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

The following discussion should be read in conjunction with, and is qualified in its entirety to, the financial statements and notes thereto included in Item 1 of this Form 10-Q and the financial statements and notes thereto and our Management's Discussion and Analysis of Financial Condition and Results of Operation for the year ended December 31, 2007 included in our 2007 Annual Report on Form 10-K. Throughout this quarterly report on Form 10-Q, the terms "we," "us," "our," and "our company" refer to GPS Industries, Inc. (GPSI), a Nevada corporation, and, unless the context indicates otherwise, also includes our subsidiaries, Optimal Golf Solutions Ltd., Direct Golf Services Inc., Golf Academies Ltd. (collectively GPSI Europe) and GPS IT, LLC (which owns the assets and assumed the liabilities acquired per the UpLink Asset Purchase Agreement including the rights to the UpLink name).

This report contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that involve risks and uncertainties. Our expectations with respect to future results of operations that may be embodied in oral and written forward-looking statements, including any forward looking statements that may be included in this report, are subject to risks and uncertainties that must be considered when evaluating the likelihood of our realization of such expectations. Our actual results could differ materially. The words "believe," "expect," "intend," "plan," "project," "will" and similar phrases as they relate to us are intended to identify such forward-looking statements. In addition, please see the "Risk Factors" in Part II, Item 1A of this Form 10-Q for a discussion of items that may affect our future results.

RESTATEMENT OF CONSOLIDATED 2007 QUARTERLY COMPARATIVE RESULTS

As a result of an in-depth review of certain sales and installation agreements and course installations that occurred in 1st, 2nd and 3rd quarters of 2007, the company determined that it had incorrectly accounted for the related revenues, cost of goods sold, course assets, accrued liabilities and deferred revenues. Accordingly, the Company announced on April 15, 2008 that previously filed quarterly reports on Form 10-QSB for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007 initially filed with the Securities and Exchange Commission (the "SEC") on May 21, 2007, August 14, 2007 and November 19, 2007 (the "Original Filings"), should no longer be relied upon. The Company's consolidated financial statements presented in this report as at and for the period ended June 30, 2007 reflects these restatements.

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