SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 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 June 30, 1996

                         Commission file number: 0-28082


                              KVH Industries, Inc.
             (Exact name of registrant as specified in its charter)



          Delaware                                              05-0420589
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification No.)


                  110 Enterprise Center, Middletown, RI. 02842
                    (Address of principal executive offices)


        Registrant's telephone number, including area code (401) 847-3327



         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



                 The number of  outstanding  shares of the  Registrant's  Common
Stock as of July 31, 1996 was 6,815,498.







                       KVH INDUSTRIES, INC. AND SUBSIDIARY
                                      INDEX

                                                                        Page No.
PART I.   FINANCIAL INFORMATION

         ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

                  Consolidated Balance Sheets as of  June 30, 1996 and
                  December 31, 1995                                          3

                  Consolidated Statements of  Income for the
                  three and six months ended June 30, 1996 and 1995          4

                  Consolidated Statements of Cash Flows for the
                  six months ended June 30, 1996 and 1995                    5

                  Notes to Consolidated Financial Statements                 6


         ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS              7

PART II. OTHER INFORMATION

         ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                           10

         SIGNATURES                                                         11







Part I. Financial Information

Item 1.  Financial Statements.

                       KVH INDUSTRIES, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS

                                             June 30,        December 31,
                                              1996              1995
                                            (Unaudited)        (Audited)
                      Assets

Cash and cash equivalents ..............   $  8,411,628    $    895,677
Accounts receivable, net ...............      3,571,289       2,187,916
Contract receivables ...................         84,347         994,056
Costs and estimated earnings in
 excess of billings on uncompleted contract     295,127         916,194
Inventories ............................      2,660,919       1,753,172
Prepaid expenses and other deposits ....        263,273         156,675
Deferred income taxes ..................        515,285         515,285
                                           ------------    ------------    
  Total current assets .................     15,801,868       7,418,975
                                           ------------    ------------    
Property and equipment, net ............      2,919,696         423,842
Other assets, less accumulated amortization      45,462          64,946
Deferred income taxes ..................         23,510          23,510
                                           ------------    ------------   
  Total assets .........................   $ 18,790,536    $  7,931,273
                                           ============    ============   


       Liabilities and stockholders' equity

Current liabilities:
Current lease obligation ...............   $     47,653    $     40,787
Accounts payable .......................      1,242,672         958,507
Accrued expenses .......................        578,488         335,896
Customer deposits ......................      2,621,095       2,869,595
                                            ------------    ------------    
  Total current liabilities ............      4,489,908       4,204,785
                                            ------------    ------------    
Obligations under capital leases,
 excluding current installments ........         40,047          72,439
                                            ------------    ------------    
  Total liabilities ....................      4,529,955       4,277,224
                                            ------------    ------------    
Stockholders' equity
Preferred stock ........................              0          12,982
Common stock ...........................         68,155          16,160
Additional paid-in capital .............     14,532,897       4,473,045
Accumulated deficit ....................       (340,471)       (848,138)
                                            ------------    ------------    
  Total stockholders' equity ...........     14,260,581       3,654,049
                                            ------------    ------------   
Total liabilities and stockholders' equity $ 18,790,536    $  7,931,273
                                            ============    ============   

                 See accompanying notes to financial statements.






Item 1.  Financial Statements.

                       KVH INDUSTRIES, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

        .....                             Three monthsSix months ended:
          .....                          June 30,                June 30,
                                     1996        1995        1996        1995
                                 --------    --------    --------    --------

Net sales ....................  $5,113,602  $3,080,851  $9,894,261  $5,848,730

Cost of goods sold ...........   2,829,248   1,892,733   5,521,637   3,431,119
                                 ---------   ---------   --------- ---------

Gross profit .................   2,284,354   1,188,118   4,372,624   2,417,611

Operating expenses:
 Research and development ....    674,297     190,102    1,284,018    365,687
 Sales and marketing .........    785,701     520,783    1,643,923  1,027,019
 General and administrative ..    394,284     238,493     710,419     438,720
                                 --------    --------    --------    --------

Income from operations .......    430,072     238,740     734,264     586,185

Other (income) deductions:
 Interest (income) expense, ..   (102,660)     15,212    (102,660)     27,424
 Other (income) expense, net .     (8,975)     19,211     (10,226)     19,211
 Foreign currency (gain) loss.     29,612      (5,996)     22,446     (21,851)
                                 --------    --------    --------    --------

Income before income taxes        512,095     210,313     824,704     561,401

Income tax expense ...........    191,996           0     317,038           0
                                 --------    --------    --------    --------

 Net income ..................   $320,099    $210,313    $507,666    $561,401
                                 ========    ========    ========    ========

Net income per share:
 Primary ..............         $   0.04     $  0.04     $  0.08      $  0.10
                                ========    ========    ========     ========
 Fully diluted .........        $   0.04     $  0.04     $  0.08      $  0.10
                                ========    ========    ========     ========

Weighted average number of common and common equivalent shares outstanding: 

  Primary                 7,404,464    5,710,177     6,470,208     5,710,177
                         ===========   ==========   ===========    =========
  Fully diluted           7,408,232     5,710,177    6,496,153     5,710,177
                         ===========   =========    ===========    =========

                 See accompanying notes to financial statements.






Item 1. Financial Statements.

                       KVH INDUSTRIES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                                           Six months ended
                                                                June 30,
                                                            1996        1995
Cash flows from operating activities:

Net income .......................................   $    507,666    $ 561,401

Adjustments to reconcile net income to
 net cash provided by operating activities:
Depreciation and amortization ....................         90,207       67,268
(Increase) in accounts receivable ................       (473,664)    (883,638)
Decrease in costs and estimated earnings in excess of
 billings on uncompleted contracts ...............        621,067      681,165
(Increase) in inventories ........................       (907,747)    (430,671)
(Increase in prepaid expenses and other deposits         (106,598)     (77,021)
Increase in accounts payable .....................        284,165      137,866
Increase (decrease) in accrued expenses ..........        242,592      (67,021)
Increase (decrease) in customer deposits .........       (248,500)     250,000
                                                     ------------    ----------

Net operating cash provided by operating
 activities ......................................        240,349        9,188


Cash flows from investing activities:
Capital expenditures .............................     (2,566,576)    (114,147)
                                                     ------------    ----------

Net cash (used in) investing activities ..........     (2,566,576)    (114,147)
                                                     ------------    ----------

Cash flows from financing activities:
(Repayments) incurrence of obligations under capital
 lease ...........................................        (25,526)      15,467
Issuance of capital stock, exercise of warrants and
 stock options ...................................     10,098,865        7,500
                                                     ------------    ----------

Net cash provided by financing activities ........     10,073,339       22,967
                                                      ------------   ----------

Net increase in cash and cash equivalents ........      7,515,951      149,169

Cash and cash equivalents at beginning of year ...        895,677      191,438
                                                      ------------   ----------

Cash and cash equivalents at end of period .......   $  8,411,628    $ 340,169
                                                     ============    ==========

Supplemental disclosure of cash flow information:
 Cash paid during the period for interest              $  5,176       $ 30,016
                                                      ==========      =========


                 See accompanying notes to financial statements.






Item 1.  Financial Statements.
                       KVH INDUSTRIES, INC. AND SUBSIDIARY
                   Notes to Consolidated Financial Statements
                             June 30, 1996 and 1995
                                   (Unaudited)

(1.) The  unaudited  interim  financial  statements  presented  herein have been
prepared in accordance with generally  accepted  accounting  principles and with
the instructions to Form 10-Q and Regulation S-X pertaining to interim financial
statements.  The financial  statements  reflect all  adjustments  (consisting of
normal recurring  adjustments and accruals) which, in the opinion of management,
are considered  necessary for a fair presentation of financial  position at June
30, 1996 and results of  operations  for the three and six months ended June 30,
1996 and June 30, 1995. These consolidated  financial  statements do not include
all  disclosures  associated  with annual  financial  statements and accordingly
should be read in conjunction  with the  consolidated  financial  statements and
notes thereto included in the Company's Registration Statement on Form S-1 filed
with the Securities and Exchange  Commission  (file number  333-01258)  declared
effective  March 28, 1996, a copy of which is  available  from the Company.  The
results of  operations  for the three and six months ended June 30, 1996 are not
necessarily  indicative  of the results  that may be expected  for the full year
ending December 31, 1996.

(2.) On March 28, 1996,  the  Company's  registration  statement  for an initial
public  offering  of common  stock  was  declared  effective.  An  aggregate  of
1,800,000 shares of common stock were issued by the Company in April, 1996 at an
initial public offering price of $6.50 per share.

(3.)  Inventories  at June 30, 1996 and  December  31, 1995 include the costs of
material,  labor and factory  overhead.  Inventories  are stated at the lower of
cost (first-in, first-out) or market and consist of the following:

                                 (in thousands of dollars)
                                    1996            1995
      Raw materials               $1,898          $1,256
      Work in progress               173             101
      Finished Goods                 590             396
                                --------         --------
               Total              $2,661           $1,753
                                ========         ========

(4.) On May 10, 1996 the Company  purchased a 75,000  square foot  manufacturing
and  office  facility  adjacent  to  the  Company's   existing   operations  for
$2,000,000.  The  Company  is in the  process  of  renovating  the  facility  to
accommodate  engineering,  manufacturing and office areas. The Company estimates
the cost of renovation at  approximately  $1,200,000  and that the space will be
ready for  occupancy  in the  fourth  quarter  of 1996.  The new  facility  will
increase  the  Company's  total  floor area to over  100,000  square feet and is
expected to be sufficient to accommodate  the Company's  operating needs for the
next three years.

(5.) Through  December 31, 1995 the Company had  available  net  operating  loss
carry-forwards for both tax return and financial reporting purposes. In 1995 the
full benefit of the net operating loss carry-forward  deduction was realized for
financial  reporting  purposes and as a consequence taxes have been recorded for
financial  reporting  purposes in 1996. Income tax expense for the three-and six
month  periods  ended June 30, 1996 were  calculated  using an estimated  annual
effective tax rate of 40%.

The  effective tax rate for the three and six months ended June 30, 1996 differs
from the federal statutory rate of 34% primarily due to state tax expense net of
federal tax benefit.  The Company believes that its net deferred tax assets will
more likely than not be realized,  based upon  estimated  future  taxable income
projections.









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

This  report may  contain  forward-looking  statements  which  involve  risks or
uncertainties.  The  Company's  actual  results may differ  materially  from the
results discussed in the forward-looking  statements.  Factors which might cause
such  differences  include,  but are not limited to, those discussed under "Risk
Factors"  in  the  Company's  Registration  Statement  on  Form  S-1  (file  No.
333-01258)  declared effective March 28, 1996, a copy of which is available from
the Company.


Net Income and  Earnings  Per Share - Net  income  and  earnings  per share were
$320,099  or $0.04 per share  (after  taking  into  effect the  increase  in the
weighted  average number of shares  outstanding that resulted from the Company's
initial  public  offering in April 1996) and $210,313 or $0.04 per share for the
three  months  ended  June 30,  1996 and 1995  respectively.  Net income for the
second  quarter of 1996  increased by $109,786 or 52% over the second quarter of
1995.  Net income and  earnings  per share were  $507,666 or $0.08 per share and
$561,401  or $0.10 per share for the six  months  ended  June 30,  1996 and 1995
respectively.  Net income and  earnings  per share for the six months ended June
30, 1995 were positively  affected by a one time contract settlement relating to
a  customer-funded  engineering  development and by the absence of any provision
for income  taxes.  Excluding  the  positive  impacts  of the one time  contract
settlement  and the absence of tax expense,  net income for the six months ended
June 30, 1995 would have been $183,000 or $0.03 per share.


Net Sales - Net sales for the three  month  period  ended June 30,  1995 grew to
$5,113,602 or a 66% increase when compared with second quarter 1995 net sales of
$3,080,851.  Second quarter 1996 product  revenues  increased to $4,846,382 or a
133% increase  compared with second quarter 1995 revenues of  $2,078,684.  Lower
margin  engineering  development  revenues  declined  to  $267,220 in the second
quarter of 1996 from  $1,002,167 in the second  quarter of 1995.  The shift away
from engineering development revenues to higher margin product revenues reflects
the Company's  completion of the TacNav military land navigation system that was
primarily  funded by the  governments  of Canada,  the United States and Sweden.
Military  land  navigation  product  revenues  grew to  $2,380,903 in the second
quarter of 1996, a 509% increase when compared with second quarter 1995 revenues
of $391,030.  The growth in military  land  navigation  revenues  resulted  from
shipments  to the United  States Army  Bradley  Fighting  Vehicle  program,  the
Canadian RECCE program,  the Saudi Arabian Light Armored Vehicle program and the
Swedish CV-90 program.  Communications  product revenues grew to $901,820 in the
second  quarter of 1996, a 346% increase when compared with second  quarter 1995
revenues of $202,000.  Communications  revenue growth resulted from shipments to
American Mobile Satellite  Corporation and Mitsubishi  Electronics  Corporation.
The American Mobile Satellite  delivery is a significant  milestone  marking the
shipment of the first 100 TracPhone turnkey  satellite  telephone  systems.  The
Tracphone  shipment is the first  shipment  of products to fulfill the  American
Mobile Satellite  contract that amounts to over $10 million dollars. . Net sales
for the six month  period  ended June 30, 1996  increased  to  $9,894,261  a 69%
growth over the comparable 1995 net sales of $5,848,730.

Gross Profit - Gross profit increased by $1,096,236 or 92% in the second quarter
of 1996 when  compared  with the second  quarter of 1995 due to increased  sales
volumes and improved product gross margins.  Gross profit as a percentage of net
sales was 45% in the second  quarter  of 1996 and 39% in the  second  quarter of
1995.  Gross  margin grew to 44% of net sales in the first six months of 1996 as
opposed to 41% of net sales for the comparable  period of 1995. This improvement
represents a shift away from lower margin engineering development sales.








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


Operating  Expenses - Research and development  expense increased by $484,195 or
255% in the second quarter of 1996 when compared with the second quarter of 1995
and  increased  $918,331 or 251% in the first six months of 1996  primarily as a
result  of a shift  in the  Company's  research  and  development  efforts  from
customer-funded  research and  development  (accounted  for as cost of sales) to
Company-funded   research  and  development   (accounted  for  as  research  and
development  expense).  Sales and marketing expense increased $264,918 or 51% in
the second  quarter of 1996 when  compared  with the second  quarter of 1995 and
increased  $616,904 or 60% in the first six months of 1996,  due to increases in
variable selling support costs such as sales  commissions,  as well as marketing
media expense and travel  expense,  associated  with  increased  sales  volumes.
General and  administrative  expense  increased by $155,791 or 65% in the second
quarter  of 1996 when  compared  with the second  quarter of 1995 and  increased
$271,699  or 62% in the first six months of 1996,  primarily  as a result of new
hires to support the company's growth and increased  legal,  audit and insurance
expenses that result from the Company's status as a publicly traded company.


Other  (Income)  Deductions - Other  (income)  deductions is made up of interest
(income)  expense net, other (income)  expense net, and foreign  currency (gain)
loss.  The year to year decrease in other  deductions  resulted  primarily  from
increased  second quarter 1996 interest income of $137,083,  which off set other
expense  charges  in both the second  quarter  and the first six months of 1996.
Second quarter 1996 interest  income results from the investment of a portion of
Company's  initial  public  offering  proceeds  in interest  bearing  short term
government securities.


Income Taxes - Income tax expense increased by $191,996 in the second quarter of
1996 when compared with the first quarter of 1995 and increased $317,039 for the
first six months of 1996 when compared with the  comparable  period of the prior
year. No provision  for income taxes was recorded in 1995 as the entire  benefit
of the Company's net operating loss  carry-forward  deduction was fully realized
for  financial   reporting   purposes  in  1995.  In  1996  net  operating  loss
carry-forwards  are available for tax return  purposes only,  consequently  1996
operating results include a provision for income tax expense.


Liquidity and Capital Resources - Working capital increased by $8,097,770 in the
second  quarter of 1996 due to receipt of the proceeds of the Company's  initial
public offering in April,  1996. In May 1996 the Company  purchased an operating
facility  in the amount of  $2,000,000  using a portion of the  proceeds  of the
Company's  initial  offering.  Cash and cash  equivalents  were  $8,411,628  and
$895,677 on June 30, 1996 and December 31, 1995 respectively.

On June 28, 1996 the Company entered into a bank revolving line of credit in the
amount of  $2,500,000  to replace the bank line of credit  that  expired on that
date.  The revolving  line of credit is  collateralized  by all of the Company's
assets. The Company has not drawn upon the loan facility. The new loan agreement
expires on June 30, 1998.

On March 28, 1996,  the Company's  registration  statement for an initial public
offering of common  stock was  declared  effective.  An  aggregate  of 1,800,000
shares of common  stock were issued by the Company in April,  1996 at an initial
public  offering  price of $6.50 per share that resulted in  approximately  $9.9
million dollars in net proceeds.  The Company  believes that cash generated from
operations,  amounts available under its credit facility and the net proceeds of
the initial public offering will be sufficient to fund its necessary  operations
and planned capital expenditures for at least the next twelve months.



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


Capital Expenditures - Property and equipment increased approximately $2,566,576
in the second  quarter of 1996 as compared with December 31, 1995.  The increase
in fixed assets reflects the purchase of a manufacturing  and office facility in
the  amount of  $2,000,000  as well as the  procurement  of  production  tooling
related  to  communications  products.  The  Company  believes  that the cost of
renovating  the facility  will  approximate  an additional  $1,200,000  prior to
occupancy in fourth quarter of 1996.


Other  Matters  -  Effective  January  1,  1996 the  Company  adopted  Financial
Accounting  Standards Board Statements No. 121 "Accounting for the Impairment of
Long  Lived  Assets  and for Long Lived  Assets to be  Disposed  of" and No. 123
"Accounting for  Stock-Based  Compensation"  ("FAS 123").  The adoption of these
standards had no impact on the  financial  position or the results of operations
of the Company for the period  ended June 30,  1996.  Under FAS 123, the Company
has elected not to adopt the new accounting  method and will continue to account
for its  stock-based  compensation  under the existing  provisions of Accounting
Principles  Board Opinion No. 25,  "Accounting  for Stock Issued to  Employees".
Accordingly,  the Company will provide  pro-forma  disclosures of net income and
earnings per share for the year ended  December  31, 1996,  assuming FAS 123 had
been adopted.






Part II. Other Information

Item 1. Legal Proceedings.

         None

Item 6. Exhibits and reports on Form 8-K.

1.   Exhibit 11 - Computation of Earnings Per Common Share: Three and Six 
     Months Ended June 30, 1996 and 1995.

2.   Exhibit 27 - Financial Data Schedule: Six Months Ended June 30, 1996.

3.   No reports on Form 8-K were filed during the quarter for which this
     report was filed.









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.

KVH Industries, Inc.




  By:_____________________________________________________________
      Richard C. Forsyth   Chief Financial and Accounting Officer

  Date: July 31, 1996







Exhibit 11

                              KVH INDUSTRIES, INC.
                      COMPUTATION OF NET EARNINGS PER SHARE
                      (in thousands, except per share data)
                                   (Unaudited)

                                       For the three          For the six 
                                       months ended:          months ended:
                                          June 30,              June 30,
                                       1996      1995        1996      1995
                                     --------  --------     -------  --------
Primary earnings per share: 

Net income                            $  320    $  209      $  508    $  560
                                     --------  --------     -------   -------
Shares:
Weighted average number of             
 common shares outstanding             6,724     4,861       5,793     4,861

Additional shares assuming
 conversion of:

Stock options and warrants               680       849          677       849
                                     --------  --------      -------   -------
Average common shares and
 equivalents outstanding               7,404     5,710         6,470    5,710
                                     --------  --------      -------   -------
Net earnings per common share        $ 0.04     $ 0.04       $ 0.08    $ 0.10
                                     ========  ========      =======   =======

Fully diluted earnings per share:

Net income                            $  320    $  209      $  508    $  560
                                     --------  --------     -------   -------
Shares:
Weighted average number of             
 common shares outstanding             6,724     4,861       5,793     4,861

Additional shares assuming
 conversion of:

Stock options and warrants               684       849          703       849
                                     --------  --------      -------   -------
Average common shares and
 equivalents outstanding               7,408     5,710        6,496     5,710
                                     --------  --------      -------   -------
Net earnings per common share        $ 0.04     $ 0.04        $ 0.08    $ 0.10
                                     ========  ========      =======   =======

 

5 Financial Data Schedule June 30, 1996 6-MOS DEC-31-1996 JUN-30-1996 8,411,628 0 3,719,978 148,689 2,660,919 15,801,868 2,990,418 70,722 18,790,536 4,489,908 0 0 0 68,155 0 18,790,536 9,894,261 9,894,261 5,521,637 5,521,637 3,638,360 0 5,176 824,704 317,038 507,666 0 0 0 507,666 .08 .08