===============================================================================
                     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 September 27, 2002 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 001-31235

                  Integrated Defense Technologies, Inc.
       -----------------------------------------------------------
         (Exact name of registrant as specified in its charter)

                Delaware                               13-4027646
   ---------------------------------      ------------------------------------
    (State or other jurisdiction of       (I.R.S. Employer Identification No.)
    incorporation or organization)

    110 Wynn Drive, Huntsville, Alabama                 35805
  ----------------------------------------           -----------
  (Address of principal executive offices)            (Zip Code)

                             (256) 895-2000
                        ----------------------
                         (Telephone Number)

   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  ___

      Common stock, par value $.01 per share: 21,327,931 shares
                 outstanding as of November 7, 2002
===============================================================================




                INTEGRATED DEFENSE TECHNOLOGIES, INC.
                              FORM 10-Q
                         September 27, 2002

                                INDEX

PART I. FINANCIAL INFORMATION

Item 1. Condensed Financial Statements

Consolidated Balance Sheets as of September 27, 2002 and
        December 31, 2001 (unaudited)                                   2

Consolidated Statements of Operations for the quarters
        and nine months ended September 27, 2002 and
        September 28, 2001 (unaudited)                                  3

Consolidated Statements of Cash Flows for the nine
        months ended September 27, 2002 and
        September 28, 2001 (unaudited)                                  4

Notes to Condensed Financial Statements                                 5 - 12

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations                             13 - 24

Item 3. Quantitative and Qualitative Disclosures About
        Market Risk                                                     24

Item 4. Controls and Procedures                                         24


PART II. OTHER INFORMATION

Item 5: Other information                                               25

Item 6. Exhibits and Reports on Form 8-K                                25


SIGNATURES                                                              26


CERTIFICATIONS                                                          27





PART I. FINANCIAL INFORMATION
ITEM 1.
       INTEGRATED DEFENSE TECHNOLOGIES, INC.  AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS
                             (Unaudited)
--------------------------------------------------------------------------------
                                                  September 27,     December 31,
                                                     2002              2001
--------------------------------------------------------------------------------
(In thousands except share and per share amounts)

ASSETS

Current assets:
  Cash                                              $ 17,038         $  3,893
  Restricted cash                                        463              769
  Accounts receivable, net                           127,262          113,863
  Inventories, net                                    12,700           13,567
  Prepaid expenses and other current assets            3,358            2,028
  Deferred income taxes                                6,377            7,068
     Total current assets                            167,198          141,188
Property and equipment, net                           43,662           45,548
Goodwill, net                                         83,734           83,734
Other assets                                           7,676            7,828
--------------------------------------------------------------------------------
     Total Assets                                   $302,270         $278,298
================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Revolving credit loan                             $    ---         $  8,500
  Current portion of long-term debt                    4,950            9,164
  Accounts payable                                    19,013           14,802
  Accrued compensation                                 8,425            8,317
  Other accrued expenses                              10,827           11,030
  Derivative liabilities                                 ---            7,326
  Billings in excess of costs and earnings             4,413            8,743
--------------------------------------------------------------------------------
     Total current liabilities                        47,628           67,882
Long-term debt                                        78,813          153,561
Pension and other postretirement employee benefits     6,583            6,675
--------------------------------------------------------------------------------
     Total liabilities                               133,024          228,118
--------------------------------------------------------------------------------
Contingencies (Note 11)                                  ---              ---
--------------------------------------------------------------------------------
Stockholders' equity:
  Preferred stock, $.01 par value per share,
    20,000,000 shares authorized, none issued
  Common stock, $.01 par value per share,
    200,000,000 shares authorized, 21,327,931
    issued at September 27, 2002 and  13,565,243
    issued at December 31, 2001                          213              136
  Additional paid-in capital                         170,955           54,434
  Accumulated other comprehensive loss                (2,267)          (6,703)
  Retained earnings                                      345            2,313
--------------------------------------------------------------------------------
     Total stockholders' equity                      169,246           50,180
--------------------------------------------------------------------------------
     Total Liabilities and Stockholders' Equity     $302,270         $278,298
================================================================================

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



       INTEGRATED DEFENSE TECHNOLOGIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS
                             (Unaudited)



----------------------------------------------------------------------------------------------------------------------
                                                             Quarter ended                    Nine months ended
                                                       September 27,  September 28,     September 27,   September 28,
                                                            2002           2001             2002            2001
----------------------------------------------------------------------------------------------------------------------
(In thousands except per share amounts)

                                                                                              
Revenue                                                   $75,723        $67,868          $216,215        $189,261
Cost of revenue                                            55,599         48,996           153,645         134,306
----------------------------------------------------------------------------------------------------------------------
Gross profit                                               20,124         18,872            62,570          54,955

Selling, general and administrative expenses                8,022          7,693            27,762          25,543
Research and development and bid and proposal expenses      3,294          3,620            11,362           9,786
Amortization of debt issuance costs                           192            203               591             646
Amortization of patents and goodwill                            9          1,774                28           4,833
----------------------------------------------------------------------------------------------------------------------
Income from operations                                      8,607          5,582            22,827          14,147

Interest expense                                             (958)        (5,224)           (5,808)        (14,883)
Refinancing costs                                             ---            ---            (7,571)            ---
Other income (expense) - net                                 (383)           277            (  139)            277
----------------------------------------------------------------------------------------------------------------------
Income (loss) before income taxes and extraordinary loss    7,266            635             9,309            (459)

Income tax expense                                         (2,652)          (506)           (3,271)         (1,294)
----------------------------------------------------------------------------------------------------------------------
Income (loss) before extraordinary loss                     4,614            129             6,038          (1,753)

Extraordinary loss on early extinguishment of debt
  (net of income tax benefit of $5,119)                       ---            ---            (8,006)            ---
----------------------------------------------------------------------------------------------------------------------
     Net income (loss)                                     $4,614           $129           $(1,968)        $(1,753)
======================================================================================================================

Basic income (loss) per share:
    Income (loss) before extraordinary loss                  $.23           $.01             $ .32           $(.13)
    Extraordinary loss                                        ---            ---              (.43)            ---
----------------------------------------------------------------------------------------------------------------------
     Net income (loss)                                       $.23           $.01             $(.11)          $(.13)
======================================================================================================================

Diluted income (loss) per share:
    Income (loss) before extraordinary loss                  $.22           $.01             $ .30           $(.13)
    Extraordinary loss                                        ---            ---              (.41)            ---
----------------------------------------------------------------------------------------------------------------------
     Net income (loss)                                       $.22           $.01             $(.11)          $(.13)
======================================================================================================================

Weighted-average shares outstanding - Basic                20,216         13,565            18,639          13,565
                                      Diluted              21,328         15,328            20,075          13,565
======================================================================================================================


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




                   INTEGRATED DEFENSE TECHNOLOGIES, INC. AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (Unaudited)


----------------------------------------------------------------------------------------------------
Nine months ended                                                    September 27,    September 28,
                                                                         2002             2001
----------------------------------------------------------------------------------------------------
(In thousands)

OPERATING ACTIVITIES:                                                                
 Net loss                                                               $( 1,968)        $(1,753)
 Adjustments to reconcile net loss to net cash
  provided by operating activities:
   Depreciation expense                                                    8,004           7,957
   Amortization of debt issuance costs                                       591             646
   Amortization of goodwill and other intangible assets                      171           4,833
   Extraordinary loss on early extinguishment of debt, net                 8,006             ---
   Other refinancing costs                                                 7,571             ---
   Deferred income taxes                                                   3,026           1,012
   Changes in current assets and liabilities:
    Restricted cash                                                          305           2,821
    Accounts receivable, net                                             (13,558)        (15,018)
    Inventories, net                                                     (    56)            201
    Other current assets                                                 ( 1,204)          3,881
    Accounts payable                                                       4,757           3,013
    Billings in excess of costs and earnings                             ( 4,330)          4,425
    Other current liabilities                                                440          (9,174)
---------------------------------------------------------------------------------------------------
     Net cash provided by operating activities                            11,755           2,844
---------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES:
 Purchases of property and equipment                                     ( 6,136)        ( 3,492)
 Capitalization of internally developed software                         (   865)            ---
 Other                                                                   (   253)        (    57)
---------------------------------------------------------------------------------------------------
    Net cash used in investing activities                                ( 7,254)        ( 3,549)
---------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES:
 Proceeds from sale of common stock, net of issuance costs               116,688             ---
 Issuance of long-term debt                                               85,000             ---
 Repayment of long-term debt                                            (169,823)        ( 5,592)
 Payment of debt issuance and other refinancing costs                   ( 14,721)            ---
 Net borrowings (repayments) under revolving credit loans               (  8,500)          2,450
---------------------------------------------------------------------------------------------------
    Net cash provided by (used in) financing activities                    8,644         ( 3,142)
---------------------------------------------------------------------------------------------------
Net increase (decrease) in cash                                           13,145         ( 3,847)
Cash at beginning of period                                                3,893           4,938
---------------------------------------------------------------------------------------------------
Cash at end of period                                                    $17,038         $ 1,091
===================================================================================================

Supplemental disclosure of noncash financing activities:
  Unrealized loss on derivative financial instrument                     $(2,833)        $(9,274)


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




       INTEGRATED DEFENSE TECHNOLOGIES, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1: BASIS OF PRESENTATION

        The  accompanying  unaudited condensed consolidated  financial
        statements  of  Integrated  Defense  Technologies,  Inc.   and
        subsidiaries   (the   "Company")   have   been   prepared   on
        substantially   the  same  basis  as  the   Company's   annual
        consolidated  financial  statements  and  should  be  read  in
        conjunction  with the Company's Prospectus dated February  26,
        2002  filed  with  the Securities and Exchange  Commission  on
        February 27, 2002 pursuant to Rule 424(b)(1) of the Securities
        Act  of  1933.  In the opinion of management, the accompanying
        unaudited condensed consolidated financial statements  contain
        all   adjustments  (consisting  of  normal  recurring   items)
        necessary  for a fair presentation of results for the  interim
        periods   presented.  The  consolidated  results  for  interim
        periods are not necessarily indicative of the results that may
        be  expected for the full year.  Certain prior period  amounts
        have  been  reclassified  to provide  comparability  with  the
        current presentation.

NOTE 2: REFINANCING

        On  February 27, 2002, the Company completed an initial public
        offering of 6,000,000 shares of common stock at $22 per share,
        generating net cash proceeds of $116,688,000.  The majority of
        these  proceeds were used for debt retirement and refinancing.
        Concurrent  with  the  closing of the  offering,  the  Company
        repaid  the  outstanding balances on its revolving credit  and
        term   loan  agreement  and  its  senior  subordinated   notes
        ($125,836,000 and $51,250,000, respectively) and replaced  the
        previous  revolving credit and term loan facility with  a  new
        facility  provided  by a syndicate of financial  institutions.
        This  new  facility provided financing of up to  $125,000,000,
        consisting   of  a  $40,000,000  five-year  revolving   credit
        facility, a $40,000,000 five-year term loan, and a $45,000,000
        six-year  term loan.  At September 27, 2002, the  Company  had
        outstanding  borrowings  of $83,763,000  under  the  facility,
        consisting  of $38,875,000 under the five-year term  loan  and
        $44,888,000  under  the  six-year  term  loan.    The  current
        interest   rates  on  these  loans  are  4.007%  and   4.257%,
        respectively.

        On November 1, 2002, in connection with its acquisition of BAE
        SYSTEMS Advanced Systems Gaithersburg, Maryland operation (see
        Note  12),  the  Company  amended and restated  its  revolving
        credit and term loan facility. The amendment increased the six-
        year  term loan by $135,000,000, increased availability  under
        the  revolving credit facility by $5,000,000, and updated  the
        financial  covenants  to  reflect  the  integration   of   the
        Gaithersburg operation into the Company.   As of the  date  of
        this  Form 10-Q filing, the Company had outstanding borrowings
        of  $225,025,000 under the facility, consisting of $37,750,000
        under the five-year term loan, $179,775,000 under the six-year
        term  loan, and $7,500,000 borrowed under the revolving credit
        facility.   The current interest rates on the additional  term
        loan  borrowing and on the revolving credit facility are 5.39%
        and 4.39%, respectively.

        Borrowings under the amended facility are secured by a  pledge
        of substantially all of the Company's assets and bear interest
        at a base rate or LIBOR plus an applicable margin ranging from
        2%  to  4%.  Available borrowings under the  revolving  credit
        facility  are determined by the Company's borrowing  base,  as
        defined  in  the  agreement, which is  calculated  based  upon
        eligible accounts receivable and inventories.

        The  amended revolving credit and term loan agreement contains
        certain  financial covenants of the Company, including,  among
        other    things,    limitations   on   capital   expenditures,
        investments,  and  asset  sales, and  maintenance  of  certain
        financial  ratios.  The Company was in compliance  with  these
        covenants as of the date of this Form 10-Q filing.

        In connection with the early retirement and refinancing of its
        prior  credit facility in February 2002, the Company  incurred
        one-time  charges  totaling $20,696,000, including  prepayment
        penalties,  write-offs of capitalized debt issuance  costs,  a
        write-off   of   the  unamortized  discount  on   the   senior
        subordinated  notes, and payments to terminate  interest  rate
        swap   agreements  associated  with  the   debt.    The   swap
        termination  payments totaled $7,571,000 and are reflected  as
        "Refinancing costs" in the Company's consolidated statement of
        operations for the nine months ended September 27, 2002.   The
        remaining  charges  are reflected, net of the  associated  tax
        benefit  of  $5,119,000, as an "Extraordinary  loss  on  early
        extinguishment of debt" in that statement of operations.

        In  February 2002, the Company capitalized $4,629,000 of  debt
        issuance costs associated with the  revolving credit and  term
        loan  agreement,  consisting primarily of  legal  fees  and  a
        facility  fee paid to the new lenders.  These costs are  being
        amortized on a straight-line basis over the six-year  term  of
        the  agreement.  The unamortized balance at September 27, 2002
        of  $4,182,000 is included in "Other assets" in the  Company's
        consolidated balance sheet as of that date.

NOTE 3: INVENTORIES

        Inventories consist of the following:
        ----------------------------------------------------------------------
                                                 September 27,    December 31,
                                                     2002             2001
        ----------------------------------------------------------------------
        (In thousands)

        Stock materials                             $10,029        $15,034
        Work-in-process                              10,014          5,523
        Finished goods                                    9            458
        ----------------------------------------------------------------------
                                                     20,052         21,015
        Less reserve for excess and obsolescence      7,352          7,448
        ----------------------------------------------------------------------
          Inventories, net                          $12,700        $13,567
        ======================================================================

        Stock materials, work-in-process and finished goods are stated
        primarily at the lower of first-in, first-out ("FIFO") cost or
        market.

        Work-in-process and finished goods inventory consist primarily
        of  electronic  components for use in fulfilling  current  and
        future contracts.

NOTE 4: PROPERTY AND EQUIPMENT

        Property   and   equipment,   net  includes   allowances   for
        depreciation  of $64,024,000 and $59,832,000 at September  27,
        2002 and December 31, 2001, respectively.

NOTE 5: DERIVATIVE FINANCIAL INSTRUMENTS

        The  Company  has  from time to time used interest  rate  swap
        agreements  to  manage the risk associated with interest  rate
        fluctuations on its variable rate debt. In October  2000,  the
        Company  entered  into  three such  agreements  with  notional
        amounts  of  $25,000,000, $10,000,000, and $60,000,000,  under
        which the Company paid fixed interest rates ranging from 6.39%
        to  6.75% and received a variable LIBOR-based rate of interest
        from the holders of the agreements.  The difference in the pay
        and  receive  rates  of interest was charged  or  credited  to
        interest expense as incurred.  These swap agreements increased
        interest  expense by $939,000 and $830,000 in the  first  nine
        months of 2001 and 2002, respectively.

        On  January  1, 2001, the Company adopted Financial Accounting
        Standards  Board  ("FASB") Statement of  Financial  Accounting
        Standards  No. 133, Accounting for Derivative Instruments  and
        Hedging Activities, as amended, ("SFAS 133") which establishes
        accounting  and  reporting standards for derivative  financial
        instruments, including certain derivative instruments embedded
        in  other contracts and for hedging activities.  Upon adoption
        of SFAS 133, the Company's interest rate swaps
        were   designated  as  highly  effective  cash  flow   hedges.
        Accordingly,  the  Company recognized  a  one-time  transition
        adjustment  to increase other comprehensive loss by $2,863,000
        ($1,775,000 net of income tax benefit), the fair value of  the
        interest  rate  swaps  at  January 1, 2001,  representing  the
        approximate cost to the Company of terminating the  agreements
        as of that date.  In accordance with SFAS 133, this transition
        adjustment was reflected as the cumulative effect of a  change
        in accounting principle, net of income taxes, in the Company's
        other  comprehensive loss for the nine months ended  September
        27,  2001  (see  Note  7).  At September 28,  2001,  the  swap
        agreements had a fair value of $8,335,000 ($5,171,000  net  of
        tax  benefit), resulting in a component of other comprehensive
        loss   for  the  first  nine  months  of  2001  of  $5,472,000
        ($3,396,000 net of income tax benefit).  The approximate  cost
        to  terminate  the  swaps at December 31, 2001  of  $7,326,000
        ($4,542,000  net of tax benefit) is reflected  as  "Derivative
        liabilities" in the Company's consolidated balance sheet as of
        that date.

        On  March 4, 2002, in connection with its debt retirement  and
        refinancing  (see  Note  2), the Company  paid  $7,571,000  to
        terminate its interest rate swaps.  The after tax expense  for
        the  swap termination of $4,618,000, along with the after  tax
        expense  of $506,000 associated with payments made during  the
        first  quarter of 2002 prior to the termination, is  reflected
        in  the Company's consolidated statement of operations for the
        nine months ended September 27, 2002.

        There  was  no impact to earnings due to hedge ineffectiveness
        during  the  nine month periods ended September  27,  2002  or
        September  28,  2001.   The Company does  not  use  derivative
        financial instruments for speculative or trading purposes.

NOTE 6: INCOME (LOSS) PER SHARE

        Basic  income or loss per share is computed using the weighted
        average  number of common shares outstanding.  Diluted  income
        or  loss  per  share  is computed using the  weighted  average
        number  of  common  and equivalent common shares  outstanding.
        Common  stock  warrants are the Company's  only  common  stock
        equivalent  and  are  included  in  the  calculation  only  if
        dilutive.

        On February 5, 2002, the Company's Board of Directors approved
        a  198.6359 to 1 common stock split.  All share and per  share
        amounts  for  the quarter and nine months ended September  28,
        2001 have been restated to reflect this stock split.

        On  February  27, 2002, in connection with its initial  public
        stock offering, the Company issued 6,000,000 additional shares
        of  common  stock  and  warrant holders converted  outstanding
        warrants  into  235,749 shares of Company  common  stock.   On
        September  6,  2002, warrant holders converted  the  remaining
        outstanding  warrants  into  1,526,939  shares  of  restricted
        common  stock.   The Company no longer has  any  common  stock
        warrants outstanding.

        The  computations of basic and diluted weighted-average shares
        outstanding  for  the  quarters and nine month  periods  ended
        September 27, 2002 and September 28, 2001 are as follows.


--------------------------------------------------------------------------------
                            Quarter ended,              Nine months ended,
                     September 27,  September 28,  September 27,   September 28,
                         2002           2001           2002            2001
--------------------------------------------------------------------------------

Weighted-average shares
 outstanding -- basic     20,215,921  13,565,243     18,638,852     13,565,243
Dilutive effect
 of warrants               1,112,015   1,762,695      1,436,338            ---
--------------------------------------------------------------------------------
Weighted-average shares
 outstanding -- diluted   21,327,936  15,327,938     20,075,190     13,565,243
================================================================================


        Anti-dilutive shares were 1,762,695 for the nine months ended
        September 28, 2001.

NOTE 7: COMPREHENSIVE INCOME (LOSS)

        Comprehensive income (loss) includes net income (loss) as well
        as all other nonowner changes in equity. The components of the
        Company's  comprehensive income (loss) for  the  quarters  and
        nine month periods ended September 27, 2002 and September  28,
        2001  are  presented below, net of related income tax effects.
        See  Note  5  for further information regarding the derivative
        financial  instruments used by the Company and the  impact  of
        those  derivatives  on  the Company's  consolidated  financial
        position and results of operations.

   
   
   ---------------------------------------------------------------------------------------------------------------
                                                             Quarter ended,               Nine months ended,
                                                       September 27,  September 28,   September 27,  September 28,
                                                            2002          2001            2002          2001
   ---------------------------------------------------------------------------------------------------------------
   (In thousands)
                                                                                           

   Net income (loss)                                        $4,614          $129          $(1,968)     $(1,753)
   Other comprehensive income (loss):
     Cumulative effect of change in accounting principle
       with respect to derivative financial instruments        ---           ---              ---       (1,775)
     Unrealized loss on derivative financial instruments       ---        (2,620)            (582)      (3,978)
     Realized loss on derivative financial instruments
       charged to net income (loss)                            ---           274            5,124          582
     Minimum pension liability adjustment                      (81)          ---             (106)         ---
   ---------------------------------------------------------------------------------------------------------------
      Comprehensive income (loss)                           $4,533       $(2,217)          $2,468      $(6,924)
   ===============================================================================================================
   

NOTE 8: SEGMENT INFORMATION

        The  Company's  business  consists  of  three  operating
        segments:  Electronic  Combat  Systems,  Diagnostics  &  Power
        Systems,  and  Communications & Surveillance  Systems.   These
        reportable  segments are defined primarily by  their  economic
        characteristics,  the nature of their products  and  services,
        and by their class of customer.

        The  Electronic  Combat Systems segment  designs,  integrates,
        manufactures,  and  sells electronics and  avionics  equipment
        primarily  to  the  U.S. Government for  military,  civil  and
        governmental  uses,  and  designs, manufactures  and  supports
        advanced  test  and evaluation systems, rangeless  air  combat
        training  systems,  threat simulation  equipment,  high  power
        transmitters, and control subsystems for both guided bombs and
        missile  launching systems for the U.S. Department of Defense,
        major defense prime contractors and foreign government defense
        agencies.

        The  Diagnostics  &  Power  Systems segment  is  a  contractor
        primarily to the U.S. Government and foreign governments,  and
        designs,  manufactures  and supports test  equipment,  vehicle
        electronics  systems and energy management  systems  primarily
        for military combat vehicle applications.

        The  Communications & Surveillance Systems segment designs and
        manufactures meteorological surveillance and analysis systems,
        more  commonly  known as Doppler weather  radar  systems,  and
        designs and produces advanced electronics systems, subsystems,
        components  and radio transmission products for  the  defense,
        aerospace  and communications industries for U.S. and  foreign
        government agencies and commercial customers.

        The  Company  evaluates performance of the operating  segments
        based   on  revenue  and  earnings  before  interest,   taxes,
        depreciation,  and  amortization  ("EBITDA"),  calculated   as
        income  from  operations plus depreciation  and  amortization.
        The   accounting  policies  of  the  operating  segments   are
        consistent across segments and are the same as those  used  in
        preparation  of the consolidated financial statements  of  the
        Company.  (See  Note  2  of  Notes to  Consolidated  Financial
        Statements included in the Company's Prospectus dated February
        26, 2002 filed with the Securities and Exchange Commission  on
        February 27, 2002 pursuant to Rule 424(b)(1) of the Securities
        Act   of  1933.)   Sales  among  the  operating  segments  are
        insignificant.   With  the exception  of  debt  issuance  cost
        amortization related to the Company's new revolving credit and
        term  loan  facility,  the Company's  corporate  expenses  are
        allocated  in  full to the segments on the basis  of  relative
        employment,  revenue, and selected assets.   Corporate  assets
        and  expenses  are  included in "All other" in  the  following
        tables.

        The following table sets forth revenue and EBITDA by operating
        segment  for  the  quarters  and  nine  month  periods   ended
        September 27, 2002 and September 28, 2001.

        
        
        --------------------------------------------------------------------------------------------------------
                                                             Quarter ended,              Nine months ended,
                                                      September 27,  September 28,  September 27,  September 28,
                                                           2002          2001           2002           2001
        --------------------------------------------------------------------------------------------------------
        (In thousands)
                                                                                           
        REVENUES FROM UNAFFILIATED CUSTOMERS:
         Electronic Combat Systems                        $37,165       $30,199       $105,290        $ 91,860
         Diagnostics & Power Systems                       23,012        22,448         64,599          52,162
         Communications & Surveillance Systems             15,585        15,090         46,070          44,655
         All other                                            (39)          131            256             584
        --------------------------------------------------------------------------------------------------------
           Total                                          $75,723       $67,868       $216,215        $189,261
        ========================================================================================================

        OTHER FINANCIAL INFORMATION:
        --------------------------------------------------------------------------------------------------------
        EBITDA:
         Electronic Combat Systems                        $ 6,811       $ 5,399        $18,441         $18,627
         Diagnostics & Power Systems                        3,179         3,474          7,466           5,769
         Communications & Surveillance Systems              1,457         1,401          5,981           3,165
         All other                                             23            (1)          (295)             22
        --------------------------------------------------------------------------------------------------------
           Total                                          $11,470       $10,273        $31,593         $27,583
        ========================================================================================================
        

        EBITDA   is  not  a  presentation  made  in  accordance   with
        accounting principles generally accepted in the United States,
        and as such, it should not be considered in isolation or as  a
        substitute  for  net income (loss), cash flows from  operating
        activities  or  other  income  or  cash  flow  statement  data
        prepared  in  accordance with accounting principles  generally
        accepted in the United States or as a measure of profitability
        or  liquidity.   The  Company monitors EBITDA  by  segment  to
        determine each segment's ability to satisfy its debt  service,
        capital  expenditures  and  working capital  requirements  and
        because  certain  covenants in the Company's revolving  credit
        and  term loan facility are based upon similar measures.   The
        Company's  EBITDA  is  not  necessarily  comparable  to  other
        similarly   titled  captions  used  by  other  companies.    A
        reconciliation of the Company's EBITDA to income (loss) before
        income taxes and extraordinary loss is presented in the  table
        below.

        RECONCILIATION OF EBITDA TO INCOME (LOSS)BEFORE INCOME TAXES AND
        EXTRAORDINARY LOSS:

        
        
        --------------------------------------------------------------------------------------------------------
                                                             Quarter ended,              Nine months ended,
                                                     September 27,  September 28,   September 27,  September 28,
                                                         2002            2001           2002          2001
        --------------------------------------------------------------------------------------------------------
        (In thousands)
                                                                                         
           EBITDA                                       $11,470         $10,273        $31,593       $27,583
           Less:Depreciation and amortization
                   expense                                2,863           4,691          8,766        13,436
                Interest expense                            958           5,224          5,808        14,883
                Refinancing costs                           ---             ---          7,571           ---
                Other expense (income) - net                383            (277)           139          (277)
        --------------------------------------------------------------------------------------------------------
             Income (loss) before income taxes and
                extraordinary loss                      $ 7,266         $   635        $ 9,309       $  (459)
        ========================================================================================================
        

        The  following table presents total assets for each  of  the
        Company's  operating  segments as of September  27, 2002 and
        December  31,  2001.  The December 31, 2001  asset  balances
        have  been  reclassified  to  reflect  the  reallocation  of
        goodwill in accordance with SFAS 142.
        ----------------------------------------------------------------------
                                                September 27,    December 31,
                                                    2002            2001
        ----------------------------------------------------------------------
        (In thousands)

        Total assets:
          Electronic Combat Systems               $152,236         $151,748
          Diagnostics & Power Systems               57,644           51,373
          Communications & Surveillance Systems     58,575           58,452
          All other                                 33,815           16,725
        ----------------------------------------------------------------------
            Total                                 $302,270         $278,298
        ======================================================================

        The increase in "All other" assets (essentially corporate)  is
        due  primarily to the Company's first quarter 2002 refinancing
        activities   (see  Note  2).   Corporate  assets   have   been
        increased by the net cash generated from the Company's  public
        offering,  by  cash  generated from the  Company's  operations
        during  the  first  nine months of 2002, by  capitalized  debt
        issuance  costs,  and  by an increase in deferred  tax  assets
        associated  with the extraordinary loss and other  refinancing
        costs  incurred  in first quarter 2002.  Prior  to  the  first
        quarter 2002 refinancing, capitalized debt issuance costs  had
        been allocated to the segments on a similar basis as corporate
        expenses.   The  write-off of capitalized debt issuance  costs
        associated  with  the debt that was retired in  first  quarter
        2002   reduced  the  assets  of  Electronic  Combat   Systems,
        Diagnostics & Power Systems, and Communications & Surveillance
        Systems by $3,100,000, $600,000, and $1,300,000, respectively.

        The increase in Diagnostics & Power Systems assets is due
        primarily to a $5,630,000 increase in the segment's accounts
        receivable, reflecting the growth in the segment's revenues.

NOTE 9: GOODWILL AND OTHER INTANGIBLE ASSETS

        Effective  January  1,  2002,  the  Company  adopted  the
        provisions of FASB Statement of Financial Accounting Standards
        No.  142,  Goodwill and Other Intangible Assets ("SFAS  142"),
        under which the Company's goodwill is no longer amortized  and
        is instead subject to annual impairment tests using a new fair
        value based approach.  The Company's other recorded intangible
        assets,  which are immaterial with respect to its consolidated
        financial position and results of operations, continue  to  be
        amortized over their estimated useful lives.

        With  the  adoption of SFAS 142, on January 1, 2002,  the
        Company  ceased amortization of its goodwill.   The  following
        table  presents the pro forma results of the Company  for  the
        quarters  and nine month periods ended September 27, 2002  and
        September 28, 2001 on a comparable basis:

    
    
    -----------------------------------------------------------------------------------------------------------------
                                                                  Quarter ended,              Nine months ended,
                                                          September 27,  September 28,   September 27,  September 28,
                                                              2002           2001            2002           2001
    -----------------------------------------------------------------------------------------------------------------
     (In thousands except per share amounts)
                                                                                              
     Reported income (loss) before extraordinary loss        $4,614        $  129            $6,038       $(1,753)

     Add back:  Goodwill amortization, net of tax               ---         1,448               ---         3,962
    -----------------------------------------------------------------------------------------------------------------
     Adjusted income before extraordinary loss               $4,614        $1,577            $6,038       $ 2,209
    =================================================================================================================

     Reported net income (loss)                              $4,614        $  129           $(1,968)      $(1,753)

     Add back:  Goodwill amortization, net of tax               ---         1,448               ---         3,962
    -----------------------------------------------------------------------------------------------------------------
     Adjusted net income (loss)                              $4,614        $1,577           $(1,968)      $ 2,209
    =================================================================================================================

    Basic income (loss) per share:

       Reported income (loss) before extraordinary loss        $.23          $.01             $ .32         $(.13)

       Goodwill amortization, net of tax                        ---           .11               ---           .29
    -----------------------------------------------------------------------------------------------------------------
          Adjusted income before extraordinary loss            $.23          $.12             $ .32         $ .16
    =================================================================================================================

       Reported net income (loss)                              $.23          $.01             $(.11)        $(.13)

       Goodwill amortization, net of tax                        ---           .11               ---           .29
    -----------------------------------------------------------------------------------------------------------------
          Adjusted net income (loss)                           $.23          $.12             $(.11)        $ .16
    =================================================================================================================

    Diluted income (loss) per share:

       Reported income (loss) before extraordinary loss        $.22          $.01             $ .30         $(.13)

       Goodwill amortization, net of tax                        ---           .09               ---           .27
    -----------------------------------------------------------------------------------------------------------------
           Adjusted income before extraordinary loss           $.22          $.10             $ .30         $ .14
    =================================================================================================================

       Reported net income (loss)                              $.22          $.01             $(.11)        $(.13)

       Goodwill amortization, net of tax                        ---           .09               ---           .27
    -----------------------------------------------------------------------------------------------------------------
           Adjusted net income (loss)                          $.22          $.10             $(.11)        $ .14
    =================================================================================================================
    

        For  impairment  testing purposes, the Company  determined  the
        value of its individual business units using a discounted cash
        flow  model,  a  guideline company model,  and  a  transaction
        model,  and  by  observation of demonstrable  fair  values  of
        comparable entities.  The Company has determined that there is
        no  impairment  of  its goodwill as of  the  January  1,  2002
        implementation date of SFAS 142.

NOTE 10: RECENT ACCOUNTING PRONOUNCEMENTS

        Effective  January 1, 2002, the Company adopted FASB Statement
        of  Financial Accounting Standards No. 144, Accounting for the
        Impairment  or  Disposal of Long-Lived  Assets  ("SFAS  144").
        SFAS  144 establishes a single accounting model for long-lived
        assets to be disposed of by sale. The adoption of SFAS 144 did
        not  have  a  material  effect on the  Company's  consolidated
        operating results or financial position.


NOTE 11: CONTINGENCIES

        As   further  described  in  the  Company's  Prospectus  dated
        February  26,  2002  filed  with the Securities  and  Exchange
        Commission on February 27, 2002 pursuant to Rule 424(b)(1)  of
        the Securities Act of 1933, the Company is involved in various
        legal  actions  arising in the normal course of its  business,
        including a National Park Service investigation regarding  the
        presence  of  residual radioactive materials and contamination
        at  a uranium mine previously owned by a predecessor of one of
        the  Company's  subsidiaries. Although the ultimate  costs  of
        these matters cannot be predicted with certainty, the outcomes
        of such legal actions are not expected, either individually or
        in  the  aggregate, to result in a material adverse effect  on
        the  Company's business, results of operations,  or  financial
        condition.   There were no material developments with  respect
        to these matters during the first nine months of 2002.

NOTE 12:  SUBSEQUENT EVENT

        On  November 1, 2002, Signia-IDT, Inc. (formerly known as  IDT
        Acquisition  Co.), a wholly-owned subsidiary of  the  Company,
        acquired  substantially all of the assets and assumed  certain
        of   the   liabilities   of  BAE  SYSTEMS   Advanced   Systems
        Gaithersburg,  Maryland operation for  $146,000,000  in  cash,
        $11,000,000  of  which  was  taken  from  the  Company's  cash
        reserves  and the remainder of which was financed  through  an
        add-on  to  the  Company's  revolving  credit  and  term  loan
        facility.   See  Note  2  of  Notes  to  Financial  Statements
        contained  in  this  Form 10-Q for details  of  the  Company's
        credit  facility  and  a  summary  of  the  November  1,  2002
        amendment.

        The  acquisition  will  be accounted for  using  the  purchase
        method  and accordingly, the purchase price, including  direct
        acquisition  costs, will be allocated to the assets  acquired,
        including  identifiable  intangible  assets,  and  liabilities
        assumed  based on their estimated fair values at the  date  of
        acquisition.  Independent appraisals will be used to determine
        the  estimated  fair  values of the assets  acquired  and  the
        liabilities  assumed, and any excess of  cost  over  the  fair
        value of the acquired net assets will be recorded as goodwill.

        The  BAE SYSTEMS Gaithersburg operation (now known as "Signia-
        IDT")  employs  over 300 people and designs  and  manufactures
        high  performance radio frequency surveillance equipment  used
        in   communications  intelligence  and  signals   intelligence
        applications.   The  operation will  be  integrated  into  the
        Company's Communications & Surveillance Systems segment in the
        fourth quarter of 2002.




ITEM 2.

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                        RESULTS OF OPERATIONS

     GENERAL

     Integrated  Defense  Technologies, Inc. (the  "Company")  is  a
designer  and  developer  of  advanced  electronics  and  technology
products  to the defense and intelligence industries. The  Company's
products  are  installed on or used in support of a broad  array  of
military platforms in order to enhance their operational performance
or  extend  their useful life.  The Company's customers include  all
branches  of  the  military services, major domestic  prime  defense
contractors   such   as   The  Boeing  Company,   General   Dynamics
Corporation,   Lockheed   Martin   Corporation,   Northrop   Grumman
Corporation,  Raytheon Company and United Defense Industries,  Inc.,
foreign defense contractors, foreign governments and U.S. Government
agencies.

     The  Company's  contracts typically fall into  two  categories:
cost-plus   and  fixed-price  contracts.  Contracts  for   research,
engineering,  prototypes, and repair and maintenance  are  typically
cost-plus  arrangements.  Customer-funded research  and  development
costs  are typically included in the Company's contracts and  booked
as revenue and cost of revenue.

     In  a  fixed-price  contract,  the  price  is  not  subject  to
adjustment based on cost incurred to perform the required work under
the contract. In a cost-plus contract, the Company is reimbursed for
allowable incurred costs plus a fee, which may be fixed or variable.
The  price  on  a  cost-plus contract is  based  on  allowable  cost
incurred,  but generally is subject to contract funding limitations.
Under  fixed-price contracts the Company agrees  to  perform  for  a
predetermined   contract  price.  Although   fixed-price   contracts
generally permit the Company to keep profits if costs are less  than
projected,  the Company bears the risk that increased or  unexpected
costs  may  reduce profit or cause the Company to sustain losses  on
the contracts. Generally, fixed-price contracts offer higher margins
than cost-plus type contracts.

     All  of  the  Company's domestic U.S. Government contracts  and
subcontracts  are  subject to audit and various  cost  controls  and
include  standard provisions for termination at the  convenience  of
the  U.S.  Government. The Department of Defense generally  has  the
right  to  object to the costs as not allowable or as  unreasonable,
which  can increase the level of costs the Company bears. Multi-year
U.S.  Government  contracts  and  related  orders  are  subject   to
cancellation  if funds for contract performance for  any  subsequent
year  are  not  available.  Foreign government  contracts  generally
include  comparable  provisions  relating  to  termination  at   the
convenience of the foreign government.

     The   Company  uses  the  percentage-of-completion  method   of
accounting  for fixed-price and cost-plus contracts and,  therefore,
matches revenue with the cost incurred on each unit produced at  the
time  the Company recognizes its sale based on the estimate of gross
profit  margin the Company expects to receive over the life  of  the
contract.  The  Company currently evaluates its estimates  of  gross
margin  on  a  monthly  basis. In addition,  the  Company  uses  the
cumulative catch-up method to recognize its changes in estimates  of
sales and gross margins during the period in which those changes are
determined. The Company charges any anticipated losses on a contract
to  operations as soon as those losses are determined. The principal
components  of the Company's contract cost of revenue are materials,
subcontractor costs, labor and overhead. The Company charges all  of
these costs to the respective contracts as incurred.

     The  Company expenses operating costs such as selling,  general
and  administrative, independent research and development costs  and
bid  and proposal costs in the period incurred. The major components
of  these  costs  are  compensation and overhead.  Capitalized  debt
issuance costs, software development costs and patents are amortized
over  their  useful  lives,  with the  amortization  of  capitalized
software  development costs included as a component of the Company's
cost of revenue. Since January 1, 2002, the Company has been subject
to  a  new  accounting standard under which it no  longer  amortizes
goodwill,  although  it  must  test its  goodwill  periodically  for
impairment.

     The  Company's results of operations, particularly its  revenue
and  gross  profits, and its cash flows may vary significantly  from
period  to period depending  upon the timing of delivery of finished
products, the terms of contracts and the level of export sales. As a
result,  period-to-period comparisons may show  substantial  changes
disproportionate  to  the  Company's underlying  business  activity.
Accordingly, the Company does not believe that its quarterly results
of  operations  are  necessarily indicative of  results  for  future
periods.

     FORWARD LOOKING STATEMENTS

     The information contained in this report, other than historical
information,  includes  forward-looking  statements,  including   in
particular  statements about plans, strategies and  prospects  under
the  heading  "Management's  Discussion and  Analysis  of  Financial
Condition  and Results of Operations." Words such as "may,"  "will,"
"expect," "anticipate," "believe," "estimate," "plan," "intend"  and
similar   expressions   in  this  report  identify   forward-looking
statements.  These forward-looking statements are based  on  current
views with respect to future events and financial performance of the
Company  and  of Signia-IDT based, in part, on assumptions  made  by
management  or other persons believed by management to be  reliable.
Actual  results could differ materially from those projected in  the
forward-looking statements.   You should also refer to those factors
disclosed  under  "Risk Factors" in the Company's Prospectus,  dated
February 26, 2002, filed with the Securities and Exchange Commission
on  February  27, 2002 pursuant to Rule 242(b)(1) of the  Securities
Act of 1933.

     The  Company's forward-looking statements are subject to  risks
and uncertainties, including:

          o    the Company's dependence on the defense industry and the
               business risks peculiar to that industry, including
               changing priorities or reductions in the U.S. Government
               defense budget;

          o    the Company's ability to obtain future government
               contracts on a timely basis;

          o    the  availability of government funding and  customer
               requirements;

          o    the potential development of new and competing technologies
               and the Company's ability to compete technologically

          o    difficulties encountered in the integration of acquired
               businesses; and

          o    general economic conditions, the competitive environment
               of the defense industry, international business and
               political conditions and timing of awards and contracts.

     As  for  the forward-looking statements that relate  to  future
financial  results and other projections, actual  results  could  be
different  due  to the inherent uncertainty of estimates,  forecasts
and  projections and may be better or worse than anticipated.  Given
these  uncertainties, you should not place any reliance on  forward-
looking   statements.  Forward-looking  statements   represent   the
Company's  estimates and assumptions only as of the date  they  were
made. The Company expressly disclaims any duty to provide updates to
forward-looking   statements  and  the  estimates  and   assumptions
associated  with them, except to the extent required  by  applicable
securities laws.

     RECENT DEVELOPMENTS

     On September 23, 2002, the Company announced the appointment of
John  J.  Sciuto as Chief Operating Officer of the corporation.   In
this   newly-created   position,  Mr.  Sciuto   will   have   direct
responsibility for the operations of all of the Company's  operating
segments.  Mr. Sciuto was formerly the Chairman, President and Chief
Executive  Officer  of Comptek Research Inc., a  niche  supplier  of
highly specialized electronic defense systems and services.  He is a
retired    Naval  Officer,  with  Bachelors  degrees   in   Aviation
Electronics and Corporate Finance.

     RESULTS OF OPERATIONS

     The   following   tables  summarize  the  Company's   operating
information as a percentage of revenue and its segment data for  the
quarters  and  nine  month  periods ended  September  27,  2002  and
September 28, 2001:



-------------------------------------------------------------------------------------------------------------------
                                                                 Quarter ended              Nine months ended
                                                         September 27, September 28,   September 27,  September 28,
                                                              2002         2001            2002           2001
-------------------------------------------------------------------------------------------------------------------
STATEMENT OF OPERATIONS AND OTHER FINANCIAL INFORMATION:
                                                                                              
Revenue                                                       100.0%       100.0%          100.0%         100.0%
Cost of revenue                                                73.4         72.2            71.1           71.0
-------------------------------------------------------------------------------------------------------------------
  Gross profit                                                 26.6         27.8            28.9           29.0

Selling, general and administrative expenses                   10.6         11.4            12.8           13.5
Research and development and bid and proposal expenses          4.3          5.3             5.2            5.1
Amortization of patents, debt issuance costs and goodwill        .3          2.9              .3            2.9
-------------------------------------------------------------------------------------------------------------------
   Income from operations                                      11.4%         8.2%           10.6%           7.5%
===================================================================================================================
EBITDA (1)                                                     15.1%        15.1%           14.6%          14.6%
===================================================================================================================

OPERATIONS INFORMATION BY SEGMENT AND OTHER FINANCIAL INFORMATION:
(In millions)

Revenue:
 Electronic Combat Systems                                    $37.1        $30.2          $105.3         $ 91.9
 Diagnostics & Power Systems                                   23.0         22.5            64.6           52.2
 Communications & Surveillance Systems                         15.6         15.1            46.1           44.6
 Other                                                          ---           .1              .2             .6
------------------------------------------------------------------------------------------------------------------
   Total revenue                                              $75.7        $67.9          $216.2         $189.3
==================================================================================================================

Gross profit:
 Electronic Combat Systems                                    $10.6        $ 9.6           $32.8          $29.7
 Diagnostics & Power Systems                                    5.3          5.2            14.5           11.2
 Communications & Surveillance Systems                          4.2          3.8            15.2           13.6
 Other                                                          ---           .3              .1             .5
------------------------------------------------------------------------------------------------------------------
   Total gross profit                                         $20.1        $18.9           $62.6          $55.0
==================================================================================================================

EBITDA (1) :
 Electronic Combat Systems                                    $ 6.8        $ 5.4           $18.4          $18.6
 Diagnostics & Power Systems                                    3.2          3.5             7.5            5.8
 Communications & Surveillance Systems                          1.5          1.4             6.0            3.2
 Other                                                          ---          ---             (.3)           ---
------------------------------------------------------------------------------------------------------------------
   Total EBITDA                                               $11.5        $10.3           $31.6          $27.6
==================================================================================================================


(1)  The  Company's EBITDA represents income from operations  plus
     depreciation and amortization.  EBITDA is not a presentation made
     in  accordance with accounting principles generally  accepted  in
     the  United  States, and as such, it should not be considered  in
     isolation  or as a substitute for net income (loss),  cash  flows
     from  operating activities or other income or cash flow statement
     data  prepared in accordance with accounting principles generally
     accepted in the United States or as a measure of profitability or
     liquidity.   The Company monitors EBITDA by segment to  determine
     each  segment's  ability  to satisfy its  debt  service,  capital
     expenditure and working capital requirements and because  certain
     covenants  in  the  Company's  revolving  credit  and  term  loan
     facility  are based upon similar measures.  The Company's  EBITDA
     is  not necessarily comparable to other similarly titled captions
     used by other companies.


     RESULTS OF OPERATIONS.    In third quarter  2002,  the  Company
earned  net  income  of $4.6 million on revenues of  $75.7  million,
compared  to  a  second quarter 2002 net income of $4.5  million  on
revenues of $72.1 million and third quarter 2001 net income  of  $.1
million on revenues of $67.9 million.  For the first nine months  of
2002, the Company incurred a net loss of $2.0 million on revenues of
$216.2 million, compared to a comparable prior year period net  loss
of $1.8 million on revenues of $189.3 million.

     On February 27, 2002, the Company completed an initial public
offering  of  6  million shares of common stock at  $22  per  share,
generating  net cash proceeds of approximately $116.7 million.   The
majority  of  these  proceeds  were used  for  debt  retirement  and
refinancing.   Concurrent  with the closing  of  the  offering,  the
Company repaid the outstanding balances on its revolving credit  and
term  loan agreement and its senior subordinated notes, and replaced
the  previous  revolving credit and term loan facility  with  a  new
facility  provided  by  a syndicate of financial  institutions.  See
"Liquidity  and Capital Resources" following for further  discussion
of  the  debt  refinancing,  as  well  as  of  terms  and  covenants
associated with the new revolving credit and term loan facility.

     The   Company  incurred  charges  related  to  its  early  debt
retirement   and  refinancing  totaling  $20.7  million,   including
prepayment penalties, write-offs of capitalized debt issuance costs,
a  write-off  of   unamortized discount on its  senior  subordinated
notes, and payments to terminate interest rate swaps associated with
its  revolving credit and term loan facility.  The swap  termination
payments  totaled  approximately $7.6 million and are  reflected  as
"Refinancing  costs"  in  the Company's  consolidated  statement  of
operations  for the first nine months of 2002.  The remaining  costs
are reflected, net of the associated tax benefit of $5.1 million, as
an  "Extraordinary  loss on early extinguishment  of  debt"  in  the
consolidated  statement  of operations for  that  same  period.  The
Company's net losses for the first quarter and first nine months  of
2002  were  primarily  the result of these  charges,  which  totaled
approximately $12.6 million net of the associated tax benefits.

     PRO FORMA RESULTS OF OPERATIONS.     Excluding  the  impact  on
earnings  of  these  debt  retirement and refinancing  charges,  the
Company  earned a pro forma net income in the first nine  months  of
2002  of  $10.7 million ($.53 per share), compared to a net loss  of
$1.8  million  ($.13  per share) in the same  prior  year  period.
Approximately  $4.8 million of the improvement from the  prior  year
period  was  the  result  of adoption of the  goodwill  amortization
provisions of SFAS 142 effective January 1, 2002.  (See  Note  9  of
Notes to Consolidated Financial Statements contained in this Form 10-
Q.)   The  remainder of the improvement was due primarily to  a  14%
revenue  increase and a $9.1 million decline in interest expense  as
the result of the Company's debt refinancing, partially offset by an
11% increase in operating expenses.

     REVENUE.     Revenue for third quarter 2002 was $75.7  million,
up 5% from the second quarter 2002 level and 12% from the same prior
year  period. Year to date revenues are $216.2 million, up 14%  from
the comparable prior year period.

     The Company's Electronic Combat Systems segment earned revenues
of $37.2 million in third quarter 2002, up 4% and 23%, respectively,
from the second quarter 2002 and third quarter 2001 levels.  Year to
date  revenues were $105.3 million, up 15% from the same prior  year
period.  The  increase in revenue from the prior  year  periods  was
primarily the result of strong bookings in fourth quarter  2001  and
in  the  first  half of 2002, including a large fourth quarter  2001
order from the U.S. Navy Fiber Optics Data Management System program
and  several orders for the segment's airborne instrumentation  pods
under  the Air Force P4 Refurbishment Contract (P4RC).  Activity  on
the  P4RC  program began to accelerate in the third quarter  as  the
planning  and  engineering  phases  were  completed  and  production
efforts were increased to meet the 2003 delivery schedule.

     Revenues for the Company's Diagnostics & Power Systems  segment
were  $23.0  million for the quarter, up 16% and  3%,  respectively,
from  the second quarter 2002 and the same prior year period levels.
Year to date revenues were $64.6 million, up 24% from the comparable
prior year period. Current year revenues for the Diagnostics & Power
Systems  segment have been strong due to strong fourth quarter  2001
orders  for  embedded diagnostics, additions to  the  scope  of  the
Abrams  Systems  Technical Support program,  earlier  than  expected
booking of the Common Support Function Module program, and an  early
contract  award  for  the  10th  Year Power  Supplies  and  Displays
program.   First quarter 2002 revenues were high due to  accelerated
production  on  the embedded diagnostics orders received  in  fourth
quarter  2001.  Embedded diagnostics revenues declined consecutively
in  the  second  and third quarters as these projects began  nearing
completion.   However, in the third quarter, this  negative  revenue
impact  was  more than offset by revenues earned on  the  10th  Year
Power Supplies and Displays program and on the hybrid electric  High
Mobility Multipurpose Wheeled Vehicle program.

     Revenues   for  the  Company's  Communications  &  Surveillance
Systems  segment were $15.6 million, down 4% from the second quarter
2002  level, but up 3% from the same prior year period. Year to date
revenues  were $46.1 million, up 3% from the comparable  prior  year
period.  Though up from the prior year level, current year  revenues
have  been  less than expected due to the first quarter  loss  of  a
weather radar system booking in Turkey. Second quarter revenues were
strong due to the completion and shipment of the first phase of  the
segment's largest program.

     GROSS PROFIT.    The Company's gross profit for third  quarter
was  $20.1 million, down from $22.3 million in second quarter  2002,
but up from $18.9 million in third quarter 2001. The dollar increase
in  gross  profit  against  the  same  prior  year  period  resulted
primarily  from the Company's increased revenues, primarily  in  its
Electronic  Combat  Systems segment.  As a  percentage  of  revenue,
gross  profit  for the quarter was 26.6%, down from  31%  in  second
quarter 2002 and 27.8% in the same prior year period.  Third quarter
2002  margin  was negatively impacted by the volume decline  in  the
Company's Communications & Surveillance Systems segment and  by  low
margin  earned  on  start-up programs in  the  Diagnostics  &  Power
Systems segment.

     The  Company's gross profit for the first nine months  of  2002
was  $62.6 million, up from $55 million in the first nine months  of
2001,  due  to  across the board revenue increases in the  Company's
operating  segments.  As a percentage of revenue, gross  profit  was
flat  with  the prior year level at approximately 29%.  One  of  the
largest  revenue  increases  from the prior  year  occurred  in  the
Company's  Diagnostics & Power Systems segment, which has  a  higher
proportion of cost-plus business than the other segments.  As  such,
its  margins  will generally be lower, and may limit improvement  in
the   consolidated  margin  percentage  in  periods   of   increased
Diagnostics  revenue  relative  to  total  revenue.   Other  factors
impacting  2002 margins include start-up production costs  resulting
from continued investment in the hybrid electric business and in the
Sidecar program by Diagnostics & Power Systems, and cost and  volume
issues  in  a  portion  of  the Electronic Combat  Systems  segment.
However,   these  negative  factors  were  offset  by  the  benefits
resulting from the Company's periodic downsizing and continuing cost
control  efforts,  primarily  in its Communications  &  Surveillance
Systems segment.

     SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.     The Company's
selling, general and administrative expenses for third quarter  2002
were  $8.0 million, down 18% from the second quarter 2002 level  and
up  4% from the same prior year period. Expenses for the first  nine
months of 2002 were $27.8 million, up 9% from the prior year to date
level.  The  expense  increases from  the  prior  year  levels  have
resulted   primarily   from   additional   administrative   expenses
associated  with  operating  as  a  publicly-held  company.    These
expenses  may  continue to increase, particularly in  2003,  as  the
result  of  new corporate governance legislation and the  increasing
costs  of compliance with new regulations, including but not limited
to,  increased  legal  and accounting fees and increasing  costs  of
obtaining directors and officers liability insurance.

     In  comparison  to  the second of quarter 2002,  expenses  have
declined in all of the Company's operating segments as the result of
ongoing  cost  reduction efforts and the timing of  various  selling
efforts from quarter to quarter. The Company has an aggressive cost-
cutting  plan which was put into effect during second quarter  2002,
primarily related to its general and administrative expenses.    The
most  significant  expense decline has occurred  in  the  Electronic
Combat  Systems  segment, where selling, general, and administrative
expenses  declined by $1.2 million, or 24%, from the second  quarter
level.   This  decline was primarily the result  of  second  quarter
reductions  in  force in a portion of the segment, the  benefits  of
which began to accrue in the third quarter.  Second quarter expenses
for   this  segment  were  also  inflated  by  the  severance  costs
associated with these staff reductions.

     Selling, general, and administrative expenses also continue  to
decline  as  a  percentage of the Company's revenue.  Third  quarter
2002  expenses  were  10.6% of revenue, down from  13.6%  in  second
quarter 2002 and 11.4% in third quarter 2001.  Year to date expenses
have declined from 13.5% of revenue in first nine months of 2001  to
12.8% in the current year period.

     RESEARCH AND DEVELOPMENT AND BID AND PROPOSAL EXPENSES.     The
Company's  research  and development and bid and  proposal  expenses
were  $3.3 million for third quarter 2002, down 27% from the  second
quarter  2002  level and 9% from the same prior year  period.  As  a
percentage of revenue, research and development and bid and proposal
expenses were 4.3% for the quarter, down from 6.2% in second quarter
2002  and  5.3% in third quarter 2001.  Second quarter 2002 expenses
were  inflated  by an acceleration of bid and proposal  expenses  of
approximately  $.6 million in an effort to win bookings  on  several
large  forthcoming projects.  These expenses have declined  to  more
normal  levels  in the third quarter as many of the major  proposals
have  now  been  submitted.  Research and development  efforts  also
increased  in  the  second quarter as programs were  accelerated  to
support potential new products.

     Year  to  date  research and development and bid  and  proposal
expenses were $11.4 million, up 16% from the same prior year period.
However,  as  a percentage of revenue, research and development  and
bid  and  proposal expenses remain relatively flat  with  the  prior
period at 5.2%.  Electronic Combat Systems' and Diagnostics &  Power
Systems'  expenses  increased  by  $1.9  million  and  $.6  million,
respectively, due primarily to growth in these business segments and
pursuit of some large project awards.  Communications & Surveillance
Systems'  expenses  declined  by $.8 million  from  the  prior  year
period.   Cost  containment achieved in this segment has  served  to
offset   the  additional  expenses  associated  with  its  increased
research and development and program proposal efforts.

     AMORTIZATION  OF  PATENTS,  DEBT  ISSUANCE  COSTS AND GOODWILL.
The Company's amortization expense, excluding  amounts included  in
cost  of  revenue  for  amortization  of  its  internally  developed
software,  was $.2  million and $.6 million,  respectively, in   the
third quarter and first nine  months  of  2002,  down  significantly
from  the  prior year  levels.  The  Company  ceased amortization of
its goodwill on January 1, 2002 in accordance  with  the  provisions
of  SFAS 142.    See  Note  9  of  Notes  to  Consolidated Financial
Statements contained in this Form 10-Q for  a pro forma presentation
of   results   of    operations   excluding   goodwill  amortization
for the third quarter and first nine months of 2001.

     INCOME FROM OPERATIONS.    The Company's income from operations
was $8.6 million or 11.4% of revenue for third quarter 2002, up from
$7.9  million  or  10.9%  of  revenue in  second  quarter  2002  and
$5.6 million or 8.2% of revenue in third quarter 2001. Year to date,
the  Company's income from operations was $22.8 million or 10.6%  of
revenue, up from $14.1 million or 7.5% of revenue for the same prior
year period.

     Communications & Surveillance Systems  had an operating  income
for  the  quarter of $1 million, down from $2 million in the  second
quarter, but up from $.4 million in the third quarter of 2001.  Year
to  date,  the  segment's income from operations was  $4.5  million,
compared  to  $.4  million in the first nine months  of  2001.   The
improvement  from  the  prior year levels is due  primarily  to  the
positive  results  of  the  segment's downsizing  and  cost  control
efforts  as well as to the lack of goodwill amortization expense  in
2002.   However,  the segment's third quarter operating  income  was
reduced  versus  second  quarter 2002  as  declining  volume  levels
continue to pressure its gross margin.

     Diagnostics  &  Power Systems' operating income for  the  third
quarter  and  first nine months of 2002 was $2.8  million  and  $6.2
million,  respectively, up by approximately  $.2  million  and  $3.0
million,  respectively,  over  the  comparable  prior  year  levels.
Electronic  Combat Systems' operating income for the  third  quarter
and  first  nine  months of 2002 was $5.1 million and  $13  million,
respectively,  up  by approximately $2.7 million and  $3.3  million,
respectively,  from the same prior year periods.  The  current  year
improvement  in both segments' operating results was  primarily  the
result  of  increased volumes and lack of goodwill  amortization  in
2002, partially offset by the increased operating expenses described
previously.   In  comparison to the second quarter  of  2002,  third
quarter  operating  income  for  Diagnostics  &  Power  Systems  and
Electronic Combat Systems increased by $1.1 million and $.5 million,
respectively.   These increases were due primarily to the  operating
expense  reductions achieved by these segments in the third quarter,
as well as to their increased revenue levels.

     INTEREST EXPENSE.     The Company's interest  expense  for  the
third quarter and first nine months of 2002 was $1 million and  $5.8
million,   respectively,  down  $4.3  million  and   $9.1   million,
respectively, from the comparable prior year levels.   The  interest
expense  decline is due primarily to the reduction in debt  achieved
through  the Company's first quarter 2002 refinancing.  In addition,
average  LIBOR rates have declined by approximately 2.1 points  from
the comparable prior year level.  The Company's interest expense can
be  expected to increase in the fourth quarter as the result of  the
additional  debt incurred under its amended credit  facility.   (See
"Liquidity and Capital Resources" following.)  The Company estimates
that the additional borrowings under the facility will increase  its
annual interest expense by approximately $9 million.

     INCOME TAX EXPENSE.     The Company recorded income tax expense
of  $2.7  million, or 36.5% of pretax income, in third quarter  2002
and  an income tax benefit of $1.8 million (including the income tax
benefit related to its extraordinary loss), or 48.4% of pretax loss,
year  to date.   In the third quarter and first nine months of 2001,
the  Company  recorded income tax expense of $.5  million  and  $1.3
million, respectively, on pretax income (losses) of $.6 million  and
($.5  million),  respectively.  The Company's effective  income  tax
rates  exceeded the U.S. federal statutory rates in all periods  due
primarily    to   non-deductible   expenses,   including    goodwill
amortization in 2001.

     EBITDA.     The  Company's EBITDA was $11.5 million  for  third
quarter  2002,  up  from $10.8 million in second  quarter  2002  and
$10.3  million  in third quarter 2001. As a percentage  of  revenue,
third quarter EBITDA was basically flat with the second quarter 2002
and third quarter 2001 levels at 15.1%.  Year to date, the Company's
EBITDA  was  $31.6 million, up from $27.6 million in the  comparable
prior year period. However, as a percentage of revenue, year to date
EBITDA also was flat with the prior year period at 14.6%.

     Communications  & Surveillance Systems' EBITDA  for  the  third
quarter  and  first nine months of 2002 was $1.5 million  and   $6.0
million,  respectively, compared to $1.4 million and  $3.2  million,
respectively,  for the same prior year periods.  As a percentage  of
revenue, the segment's year to date EBITDA has improved to  13%,  up
from  7.1%  for the first nine months of 2001.  This improvement  is
primarily  the result of the segment's downsizing and  cost  control
efforts.

     Diagnostics  & Power Systems' EBITDA for the third quarter  and
first  nine  months  of  2002 was $3.2 million  and   $7.5  million,
respectively,   compared   to  $3.5  million   and   $5.8   million,
respectively,  for the same prior year periods.  As a percentage  of
revenue, the segment's year to date EBITDA is up slightly to  11.6%,
compared  to  11.1%  for  the  first  nine  months  of  2001.   This
improvement was primarily the result of increased volume,  partially
offset by increased operating expenses.

     Electronic  Combat  Systems' EBITDA for the third  quarter  and
first  nine  months  of 2002 was $6.8 million  and   $18.4  million,
respectively,   compared  to  $5.4  million   and   $18.6   million,
respectively, for the comparable prior year periods.  The  segment's
year to date EBITDA has also declined to 17.5% of revenue, down from
20.3% for the first nine months of 2001, as the negative effects  of
the  segment's increased operating expenses have only been partially
offset by its improved revenues.

     SUBSEQUENT EVENT.    On  November  1,  2002,  Signia-IDT,  Inc.
(formerly  known as IDT Acquisition Co.), a wholly-owned  subsidiary
of the Company, acquired substantially all of the assets and assumed
certain   of  the  liabilities  of  BAE  SYSTEMS  Advanced   Systems
Gaithersburg,  Maryland  operation for $146  million  in  cash,  $11
million of which was taken from the Company's cash reserves and  the
remainder  of which was financed through an add-on to the  Company's
revolving credit and term loan facility.  See "Liquidity and Capital
Resources"  following for details of the Company's  credit  facility
and a summary of the November 1, 2002 amendment.

     The acquisition will be accounted for using the purchase method
and  accordingly,  the purchase price, including direct  acquisition
costs,   will  be  allocated  to  the  assets  acquired,   including
identifiable  intangible assets, and liabilities  assumed  based  on
their estimated fair values at the date of acquisition.  Independent
appraisals  will be used to determine the estimated fair  values  of
the  assets acquired and the liabilities assumed, and any excess  of
cost over the fair value of the acquired net assets will be recorded
as goodwill.

      The  BAE SYSTEMS Gaithersburg operation (now known as "Signia-
IDT")  employs  over  300 people and designs and  manufactures  high
performance   radio   frequency  surveillance  equipment   used   in
communications  intelligence and signals intelligence  applications.
The operation will be integrated into the Company's Communications &
Surveillance Systems segment in the fourth quarter of 2002.


     LIQUIDITY AND CAPITAL RESOURCES

     In  the first nine months of 2002 the Company generated cash of
$13.1  million,  primarily  from its operations  and  from  the  net
proceeds  of  its  initial  public offering  and  debt  refinancing,
compared  to a net cash use of $3.8 million in first nine months  of
2001. Cash provided by operations totaled $11.8 million in the first
nine  months of 2002, compared to $2.8 million generated in the same
prior year period.

     Capital  expenditures in the first nine  months  of  2002  were
$6.1 million, up $2.6 million from the comparable prior year period.
The Company's capital expenditures consist primarily of purchases of
test   equipment,  office  equipment  and  building  and   leasehold
improvements.  Due to the nature of the Company's business,  capital
expenditures  have  historically not been substantial.  The  Company
expects  that  its  total capital expenditures for  2002,  excluding
those  of  Signia-IDT  from the acquisition date  forward,  will  be
within the range of  $7 to $8 million.

     On  February 27, 2002, the Company completed an initial  public
offering  of  6  million shares of common stock at  $22  per  share,
generating  net  cash  proceeds  of  approximately  $116.7  million.
Concurrent with the closing of the offering, the Company repaid  the
outstanding balances on its revolving credit and term loan agreement
and its senior subordinated notes ($125.8 million and $51.3 million,
respectively)  and replaced the previous revolving credit  and  term
loan  facility  with  a  new facility provided  by  a  syndicate  of
financial institutions.  This new facility provided financing of  up
to  $125  million,  consisting of a $40 million five-year  revolving
credit  facility,  a  $40 million five-year term  loan,  and  a  $45
million  six-year  term  loan. Borrowings under  the  facility  were
secured by a pledge of substantially all of the Company's assets and
bore  interest  at  a base rate or LIBOR plus an  applicable  margin
ranging  from 2% to 2.75%. Available borrowings under the  revolving
credit facility were determined by the Company's borrowing base,  as
defined  in the agreement, which was calculated based upon  eligible
accounts  receivable  and inventories. At September  27,  2002,  the
Company  had  outstanding  borrowings of  $83.8  million  under  the
facility, consisting of $38.9 million under the five-year term  loan
and  $44.9  million  under the six-year  term  loan.    The  current
interest rates on these loans are 4.007% and 4.257%, respectively.

     On  November  1,  2002, in connection with its  acquisition  of
Signia-IDT (see "Subsequent Event" preceding), the Company  amended
and  restated  its  revolving credit and  term  loan  facility.  The
amendment  increased  the  six-year  term  loan  by  $135   million,
increased  availability under the revolving credit  facility  by  $5
million,  and  updated the financial covenants in the  agreement  to
reflect   the   integration  of  Signia-IDT   into   the   Company's
Communications & Surveillance Systems segment.   As of the  date  of
this  Form  10-Q filing, the Company had outstanding  borrowings  of
$225  million under the facility, consisting of $37.7 million  under
the  five-year  term loan, $179.8 million under  the  six-year  term
loan,  and  $7.5  million under the revolving credit  facility.  The
current interest rates on the additional term loan borrowing and  on
the revolving credit facility are 5.39% and 4.39%, respectively.

     Borrowings under the amended facility are secured by a  pledge
of substantially all of the Company's assets and bear interest at  a
base rate or LIBOR plus an applicable margin ranging from 2% to  4%.
Available  borrowings  under  the  revolving  credit  facility   are
determined  by  the  Company's borrowing base,  as  defined  in  the
agreement,   which  is  calculated  based  upon  eligible   accounts
receivable and inventories.

     The  revolving credit and term loan agreement contains certain
financial  covenants of the Company, including, among other  things,
limitations  on capital expenditures, investments, and asset  sales,
and  maintenance of certain financial ratios.  The  Company  was  in
compliance  with these covenants as of the date of  this  Form  10-Q
filing.

     In  connection  with the refinancing of its  debt  in  February
2002,  the  Company paid approximately $10.1 million in  refinancing
costs, primarily for prepayment penalties and swap termination costs
(see "Results of Operations" above) and capitalized $4.6 million  of
debt  issuance  costs associated with the new revolving  credit  and
term  loan  agreement, consisting primarily  of  legal  fees  and  a
facility fee paid to the new lenders.

     Historically,  the Company's primary source  of  liquidity  has
been  cash  provided  by operations, derived from  net  income  plus
depreciation  and amortization and plus or minus net investments  in
working  capital  from  period to period.  The  Company's  liquidity
position  is dependent on a number of factors, including the  timing
of  production  and delivery on sales contracts and  the  timing  of
billing   and  collection  activity.   Purchase  of  materials   for
production and payment for labor and overhead expenses can represent
significant advance expenditures, and billing to and collection from
customers  can lag those expenditures significantly on some  longer-
term customer contracts.  The Company's billing arrangements include
(a)  monthly progress payments (typically on fixed-price  contracts)
in  which customers are billed 80% of incurred cost plus general and
administrative expenses but without profit, (b) monthly  billing  in
full   at   cost  incurred  plus  profit  (typically  on   cost-plus
contracts), (c) periodic milestone achievement-based billing at cost
incurred  plus  profit, and (d) billing at final  delivery  at  cost
incurred  plus  profit.  Fixed-price contracts, some milestone-based
billing  contracts,  and  bill-at-delivery  contracts  represent   a
significant  required use of working capital for  the  Company  that
must be funded by operations or through external sources.

     The  Company's  liquidity  and ability  to  generate  cash  has
improved   during  2002,  and  the  Company  anticipates   continued
improvement in its operating cash flows as the receivables built  up
in  the  first  nine  months of the year are collected  and  as  the
Company  continues to focus on reducing its investment  in  unbilled
receivables.     Based  on  its  current  level  of  operations  and
anticipated growth, including that of the newly acquired Signia-IDT,
the  Company  believes that cash proceeds from  the  initial  public
offering  and  cash from operations and other available  sources  of
liquidity,  including borrowings under the amended revolving  credit
and  term  loan facility, will be sufficient to fund its  operations
for  at  least the next two years.  The Company does not  anticipate
any  significant nonoperating events that will require  the  use  of
cash,  other  than potential acquisitions of companies which  are  a
match for existing and potential products and business.  Though  the
Company  is continuously evaluating such opportunities,  as  of  the
date  of  this  Form  10-Q filing, it does not have  any  definitive
acquisition negotiations in process.

     The Company has contractual obligations to make future payments
under   its   amended  term  loan  agreement  and  under   long-term
noncancelable  lease  agreements.  The following  table  sets  forth
these  contractual  obligations as of the date  of  this  Form  10-Q
filing.   These  numbers do not include any contractual  obligations
under operating leases which may be assumed by Signia-IDT.
----------------------------------------------------------------------------
                                 Payments due by period
----------------------------------------------------------------------------
Contractual Obligation      2002     2003-2006    2007 and beyond      Total
----------------------------------------------------------------------------
(In millions)

Term loans                  $1.6       $41.0           $182.4         $225.0
Operating leases             1.3        16.4              2.5           20.2
----------------------------------------------------------------------------
  Total                     $2.9       $57.4           $184.9         $245.2
============================================================================

     The Company's term loan obligations for 2007 and beyond relate
primarily to its six-year term loan, which must be paid in  full  by
March  4,  2008.  The Company may prepay any obligations  under  its
revolving  credit  and  term  loan  facility  without  penalty.   In
addition,  the  lenders under the facility may  require  prepayments
from  the proceeds of certain transactions, including sales  of  net
assets,   issuance   of  equity  securities,  insurance/condemnation
settlements, and the reversion of surplus assets from pension plans,
as  well as from any excess cash flows, as defined in the agreement,
generated by the Company during a fiscal year.

     The  Company's noncancelable operating leases are primarily for
office   space  and  manufacturing  equipment.   Certain  of   these
agreements  are  subject  to  periodic  escalation  provisions   for
increases in real estate taxes and other charges.


     BACKLOG

     The  Company  defines backlog as the value of  contract  awards
received  from  customers which have not been recognized  as  sales.
Funded  backlog refers to contract awards for which the Company  has
received  orders  and  the  customer has obligated  funds.  Unfunded
backlog  consists of potential product orders relating  to  existing
customer  contracts  that are the subject of  customer  options  for
additional  products  or potential orders under  existing  contracts
that receive annual or incremental funding. A significant portion of
sales  are  to  prime contractors, the Department  of  Defense,  and
foreign  governments  pursuant to long-term contracts.  Accordingly,
the  backlog consists in large part of orders under these contracts.
As  of  September  27, 2002, funded backlog was $233.1  million  and
total backlog was $383.8 million.

     The  following  depicts  the Company's  backlog  of  orders  by
business segment at September 27, 2002 and December 31, 2001:



--------------------------------------------------------------------------------------------------------
                                                        FUNDED                    UNFUNDED
                                             September 27,  December 31,  September 27,  December 31,
                                                 2002           2001          2002           2001
--------------------------------------------------------------------------------------------------------
 (In millions)
                                                                                
Electronic Combat Systems                       $135.9         $125.8         $131.1        $160.6
Diagnostics & Power Systems                       57.6           51.7           17.6           1.5
Communications & Surveillance Systems             39.6           43.9            2.0           8.8
--------------------------------------------------------------------------------------------------------
  Total Backlog                                 $233.1         $221.4         $150.7        $170.9
========================================================================================================


     While  it  is  expected that a substantial  portion  of  funded
backlog  will be converted to revenue during the next twelve months,
the  Company cannot provide assurance that the backlog, both  funded
and  unfunded, will become revenue in any particular period,  if  at
all.   Uncertain  timing  of  bookings and  revenue  recognition  is
typical in the industry in which the Company conducts business.

     RELATED PARTY TRANSACTIONS

     The Company pays Veritas Capital Management, L.L.C. ("Veritas")
an  annual management fee.  Veritas controls the Company's principal
stockholder, IDT Holding, L.L.C.  The Company paid $675 thousand  in
management fees to Veritas in the first nine months of both 2001 and
2002.  The Company was not indebted to its principal stockholder  or
to Veritas at September 27, 2002 or December 31, 2001.  In addition,
in connection with the Company's initial public offering on February
27, 2002, the Company paid a transaction advisory fee to The Veritas
Capital  Fund,  L.P. in the amount of $1.5 million, and  anticipates
payment of a similar fee in the amount of $2.5 million in connection
with   the  November  1st  acquisition  of  Signia-IDT  and  related
refinancing  described previously in this Form 10-Q.  Robert  McKeon
and  Thomas  Campbell, the Chairman and a member  of  the  Board  of
Directors, respectively, are managing members of Veritas.

     William G. Tobin, a member of the Board of Directors and  audit
committee,  is a Managing Director and Chairman of the  Defense  and
Aerospace practice of Korn/Ferry International, an executive  search
firm.   The Company contracted with Korn/Ferry to conduct its search
for  a  Chief  Operating  Officer.  During  the  nine  months  ended
September  27,  2002,  the  Company  made  installment  payments  to
Korn/Ferry totaling approximately $177 thousand.

     Edward  N.  Ney, a member of the Board of Directors  and  audit
committee,  is Chairman Emeritus of Young & Rubicam, an  advertising
firm for which he previously served as President and Chief Executive
Officer.   The  Company  has contracted with  Burson-Marsteller,  an
affiliate  of  Young  &  Rubicam, to  manage  its investor relations
functions.  During the nine  months  ended September 27,  2002,  the
Company  made payments to Burson-Marsteller  totaling approximately
$210 thousand.

     CRITICAL ACCOUNTING POLICIES AND ESTIMATES

     Management's Discussion and Analysis of Financial Condition and
Results  of  Operations  is  based upon the  Company's  consolidated
financial  statements, which have been prepared in  accordance  with
accounting principles generally accepted in the United States.   The
preparation  of  these financial statements requires  management  to
make estimates and assumptions which affect the amounts reported  in
the financial statements and determine whether contingent assets and
liabilities, if any, are disclosed in the financial statements.   On
an   ongoing   basis,  the  Company  evaluates  its  estimates   and
assumptions, including those related to long-term contracts, product
returns  and  warranty  obligations,  bad  debts,  inventories,  the
recoverability of goodwill and other intangible assets, fixed  asset
lives,  income  taxes, self-insurance reserves, pensions  and  other
post-retirement  benefits,  environmental  matters,  litigation  and
other   contingencies.   The  Company  bases   its   estimates   and
assumptions  on historical experience and on various  other  factors
that   are  believed  to  be  reasonable  under  the  circumstances,
including  current and expected economic conditions, the results  of
which  form the basis for making judgments about the carrying values
of  assets and liabilities that are not readily apparent from  other
sources.  Actual  results may differ materially from  the  Company's
estimates under different assumptions or conditions.

     The   Company   believes  the  following  critical   accounting
policies,  among others, affect its more significant  estimates  and
assumptions  used  in the preparation of its consolidated  financial
statements:

     REVENUE RECOGNITION.  The Company recognizes revenue and profit
on  substantially  all  of  its contracts using  the  percentage-of-
completion method of accounting, which relies on estimates of  total
expected  contract  revenues and costs.  The  Company  follows  this
method  since  reasonably dependable estimates of the  revenues  and
costs  applicable to various stages of the contracts  can  be  made.
Recognized  revenues  and profit are subject  to  revisions  as  the
projects progress to completion.  Revisions to the Company's  profit
estimates  are  charged to income in the period in which  the  facts
that  give rise to the revisions become known. Although the  Company
makes  provisions  for  losses on its  contracts  in  its  financial
statements,  it  cannot provide assurance that  such  contract  loss
provisions, which are based on estimates, will be adequate to  cover
all  future losses or that it will not be required to restate  prior
period  quarterly or annual financial statements as  the  result  of
errors in its estimates.

     GOODWILL.    The  Company  has  in  its  September   27,   2002
consolidated balance sheet a goodwill asset in the amount  of  $83.7
million.   In connection with the adoption of SFAS 142, the  Company
performs periodic  impairment tests of its goodwill.  The process of
evaluating goodwill for impairment involves the determination of the
fair  value of the Company's business units.  Inherent in such  fair
value  determinations are certain judgments and estimates, including
the   interpretation  of  current  economic  indicators  and  market
valuations, and assumptions about the Company's strategic plans with
regard  to  its  operations.  To the extent  additional  information
arises  or the Company's strategies change, it is possible that  the
Company's conclusions regarding goodwill impairment could change and
result in a material effect on its financial position or results  of
operations.

     INVENTORY.  The Company writes down its inventory for estimated
obsolescence  or  unmarketable items  in  an  amount  equal  to  the
difference  between the cost of inventory and its  estimated  market
value   based  upon  assumptions  about  future  demand  and  market
conditions.  If actual future demand or market conditions  are  less
favorable  than those projected by management, additional  inventory
write-downs may be required.

     INSURANCE.   The  Company records cost  estimates  for  certain
health  and welfare and workers' compensation and casualty insurance
plans that are partially self-insured by the Company.  Should actual
claims  exceed  the  estimates or should medical  costs  in  general
increase  beyond  the  estimates,  reserves  recorded  may  not   be
sufficient  and  adverse  effects  on  the  consolidated   financial
statements could occur.

     CONTINGENCIES.  As discussed in the Company's Prospectus  dated
February  26, 2002 filed with the Securities and Exchange Commission
on  February  27, 2002 pursuant to Rule 424(b)(1) of the  Securities
Act  of  1933,  the  Company is involved in  various  legal  actions
arising  in the normal course of its business, including a  National
Park  Service  investigation  regarding  the  presence  of  residual
radioactive materials and contamination at a uranium mine previously
owned  by  a predecessor of one of the Company's subsidiaries.   The
outcomes of such legal actions are not expected, either individually
or  in the aggregate, to result in a material adverse effect on  the
Company's  business, results of operations, or financial  condition.
It  is possible, however, that future results of operations for  any
particular  quarterly or annual period could be materially  affected
by   changes   in  the  Company's  assumptions  related   to   these
proceedings.  The Company accrues its best estimate of the  probable
cost  for  the  resolution  of  legal claims.   Such  estimates  are
developed  in  consultation  with  outside  counsel  handling  these
matters  and  are  based  upon  a  combination  of  litigation   and
settlement strategies.  To the extent additional information  arises
or  the  Company's  strategies  change,  it  is  possible  that  the
Company's best estimate of its liability in these matters,  if  any,
may change.

     The above listing is not intended to be a comprehensive list of
all  of  the  Company's accounting policies.   In  many  cases,  the
accounting  treatment  of a particular transaction  is  specifically
dictated  by accounting principles generally accepted in the  United
States, with no need for management's judgment of their application.
There are also areas in which management's judgment in selecting  an
available  alternative  would  not produce  a  materially  different
result.   See the Company's audited financial statements  and  notes
thereto  contained in its Prospectus dated February 26,  2002  filed
with  the  Securities and Exchange Commission on February  27,  2002
pursuant  to  Rule 424(b)(1) of the Securities Act  of  1933  for  a
discussion   of   the  Company's  accounting  policies   and   other
disclosures required by accounting principles generally accepted  in
the United States.

      RECENT ACCOUNTING PRONOUNCEMENTS

      Effective  January 1, 2002, the Company adopted  the  goodwill
amortization  provisions of FASB Statement of  Financial  Accounting
Standards  No.  142,  Goodwill and Other  Intangible  Assets  ("SFAS
142"),  under  which  the  Company's goodwill  is  no  longer  being
amortized and is instead subject to annual impairment tests using  a
new  fair  value  based  approach.   The  Company's  other  recorded
intangible  assets,  which  are  immaterial  with  respect  to   its
financial  position  and  results  of  operations,  continue  to  be
amortized over their estimated useful lives.

      For  impairment  testing purposes, the Company determined  the
value  of its reporting units using a discounted cash flow model,  a
guideline company model, and a transaction model, and by observation
of demonstrable fair values of comparable entities.  The Company has
determined  that there is no impairment of its goodwill  as  of  the
January 1, 2002 implementation date of SFAS 142.

      Effective  January 1, 2002, the Company adopted FASB Statement
of  Financial  Accounting  Standards No.  144,  Accounting  for  the
Impairment or Disposal of Long-Lived Assets ("SFAS 144").  SFAS  144
establishes  a single accounting model for long-lived assets  to  be
disposed  of  by  sale.  The adoption of SFAS 144  did  not  have  a
material  effect on the Company's consolidated operating results  or
financial position.


Item 3: Quantitative and Qualitative Disclosures About Market Risk

     The Company is exposed to potential increases in interest rates
on  its variable rate debt under its revolving credit and term  loan
agreement.  The Company does not currently have interest  rate  swap
agreements in place to mitigate this interest rate risk  as  it  did
with its previous variable rate debt.

     To  illustrate  the  sensitivity of the  Company's  results  of
operations  to  changes in interest rates on its debt,  the  Company
estimates  that  a  66% increase in LIBOR rates would  increase  its
interest expense by approximately $250,000 for the remainder of  the
year  ended  December 31, 2002.  Likewise, a 66%  decline  in  LIBOR
rates  would reduce its interest expense by approximately  $150,000.
This hypothetical change in LIBOR rates was calculated based on  the
fluctuation  in  LIBOR  during 2001, which  was  the  maximum  LIBOR
fluctuation  in the last ten years, and as such, is not  necessarily
indicative of LIBOR fluctuations that may occur during the remainder
of  2002.   These  estimates also assume a level of debt  consistent
with  the  September  27,  2002  level.  The  Company  is  currently
evaluating the risk of potential increases in interest rates on  the
additional  variable rate debt assumed under its  amended  revolving
credit  and  term loan agreement and is considering alternatives  to
mitigate this risk.


Item 4: Controls and Procedures

Under  the  supervision and with the participation of the  Company's
management,  including  its  Chief  Executive  Officer   and   Chief
Financial  Officer, the Company has evaluated the  effectiveness  of
the  design  and operation of its disclosure controls and procedures
within  90  days prior to the filing date of this quarterly  report.
Based  upon this evaluation, the Chief Executive Officer  and  Chief
Financial  Officer  have  concluded that  the  Company's  disclosure
controls  and procedures are adequate and effective to  ensure  that
material  information relating to the Company and  its  consolidated
subsidiaries is made known to them by others within those  entities,
particularly  during the period in which this quarterly  report  was
prepared.   There  were  no  significant changes  in  the  Company's
internal  controls  or  in  other factors that  could  significantly
affect these controls subsequent to the date of their evaluation.



INTEGRATED DEFENSE TECHNOLOGIES, INC.
PART II. OTHER INFORMATION



Item 5: Other information

On  November  1,  2002,  Signia-IDT, Inc.  (formerly  known  as  IDT
Acquisition Co.), a wholly-owned subsidiary of the Company, acquired
substantially  all  of  the  assets  and  assumed  certain  of   the
liabilities  of BAE SYSTEMS Advanced Systems Gaithersburg,  Maryland
operation  for $146,000,000 in cash, $11,000,000 of which was  taken
from  the  Company's cash reserves and the remainder  of  which  was
financed  through  an add-on to the Company's revolving  credit  and
term  loan  facility.   See Note 2 of Notes to Financial  Statements
contained  in  this  Form 10-Q for details of the  Company's  credit
facility and a summary of the November 1, 2002 amendment.

The  acquisition will be accounted for using the purchase method and
accordingly, the purchase price, including direct acquisition costs,
will  be  allocated  to the assets acquired, including  identifiable
intangible assets, and liabilities assumed based on their  estimated
fair values at the date of acquisition.  Independent appraisals will
be  used  to  determine  the estimated fair  values  of  the  assets
acquired  and the liabilities assumed, and any excess of  cost  over
the  fair  value  of  the acquired net assets will  be  recorded  as
goodwill.

The  BAE  SYSTEMS Gaithersburg operation (now known as "Signia-IDT")
employs   over  300  people  and   designs  and  manufactures   high
performance   radio   frequency  surveillance  equipment   used   in
communications  intelligence and signals intelligence  applications.
The operation will be integrated into the Company's Communications &
Surveillance Systems segment in the fourth quarter of 2002.

The  Company has engaged its independent accountants to  perform  an
audit  of  Signia-IDT's financial statements  for  the  years  ended
December  31,  2000  and 2001 and for the nine  month  period  ended
September  27, 2002.  Once the audit is complete, the  Company  will
file  these  audited  financial  statements,  along  with  unaudited
interim financial statements for the first nine months of 2001,  pro
forma income statements reflecting the impact of the acquisition  as
of  the  beginning of 2002, and a pro forma balance sheet reflecting
the  impact of the acquisition as of September 27, 2002, in a report
on  Form 8-K.   This Form 8-K will be filed with the Securities  and
Exchange Commission no later than January 6, 2003.


Item 6: Exhibits and Reports on Form 8-K


(a)  Exhibits

     Exhibit 10.1  Asset Purchase Agreement by and among BAE SYSTEMS
                   Aerospace Electronics Inc. as seller,  IDT Acquisition
                   Co. as buyer and Integrated Defense Technologies, Inc.
                   as guarantor dated as of September 12, 2002 and
                   amendment letter dated November 1, 2002

     Exhibit 10.2  Integrated Defense Technologies, Inc. Amended and
                   Restated Credit Agreement dated as of October 31, 2002,
                   among Integrated Defense Technologies, Inc. and Canadian
                   Imperial Bank of Commerce, as administrative agent for
                   itself and the lenders and other lenders named therein

(b)  Reports on Form 8-K

       1.  On September 13, 2002, the Company filed a report on Form 8-K
           dated September 12, 2002 to report under Item 5 an agreement to
           purchase the Gaithersburg, Maryland operations of BAE SYSTEMS
           Aerospace Electronics Inc.

       2.  On October 15, 2002, the Company filed a report on Form 8-K
           dated October 15, 2002 to report under Item 5 a revised outlook for
           the third and fourth quarters of 2002.




                INTEGRATED DEFENSE TECHNOLOGIES, INC.

                             SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                 INTEGRATED DEFENSE TECHNOLOGIES, INC.
                ---------------------------------------
                            (Registrant)

By:   /s/ Thomas J. Keenan                    By:   /s/ John W.Wilhoite
      -------------------------------------         ---------------------------
      Thomas J. Keenan                              John W. Wilhoite
      President and Chief Executive Officer         Vice President of Finance
      (Principal Executive Officer)                 and Chief Financial Officer
                                                    (Principal Financial and
                                                    Accounting Officer)

Date: November 7, 2002                        Date: November 7, 2002








                           CERTIFICATIONS


CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

I, Thomas J. Keenan, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of
    Integrated Defense Technologies, Inc. (the "registrant");

2.  Based on my knowledge, this quarterly report does not contain
    any untrue statement of a material fact or omit to state a material
    fact necessary to make the statements made, in light of the
    circumstances under which such statements were made, not misleading
    with respect to the period covered by this quarterly report;

3.  Based on my knowledge, the financial statements, and other
    financial information included in this quarterly report, fairly
    present in all material respects the financial condition, results of
    operations and cash flows of the registrant as of, and for, the
    periods presented in this quarterly report;

4.  The registrant's other certifying officers and I are
    responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
    the registrant and we have:

    a)  designed such disclosure controls and procedures to ensure that
        material information relating to the registrant, including its
        consolidated subsidiaries, is made known to us by others within
        those entities, particularly during the period in which this
        quarterly report is being prepared;

    b)  evaluated the effectiveness of the registrant's disclosure
        controls and procedures as of a date within 90 days prior to the
        filing date of this quarterly report (the "Evaluation Date"); and

    c)  presented in this quarterly report our conclusions about the
        effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have
    disclosed, based on our most recent evaluation, to the registrant's
    auditors and the audit committee of registrant's board of directors
    (or persons performing the equivalent function):

    a)  all significant deficiencies in the design or operation of
        internal controls which could adversely affect the registrant's
        ability to record, process, summarize and report financial data and
        have identified for the registrant's auditors any material
        weaknesses in internal controls; and

    b)  any fraud, whether or not material, that involves management or
        other employees who have a significant role in the registrant's
        internal controls; and

6.  The registrant's other certifying officers and I have indicated
    in this quarterly report whether or not there were significant
    changes in internal controls or in other factors that could
    significantly affect internal controls subsequent to the date of our
    most recent evaluation, including any corrective actions with regard
    to significant deficiencies and material weaknesses.



Date:  November 7, 2002                      /s/ Thomas J. Keenan
                                             --------------------------------
                                             Thomas J. Keenan
                                             President and Chief
                                             Executive Officer




CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

I, John W. Wilhoite, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of
    Integrated Defense Technologies, Inc. (the "registrant");

2.  Based on my knowledge, this quarterly report does not contain
    any untrue statement of a material fact or omit to state a material
    fact necessary to make the statements made, in light of the
    circumstances under which such statements were made, not misleading
    with respect to the period covered by this quarterly report;

3.  Based on my knowledge, the financial statements, and other
    financial information included in this quarterly report, fairly
    present in all material respects the financial condition, results of
    operations and cash flows of the registrant as of, and for, the
    periods presented in this quarterly report;

4.  The registrant's other certifying officers and I are
    responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
    the registrant and we have:

    a)  designed such disclosure controls and procedures to ensure that
        material information relating to the registrant, including its
        consolidated subsidiaries, is made known to us by others within
        those entities, particularly during the period in which this
        quarterly report is being prepared;

    b)  evaluated the effectiveness of the registrant's disclosure
        controls and procedures as of a date within 90 days prior to the
        filing date of this quarterly report (the "Evaluation Date"); and

    c)  presented in this quarterly report our conclusions about the
        effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have
    disclosed, based on our most recent evaluation, to the registrant's
    auditors and the audit committee of registrant's board of directors
    (or persons performing the equivalent function):

    a)  all significant deficiencies in the design or operation of
        internal controls which could adversely affect the registrant's
        ability to record, process, summarize and report financial data and
        have identified for the registrant's auditors any material
        weaknesses in internal controls; and

    b)  any fraud, whether or not material, that involves management or
        other employees who have a significant role in the registrant's
        internal controls; and

6.  The registrant's other certifying officers and I have indicated
    in this quarterly report whether or not there were significant
    changes in internal controls or in other factors that could
    significantly affect internal controls subsequent to the date of our
    most recent evaluation, including any corrective actions with regard
    to significant deficiencies and material weaknesses.



Date:  November 7, 2002                 /s/ John W. Wilhoite
                                        ------------------------------
                                        John W. Wilhoite
                                        Vice President of Finance and
                                        Chief Financial Officer