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                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

   
                                  FORM 10-Q/A
    

                                   ----------

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

    For the quarterly period ended March 31, 1998

                                       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 0-5260


                            GENERAL AUTOMATION, INC.
-------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter).

          DELAWARE                                            95-2488811
-------------------------------                       --------------------------
(State or other jurisdiction of                       (I.R.S. employer I.D. No.)
 incorporation or organization)

17731 MITCHELL NORTH, IRVINE, CALIFORNIA                        92614
----------------------------------------              --------------------------
(Address of principal executive offices)                      (Zip code)

Registrant's telephone number including area code:  (949) 250-4800
                                                   -----------------

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 registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days:

No [ ]    Yes [X]

As of August 6, 1998 there were 9,332,641 shares of common stock of the
Registrant outstanding.

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                    GENERAL AUTOMATION, INC. AND SUBSIDIARIES

                CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

   
<TABLE>
<CAPTION>
                                                                       *RESTATED
                                          ---------------------------------------------------------------------
                                                Three Months Ended                    Six Months Ended
                                                     March 31,                             March 31,
                                          -------------------------------       -------------------------------
                                              1998              1997*               1998              1997*
                                          ------------       ------------       ------------       ------------
<S>                                       <C>                <C>                <C>                <C>         
Sales - Product                           $  2,831,000       $  2,864,000       $  5,391,000       $  5,773,000
Sales - Service revenue                      4,986,000          6,273,000         10,650,000         12,862,000
                                          ------------       ------------       ------------       ------------ 
                  Total                      7,817,000          9,137,000         16,050,000         18,635,000
                                          ------------       ------------       ------------       ------------ 

Costs and expenses:

 Cost of sales - Product                     2,334,000          2,135,000          4,259,000          4,446,000
 Cost of sales - Service                     3,292,000          3,800,000          6,864,000          7,497,000
 Research and development                      320,000            824,000            874,000          1,817,000
 Selling and administrative                  2,622,000          2,452,000          5,050,000          4,773,000
 Depreciation                                  170,000                               358,000
 Amortization                                  534,000            330,000          1,075,000            660,000
 Other, net                                     72,000             42,000             71,000            100,000
                                          ------------       ------------       ------------       ------------ 

                                             9,344,000          9,583,000         18,551,000         19,293,000
                                          ------------       ------------       ------------       ------------ 

Operating income                            (1,527,000)          (446,000)        (2,501,000)          (658,000)

Interest income                                  4,000             15,000              6,000             28,000
Interest expense                              (161,000)           (83,000)          (254,000)          (148,000)
                                          ------------       ------------       ------------       ------------ 

     Income before income taxes             (1,684,000)          (514,000)        (2,749,000)          (778,000)

Provision for income taxes                      50,000             29,000             50,000            120,000
                                          ------------       ------------       ------------       ------------ 

Net income                                $ (1,734,000)      $   (543,000)      $ (2,799,000)      $   (898,000)
                                          ============       ============       ============       ============ 
Net (loss) income per share:

    Basic                                 $      (0.19)      $      (0.06)      $      (0.30)      $      (0.10)

    Fully Diluted                         $      (0.19)      $      (0.06)      $      (0.30)      $      (0.10)
                                          ============       ============       ============       ============ 
Weighted average shares outstanding:

    Basic                                    9,295,924          8,951,443          9,284,528          8,910,167
    Fully Diluted                            9,295,924          8,951,443          9,284,528          8,910,167

</TABLE>
    

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

                                        2

<PAGE>   3

                    GENERAL AUTOMATION, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (Unaudited)

   
<TABLE>
<CAPTION>
                                                                 F.Y. 1997 HAS BEEN *RESTATED
                                                                 -----------------------------
                                                                   FOR THE  SIX MONTHS ENDED
                                                                 -----------------------------
                                                                   March 31          March 31
                                                                     1998             1997*
                                                                 -----------       -----------
<S>                                                              <C>               <C>         
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
NET (LOSS)/INCOME                                                $(2,799,000)      $  (283,000)

Adjustments to reconcile net income (loss) to net cash
 provided by (used in) operating activities:
  Depreciation and amortization                                    1,433,000           878,000

  Changes in assets and liabilities:
       (Increase)decrease:
          Receivable                                                (318,000)          832,000
          Inventories                                              1,109,000           407,000
          Prepaid expenses                                          (132,000)         (548,000)
          Other assets                                              (148,000)          191,000
       Increase (decrease):
          Accounts payable                                         1,494,000           (92,000)
          Deferred revenue                                           (11,000)         (542,000)
          Accrued expense                                            197,000           (26,000)
                                                                 -----------       -----------
              NET CASH PROVIDED BY (USED IN)
                    OPERATING ACTIVITIES                             825,000           817,000

CASH FLOWS (USED IN) INVESTING ACTIVITIES:
  Acquisitions                                                      (282,000)       (1,547,000)
  Purchase of property, plant and equipment                          (30,000)         (107,000)
  Proceeds from disposal of assets
  Capitalized software costs                                        (230,000)
  Investment in subsidiaries                                                          (112,000)
                                                                 -----------       -----------

              NET CASH USED IN INVESTING ACTIVITIES                 (542,000)       (1,766,000)

CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
  Proceeds from issuance of common stock                             120,000            77,000
  Proceeds from issuance of notes                                    349,000         2,162,000
  Principal payments on notes payable                             (1,510,000)         (392,000)
  Proceeds from sale of SGA Pacific                                                          0
                                                                 -----------       -----------
             NET CASH PROVIDED BY (USED IN)
                   FINANCING ACTIVITIES                           (1,041,000)        1,847,000
                                                                 -----------       -----------

EFFECTS OF EXCHANGE RATE CHANGES ON CASH                              22,000            66,000

(Decrease) increase in cash                                         (736,000)          964,000
Cash at beginning of period                                          797,000           119,000
                                                                 -----------       -----------

Cash at end of period                                            $    61,000       $ 1,083,000
                                                                 ===========       ===========

      Cash paid during the period for:
          Interest                                               $   254,000       $   148,000
                                                                 ===========       ===========

          Income taxes                                           $    50,000                 0
                                                                 ===========       ===========
</TABLE>
    

         The accompanying notes are an integral part of these statements

                                        3

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                                   SIGNATURES

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

GENERAL AUTOMATION, INC.
Registrant

/s/ Jane M. Christie                        August 28, 1998
--------------------                        ---------------
Jane Christie                               Date
President and Chief Executive Officer

/s/ Richard H. Nance                        August 28, 1998
--------------------                        ---------------
Richard H. Nance                            Date
Vice President and 
Chief Financial Officer
    


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