
FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549


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

For the quarterly period ended September 30, 1995        

OR

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

For the transition period from               to                     

Commission file number    0-14567                    

ACC CORP.
(exact name of registrant as specified in its charter)

        Delaware                        16-1175232
State of other jurisdiction of          I.R.S. Employer
incorporation or organization           Identification No.

400 West Avenue, Rochester, New York  14611
(Address of principal executive offices)

(716) 987-3000
(Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all 
reports required to be filed by Section 13 or 15(d) of the Securities 
Exchange Act of 1934 during the 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        

APPLICABLE ONLY TO CORPORATE ISSUERS:

As of November 8, 1995, the Registrant had issued and outstanding, 
7,855,062 shares of its $.015 par value Class A Common Stock, and 
10,000 shares of its Series A Preferred Stock.

The Index of Exhibits filed with the Report is found at Page 19.



<TABLE>
                                        ACC CORP. AND SUBSIDIARIES
                                   CONSOLIDATED STATEMENTS OF INCOME
                                         (UNAUDITED)
                                (Amounts in 000's, except per share data)

                                  Three months ended         Nine months ended
                                     September 30,              September 30,
                                   1995        1994           1995        1994
<S>                              <C>         <C>           <C>          <C>
Revenue:
  Toll revenue                    $42,322     $26,584       $119,268     $83,817
  Leased lines and other            3,589       1,825          7,973       5,735
                                   45,911      28,409        127,241      89,552

Operating expenses:
  Network costs                    28,105      17,749         79,163      56,988
  Depreciation and amortization     3,011       2,259          8,405       6,314
  Selling, general and 
  administrative                   15,159      11,943         41,345      30,632
  Equal access costs                   -        2,463             -        2,463
                                   46,275      34,414        128,913      96,397

 Loss from operations                (364)     (6,005)        (1,672)     (6,845)

Other income (expense):
  Interest                         (1,340)       (644)        (3,666)     (1,143)
  Terminated merger costs            -           -              -           (200)
  Foreign exchange gain (loss)        (14)        (62)          (109)        106
                                   (1,354)       (706)        (3,775)     (1,237)

 Loss before provision for income
   taxes and minority interest     (1,718)     (6,711)        (5,447)     (8,082)

 Provision for income taxes           249       3,988            538       3,417

 Loss before minority interest     (1,967)    (10,699)        (5,985)    (11,499)

Minority interest in loss of
  consolidated subsidiary             118       2,243            225       2,367

Net loss                          ($1,849)    ($8,456)       ($5,760)    ($9,132)

Net loss per common
 & common equivalent share:        ($0.24)     ($1.20)        ($0.77)     ($1.29)

Average number of common
 and common equivalent shares      7,978,225   7,047,071      7,643,174   7,060,731
</TABLE>

<TABLE>

        ACC CORP. AND SUBSIDIARIES
     CONSOLIDATED BALANCE SHEETS
  (Amounts in 000's except share data)


                                      September 30,   December 31,
                                         1995            1994
                                      (Unaudited)      (Audited)
<S>                                    <C>              <C>
Current assets:
 Cash and cash equivalents               $1,672           $1,021
 Restricted cash                          -                  272
 Accounts receivable, net of allowance
  for doubtful accounts of $2,659 in
  1995 and $1,035 in 1994                31,867           20,499
 Other receivables                        5,504            5,433
 Prepaid and other assets                 1,859            1,124
  Total current assets                   40,902           28,349


Property, plant and equipment:
 At cost                                 75,781           62,618
 Less-accumulated depreciation and
  amortization                          (24,789)         (18,537)
                                         50,992           44,081

Other assets:
 Restricted cash                          -                  157
 Goodwill and customer base              14,602            6,884
 Deferred installation costs, net         1,801            1,639
 Other                                    4,777            3,642
                                         21,180           12,322

   Total assets                        $113,074          $84,752

Current liabilities:
 Notes payable                           $2,966            $  -
 Current maturities of
  long-term debt                          2,573            1,613
 Accounts payable                         6,386           10,498
 Accrued network costs                   25,651           10,443
 Other accrued expenses                  13,200            8,053
 Dividends payable                        -                  208
   Total current liabilities             50,776           30,815

Deferred income taxes                     4,088            3,675

Long-term debt                           23,445           29,914

Redeemable preferred stock                8,997            -

Minority interest                         1,092            1,262

Shareholders' equity:
 Class A Common stock, $.015 par value
  Authorized-50,000,000 shares
  Issued- 8,498,580 in 1995 and
  7,652,601  in 1994                        127              115
 Capital in excess of par value          31,515           20,070
 Cumulative translation adjustment         (888)          (1,013)
 Retained earnings                       (4,468)           1,524
                                         26,286           20,696
Less-
 Treasury stock, at cost (726,589 
   shares)                               (1,610)          (1,610)
    Total shareholders' equity           24,676           19,086

    Total liabilities and
    shareholders' equity               $113,074          $84,752
                                         
</TABLE>
                                         
<TABLE>
                        ACC CORP. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (UNAUDITED)
                        (Amounts in 000's, except per share data)
                     
                                                                FOR THE NINE MONTHS ENDED
                                                                SEPTEMBER 30,
                                                                1995            1994

<S>                                                            <C>             <C>      
Cash flows from operating activities:
 Net loss                                                       ($5,760)        ($9,132)
                                                      
 Adjustments to reconcile net income to net cash provided by 
   operating activities:
   Depreciation and amortization                                  8,405           6,314
   Deferred income taxes                                            515           2,932
   Minority interest in income of consolidated subsidiary          (225)         (2,367)
   Unrealized foreign exchange loss                                 430             (50)
   Amortization of deferred financing costs                         165             -
   Loss on disposal of equipment                                    193             -
   (Increase) decrease in assets:
      Restricted cash                                                -              -
      Accounts receivable, net                                  (10,040)         (2,350)
      Other receivables                                             252             184
      Prepaid and other assets                                     (329)            712
      Deferred installation costs                                (1,160)           (835)
      Other                                                         415            (827)
   Increase (decrease) in liabilities:
      Accounts payable                                           (8,217)           (991)
      Accrued network costs                                      15,041           1,762
      Other accrued expenses                                      3,305           2,021

       Total adjustments                                          8,750           6,505
                                                      
        Net cash provided by (used in) operating activities       2,990          (2,627)
                                                      
Cash flows from investing activities:
  Capital expenditures, net                                      (8,709)        (21,525)
   Payment for purchase of subsidiary, net of cash acquired      (1,386)             -
  Acquisition of customer base                                     (229)         (2,077)
                                                      
        Net cash used in investing activities                   (10,324)        (23,602)
                                                      
Cash flows from financing activities:
  Net borrowings (repayments) under lines of credit              (7,602)         30,378
  Repayment of long-term debt                                    (1,734)         (1,320)
  Proceeds from issuance of common stock                         11,395              87
  Proceeds from issuance of preferred stock                      10,000
  Repurchase of minority interest                                   -              (215)
  Financing costs                                                (2,807)            -    
  Dividends paid                                                   (440)         (4,033)
                                                      
        Net cash provided by financing activities                 8,812          24,897

Effect of exchange rate changes on cash                            (827)           (135)
                                                      
Net increase (decrease) in cash from continuing operations          651          (1,467)

Cash and cash equivalents at beginning of period                  1,021           1,467
                                                      
Cash and cash equivalents at end of period                       $1,672              -
                                                      
Supplemental disclosures of cash flow information:
Cash paid during the period for:
  Interest                                                       $2,831          $1,010
  Income taxes                                                     $103            $280

Supplemental schedule of noncash investing activities:
  Equipment purchased through capital leases                     $2,995            $942
  Purchase of subsidiary with short-term notes payable           $2,966              -

Supplemental schedule of noncash financing activities:
  Exchange of treasury shares for common shares                    -               $327

</TABLE>


ACC CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

September 30, 1995

1.      Statement of Management

        The condensed financial statements of ACC Corp. and subsidiaries 
("The Company") included herein have been prepared by the Company, without 
audit, pursuant to the rules and regulations of the Securities and Exchange 
Commission.  Certain information and footnote disclosures normally included 
in financial statements prepared in accordance with generally accepted 
accounting principles have been condensed or omitted pursuant to such rules 
and regulations, although the Company believes that the disclosures are 
adequate to make the information presented not misleading.  It is suggested 
that these condensed financial statements be read in conjunction with the 
financial statements and the notes thereto included in the Company's latest 
Annual Report on Form 10-K.

        The interim financial statements contained herein reflect all 
adjustments of a normal recurring nature which are, in the opinion of 
management, necessary to a fair statement of the results of operations for 
the interim periods presented. 

2.      Form 10-K

        Reference is made to the following footnotes included in the 
Company's 1994 Annual Report on Form 10-K:

                        Principles of Consolidation
                        Sale of Subsidiary Stock
                        Revenue
                        Property, Plant and Equipment
                        Deferred Installation Costs
                        Goodwill and Customer Base
                        Common and Common Equivalent Shares
                        Foreign Currency Translation
                        Income Taxes
                        Cash Equivalents and Restricted Cash
                        Currency Forward Contracts
                        Reclassifications
                        Operating Information
                        Discontinued Operations
                        Asset Write-down
                        Equal access costs
                        Merger of local exchange subsidiary
                        Acquisition
                        Long-Term Debt, Lines of Credit and
                        Financing Arrangements
                        Class A Common Stock
                        Treasury Stock
                        Commitments and Contingencies
                        Geographic Area Information
                        Related Party Transactions
                        Subsequent Event

3.      Net Income Per Share

        Net Income per common and common equivalent share is computed on 
the basis of the weighted average number of common and common equivalent 
shares outstanding during the period and net income reduced by preferred 
dividends. For the three and nine month periods in 1995, preferred dividends 
were $98,630.  There were no preferred dividends in 1994.  The average number 
of shares outstanding is computed as follows:


<TABLE>
                                For the Nine Months             For the Three Months 
                                Ended September 30:             Ended September 30:
<S>                             <C>             <C>             <C>             <C>
Average Number Outstanding:     1995            1994            1995            1994

Common Shares                   7,478,161       6,909,012       7,763,949       6,910,883  
Common Equivalent Shares          165,013         151,719         214,276         136,188
        Total                   7,643,174       7,060,731       7,978,225       7,047,071

</TABLE>

        Fully diluted income per share amounts are not presented for the 
three and nine month periods ended September 30, 1995, because inclusion of 
these amounts would be anti-dilutive.

4.      Reclassification

        Certain reclassifications have been made to previously reported prior 
year balances to conform to the September 30, 1995 presentation.

5.      Sale of Class A Common Stock

        During 1995, the Company made an offshore offering of 825,000 shares 
of its Class A Common Stock at an average price of $14.53 per share, pursuant 
to SEC Regulation S, to foreign investors through a placement agent.  The 
offering raised net proceeds of $11.1 million, after deduction of fees and 
expenses of $0.9 million.  In conjunction with this transaction, warrants to 
purchase 82,500 shares of Class A Common Stock at an exercise price of $14.40 
were issued.  These warrants were exercised subsequent to September 
30, 1995.

6.      Private Placement

        On May 22, 1995, the Company completed a $10 million private 
placement of 12% convertible subordinated debt to a group of private investors 
led by Fleet Equity Partners.  The notes were converted into 10,000 shares of 
cumulative, convertible Series A Preferred Stock on September 1, 1995.  The 
Series A preferred shares have a liquidation value of $1,000 per share, 
accrue cumulative dividends of 12% annually, payable upon redemption, and 
are convertible into Class A Common Stock at an initial conversion price of 
$16 per share, or 625,000 shares, subject to certain adjustments.  All of the 
outstanding Series A preferred shares will be repaid in cash, or partly in 
cash and partly in Class A Common Stock, on the seventh anniversary of the 
closing at the greater of i) the principal amount plus all accrued and unpaid 
interest and dividends or ii) the fair market value of the underlying Class A 
Common Stock into which the preferred shares are convertible.  Optional 
repayments are permitted at any time.  The preferred shares will be 
automatically converted into Class A Common Stock if, after the second 
anniversary of the closing, i) the daily trading volume of the Class A Common 
Stock exceeds 5% of the number of shares of Class A Common Stock issuable 
upon conversion of the preferred shares for 45 consecutive trading days, 
ii) the holders of the preferred shares are not subject to any underwriters 
lock up agreement and iii) the average closing price of the Class A Common 
Stock for 15 consecutive trading days exceeds the price set forth in 
the investment agreement (ranging from $32.00 to $57.33, depending on the 
period of time that the preferred shares have been outstanding).

        At closing, warrants for 100,000 shares of the Company's Class A 
Common Stock were issued at an initial exercise price of $16 per share.  Also 
at closing, the Company issued warrants to purchase Class A Common Stock that 
will become exercisable upon one or more optional repayments of the Series A 
preferred shares at an exercise price of $16.00, subject to adjustments as 
defined in the Agreement, and will permit each holder to acquire initially 
the same number of shares of Class A Common Stock into which the preferred 
shares were convertible as of the relevant repayment date.

        The Series A preferred stock is senior to all classes and series of 
preferred stock and Class A Common Stock as to the payment of dividends and 
redemptions, and upon liquidation at liquidation value, senior to all other 
classes of the Company's capital stock.  In certain circumstances, the 
holders of the Series A Preferred Stock will have preemptive rights to 
purchase, on an as-converted basis, a pro rata portion of certain Class A 
Common Stock issuances by the Company.  The Fleet Equity investors are 
entitled to elect one director to the Company's Board of Directors, so long 
as more than 33% of the Series A Preferred Stock is outstanding.  They also 
have the right to approve certain transactions as listed in the agreement.

        At September 30, 1995, the Series A preferred stock is reflected on 
the accompanying balance sheet as redeemable preferred stock, and is shown 
inclusive of cumulative unpaid dividends, and net of unamortized issuance 
costs.  The carrying value of the redeemable preferred stock will be 
accreted to the liquidation value, as defined, over the seven year term.

7.      Long-Term Debt

        On June 7, 1995, the Company entered into a commitment for a $35 
million five year senior credit facility with two financial institutions.  
On July 21, 1995, the transaction was closed and $15 million was borrowed 
under the new agreement, which was used to pay down and terminate the 
Company's previously existing lines of credit and to pay fees related to the 
transaction.

        The agreement contains certain financial covenants, one of which 
limits the amount that may be borrowed against this facility, based on the 
Company's operating cash flow.  The facility will be reduced in quarterly 
increments commencing 24 months after closing.  Borrowings under the facility 
are secured by certain of the Company's assets, and will bear interest at 
either LIBOR or prime interest rates, with additional percentage points added 
based on a ratio of debt to operating cash flow, as defined in the loan 
agreement.

        The Company is obligated to pay the managing agent banks a contingent 
interest payment based on the appreciation in value of 140,000 shares of the 
Company's Class A Common Stock over the 18 month period following the date 
of closing.  The payment will range from $750,000 to $2,100,000.

        In addition to repaying the Company's previously existing lines of 
credit, proceeds from the facility will be used to finance capital 
expenditures and provide working capital.  In conjunction with the closing 
the Company issued to a financing agent warrants to purchase 30,000 shares of 
the Company's Class A Common Stock at an exercise price of $16.00 per share.

8.      Purchase

        As of August 1, 1995, the Company acquired Metrowide Communications 
(Metrowide) in a business combination accounted for as a purchase.  Metrowide 
is based in Toronto, Canada, and provides local and long distance services 
to Ontario based customers.  The results of operations of Metrowide are 
included in the accompanying financial statements since the date of 
acquisition.  The total cost of the acquisition was CDN $6 million 
(US $4.4 million), of which CDN $2 million (US $1.5 million) was paid at 
the date of purchase, with the remaining CDN $4 million (US $2.9 million) 
due in installments through August 1, 1996.

        The fair value of assets acquired, including goodwill and customer 
base, was CDN $14.7 million (US $10.8 million), and liabilities assumed 
totaled CDN $8.7 million (US $6.4 million).  Goodwill of CDN $7.0 million 
(US $5.0 million) is being amortized over twenty years, and customer base 
of CDN $4.2 million (US $3.1 million) is being amortized over five years.

9.      Subsequent Event

        In October, 1995, the Company's former Chief Executive Officer 
resigned his position, but remains an employee and Chairman of the Company's 
Board of Directors.  A new Chief Executive Officer was hired.  In conjunction 
with the management changes, the Company entered into agreements with both 
executives.  The contract with the Chief Executive Officer has a two year term 
and provides for continuation of salary and benefits for the term of the 
agreement, in the event of a change in control of the Company.  The contract 
with the Chairman of the Board provides for a payment of $1,000,000, payable 
over a three year term, in the event that he resigns or is terminated. 
Payments under this agreement are accelerated and are due in full within 30 
days following a change in control of the Company.  The Company has also 
entered into a non-competition agreement with the Chairman of the Board, 
for which $750,000 was paid in October, 1995.

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

RESULTS OF OPERATIONS

        The following chart shows the total revenue contribution from each of 
the Company's operating units as well as billable long distance minutes 
(in 000's):  Revenue and minutes are shown net of revenue and minutes from 
affiliates.

                        Three months ended September 30,

                                Percent of                      Percent of
Revenue         1995            Total           1994            Total

United States   $15,204         33.1%           $12,698         44.7%
Canada           20,547         44.8%           14,907          52.5%
United Kingdom   10,073         21.9%              804           2.8%
Local Exchange       87           .2%              -              -   
                $45,911        100.0%          $28,409         100.0%

Billable Minutes

United States   119,400         41.7%          107,607          52.0%
Canada          120,585         42.2%           96,276          46.6%
United Kingdom   46,118         16.1%            2,938           1.4%
                286,103        100.0%          206,821         100.0%

                        Nine months ended September 30,

                                Percent of                      Percent of
Revenue         1995            Total           1994            Total

United States   $43,693         34.3%           $38,910         43.5%
Canada           59,737         47.0%            49,289         55.0%
United Kingdom   23,641         18.6%             1,353          1.5%
Local Exchange      170           .1%             -               -     
               $127,241        100.0%           $89,552        100.0%

                        
Billable Minutes        

United States   343,813         41.6%           321,623         51.2%
Canada          376,829         45.5%           301,646         48.0%
United Kingdom  106,605         12.9%             4,920           .8%
                827,247        100.0%           628,189        100.0%

        For the three months ended September 30, 1995, toll revenue 
increased by 59.0% to $42.3 million from $26.6 million for the three months 
ended September 30, 1994.  In the United States, toll revenue increased 
18.2%, due to both volume and price increases.  The volume increases are a 
result of increased carrier revenue, university business, and an increased 
focus on small to medium commercial customers in the Company's service region.  
The price increases are a result of general price increases in the industry. 
In Canada, toll revenue increased 32.2% primarily as a result of a 25.3% 
increase in billable minutes, with a 5.7% increase in prices.  These 
increases reflect growth in the Company's successful 800 service program 
in student and residential traffic. In the United Kingdom (U.K.), toll 
revenue increased 1,156% due to substantial volume increases, offset slightly 
by lower prices, as a result of entering into commercial and residential 
markets, as compared to 1994 when ACC's U.K. customers were primarily 
university students. 

        Exchange rate changes did not have a significant impact on Canadian 
or U.K. toll revenue for the three month period.

        For the nine months ended September 30, 1995, toll revenue increased 
by 42.3% to $119.3 million from $83.8 million for the nine months ended 
September 30, 1994.  In the United States, toll revenue increased 11.0%, 
and was fairly evenly split between volume and price increases. In Canada, 
toll revenue increased 20.0%, largely attributable to volume increases, 
with slight price decreases compared to the same nine months in 1994.  
The price decreases were a result of competition that resulted in decreased 
revenue per minute in the second quarter of 1994, but which has stabilized 
since June 30, 1994.  Exchange rate changes were not a significant percentage 
of the increase in Canada.  The U.K. had a 1,665% toll revenue increase, due 
to significant volume increases offset by price declines as discussed in the 
preceding paragraph.  In the U.K., favorable exchange rate changes accounted 
for approximately 3.0% of the increase.

        Leased lines and other revenue increased 96.7% to $3.6 million for 
the quarter ended September 30, 1995 from $1.8 million for the same period 
in 1994.  For the nine month period ended September 30, 1995, leased lines 
and other revenue increased 39% to $8.0 million from $5.7 million for the 
same period in 1994. These increases primarily related to increased local 
revenue generated by the University Program in the U.S., the start up of 
local exchange operations in upstate New York, and the Metrowide acquisition 
as of August 1, 1995.  The Metrowide acquisition accounted for approximately 
$1.5 million of leased lines and other revenue, for both the three and the 
nine month periods in 1995.

OPERATING EXPENSES

        Network costs increased to $28.1 million and $79.2 million for the 
three and nine month periods ended September 30, 1995, respectively, from 
$17.7 million and $57.0 million for the same periods in 1994.  Expressed as a 
percentage of revenue, network costs decreased to 61% for the three months 
ended September 30, 1995 from 63% for the same period in 1994, and decreased 
to 62% for the nine month period ended September 30, 1995 from 64% for the 
same period in 1994.  The decreases, as a percentage of revenue, were mainly 
due to lower Canadian contribution rates and volume related efficiencies in 
Canada.  These decreases were partially offset by increased per minute costs 
in the United Kingdom where the Company's network is still being developed.

        Depreciation and amortization increased to $3.0 million and $8.4 
million for the three and nine month periods ended September 30, 1995, 
respectively, from $2.3 million and $6.3 million for the same periods in 
1994.  These increases were primarily due to assets placed in service since 
September 30, 1994, particularly equipment at U.S. university sites, the 
London switching center and billing system, the local switching center in 
Syracuse, New York and also a Rochester switching center upgrade in the third 
quarter of 1995.  The Company anticipates that depreciation and amortization 
will increase during the fourth quarter of 1995, as a result of switching 
center upgrades scheduled in Toronto and in Manchester, U.K., and the 
customer base and goodwill associated with the Metrowide acquisition.

        Selling, general and administrative expenses increased to $15.2 
million and $41.3 million for the three and nine month periods ended 
September 30, 1995, respectively, from $11.9 million and $30.6 million for 
the same periods in 1994.  These increases were primarily attributable to 
increased payroll and related costs, increased marketing, sales and customer 
acquisition costs associated with the rapid growth of the Company's operations 
in the U.K. and Canada, and increased facility costs due to the Company's 
expanding operations and headquarters in Rochester, New York.  Costs incurred 
in the operations of the local service business decreased to $0.4 million and 
$1.3 million, respectively, for the three and nine month periods ended 
September 30, 1995 from $0.8 million and $2.0 million for the same periods in 
1994, related to the Company's decision to decrease expenditures in an effort 
to take a controlled approach to this market opportunity.

        Expressed as a percentage of revenue, selling, general and 
administrative expenses declined to 33% for the three months ended September 
30, 1995 compared to 42% for the same period in 1994, primarily as a 
result of significant revenue increases in the U.K.  For the nine month 
periods ended September 30, 1995 and 1994, selling, general and administrative 
expenses as a percentage of revenue were 32% and 34%, respectively.  The 
improvement in the percentages for the first nine months of 1995 is a result 
of the significant increases in U.K. revenue.  Worldwide, the Company had 700 
employees at September 30, 1995, compared to 532 at September 30, 1994.

OTHER INCOME (EXPENSE)

        Net interest expense increased to $1.3 million and $3.7 million, 
respectively, for the three and nine month periods ended September 30, 1995 
from $0.6 million and $1.1 million for the same periods in 1994. These 
increases were due to increased borrowing on the Company's lines of credit 
related to financing of university projects in the U.S., start up of the U.K. 
and the local service businesses during 1994, write-off of deferred financing 
costs related to the Company's lines of credit which were terminated in July, 
1995, and debt service costs associated with the subordinated 12% notes 
issued in May, 1995.  On September 1, 1995, the subordinated notes were 
converted to preferred stock, and there will be no further interest 
expense associated with that transaction.       

        The provision for income taxes for the quarter was $.3 million 
compared to $4.0 million for the third quarter of 1994.  The income tax 
provision that was recorded at September 30, 1995 is relative to the U.S. 
operations only.   No income tax benefits have been recorded for the 1995 
operating losses in the U.K. and Canada, due to the uncertainty of the 
Company's ability to utilize these losses to reduce future taxable 
income in those countries.  In the third quarter of 1994, the Company 
recorded a valuation allowance for all previously recorded benefits in the 
U.K. and in Canada.

        Minority interest in income of consolidated subsidiary reflects the 
portion of the Company's Canadian subsidiary's income attributable to the 
approximately 30% of the shares of that subsidiary that are publicly traded 
in Canada.  For the three months ended September 30, 1995, minority interest 
in loss of consolidated subsidiary was $0.1 million compared to $2.2 million 
for the same period in 1994 due to the improvement in the Canadian 
subsidiary's operating results in 1995, and the reserve for tax benefits that 
was recorded in the third quarter of 1994.

        The Company's net loss for the three and nine month periods ended 
September 30, 1995 was $1.8 million and $5.8 million, respectively, versus 
$8.5 million and $9.1 million for the same periods in 1994.  The 1995 losses 
were primarily due to continued start-up losses in the U.K. and in the local 
exchange business, debt restructuring costs, and non-recognition of income 
tax benefits in foreign subsidiaries.  The 1994 losses include costs to 
implement equal ease of access in Canada.  The Company anticipates a net 
loss for at least the next quarter as it continues to make investments in 
all subsidiaries, particularly the U.K.

SEASONALITY

        As the percentage of the Company's revenue generated by its 
university customers has increased, especially in the U.S., the Company's 
business has become more seasonal.  Revenue generally increases during the 
school year, which runs from September through May in the U.S. and Canada, 
and from October through May in the U.K. During the summer months while 
university customer revenue is low, selling and administrative expenses, as 
a percent of revenue, generally increase due to the sales and marketing 
efforts related to generating new university customers for the following fall 
semester.

CAPITAL RESOURCES AND LIQUIDITY

        To date, the bulk of the Company's working capital needs have been met 
through funds generated from operations, from the Company's lines of credit, 
and from the equity placements discussed in the Notes to Consolidated Financial 
Statements.  In addition, the Company has used the proceeds from the sale of 
ACC TelEnterprises Ltd.'s Common Stock and the sale of its cellular operations, 
both in 1993, to fund the expansion of its operations in Canada and the U.K.

        The Company's principal need for working capital is to meet its 
selling, general and administrative expenses as its business expands.  In 
addition, the Company's resources have been used for the Metrowide 
acquisition, asset additions, various customer base acquisitions and payments 
of dividends to its shareholders.

        At September 30, 1995, the Company had a working capital deficit of 
approximately $9.8 million.  This related to 1) short term debt associated 
with the Metrowide acquisition and 2) delays in billing from certain network 
vendors.  The Company believes its cash flow from operations, vendor 
financing agreements and its new credit facility are sufficient to meet the 
cash requirements of its current operations for the foreseeable future.

        During 1995, the Company has been focused on strengthening its balance 
sheet, as well as obtaining debt and equity financing to continue to finance 
the growth of the business.  In the second quarter, the Company discontinued 
paying regular dividends on its Class A Common Stock as part of its plan to 
retain funds to support its growth and operations.  During the second quarter 
and subsequently, three transactions were completed to accomplish its 
financing goals.

        In April, the Company completed an offshore offering of 825,000 shares 
of its Class A Common Stock at an average price of $14.53 per share, pursuant 
to SEC Regulation S, to foreign investors through a placement agent, raising 
net proceeds of $11.1 million, after fees of $0.9 million.

        In May, the Company completed a $10 million private placement of 
12% convertible subordinated debt to a group of private investors led by 
Fleet Equity Partners.  The notes were converted into 10,000 shares 
of cumulative, convertible Series A Preferred Stock on September 1, 1995.  
The Series A preferred shares have a liquidation value of $1,000 per share, 
accrue cumulative dividends of 12% annually, and will be convertible into 
Class A Common Stock at an initial conversion price of $16 per share, or 
625,000 shares, subject to certain adjustments.  All of the outstanding 
Series A preferred shares will be repaid in cash, or partly in cash and 
partly in Class A Common Stock, on the seventh anniversary of the closing 
at the greater of i) the principal amount plus all accrued and unpaid interest 
and dividends or ii) the fair market value of the underlying Class A Common 
Stock into which the preferred shares are convertible.  The preferred 
shares are automatically converted to Class A Common Stock if certain 
conditions are met.

        The Company used the proceeds from the two private placements mentioned 
above to reduce its previously existing lines of credit. 

        The third phase of the Company's financing plan was to restructure 
existing debt.  On June 7, 1995, the Company entered into a commitment for a 
$35 million five year senior credit facility with two leading 
telecommunications lending financial institutions.  On July 21, 1995, the 
transaction was closed and $15 million was borrowed under the new agreement 
which was used to pay down and terminate the Company's previously existing 
lines of credit and to pay fees related to the transaction.  In addition to 
paying off the Company's previously existing lines of credit, proceeds from 
the facility will be used to finance capital expenditures and provide working 
capital for all business segments, and pay the remaining amounts due for 
the Metrowide acquisition.

        The agreement contains certain financial covenants, one of which 
limits the amount that may be borrowed against this facility, based on the 
Company's operating cash flow.  The facility will be reduced in 
quarterly increments commencing 24 months after closing.  At September 30, 
1995, the available facility was approximately $30 million, of which 
$11 million was unused.  Borrowings bear interest based on either LIBOR or 
prime interest rates, with additional percentage points added based on a 
ratio of debt to operating cash flow, as defined in the loan agreement.

        The Company is obligated to pay the lenders a contingent interest 
payment based on the appreciation in market value of 140,000 shares of the 
Company's Class A Common Stock from $14.92 per share.  The payment will range 
from $750,000 to $2,100,000 and is due upon the earlier of i) 18 months 
following the closing date, ii) any subsequent refinancing of the facility, 
iii) the signing of a letter of intent to sell the Company or any material 
subsidiary, or iv) the cessation of active trading of the Company's Class A 
Common Stock on other than a temporary basis.  The Company believes that it 
will have adequate cash flow from operations or available bank lines to make 
this payment and is accruing this obligation over the 18 month period 
following the closing date.


PART II OTHER INFORMATION

Item 1. Legal Proceedings. 

        1)  Yankee Microwave, Inc. v. ACC Corp., et al.  This matter was 
concluded substantially in favor of the Company during the second quarter of 
1995.  For further information concerning this matter, reference is made to 
the discussion of this matter found at Part II, Item 1 of the Company's Report 
on Form 10-Q for its Quarter ended June 30, 1995, as filed with the SEC.

        2)  Matters Involving Vivian Warner.  There were no developments in 
these matters during the quarter for which this Report is being filed.  For 
additional information concerning these matters, reference is made to the 
discussions found at Part II, Item 1 of the Company's Report on Form 10-Q 
for its Quarter ended June 30, 1995, as filed with the SEC.

Item 2. Changes in Securities.

        (b)     As disclosed in a Form 8-K filed on June 22, 1995 with 
respect to this matter, on May 22, 1995, an investment group composed of 
Fleet Venture Resources, Inc., Fleet Equity Partners VI, L.P., and Chisholm 
Partners II, L.P. (collectively the "Fleet Investors") completed a 
$10,000,000 investment in the Company by purchasing $10,000,000 in principal 
amount of the Company's 12% subordinated convertible notes (the "Notes") and 
certain warrants to acquire shares of the Company's Common Stock.   

        Thereafter, at their 1995 Annual Meeting held on July 19, 1995, and 
as more fully described under Proposal 4 of the Company's Proxy Statement 
prepared and circulated with respect to this meeting, the Company's 
shareholders approved an amendment to the Company's Certificate of 
Incorporation that (1) authorized the creation of 2,000,000 shares of 
"blank check" Preferred Stock, par value $1.00 per share, (2) authorized the 
creation of 25,000,000 shares of Class B non-voting Common Stock, par value 
$.015 per share, and (3) redesignated the 50,000,000 shares of Common Stock, 
par value $.015 per share, that were previously authorized for issuance as 
50,000,000 shares of Class A Common Stock.

        Thereafter, pursuant to the terms of the Note and Warrant Purchase 
Agreement under which the Notes were purchased (the "Purchase Agreement"), 
the Notes were automatically converted into 10,000 shares of Series A 
Preferred Stock, par value $1.00 per share, effective August 31, 1995,  
the date on which the Company filed with the Delaware Secretary of State of 
a Certificate of Designation authorizing the issuance of this series of 
Preferred Stock.  This Series A Preferred Stock has the following rights and 
preferences:  

        (1)     a liquidation value of $1,000 per share;

        (2)     convertible into shares of Class A Common Stock at an initial 
        conversion price of $16.00 per share, subject to certain antidilution 
        adjustments;

        (3)     dividends payable at the rate of 12% per annum, cumulative 
        and compounded quarterly and extinguished upon conversion into shares 
        of Class A Common Stock; 

        (4)     senior to all other classes and series of Preferred Stock 
        and Common Stock as to the payment of dividends and redemptions, and 
        upon liquidation at liquidation value, senior to all other classes of 
        the Company's capital stock; 

        (5)     subject to mandatory redemption on the seventh anniversary of 
        the closing of the transaction at the greater of  liquidation value 
        (plus all accrued but unpaid dividends) or the then-fair market value 
        of the underlying Class A Common Stock into which the Series A 
        Preferred Stock is convertible, and subject to redemption at the 
        greater of such amounts at the request of the holders of the Series A 
        Preferred Stock in the event of a change in control of the Company; 

        (6)     mandatory conversion of the Series A Preferred Stock into 
        shares of Class A Common Stock upon the occurrence of certain events; 

        (7)     the Series A Preferred Stock will vote on an as-converted basis
        with the shares of Class A Common Stock outstanding on all matters to 
        be voted on by the Company's shareholders, including the election of 
        Directors, and the holders of the Series A Preferred Stock, voting as a
        separate class, shall be entitled to elect one Director so long as more
        than 33% of the Series A Preferred shares issued in this transaction 
        remain issued and outstanding; 

        (8)     so long as any shares of the Series A Preferred Stock remain 
        outstanding, the Company will not be able to take any of the following 
        actions without obtaining the prior written consent of the holders of a 
        majority of the Series A Preferred Stock:  (a) declare dividends on 
        any class of capital stock other than the Series A Preferred Stock; 
        (b) redeem any capital stock other than Series A Preferred Stock; 
        (c) make any amendment to the Company's Certificate of Incorporation 
        or Bylaws that would include or make any changes to any anti-takeover 
        provisions in the Company's Certificate of Incorporation or Bylaws; 
        (d) make any amendment to the Company's Certificate of Incorporation 
        or Bylaws that would have an adverse effect on or impair the rights or 
        relative priority of the Series A Preferred Stock; (e) make any changes 
        in the nature of the Company's business beyond the telecommunications 
        field; or (f) engage in any transactions with affiliates (other than 
        subsidiaries) (except for compensation and benefit matters approved 
        by the Executive Compensation Committee of the Company's Board or 
        other transactions approved by an independent committee of the Board); 
        and

        (9)     preemptive rights to purchase, on an as-converted basis, a 
        pro-rata portion of any issuance by the Company of any Class A Common 
        Stock or securities containing options or rights to acquire shares of 
        Class A Common Stock, except for issuances of Class A Common Stock in 
        connection with any of the following matters, in which events such 
        preemptive rights would not apply:  (a) option exercises under any 
        stock option plans of the Company; (b) conversion of the Notes or 
        the Series A Preferred Stock into shares of Class A Common Stock; 
        (c) exercise of the warrants issued in this transaction; (d) an 
        acquisition of another business or company; (e) a public offering 
        of securities registered under the Securities Act of 1933; 
        (f) the provision or extension of senior debt financing to the 
        Company; or (g) strategic investments by other entities in the 
        telecommunications field.

        Also, pursuant to the terms of the Purchase Agreement, 
Robert M. Van Degna was elected a Director of the Company at its 1995 
Annual Meeting as the representative of the Series A Preferred 
shareholders on the Company's Board.  

        Subject to all of the preferences and rights of both the 
Preferred Stock or any series thereof and of the Class B Common Stock at any 
time outstanding, all of which may be fixed by resolution of the Company's 
Board of Directors:  (1) dividends can continue to be paid on the Class A 
Common Stock as and when declared by the Company's Board of Directors out of 
funds legally available for the payment of such dividends; and (2) each 
share of Class A Common Stock continues to have one vote on all matters with 
respect to which such stock is entitled to vote.  Subject to the foregoing, 
the vote of the holders of a majority of the shares of Class A Common Stock 
represented at a meeting at which a quorum is present will be the act of the 
shareholders' meeting unless the vote of a greater number is required by law 
and except that the vote of a plurality of the shares of Class A Common Stock 
represented at a meeting at which a quorum is present is sufficient to elect 
members of the Board of Directors (other than the representative of the 
Series A Preferred shareholders).  Cumulative voting in the election of 
Directors is not permitted.  Holders of the Company's Class A Common Stock 
have no preemptive rights, nor are there any redemption rights provisions 
with respect to the Company's Class A Common Stock.  Subject to all of the 
preferences and rights of both the Preferred Stock or any series thereof 
and of the Class B Common Stock at any time outstanding, all of which may be 
fixed by resolution of the Company's Board of Directors, holders of the 
Company's Class A Common Stock shall be entitled to participate pro rata in 
any distribution  of the Company's assets upon liquidation.

        For additional information concerning this matter, reference is made 
to the discussion under  Proposal 4 in the Company's Proxy Statement for its 
1995 Annual Meeting, as filed with the SEC.

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

        The Company held its Annual Meeting of Shareholders on July 19, 
1995.  At that Meeting, there were four Proposals acted upon.  The first was 
the election of the Company's Board of Directors.  Richard T. Aab, Hugh F. 
Bennett, Arunas A. Chesonis, Willard Z. Estey, David K. Laniak, Robert F. 
Sykes and Daniel D. Tessoni were each elected as Directors of the Company 
for a one-year term.  The detail concerning the votes cast for and withheld 
from voting with respect to each such Director is as follows:


Votes:

Name:                   For                     Withheld

R. T. Aab               6,724,168                  409,015
H. F. Bennett           5,855,469                1,277,714
A. A. Chesonis          6,730,562                  402,621
W. Z. Estey             6,727,065                  406,118
D. K. Laniak            6,730,093                  403,090
R. F. Sykes             6,584,589                  548,594
D. D. Tessoni           5,856,769                1,276,414
R.M. Van Degna          5,989,719                1,143,464

There were no other Directors whose terms of office continued after this 
Meeting.  

        Also at this Meeting, the Company's shareholders ratified the 
selection of Arthur Andersen LLP as the Company's independent auditors for 
its 1995 fiscal year.  The detail concerning the votes cast for, against, and 
abstaining from voting with respect to this Proposal is as follows:

Votes:
        For             Against         Abstaining              
        7,069,994       37,447          25,742

There were no broker non-votes with respect to this Proposal.

        Also at this Meeting, the Company's shareholders approved an amendment 
to the Company's Employee Stock Option Plan to increase the number of shares 
of the Company's Class A Common Stock authorized for issuance thereunder by 
500,000 shares, to add the ability to grant stock incentive rights ("SIRs") 
to the Plan, to require the mandatory withholding of income taxes against the 
issuance of shares in respect of SIR awards by withholding a number of shares 
equal to the amount of all required tax withholdings, and to change the name 
of the Plan to the "Employee Long-Term Incentive Plan."  The detail concerning 
the votes cast for, against and abstaining from voting with respect to this 
Proposal is as follows:

Votes:
        For             Against         Abstaining
        4,421,983       393,943         171,604

There were 2,145,653 broker non-votes with respect to this Proposal.

        Also at this Meeting, the Company's shareholders approved a proposal 
to amend the Company's Certificate of Incorporation to:  (a) authorize the 
creation of 2,000,000 shares of "blank check" Preferred Stock, par value 
$1.00 per share; and (b) to authorize the creation of 25,000,000 shares of 
Class B non-voting Common Stock, par value $.015 per share, and to 
redesignate the 50,000,000 shares of Common Stock, par value $.015 per share, 
that were previously authorized for issuance as 50,000,000 shares of Class A 
Common Stock.  The detail concerning the votes cast for, against and 
abstaining from voting with respect to this Proposal is as follows:

Votes:
                For             Against         Abstaining
        (a)     3,883,914       981,869         81,747
        (b)     5,423,084       947,775         85,412

There were 2,185,653 broker non-votes with respect to part (a) of this 
Proposal, and 676,912 broker non-votes with respect to part (b) of this 
Proposal.

        Subsequent to the 1995 Annual Meeting, at the end of July, 1995, 
Robert F. Sykes resigned as a Director of the Company for personal reasons 
and to pursue other interests.

Item 5. Other Information.

        Effective October 6, 1995, Richard T. Aab resigned his position as 
the Company's Chief Executive Officer.  He remains its Chairman of the Board 
and an employee of the Company, however.  Effective the same date, the Board 
of Directors named David K. Laniak, a Company Director since 1989, to succeed 
Mr. Aab as the Company's Chief Executive Officer.  In connection with these 
management changes, the Company entered into an Employment Agreement with 
Mr. Laniak and into both a Non-Competition Agreement and a Salary 
Continuation and Deferred Compensation Agreement with Mr. Aab.  Under the 
terms of Mr. Laniak's two-year Employment Agreement, he will receive a base 
salary of $300,000 per year, plus a bonus determined under the Company's 
Annual Incentive Plan, plus other benefits given to the Company's other 
executives.  Under the terms of Mr. Aab's Non-Competition Agreement, he 
will not compete against the Company for three years following any "event 
of termination" (as defined in this Agreement) as an employee of the Company 
and as its Chairman of the Board, for which he received a lump-sum payment of 
$750,000.  Under the terms of his Salary Continuation and Deferred Compensation
Agreement, Mr. Aab will receive a salary of $200,000 per year, plus a bonus 
determined under the Company's Annual Incentive Plan, plus continuation of 
his current benefits for as long as he remains the Chairman of the Board and 
an employee of the Company.  At such time as he ever resigns or is terminated 
as a Company employee and from serving as the Chairman of the Board, except 
in a circumstance involving a "termination for cause" as defined in 
this Agreement, he will receive a payment of $1,000,000, payable over a 
three year term following the date of such termination or resignation, with 
the payment of such amount accelerated and paid in full within 30 days 
following a change in control of the Company.  

Item 7. Exhibits and Reports on Form 8-K.

        (a)     Exhibits.  See Exhibit Index.

        (b)     Reports on Form 8-K.  On October 27, 1995, the Company filed 
        a Report on Form 8-K to report, under the heading of Item 2, 
        Acquisition or Disposition of Assets, on the August 14, 1995 
        acquisition by the Company's 70% owned Canadian subsidiary, ACC 
        TelEnterprises Ltd., of four affiliated privately-held Canadian 
        corporations operating under the business name of Metrowide 
        Communications.  No financial statements have yet been filed with 
        this Report.

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.



                                   ACC CORP.                            
                                  (Registrant)
                

Dated:    November 14, 1995             /s/ Michael R. Daley
                                        Michael R. Daley
                                        Executive Vice President & 
                                        Chief Financial Officer



Dated:   November 14, 1995              /s/ Sharon L. Barnes
                                        Sharon L. Barnes
                                        Controller




EXHIBIT INDEX

Exhibit
Number          Description                                     Location

3               First Restated Certificate of Incorporation    Filed herewith
                of ACC Corp.

4-1             Certificate of Designations of 10,000 Shares   Filed herewith
                of Series A Preferred Stock, par value 
                $1.00 per share, of ACC Corp.

4-2             Form of Class A Common Stock Purchase          Filed herewith
                Warrant Issued to Columbia Capital Corp.,
                dated as of July 21, 1995

10-1            Credit Agreement, dated as of July 21, 1995,   Filed herewith
                by and among ACC Corp. and certain 
                Subsidiaries as Borrowers, ACC Corp. as 
                Guarantor, and First Union National Bank of 
                North Carolina, as Managing Agent and 
                Administrative Agent, and Shawmut Bank 
                Connecticut, N.A., as Managing Agent

10-2            Employment Agreement between ACC Corp.          Filed herewith
                and David K. Laniak, dated October 6, 1995

10-3            Salary Continuation and Deferred Compensation   Filed herewith
                Agreement between ACC Corp. and Richard T.
                Aab, dated October 6, 1995

10-4            Non-Competition Agreement between ACC Corp.     Filed herewith
                and Richard T. Aab, dated October 6, 1995

11              Statement re Computation of Per Share Earnings  See Note 3 to 
                                                                the Notes to
                                                                Consolidated
                                                                Financial
                                                                Statements 
                                                                filed herewith

27              Financial Data Schedule                         Filed only 
                                                                with EDGAR
                                                                filing, per 
                                                                Reg. S-K, 
                                                                Rule 601(c)
                                                                (1)(v)

