<PAGE>
 
                                   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  October 31, 1998

Commission file number  333-42423



                            J. CREW OPERATING CORP.
             (Exact name of registrant as specified in its charter)


               Delaware                                 22-3540930
     (State or other jurisdiction                    (I.R.S. Employer
   of incorporation or organization)                 Identification No.)


                    770 Broadway, New York, New York  10003
                    (Address of principal executive offices)
                                   (Zip code)

                                 (212) 209-2500
              (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 __
                                        ---      
As of November 17, 1998, there were outstanding 100 shares of Common Stock, par
value $.01 per share.

The registrant meets the conditions set forth in General Instruction H(1)(a) and
(b) of Form 10-Q and is therefore filing this Form with the reduced disclosure
format.
<PAGE>
 
                        PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.


                    J.CREW OPERATING CORP AND SUBSIDIARIES
                    --------------------------------------
                          CONSOLIDATED BALANCE SHEETS
                          ---------------------------

<TABLE> 
<CAPTION> 
                                                                                        October 31,          January 31,
                                                                                              1998                 1998
                                                                                              ----                 ----
                                                                                        (unaudited)
                                                                                                     (in thousands)

ASSETS
------

CURRENT ASSETS:
<S>                                                                                   <C>                    <C> 
Cash and cash equivalents                                                               $22,069                 $ 12,166
Accounts receivable (net of allowance for doubtful
        accounts of $5,579 and $5,438)                                                   15,175                   16,834
Merchandise inventories                                                                 227,207                  202,763
Prepaid expenses and other current assets                                                62,403                   62,399
Federal and state income taxes                                                            8,519                      ---
                                                                                        -------                 --------

        Total current assets                                                            385,373                  294,162
                                                                                        -------                 --------

PROPERTY AND EQUIPMENT-AT COST:                                                         195,166                  166,276
        Less accumulated depreciation and amortization                                  (69,236)                 (55,613)
                                                                                        -------                 --------
                                                                                        125,930                  110,663

OTHER ASSETS                                                                             17,762                   14,619
                                                                                        -------                 --------

TOTAL ASSETS                                                                           $529,065                 $419,444
                                                                                        -------                 --------


LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------

CURRENT LIABILITIES:

Notes payable-bank                                                                      $101,000               $     ---
Accounts payable                                                                         112,984                  65,553
Other current liabilities                                                                 53,291                  77,850
Deferred income taxes                                                                      8,986                   8,986
Federal and state income taxes                                                               ---                     251
                                                                                        --------                --------
        Total current liabilities                                                       $276,261                 152,640
                                                                                        --------                --------

LONG-TERM DEBT                                                                           220,000                 220,000

DEFERRED CREDITS AND OTHER LONG TERM
LIABILITIES                                                                               44,991                  43,578

STOCKHOLDERS' DEFICIT                                                                    (12,187)                  3,226
                                                                                        --------                 -------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                             $529,065                $419,444
                                                                                        -------                 --------
</TABLE> 

                See notes to consolidated financial statements



                                       1




<PAGE>

<TABLE> 
<CAPTION>  
                    J.CREW OPERATING CORP. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS

                                                           Thirty-nine weeks ended
                                                   October 31, 1998      November 1, 1997
                                                   ----------------      ----------------
                                                                (unaudited)      
                                                               (in thousands)
<S>                                                    <C>                   <C>    
Net sales                                              $554,249              $536,384
Other revenues                                            7,403                 8,567
                                                        -------               -------
                                             
        Revenues                                        561,652               544,951
                                             
Cost of goods sold including buying                     
and occupancy costs                                     319,652               302,135     
                                                        -------               -------
                                             
        Gross profit                                    242,000               242,816
                                             
Selling, general and adminstrative expenses             245,101               244,566
                                                        -------               -------
                                             
        Loss from operations                             (3,101)               (1,750)
                                             
Interest expense - net                                   22,612                10,713
                                             
Expenses incurred in connection              
with recapitalization                                       ---                19,851   
                                                        -------               -------
                                             
        Loss before income taxes and         
        extraordinary item                              (25,713)              (32,314)
                                             
Income tax benefit                                       10,300                 5,000
                                                        -------               -------
                                                                           
        Net loss before extraordinary item              (15,413)              (27,314)  
                                                                           
Extraordinary item - loss on refinancing                                   
of debt ($7,627 net of income tax benefit of $3,127)        ---                (4,500)
                                                        -------               -------
        Net loss                                       $(15,413)             $(31,814)
                                                        -------               -------

</TABLE> 

See notes to consolidated financial statements

                                      2  
<PAGE>
 
                   J. CREW OPERATING CORP. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS


<TABLE> 
<CAPTION> 
                                                                       Thirteen weeks ended
                                                            
                                                            October 31, 1998           November 1, 1997
                                                            ----------------           ----------------
                                                                           (unaudited)            
                                                                         (in thousands)              
<S>                                                          <C>                        <C> 
Net sales                                                      $216,600                   $214,639
Other revenues                                                    3,069                      3,107
                                                                  -----                      -----
                                                                                       
               Revenues                                         219,669                    217,746

Cost of goods sold including                                                           
buying and occupancy costs                                      121,702                    118,331
                                                                -------                    -------
               Gross profit                                      97,967                     99,415
                                                                                       
Selling, general and administrative expenses                     80,575                     86,653
                                                                 ------                     ------
               Income from operations                            17,392                     12,762

Interest expense - net                                            8,252                      4,085

Expenses incurred in connection                                                        
with recapitalization                                                --                     19,851
                                                                     --                     ------ 
               Income (loss) before income taxes                                       
               and extraordinary item                             9,140                    (11,174)

Provision for income taxes                                        3,640                      3,450
                                                                  -----                      ----- 
               Net income (loss) before extraordinary item        5,500                    (14,624)

Extraordinary item - loss on refinancing of                                            
debt ($7,627 net of income tax benefit of $3,127)                    --                     (4,500)
                                                                     --                     ------ 

               Net income (loss)                                 $5,500                   $(19,124)
                                                                 ------                   -------- 
</TABLE> 

                See notes to consolidated financial statements


                                       3
<PAGE>

                   J. CREW OPERATING CORP. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE> 
<CAPTION> 
                                                                           Thirty-nine weeks ended                          
                                                                      October 31, 1998   November 1, 1997                     
                                                                      ----------------   ----------------                    
                                                                                  (unaudited)                        
                                                                                 (in thousands)
<S>                                                                   <C>                <C>                
CASH FLOWS FROM OPERATING ACTIVITIES:                                                                       
        Net loss                                                          $(15,413)         $(31,814)       
        Adjustments to reconcile net loss to net cash                                                       
        used in operating activities:                                                                       
                Loss on early retirement of debt                                --             7,627        
                Depreciation and amortization                               11,556            10,191        
                Amortization of deferred financing costs                     1,681             2,259        
                Provision for losses on account receivable                   5,627             4,946        
        Changes in assets and liabilities providing/(using) cash:                                           
                Accounts receivable                                         (3,968)           35,640        
                Merchandise inventories                                    (74,444)          (62,849)       
                Prepaid expenses and other current assets                       (4)          (11,149)       
                Income taxes receivable                                     (8,770)          (14,238)       
                Other assets                                                (6,019)             (464)       
                Accounts payable                                            47,431            12,369        
                Other liabilities                                          (22,932)          (10,573)       
                                                                           -------                         
                                                                                                            
        Net cash used in operating activities                              (65,255)          (54,918)       
                                                                                                            
CASH FLOWS FROM INVESTING ACTIVITIES:                                                                       
        Capital expenditures                                               (27,924)          (38,426)       
        Proceeds from construction allowances                                4,014             8,745   
                                                                           -------           -------
        Net cash used in investing activities                              (23,910)          (29,681) 
                                                                           -------           -------

CASH FLOWS FROM FINANCING ACTIVITIES:
        Increase in notes payable, bank                                    101,000            47,000  
        Issuance of long-term debt                                              --           220,000  
        Costs incurred in connection with                                                              
                the issuance of debt                                            --           (14,374) 
        Repayment of long-term debt                                             --           (92,863)
                                                                                                     
        Dividend to parent company                                              --           (69,304) 
                                                                           -------           -------
        Net cash provided by financing activities                          101,000            90,459 
                                                                           -------           ------- 
                                                                                                    

INCREASE IN CASH AND CASH EQUIVALENTS                                        9,903             5,860 
                                                                                                     
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                              12,166             7,132 
                                                                           -------           -------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                    22,069            12,992  
                                                                           =======           ======= 
</TABLE> 

                See notes to consolidated financial statements



                                       4
<PAGE>
 
                   J. CREW OPERATING CORP. AND SUBSIDIARIES

             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

         THIRTY-NINE WEEKS ENDED NOVEMBER 1, 1997 AND OCTOBER 31, 1998


1.      BASIS OF PRESENTATION
        ---------------------

The accompanying unaudited condensed consolidated financial statements include
the accounts of J.Crew Operating Corp. and its wholly-owned subsidiaries (the
"Company"). All significant intercompany balances and transactions have been
eliminated in consolidation.

The consolidated balance sheet as of October 31, 1998 and the consolidated
statements of operations and cash flows for the thirteen and thirty nine week
periods ended November 1, 1997 and October 31, 1998 have been prepared by the
Company and have not been audited. In the opinion of management, all
adjustments, consisting of only normal recurring adjustments necessary for a
fair presentation of the financial position of the Company, the results of its
operations and cash flows, have been made.

Certain information and footnote disclosure normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Company's consolidated financial statements for the fiscal year ended January
31, 1998.

The results of operations for the thirteen and thirty nine week periods ended
October 31, 1998 are not necessarily indicative of the operating results for the
full fiscal year.

Effective January 31, 1998, the Company changed its fiscal year-end from the
Friday closest to January 31 to the Saturday closest to January 31. The Company
also changed its quarterly reporting periods to four thirteen week reporting
periods from 12-16-12-12 week reporting periods. Prior year amounts have been
restated to conform to a thirteen week period.


2.      SUBSEQUENT EVENT
        ----------------

On November 24, 1998 the Company closed on the sale of its Popular Club Plan,
Inc. ("PCP") subsidiary to Fingerhut, Inc. for proceeds of $42.0 million plus
the assumption of $41.0 million under a securitization arrangement by a wholly-
owned subsidiary of PCP. Under the terms of its credit agreement, the Company is
required to use 80% of the proceeds (after related expenses) from the sale of
assets to pay down the $70.0 million term loan.

The financial position and results of operations of PCP will be included in the
consolidated financial statements of J. Crew Operating Corp. through November 1,
1998. Revenues were $49.2 million and $125.7 million for the three month and
nine month periods ended October 31, 1998.


3.      OTHER
        -----

In May 1998 the Company announced that it had retained an investment banking
firm to find a buyer for its Clifford & Wills mail order and factory outlet
divisions. The decision to sell this business reflects the Company's strategy to
focus on building the J.Crew brand. Revenues from Clifford & Wills were $20.3
million and $53.0 million for the three month and nine month periods ended
October 31, 1998.

                                       5
<PAGE>
 
Forward Looking Statements

Certain statements in this Report on Form 10Q under the caption "Management's
Discussion and Analysis of Financial Condition and Results of Operations",
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other important factors that
could cause the actual results, performances or achievements of the Company, or
industry results to differ materially from historical results, any future
results, performances or achievements expressed or implied by such forward-
looking statements. Such risks and uncertainties include, but are not limited
to, competitive pressures in the apparel industry, changes in levels of consumer
spending or preferences in apparel and acceptance by customers of the Company's
products, overall economic conditions, governmental regulations and trade
restrictions, political or financial instability in the countries where the
Company's goods are manufactured, postal rate increases, paper and printing
costs, Year 2000 issues, the level of the Company's indebtedness and exposure to
interest rate fluctuations, and other risks and uncertainties described in the
Company's other reports and documents filed or which may be filed, from time to
time, with the Securities and Exchange Commission. The Company expressly
disclaims any obligation or undertaking to disseminate any updates or revisions
to any forward-looking statement contained herein to reflect any change in the
Company's expectations with regard thereto or any change in events, conditions
or circumstances on which any such statement is based.


Item 2.   Management's Discussion And Analysis Of Financial Condition And
Results Of Operations

Results of Operations - Nine months ended October 31, 1998 versus nine months
ended November 1, 1997

Revenues for the nine months ended October 31, 1998 increased to $561.7 million
from $545.0 million in the nine months ended November 1, 1997, an increase of
3.1%. This increase resulted primarily from an increase in J. Crew Retail net
sales of $39.2 million from $136.0 million in the first nine months of 1997 to
$175.2 million in the first nine months of 1998, offset by a decrease in J. Crew
Mail Order net sales of $13.3 million from $150.7 million in the first nine
months of 1997, to $137.4 million in the first nine months of 1998. Other
revenues decreased by $1.2 million due to a decrease in service charge income as
a result of the sales of accounts receivable.

The increase in J. Crew Retail revenues was due primarily to the sales in the
first nine months of 1998 from the 12 stores opened in fiscal 1997. Comparable
store sales in the first nine months of 1998 increased by 7.8%. The number of
stores opened at October 31, 1998 increased to 63 from 51 at January 31, 1998.

The decrease in J. Crew Mail Order revenues resulted from the elimination of a
sale book in the first and third quarters of 1998 and a decrease in pages
circulated from 5.5 billion in the first nine months of 1997 to 4.6 billion in
the first nine months of 1998. The decrease in pages circulated resulted from a
change in circulation strategy  to increase the customer segmentation of catalog
mailings. This reduction in pages circulated resulted in a decrease in paper and
postage expense and an increase in productivity or sales per page circulated.

The gross margin for the nine months ended October 31, 1998 was $242.0 million
or 43.1% of revenues compared to $242.8 million or 44.6% of revenues for the
nine months ended November 1, 1997. The decrease in gross margin was due to a
lower initial markup on spring merchandise in J. Crew Retail and J. Crew Mail
Order and increased markdowns to dispose of inventory overstocks.

Selling, general and administrative expenses increased to $245.1 million for the
nine months ended October 31, 1998 from $244.6 million for the nine months ended
November 1, 1997. As a percentage of 

                                       6
<PAGE>
 
revenues, selling, general and administrative expenses were 43.6% of revenues in
the first nine months of 1998 and 44.9% in the first nine months of 1997.

Selling expenses decreased from $79.0 million or 14.5% of revenues in the first
nine months of 1997 to $77.7 million or 13.8% of revenues in the first nine
months of 1998. Selling expenses in J. Crew Mail Order decreased by $3.5 million
primarily as a result of the decrease in the number of pages circulated in 1998.
This decrease was partially offset by an increase of $2.0 million at Clifford &
Wills, resulting from an increase in circulation in 1998.

General and administrative expenses increased from $165.6 million or 30.4% of
revenues in the first nine months of 1997 to $167.4 million or 29.8% of revenues
in the first nine months of 1998. The dollar increase was attributed primarily
to an increase in store-related expenses at J. Crew Retail resulting from the 12
stores opened in 1998 which offset a decrease attributable to the implementation
of cost reduction programs.

The increase in interest expense from $10.7 million in the first nine months of
1997 to $22.6 million in the first nine months of 1998 resulted from the
additional debt outstanding in the first nine months of 1998 as a result of the
recapitalization transaction consummated in October 1997. Average borrowings
under revolving credit arrangements were $49.3 million in the first nine months
of 1998 compared to $67.3 million in the first nine months of 1997.

The loss before income taxes and extraordinary item decreased from $32.3 million
in the first nine months of 1997 to $25.7 million in the first nine months of
1998. The loss in the 1997 period included $19.9 million of expenses incurred in
connection with the recapitalization of the Company in October 1997. Excluding
the non-recurring loss in 1997, the loss before income taxes and extraordinary
item in the nine month period ended October 31, 1998 exceeded the same period in
1997 primarily due to a $11.9 million increase in interest expense.

The disproportionate tax rate in the nine month period ended November 1, 1997
resulted from the non-deductibility of certain expenses incurred in connection
with the recapitalization.

Results of Operations   -   Three months ended October 31, 1998 versus three
months ended November 1, 1997

Revenues for the three months ended October 31, 1998 increased to $219.7 million
from $217.7 million in the three months ended November 1, 1997, an increase of
 .9%. This increase resulted primarily from an increase in J. Crew Retail net
sales of $12.3 million from $54.8 million in the third quarter of 1997 to $67.1
million in the third quarter of 1998, offset by a decrease in J. Crew Mail Order
net sales of $5.7 million from $59.8 million in the third quarter of 1997 to
$54.1 million in the third quarter of 1998. Revenues in the third quarter of
1998 were also adversely impacted by a decrease in net sales in the Popular Club
Plan division of $6.6 million compared to the third quarter of 1997.

The increase in J. Crew Retail revenues was due primarily to the sales in the
third quarter of 1998 from the 12 stores opened in fiscal 1998. Comparable store
sales in the third quarter of 1998 increased by 7.7%.

The decrease in J. Crew Mail Order revenues resulted primarily from the
elimination of a sale book and a decrease in pages circulated in the third
quarter of 1998 compared to the third quarter of 1997. Pages circulated in the
third quarter of 1998 were 1.7 billion compared to 2.1 billion in the third
quarter of 1997.

The gross margin for the three months ended October 31, 1998 was $98.0 million
or 44.6% of revenues compared to $99.4 million or 45.7% of revenues for the
three months ended November 1, 1997. The decrease in gross margin was due to
increased  markdowns to dispose of inventory overstocks.

                                       7
<PAGE>
 
Selling, general and administrative expenses decreased to $80.6 million for the
three months ended October 31, 1998 from $86.7 million for the three months
ended November 1, 1997. As a percentage of revenues, selling, general and
administrative expenses were 36.7% of revenues in the third quarter of 1998 and
39.8% in the third quarter of 1997.

Selling expenses decreased from $25.9 million or 11.9% of revenues in the third
quarter of 1997 to $23.0 million or 10.5% of revenues in the third quarter of
1998. This decrease was due primarily to an decrease of $2.7 million at J. Crew
Mail Order, which resulted from a decrease in pages circulated in the third
quarter of 1998 compared to the third quarter of 1997.

General and administrative expenses decreased from $60.8 million or 27.9% of
revenues in the third quarter of 1997 to $57.6 million or 26.2% of revenues in
the third quarter of 1998. This decrease of $3.2 million was attributed
primarily to the effect of cost reductions programs offset by an increase in
store-related expenses from the 12 additional retail stores opened in 1998.

The increase in interest expense from $4.1 million in the third quarter of 1997
to $8.3 million in the third quarter of 1998 resulted from the additional debt
outstanding in the third quarter of 1998 as a result of the recapitalization
transaction consummated in October 1997. Average borrowings under revolving
credit arrangements were $80.1 million in the third quarter of 1998 compared to
$86.0 million in the third quarter of 1997.

The increase in income before income taxes from a loss of $11.2 million in the
third quarter of 1997 to income of $9.1 million in the third quarter of 1998 was
due to the incurrence of $19.9 million of expenses in connection with the
recapitalization of the Company in October 1997.

The disproportionate tax rate in the three month period ended November 1, 1997
resulted from the non-deductibility of certain expenses incurred in connection
with the recapitalization.

Liquidity and Capital Resources

The Company's primary cash needs are for opening new stores, information
technology, and working capital. The Company's sources of liquidity are cash
flow from operations and borrowings under a $200.0 million revolving credit
facility. Cash flow used in operations increased from a use of $54.9 million in
the first nine months of 1997 to a use of $65.3 million in the first nine months
of 1998. This increase was primarily due to the sale of $40.0 million of
accounts receivable in October 1997 which was used in part to fund working
capital requirements.

Borrowings under the revolving credit line increased to $101.0 million at
October 31, 1998 from $47.0 million at November 1, 1997. Borrowings at November
1, 1997 were reduced as a result of the funds received from the sale of accounts
receivable in October 1997.

Capital expenditures for the nine months ended October 31, 1998 were incurred
primarily to fund the opening of 12 new retail stores.

Inventories at October 31, 1998 were $277.3 million compared to $260.5 million
at November 1, 1997. This increase is attributable primarily to the increase in
the number of retail stores in operation at the end of the third quarter of 1998
compared to the third quarter of 1997.

On November 24, 1998 the Company closed on the sale of its Popular Club Plan,
Inc. ("PCP") subsidiary to Fingerhut Companies, Inc. for proceeds of $42.0
million plus the assumption of $41.0 million under a securitization arrangement
by a wholly-owned subsidiary of PCP. Under the terms of its credit agreement,
the Company is required to use 80% of the proceeds (after related expenses) from
the sale of assets to pay down the $70.0 million term loan.

                                       8
<PAGE>
 
Management believes that cash flow from operations and availability under its
revolving credit facility will provide adequate funds for the Company's working
capital needs, planned capital expenditures and debt service obligations. The
Company's ability to fund its operations and make planned capital expenditures,
scheduled debt payments, refinance indebtedness and remain in compliance with
the financial covenants under its debt agreements depends on its future
operating performance and cash flow, which are subject to prevailing economic
conditions and to financial, business and other factors, some of which are
beyond its control.

Seasonality

The Company's retail and mail order businesses experience two distinct selling
seasons, spring and fall. The spring season is comprised of the first and second
quarters and the fall season is comprised of the third and fourth quarters. Net
sales are usually substantially higher in the fall season and selling, general
and administrative expenses as a percentage of net sales are usually higher in
the spring season. Approximately 35% of annual net sales in fiscal 1997 occurred
in the fourth quarter. The Company's working capital requirements also fluctuate
throughout the year, increasing substantially in September and October in
anticipation of the holiday season inventory requirements.

The Year 2000 Issue

The Year 2000 issue affecting most companies, including the Company, is caused
by the inability of internal and external computer systems to recognize and
process more than two digit entries in the date code field. Beginning with dates
later than December 31, 1999, these date code fields will need to accept four
digit entries to identify 21st century dates from 20th century dates.

The Company has adopted a Year 2000 plan consisting of the following four
phases: identifying and prioritizing the components of the Company's internal
systems, equipment and related programs that are impacted by the Year 2000
problem; remediation or replacement of non-compliant systems; testing to
determine the success of remediation efforts; and development of contingency
plans. The Company is also attempting to contact key vendors and third parties
on whom it relies to obtain assurances that their systems will be Year 2000
compliant. The Company has substantially completed the first phase, expects to
complete the second phase by the end of the third quarter of fiscal year 1999
and anticipates that the third phase would continue through December 1999. The
Company plans to prepare any necessary contingency plans by Fall of 1999.

The Company is using internal programming resources, outside consulting
services, system upgrades from existing vendors and replacement of existing
packages with packages that are Year 2000 compliant. Certain of the key systems
are being replaced to modernize existing systems, not just for Year 2000
compliance. Total expenditures relating to implementing the plan are currently
estimated to be $11.0 million for fiscal years 1997 through 2000, a substantial
portion of which will be capitalized expenditures relating to acquisition and
implementation of new package systems. This cost estimate does not include time
and costs that may be incurred by the Company as a result of failure of any
third parties to become Year 2000 ready or costs to implement contingency plans.
As of October 31, 1998, the Company has incurred costs of approximately $3.0
million relating to the Company's Year 2000 initiatives.

The Company believes that its Year 2000 compliance program is designed to
identify and address Year 2000 issues that are subject to the Company's control.
However, there can be no assurance that the Company's efforts will be fully
effective and there are significant risks that are beyond the Company's control,
including, without limitation, failure of (a) vendors to produce merchandise or
perform services required by the Company, (b) utilities to deliver electricity,
(c) shippers (including the U.S. Postal Service) to deliver merchandise, and (d)
landlords to have the malls or buildings in which the Company has stores be Year
2000 compliant.

                                       9
<PAGE>
 
                          PART II  OTHER INFORMATION



Item 6.  Exhibits and Reports on Form 8-K

         (a)  Exhibits.

              3. Amendment to Bylaws, effective October 8, 1998.

             27. Financial Data Schedule.

         (b)  Reports on Form 8-K.

              The Company did not file any reports on Form 8-K during the
              quarter for which this report is filed.

                                       10
<PAGE>
 
                                   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.


                                J. CREW OPERATING CORP.
                                (Registrant)


Date:  December 11, 1998        By:  /s/  Howard Socol
                                   ---------------------------------
                                          Howard Socol
                                          Chief Executive Officer



Date:  December 11, 1998        By:  /s/  Scott Rosen
                                   ---------------------------------
                                          Scott Rosen
                                          Chief Financial Officer

                                       11