difficulty meetings
its  financial  obligations  for the balance of this fiscal year.  These factors
raise  substantial  doubt as to the  Company's  ability to  continue  as a going
concern. Recently, operations have been funded by loans from the Chief Executive
Officer  and costs have been cut  through  substantial  reductions  in labor and
operations.

As further discussed in Note F, management is seeking  additional  financing and
intends to aggressively market its products, control operating costs and broaden
its product base through  enhancements  of products.  The Company  believes that
these  measures may provide  sufficient  liquidity for it to continue as a going
concern in its  present  form.  Accordingly,  the  financial  statements  do not
include any adjustments  relating to the  recoverability  and  classification of
recorded  asset amounts or the amount and  classification  of liabilities or any
other  adjustments  that  might be  necessary  should  the  Company be unable to
continue as a going concern in its present form.

                                       6
<PAGE>


                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

NOTE  C  -  STOCKHOLDERS' EQUITY

1.    Warrants and Options

      At March 31, 2005, the following 395,000 warrants, remained outstanding:

      (1)   20,000 exercisable at $1.00 through May 2010
      (2)   300,000  exercisable  at $2.00 through  December 31, 2005
      (3)   75,000 exercisable at $.96 through March 2007

      At March 31, 2005, the Company had employee  stock options  outstanding to
acquire 370,000 shares of common stock at exercise prices of $0.20 to $1.50.

2.    Stock Purchase and Financing Agreements

On January 28, 2004,  the Company  entered into a  Subscription  Agreement  (the
"Agreement")  with  Phoenix  Opportunity  Fund II, L.P.  ("Phoenix"),  a limited
partnership organized under the laws of the State of Delaware, pursuant to which
Phoenix  agreed to make an  aggregate  investment  of $100,000  in exchange  for
282,700 shares of a newly created class of Series C Convertible Preferred Stock,
representing  approximately  80% of the Company's  outstanding  stock on a fully
diluted  basis.  As the  Company  was  required  to  amend  its  certificate  of
incorporation  or  effect a  reverse  stock  split  in order to have  sufficient
authorized  shares to complete  the equity  financing,  Phoenix  made an initial
investment  of $20,000 in  exchange  for 54,325  shares of Series C  Convertible
Preferred  Stock,  and  loaned  approximately  $80,000 to the  Company  with the
remaining   portion   of  the   equity   investment   to  be   completed   after
recapitalization.  Phoenix also entered into a stock restriction  agreement with
Devendar S. Bains,  our former Chairman of the Board,  Chief Executive  Officer,
and  Treasurer,  pursuant  to which Mr.  Bains  issued an  irrevocable  proxy to
Phoenix until the recapitalization is completed, which, together with the shares
received in  connection  with the initial  investment,  would have given Phoenix
effective control over 53% of the Company's voting stock.

The  preferred  shares were never issued to Phoenix.  Due to a dispute among the
Parties  with  respect to the terms of the loan  transaction.  The  Company  and
Phoenix  agreed  to  rescind  their  agreement,  and the  Company  agreed to pay
Phoenix:  (i) $20,000 in cash for the funds  Phoenix  invested,  (ii) $80,000 in
cash for the funds which  Phoenix  lent to the  Company,  and (iii)  $40,000 for
expenses  incurred by Phoenix on behalf of the Company.  The $40,000 was paid by
delivery of a secured  promissory note due March 31, 2005, and bearing  interest
at the rate of eight percent per annum secured by  substantially  all the assets
of the Company.

The  Company  did not make the  required  $40,000  payment due on March 31, 2005
under the  Phoenix  rescission  agreement,  and the  Company  remains  currently
delinquent. As yet, no action has been taken by Phoenix concerning this default.

                                       7
<PAGE>

In a separate  transaction,  John Lee of Piscataway,  NJ ("Lee")  entered into a
Note Purchase Agreement with the Company by which Lee agreed to lend the Company
an initial $200,000 and up to an additional $200,000 in one or more installments
on or before  October  30,  2004.  The  Company  agreed to  deliver  to John Lee
convertible  promissory  notes  which  are  convertible  into  Series  C  shares
representing  approximately  80% of the Company's  outstanding  stock on a fully
diluted basis.  Such  conversion  will take place at such time as the Company is
able to do so. Messrs. Devendar Bains and Tarlochan Bains are required to devote
their full  business time and attention to the business of the Company for eight
(8)  years  from May 25,  2004.  In the  event  that  either  Devendar  Bains or
Tarlochan Bains must leave the employ of the Company for any reason, each agrees
that,  if requested  by the Board of  Directors of the Company,  he will use his
best efforts to find a qualified replacement for himself acceptable to the Board
of  Directors,  and that he will not engage in a business  competitive  with the
Company for a period of eight (8) years. On May 25, 2004, Lee loaned the Company
$250,000,  and  was  issued  two  convertible  promissory  notes  which  will be
convertible in the aggregate into Series C shares representing approximately 32%
of the  Company's  outstanding  stock  on a fully  diluted  basis,  if and  when
converted.  If not  converted,  the notes are payable on demand,  provided  that
demand cannot be made before December 31, 2004, unless the Company is in default
of the Note Purchase Agreement. Of the $250,000 loaned to the Company,  $100,000
was used to pay  Phoenix in  connection  with the  rescission  described  above,
$45,000 was used to make a final payment in  resolution of litigation  with High
Gain Antenna Co. Ltd. of Korea,  and to pay  associated  bank fees,  $12,000 was
used to pay legal fees and  $43,000 was used for working  capital  purposes.  In
August 2004, an  additional  $50,000 was received from each of Hye Joung Lee and
Joong Bin Lee (an aggregate of $100,000) in connection  with the same agreement.
These parties are business associates of John Lee, but otherwise  unrelated.  In
October 2004, an additional $156,000 was received from John Lee, of which $6,000
represented a temporary  additional  advance outside of the Series C Convertible
financing.

At various  times during  February  and March 2005,  an aggregate of $92,000 was
received from John Lee in connection with the Series C Convertible financing.

No conversions to the Series C shares, pursuant to the Lee financing,  have been
made as of  March  31,  2005  and to the  date of the  issuance  of the  current
quarter's financial statements. In addition, no demand for payment has been made
by Lee as of  March  31,  2005 and to the date of the  issuance  of the  current
quarter's financial statements.

NOTE  D  -  LOSS  PER  SHARE

      The Company  complies with the  requirements  of the Financial  Accounting
Standards  Board issued  Statement of Financial  Accounting  Standards  No. 128,
"Earnings per Share" ("SFAS No. 128").  SFAS No. 128 specifies the  compilation,
presentation  and  disclosure  requirements  for earnings per share for entities
with publicly held common stock or potential  common stock.  Net loss per common
share - basic and diluted is determined by dividing the net loss by the weighted
average number of common stock outstanding.

      Net loss per common  share - diluted  does not  include  potential  common
shares  derived from stock  options and  warrants  (see Note C) because they are
antidilutive.

                                       8
<PAGE>

                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

NOTE  E  -  LITIGATION

      From time to time,  the Company is party to what it  believes  are routine
litigation and proceedings that may be considered as part of the ordinary course
of its  business.  Except for the  proceedings  noted below,  the Company is not
aware of any pending litigation or proceedings that could have a material effect
on the Company's results of operations or financial condition.

1. A customer filed a complaint in the Circuit Court of the Eighteenth  Judicial
District  of the  State of  Florida  on  January  23,  1997  alleging  breach of
contract.  During  2000,  the Company  settled  with that  customer at a cost of
$175,000;  $25,000  is to be paid  quarterly  over two years.  $95,000  remained
unpaid at March 31, 2005.

2. In April 2004, a law firm filed a judgement against the Company in the amount
of  approximately  $40,000 in connection with  non-payment of legal fees owed to
it.  Inasmuch  as  this  is a  perfection  of  an  already  recorded  liability,
management  does not believe that the judgement  will have a material  impact on
the financial position of the Company.

3.  The  Company  (as well as an  officer  and  director  of the  Company)  is a
defendant in a complaint  brought in November  2003 in the Circuit  Court of the
State of Florida (17th Judicial  District,  Broward  County)  alleging fraud and
seeking relief for unspecified damages and costs associated with an aborted plan
of merger. Management has been in settlement discussions with the plaintiff, but
to date has not reached an accord.  On June 29, 2004, the Company filed a Motion
to Dismiss the lawsuit against the Company.

NOTE F - LIQUIDITY

      The Company's financial  statements have been presented on a going concern
basis,  which  contemplates  the  realization of assets and the  satisfaction of
liabilities  in the normal course of business.  The liquidity of the Company has
been adversely  affected in recent years by significant  losses from operations.
The Company has  incurred  losses of $162,291  and $265,063 for the three months
ended March 31, 2005 and 2004, respectively.

      With  little  remaining  cash  and  no  near  term  prospects  of  private
placements,  options or  warrant  exercises  and  reduced  revenues,  management
believes that the Company will have great difficulty meeting its working capital
and litigation  settlement  obligations over the next 12 months.  The Company is
presently  dependent on cash flows  generated from sales and loans from officers
to meet our obligations.  Our failure to consummate a merger with an appropriate
partner or to  substantially  improve our  revenues  will have  serious  adverse
consequences  and,  accordingly,  there is  substantial  doubt in our ability to
remain in business over the next 12 months.  There can be no assurance  that any
financing  will be available to the Company on acceptable  terms,  or at all. If
adequate  funds are not available,  the Company may be required to delay,  scale
back or eliminate its research,  engineering  and  development or  manufacturing
programs or obtain funds through  arrangements  with partners or others that may
require  the  Company to  relinquish  rights to certain of its  technologies  or
potential  products or other assets.  Accordingly,  the inability to obtain such
financing  could  have a  material  adverse  effect on the  Company's  business,
financial condition and results of operations.

                                       9
<PAGE>

                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

Management's plans for dealing with the foregoing matters include:

o     Increasing sales of its high speed internet  connectivity products through
      both individual customers, strategic alliances and mergers.

o     Decreasing  the  dependency  on certain  major  customers by  aggressively
      seeking other customers in the amplifier markets;

o     Partnering  with  significant  companies  to  jointly  develop  innovative
      products,  which has yielded orders with multinational  companies to date,
      and which are expected to further expand such relationships;

o     Maintaining a reduced cost structure through a more streamlined  operation
      by using automated machinery to produce components for our products;

o     Deferral of payments of officers' salaries, as needed;

o     Selling  remaining  net  operating  losses  applicable to the State of New
      Jersey, pursuant to a special government high-technology incentive program
      in order to provide working capital, if possible;

o     Reducing overhead costs and general expenditures.

o     Merging  with  another  company to provide  adequate  working  capital and
      jointly develop innovative products.

NOTE G - OFFICER LOANS

      As of March 31, 2005,  the Company owes  $295,149 to the Chief  Technology
Officer  (formerly the Chief Executive  Officer) for loans and unpaid  salaries.
During the three  months ended March 31,  2005,  that officer was repaid  $2,200
from the  Company.  Additionally,  salaries  of $3,946  were  deferred  for this
quarter for all officers combined.

                                       10
<PAGE>

                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

NOTE H - SEGMENT INFORMATION

      The Company commenced its wireless Internet  connectivity  business in the
summer of 2000.  The Company does not measure its operating  results,  assets or
liabilities by segment.  However,  the following limited segment  information is
available:

                           Quarter Ended   Quarter Ended   Year Ended
                             March 31         March       December 31,
                               2005            2004          2004
                             --------       --------       --------
Sales - external
         Amplifier           $141,018        290,332       $655,679
         Internet business      1,575         25,035         88,111
                             --------       --------       --------
                             $142,593       $315,367       $743,790
                             ========       ========       ========
Inventory                          --
         Amplifier           $281,840       $262,973       $249,372
         Internet business     55,261        115,430         60,261
                             --------       --------       --------
                             $337,101       $378,403       $309,633
                             ========       ========       ========

NOTE I - COMMITMENTS AND OTHER COMMENTS

1. OPERATING LEASES
During July 2000, the Company entered into a lease  agreement for  approximately
11,000 square feet of office and  manufacturing  space,  for a five-year  period
ending July 13, 2004. The annual rental was $71,000 plus the Company's  share of
real estate taxes,  utilities  and other  occupancy  costs.  The landlord held a
security deposit of $35,625 representing approximately 6 months rent.

In July 2004, Tek, Ltd. ("Tek") a company wholly owned by John Lee, entered into
a contract with the existing landlord of the operating  premises to purchase the
building.  In  connection  therewith,  Tek  negotiated  a return of the security
deposit and accumulated  interest thereon to the Company in the aggregate amount
of $40,160.  The Company was leasing the  premises on a month to month basis and
paying rent on a  semi-monthly  basis.  On April 22, 2005,  concurrent  with the
closing of the  purchase of the  building by Tek,  the  Company  entered  into a
non-cancelable  operating  lease  with Tek which  commences  on June 1, 2005 and
expires on May 31, 2008.  The Company is  obligated  for minimum  annual  rental
payments as follows:

Year ending December 31

2005                                      $ 38,500
2006                                        69,000
2007                                        72,000
2008                                        30,000
                                          --------
                                          $209,500
                                          ========

Rent expense,  including the Company's share of real estate taxes, utilities and
other occupancy  costs, was $29,431 and $27,288 for the three months ended ended
March 31, 2005 and 2004, respectively.

                                       11
<PAGE>

                                 AMPLIDYNE, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2005

2. NOTES PAYABLE CONVERTIBLE INTO COMMON STOCK AT HOLDERS' OPTION
In March 2003, two investors,  each of which already own approximately 4% of the
Company's  outstanding  common stock,  loaned the Company $20,000.  The terms of
each loan  provide  for 6%  interest  and were due in March  2005  with  accrued
interest.  By their  terms,  the loans  provide for  accelerated  payment  under
certain  conditions,  and conversion prior to maturity into the Company's common
stock at the holders  option at the rate of $.10 per share.  As of December  31,
2004,  there were no conditions  present that trigger an  acceleration,  nor has
either holder exercised their option to convert them into common stock.

The  Company  did not make the  required  payments  due March 31, 2005 under the
notes, for principal and interest, and the Company remains currently delinquent.
As yet, no actions have been taken by the holders concerning this default.

NOTE J - RESTATEMENT OF PRIOR AND CURRENT YEAR'S FINANCIAL STATEMENTS

During the quarter  ended March 31, 2005,  as a result of  management  review of
accounts  payable  details,  it was  determined  that  liabilities  reflected as
outstanding  at both  December  31, 2004 and 2003 for  accounts  payable were no
longer due and  payable.  The  write-off  of these  liabilities  resulted in the
reflection  of a gain of $135,846  reflected  in  operations  for the year ended
December 31, 2003, and reduction in Company  liabilities  and a reduction in its
shareholders'  deficit  at  December  31,  2004  and  2003.   Accordingly,   the
accumulated  deficit as originally reported at December 31, 2003 as reflected in
the  Statement  of  Shareholders'  Deficiency  has been  restated to reflect the
write-off of accounts  payable  balances as they should have  occurred  prior to
December 31, 2003.

                                       12
<PAGE>


                                 AMPLIDYNE, INC.
                                 MARCH 31, 2005


PART I - FINANCIAL INFORMATION

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF

Financial Condition and Results of Operations

Results of  Operations  - The Quarter  Ended March 31, 2005  Compared to Quarter
Ended March 31, 2004.

Revenues for the three months  ended March 31, 2005  decreased by $172,774  from
$315,367 to $142,593,  or 55% compared to the three months ended March 31, 2004.
Coupled  with  the  increased   production   costs,  the  first  quarter  losses
significantly increased compared with the first quarter of last year.

The  majority of the  amplifier  sales for the three months ended March 31, 2005
were  obtained  from the  Wireless  Local  Loop  amplifier  products  to a major
European customer.

The Company is developing  W-CDMA  amplifier  for planned  release in the second
quarter of 2005.

Cost of sales was  $103,408  or 73% of sales  compared  to 91%  during  the same
period  for  2004.  The  improvement  in gross  margin  was  principally  due to
efficiencies  in production  and materials  usage.  The Company is continuing to
assess  ways to  achieve  cost  reduction  for its  products  and  sales  volume
increases to improve gross margins in 2005.

Selling,   general   and   administrative   expenses   (excluding   stock  based
compensation)  decreased in 2005 by $113,752 to $99,252 from $213,004,  in 2004.
Expressed as a percentage  of sales,  the  selling,  general and  administrative
(SG&A) expenses (excluding stock based compensation) were 70% in 2005 and 68% in
2004.  Most of the SG&A expenses are fixed and management has cut costs about as
low as  operations  can  sustain.  The actual  dollar  decrease in SG&A from the
previous  year was  $113,752  or 53%. In the quarter  ended March 31,  2005,  we
continued to maintain the lower staffing and overhead  levels that we instituted
in 2002.

Research,  engineering  and  development  expenses were 71% of net sales for the
three months ended March 31, 2005 compared to 25% in 2004. In 2005 and 2004, the
principal  activity  of the  business  related to the design and  production  of
product for OEM manufacturers, particularly for the W-CDMA amplifier and 3.5 GHz
single channel products and refinements to the High Speed Internet products. The
research,  engineering and development  expenses  consist  principally of salary
cost for engineers and the expenses of equipment purchases  specifically for the
design  and  testing of the  prototype  products.  The  Company's  research  and
development  efforts are  influenced by available  funds and the level of effort
required by the engineering staff on customer specific projects.

We had no appreciable interest income in 2005 and 2004 because our cash balances
which we have  historically  temporarily  invested in interest  bearing accounts
have been fully depleted.

As a result of the  foregoing,  the Company  incurred  net losses of $162,291 or
$0.02 per share for the three  months  ended  March 31, 2005  compared  with net
losses of $265,063 or $0.03 per share for the same period in 2004.

                                       13
<PAGE>

Liquidity and Capital Resources

Liquidity refers to our ability to generate adequate amounts of cash to meet our
needs.  We have been  generating the cash necessary to fund our operations  from
continual loans from the President and Chief  Executive  Officer of the Company,
Devendar  Bains.  We have  incurred a loss in each year since  inception.  It is
possible that we will incur further losses,  that the losses may fluctuate,  and
that such  fluctuations  may be  substantial.  As of March 31,  2005,  we had an
accumulated deficit of $23,791,281. Potential immediate sources of liquidity are
loans from Mr.  Bains.  Another  potential  source of  liquidity  is the sale of
restricted shares of our common stock, but there are no immediate plans for such
sale.

As of March 31, 2005, our current liabilities  exceeded our cash and receivables
by  $1,624,330.  Our current  ratio was 0.24 to 1.00,  but our ratio of accounts
receivable to current  liabilities was only 0.03 to 1.00. This indicates that we
will have  difficulty  meeting our obligations as they come due. We are carrying
$337,101 in inventory,  of which $211,584 represents component parts. Because of
the lead times in our  manufacturing  process,  we will likely need to replenish
many items before we use everything we now have in stock.  Accordingly,  we will
need more cash to replenish our  component  parts  inventory  before we are able
realize cash from all of our existing inventories.

As of March 31,  2005,  we had cash of $22,288  compared to $122,234 at December
31, 2004.  Overall our cash and cash equivalents  decreased $99,946 during 2005.
Our cash used for operating  actives was $189,746 We received  advances pursuant
to the financing agreement of $92,000.

The allowance for doubtful accounts on trade receivables  remained  unchanged at
$268,000  (95% of accounts  receivable of $283,597) in 2004 compared to $264,000
(86% of accounts  receivable  of  $307,033) in 2005.  Because of our  relatively
small number of customers and low sales volume, accounts receivable balances and
allowances  for doubtful  accounts do not reflect a consistent  relationship  to
sales.  We determine  our allowance  for doubtful  accounts  based on a specific
customer-by-customer review of collectiblity.

Our inventories increased by $27,468 to $337,101 in 2005 compared to $309,633 at
December 31, 2004, an increase of 9%.

Although the Company did not convert  salaries to officers  through the issuance
of Common Stock in 2003 or 2004, it may to do so in 2005. To help  alleviate the
cash  flow  difficulties,  the Chief  Executive  Officer,  the Chief  Technology
Officer and corporate  Secretary agreed to defer salaries of $1,538,  $1,442 and
$962, respectively.

The Company continues to explore strategic  relationships with ISP's,  customers
and others,  which could involve  jointly  developed  products,  revenue-sharing
models, investments in or by the Company, or other arrangements. There can be no
assurance that a strategic relationship can be consummated.

In the past,  the  officers  of the  Company  have  deferred  a portion of their
salaries  or  provided  loans  to  the  Company  to  meet  short-term  liquidity
requirements.  Where possible,  the Company has issued stock or granted warrants
to certain vendors in lieu of cash payments,  and may do so in the future. There
can be no  assurance  that any  additional  financing  will be  available to the
Company on acceptable terms, or at all. If adequate funds are not available, the
Company  may be  required  to  delay,  scale  back or  eliminate  its  research,
engineering  and development or  manufacturing  programs or obtain funds through
arrangements  with partners or others that may require the Company to relinquish
rights to certain of its  technologies  or potential  products or other  assets.
Accordingly,  the  inability  to obtain  such  financing  could  have a material
adverse  effect on the Company's  business,  financial  condition and results of
operations.

                                       14
<PAGE>

With little  remaining  cash and no near term  prospects of private  placements,
options or warrant exercises and reduced revenues,  we believe that we will have
great  difficulty   meeting  our  working  capital  and  litigation   settlement
obligations  over the next 12 months.  We are presently  dependent on cash flows
generated  from  sales and loans  from  officers  to meet our  obligations.  Our
failure to consummate a merger. or substantially  improve our revenues will have
fserious adverse  consequences and,  accordingly,  there is substantial doubt in
our  ability  to remain in  business  over the next 12  months.  There can be no
assurance  that any  financing  will be available  to the Company on  acceptable
terms,  or at all.  If  adequate  funds are not  available,  the  Company may be
required  to delay,  scale  back or  eliminate  its  research,  engineering  and
development or manufacturing  programs or obtain funds through arrangements with
partners or others that may require the Company to relinquish  rights to certain
of its  technologies  or potential  products or other assets.  Accordingly,  the
inability to obtain such financing  could have a material  adverse effect on the
Company's business, financial condition and results of operations.

Item 3.   CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures.
Within the 90 days prior to the date of this report, Amplidyne, Inc. carried out
an evaluation, under the supervision and with the participation of the Company's
management,  including the Company's  Chief  Executive and Principal  Accounting
Officer,  of the  effectiveness  of the design and  operation  of the  Company's
disclosure controls and procedures  pursuant to Exchange Act Rule 13a-14.  Based
upon that  evaluation,  the Chief  Executive  and Principal  Accounting  Officer
concluded that the Company's disclosure controls and procedures are effective in
timely  alerting  him to  material  information  required  to be included in the
Company's periodic SEC filings relating to the Company.

(b) Changes in Internal Controls.
There were no significant changes in the Company's internal controls or in other
factors that could  significantly  affect these internal controls  subsequent to
the date of my most recent evaluation.

                                       15
<PAGE>

                                 AMPLIDYNE, INC.
                                 MARCH 31, 2005


PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

See Note E to the Company's financial statements set forth in Part I.

ITEM 2. CHANGE IN SECURITIES

During the first quarter ended March 31, 2005, the Company issued no securities.



                                       16
<PAGE>

                                   SIGNATURES


     In accordance with the requirements of the Exchange Act, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.

                                            AMPLIDYNE, INC.


Dated: May 23, 2005                         By: /s/ Tarlochan S. Bains
                                                ---------------------------
                                                Name:  Tarlochan S. Bains
                                                Title: Chief Executive Officer,
                                                       Treasurer, Principal
                                                       Accounting Officer and
                                                       Director



                                       17