<PAGE>   1

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

    For the Quarter Ended September 30, 1999   Commission File No. 001-10887

                               JENNY CRAIG, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                DELAWARE                               33-0366188
--------------------------------------------------------------------------------
        (State of Incorporation)          (I.R.S. Employer Identification No.)

11355 NORTH TORREY PINES ROAD, LA JOLLA, CA               92037
--------------------------------------------------------------------------------
 (Address of principal executive offices)              (Zip Code)

Registrant's telephone number, including area code(858) 812-7000 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 [ ]

Number of shares of common stock, $.000000005 par value, outstanding as of the
close of business on November 10, 1999 - 20,688,971.



                                     - 1 -
<PAGE>   2

ITEM 1. FINANCIAL STATEMENTS

                       JENNY CRAIG, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                ($ in thousands)

<TABLE>
<CAPTION>
                                                                                      June 30,      September 30,
                                                                                        1999            1999
                                                                                      ---------     -------------
                                                                                                     (unaudited)
<S>                                                                                   <C>                <C>
ASSETS
Cash and cash equivalents ..........................................................  $  38,864          35,322
Short-term investments .............................................................      3,150           3,621
Accounts receivable, net ...........................................................      1,925           2,050
Inventories ........................................................................     18,036          17,855
Deferred tax assets ................................................................     13,406          16,669
Prepaid expenses and other assets ..................................................      4,795           2,272
                                                                                      ---------       ---------
            Total current assets ...................................................     80,176          77,789
Cost of reacquired area franchise rights, net ......................................      8,078           7,779
Property and equipment, net ........................................................     24,360          27,256
                                                                                      ---------       ---------
                                                                                      $ 112,614         112,824
                                                                                      =========       =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable ...................................................................  $  16,393          16,684
Accrued liabilities ................................................................     15,110          15,407
Accrual  for litigation judgment ...................................................      8,203           8,992
Deferred service revenue ...........................................................     10,075          10,158
                                                                                      ---------       ---------
             Total current liabilities .............................................     49,781          51,241
Note payable .......................................................................      5,336           5,289
Obligation under capital lease......................................................         --           2,100
                                                                                      ---------       ---------
             Total liabilities .....................................................     55,117          58,630

Stockholders' equity:
   Common stock $.000000005 par value, 100,000,000 shares authorized;
      27,580,260 shares issued; 20,688,971 shares
     outstanding at June 30, 1999 and September 30, 1999 ...........................         --              --
   Additional paid-in capital ......................................................     71,622          71,622
   Retained earnings ...............................................................     56,507          52,725
   Accumulated other comprehensive income ..........................................      4,130           4,609
   Treasury stock at cost, 6,891,289 shares at June 30, 1999 and
      September 30, 1999 ...........................................................    (74,762)        (74,762)
                                                                                      ---------       ---------
            Total stockholders' equity .............................................     57,497          54,194
Commitments and contingencies ......................................................
                                                                                      ---------       ---------
                                                                                      $ 112,614         112,824
                                                                                      =========       =========
</TABLE>



     See accompanying notes to unaudited consolidated financial statements.



                                     - 2 -
<PAGE>   3

                       JENNY CRAIG, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
                   ($ in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                              Three Months Ended
                                                                September 30,
                                                             --------------------
                                                              1998         1999
                                                             -------      -------
<S>                                                          <C>           <C>
Revenues:
    Company-owned operations:
       Product sales ......................................  $74,992       61,501
       Service revenue ....................................    4,082        4,153
                                                             -------      -------
                                                              79,074       65,654
                                                             -------      -------
    Franchise operations:
       Product sales ......................................    5,726        5,045
       Royalties ..........................................      826          802
       Initial franchise fees .............................       --           10
                                                             -------      -------
                                                               6,552        5,857
                                                             -------      -------
            Total revenues ................................   85,626       71,511
                                                             -------      -------
Costs and expenses:
    Company-owned operations:
       Product ............................................   68,880       63,945
       Service ............................................    2,740        3,071
                                                             -------      -------
                                                              71,620       67,016
                                                             -------      -------
    Franchise operations:
       Product ............................................    3,930        3,374
       Other ..............................................      551          534
                                                             -------      -------
                                                               4,481        3,908
                                                             -------      -------
                                                               9,525          587
General and administrative expenses .......................    5,958        6,286
Litigation judgment .......................................       --          789
                                                             -------      -------
       Operating income (loss) ............................    3,567       (6,488)
Other income, net, principally interest ...................      465          387
                                                             -------      -------
       Income (loss) before taxes .........................    4,032       (6,101)
Income taxes (benefit) ....................................    1,542       (2,319)
                                                             -------      -------
          Net income (loss) ...............................  $ 2,490       (3,782)
                                                             =======      =======
          Basic and diluted net income (loss) per share ...  $   .12         (.18)
                                                             =======      =======
</TABLE>



     See accompanying notes to unaudited consolidated financial statements.



                                     - 3 -
<PAGE>   4

                       JENNY CRAIG, INC. AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                ($ in thousands)

<TABLE>
<CAPTION>
                                                                                     Three Months Ended
                                                                                        September 30,
                                                                                  -------------------------
                                                                                    1998             1999
                                                                                  --------         --------
<S>                                                                               <C>                <C>
Cash flows from operating activities:
    Net income (loss) ..........................................................  $  2,490           (3,782)
    Adjustments to reconcile net income (loss) to net cash  provided
      by (used in) operating activities:
      Depreciation and amortization ............................................     1,370            1,493
      Provision for deferred income taxes (benefit) ............................     1,863           (3,263)
      Loss on write-off of cost of reacquired area franchise rights ............        --               94
      Loss on disposal of property and equipment ...............................        30                4
      (Increase) decrease in:
              Accounts receivable ..............................................      (596)            (125)
              Inventories ......................................................    (1,394)             181
              Prepaid expenses and other assets ................................      (693)           2,523
      Increase (decrease) in:
              Accounts payable .................................................    (1,763)             291
              Accrued liabilities ..............................................       239             (330)
              Accrual for litigation judgment ..................................        --              789
              Income taxes payable .............................................       193               --
              Deferred service revenue .........................................      (383)              83
                                                                                  --------         --------
                       Net cash provided by (used in) operating activities .....     1,356           (2,042)
                                                                                  --------         --------

Cash flows from investing activities:
   Purchase of property and equipment ..........................................      (969)          (1,461)
   Purchase of short-term investments ..........................................    (3,145)          (1,850)
   Proceeds from maturity of short-term investments ............................       952            1,379
                                                                                  --------         --------
                       Net cash used in investing activities ...................    (3,162)          (1,932)
                                                                                  --------         --------

Cash flows from financing activities-
   Principal payments on note payable ..........................................       (47)             (47)
                                                                                  --------         --------

Effect of exchange rate changes on cash and cash equivalents ...................      (497)             479
                                                                                  --------         --------
Net decrease in cash and cash equivalents ......................................    (2,350)          (3,542)
Cash and cash equivalents at beginning of period ...............................    42,124           38,864
                                                                                  --------         --------
Cash and cash equivalents at end of period .....................................  $ 39,774           35,322
                                                                                  ========         ========

Supplemental disclosure of cash flow information:
   Income taxes paid ...........................................................  $  1,565            1,276
Supplemental disclosure of investing activities:
   Equipment acquired under capital lease ......................................        --            2,727
</TABLE>



     See accompanying notes to unaudited consolidated financial statements.



                                     - 4 -
<PAGE>   5

                       JENNY CRAIG, INC. AND SUBSIDIARIES

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 1999

1.      The accompanying unaudited consolidated financial statements do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments, consisting only of normal recurring adjustments,
considered necessary for a fair presentation have been included. Operating
results for any interim period are not necessarily indicative of the results for
any other interim period or for the full year. These statements should be read
in conjunction with the June 30, 1999 consolidated financial statements.

2.      The weighted average number of shares used to calculate basic net income
(loss) per share was 20,688,971 for the quarters ended September 30, 1998 and
1999. The impact of outstanding stock options during the periods presented did
not create a difference between basic net income (loss) per share and diluted
net income (loss) per share. Stock options had the effect of increasing the
number of shares used in the calculation by application of the treasury stock
method by 5,196 shares for the quarter ended September 30, 1998. The calculation
of diluted net loss per share for the quarter ended September 30, 1999 was not
applicable as inclusion of the effect of 2,167,000 stock options would be
antidilutive.

3.      Comprehensive income (loss) for the quarters ended September 30, 1998
and 1999 presented below includes foreign currency translation items. There was
no tax expense or tax benefit associated with the foreign currency items.

<TABLE>
<CAPTION>
                                                           Three Months Ended
                                                              September 30,
                                                        -------------------------
                                                          1998             1999
                                                        --------         --------
<S>                                                     <C>                <C>
        Net income (loss)                               $  2,490           (3,782)
        Foreign currency translation adjustments            (497)             479
                                                        ========         ========
        Comprehensive income (loss)                     $  1,993           (3,303)
                                                        ========         ========
</TABLE>

4.      In November 1999, the Company announced a restructuring plan to reduce
annual operating expenses. The plan includes closing 86 underperforming
Company-owned centres in the United States, which represent 16% of the total
United States Company-owned centres, and a staff reduction of approximately 15%
at the Company's corporate headquarters. The restructuring is expected to result
in a pre-tax charge of approximately $6.4 million in the quarter ending December
31, 1999, principally relating to lease buyouts, fixed asset writeoffs,
severance and other termination costs. The 86 underperforming centres are
scheduled to be closed not later than November 30, 1999. The centres which will
be closed had revenues of approximately $4.5 million and direct operating
expenses of approximately $5.3 million for the quarter ended September 30, 1999.



                                   (Continued)



                                     - 5 -
<PAGE>   6

                       JENNY CRAIG, INC. AND SUBSIDIARIES

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

5.      The Company operates in the weight management industry. Substantially
all revenue results from the sale of weight management products and services,
whether the centre is operated by the Company or its franchisees. The Company's
reportable segments consist of Company-owned operations and franchise
operations, further segmented by geographic area. The following presents
information about the respective reportable segments ($ in thousands):

<TABLE>
<CAPTION>
                                                    Three Months
                                                Ended September 30,
                                               ----------------------
                                                1998           1999
                                               -------        -------
<S>                                            <C>            <C>
Revenue:
    Company-owned operations:
       United States                           $67,487         52,029
       Foreign                                  11,587         13,625
    Franchise operations:
       United States                             5,101          3,546
       Foreign                                   1,451          2,311
Operating income (loss):
    Company-owned operations:
       United States                             1,074        (10,053)
       Foreign                                   1,421          2,527
    Franchise operations:
       United States                               601            181
       Foreign                                     471            857
Identifiable assets:
    United States                               95,050         97,529
    Foreign                                     11,426         15,295
</TABLE>



                                     - 6 -
<PAGE>   7

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

Forward-Looking Statements

        Information provided in this Report on Form 10-Q may contain, and the
Company may from time to time disseminate material and make statements which may
contain "forward-looking" information, as that term is defined by the Private
Securities Litigation Reform Act of 1995 (the "Act"). These forward-looking
statements may relate to anticipated financial performance, business prospects
and similar matters. The words "expects," "anticipates," "believes," and similar
words generally signify a "forward-looking" statement. These cautionary
statements are being made pursuant to the provisions of the Act and with the
intention of obtaining the benefit of "safe-harbor" provisions of the Act. The
reader is cautioned that all forward-looking statements are necessarily
speculative and there are certain risks and uncertainties that could cause
actual events or results to differ materially from those referred to in such
forward-looking statements. Among the factors that could cause actual results to
differ materially are: increased competition; technological and scientific
developments, including appetite suppressants and other drugs which can be used
in weight-loss programs; increases in cost of food or services; lack of market
acceptance of additional products and services; legislative and regulatory
restrictions or actions; effectiveness of marketing and advertising programs;
prevailing domestic and foreign economic conditions; and the risk factors set
forth from time to time in the Company's annual reports and other reports and
filings with the SEC. In particular, the Company has estimated various costs in
connection with the restructuring charge to be recorded in the quarter ending
December 31, 1999, including the amount necessary to effect lease and personnel
reductions, which will be dependent on future events and in some cases on the
Company's ability to negotiate satisfactory termination provisions. The reader
should carefully review the cautionary statements contained under the caption
"Forward-Looking Statements" in Item 1 of the Company's Annual Report on Form
10-K for the year ended June 30, 1999.

Quarter Ended September 30, 1999 as Compared to Quarter Ended September 30, 1998

The following table presents selected operating results for United States
Company-owned and foreign Company-owned operations for the quarters ended
September 30, 1998 and 1999 (U.S. $ in thousands):

<TABLE>
<CAPTION>
                                    U.S. Company Owned               Foreign Company Owned
                                        Operations                         Operations
                               Three Months Ended Sept. 30,        Three Months Ended Sept. 30,
                             --------------------------------     ------------------------------
                                                          %                                 %
                               1998         1999       Change      1998       1999        Change
                             -------      -------      ------     ------      ------      ------
<S>                          <C>          <C>          <C>        <C>         <C>         <C>
Product sales                $64,094       48,810       -24%      10,898      12,691         16%
Service revenue                3,393        3,219        -5%         689         934         36%
                             -------      -------                 ------      ------
Total                         67,487       52,029       -23%      11,587      13,625         18%
Costs and expenses            62,064       56,581        -9%       9,556      10,435          9%
General and administrative     4,349        4,712         8%         610         663          9%
Litigation judgment               --          789                     --          --
</TABLE>



                                     - 7 -
<PAGE>   8


                                  (Continued)

<TABLE>
<CAPTION>
<S>                          <C>          <C>          <C>        <C>         <C>         <C>
                             -------      -------                 ------      ------
Operating income (loss)      $ 1,074      (10,053)                 1,421       2,527
                             -------      -------                 ------      ------
Average number of centres        531          526        -1%         110         110          0%
                             -------      -------                 ------      ------
</TABLE>

Revenues from United States Company-owned operations decreased 23% for the
quarter ended September 30, 1999 compared to the quarter ended September 30,
1998 reflecting reduced demand for the Company's products and services at United
States Company-owned centres, which represented 83% of the worldwide
Company-owned centres at September 30, 1999. The overall 23% decrease in
revenues from United States Company-owned operations was the result of a 22%
decrease in the average revenue per United States Company-owned centre, from
$127,000 for the quarter ended September 30, 1998 to $99,000 for the quarter
ended September 30, 1999, and a 1% decrease in the average number of United
States Company-owned centres in operation. Product sales, which consists
primarily of food products, from United States Company-owned operations
decreased 24% principally due to a 24% decrease in the number of active
participants in the program between the periods. Although there was a 31%
decrease in the number of new participants enrolled in the program between the
periods, service revenues from United States Company-owned operations decreased
only 5% principally due to an increase in the average service fee charged per
new participant.

        Revenues from foreign Company-owned operations, which is derived from 84
centres in Australia and 26 centres in Canada, increased 18% principally due to
an increase in the number of active participants in the program in Australia.
There was a 7% weighted average increase in the Australian and Canadian
currencies in relation to the U.S. dollar between the periods.

        Costs and expenses of United States Company-owned operations decreased
9% for the quarter ended September 30, 1999 compared to the same quarter last
year. This decrease was principally due to the reduced variable costs associated
with the decreased revenues, offset, in part, by a charge of $3,068,000 for
obsolete inventory related to the discontinued On-the-Go program. Costs and
expenses of United States Company-owned operations as a percentage of United
States Company-owned revenues increased from 92% to 109% between the periods
principally due to the aforementioned charge for discontinued inventory and the
higher proportion of fixed costs when compared to the reduced level of revenues.
After including the allocable portion of general and administrative expenses,
United States Company-owned operations had an operating loss of $10,053,000 for
the quarter ended September 30, 1999 compared to operating income of $1,074,000
for the quarter ended September 30, 1998.

        Costs and expenses of foreign Company-owned operations increased 9% for
the quarter ended September 30, 1999 compared to the quarter ended September 30,
1998, principally due to the increased variable costs associated with the
increased revenues and the 7% weighted average increase in the Australian and
Canadian currencies in relation to the U.S. dollar between the periods. After
including the allocable portion of general and administrative expenses, foreign
Company-owned operations had operating income of $2,527,000 for the quarter
ended September 30, 1999 compared to operating income of $1,421,000 for the
quarter ended September 30, 1998.

        Revenues from franchise operations decreased 11% from $6,552,000 to
$5,857,000 for the quarters ended September 30, 1998 and 1999, respectively.
This decline was principally due to a 13% decrease in the average number of
franchise centres in operation between the periods. The decrease in the average
number of franchise centres reflects the Company's acquisition of 13 centres
from two franchisees and the net closure of six franchised centres between the
periods. As of September 30, 1999 there were 116 franchised centres in
operation, of which 79 were in the United States and 37 were in foreign
countries, principally Australia and New Zealand.  Revenues from United States
franchise operations decreased from $5,101,000 to $3,546,000 for the quarters
ended September 30, 1998 and 1999, respectively, while revenues from foreign
franchise operations increased from $1,451,000 to $2,311,000 for the quarters
ended September 30, 1998 and 1999, respectively.  The decrease in revenues from
United States franchise operations reflects the 19 fewer centres in operation
and a decrease in the average revenue per centre experienced at United States
franchised centres which resulted in reduced product sales and royalties for the
Company.  The increase in revenues from foreign franchise operations reflects an
increase in the average revenue per centre experienced at foreign franchised
centres which resulted in increased product sales and royalties for the Company.



                                     - 8 -
<PAGE>   9

                                  (Continued)


        Costs and expenses of franchised operations, which consist primarily of
product costs, decreased 13% from $4,481,000 to $3,908,000 for the quarters
ended September 30, 1998 and 1999, respectively, principally because of the
reduced level of franchise operations. Franchise costs and expenses as a
percentage of franchise revenues remained relatively constant between the
periods.

        General and administrative expenses increased 6% from $5,958,000 to
$6,286,000 and increased from 7.0% to 8.8% of total revenues for the quarters
ended September 30, 1998 and 1999, respectively. The increase in general and
administrative expenses is principally due to increased legal fees.

        An additional $789,000 was recorded as a charge in the accompanying
consolidated statement of operations in the quarter ended September 30, 1999
with respect to the previously disclosed litigation judgment arising out of the
dispute concerning the lease at the Company's former headquarters location. This
additional charge consists of attorney fees awarded to the plaintiff and
interest accrued on the judgment pending the appeal which has been filed
seeking to overturn the judgment.

        The elements discussed above combined to result in an operating loss of
$6,488,000 for the quarter ended September 30, 1999 compared to operating income
of $3,567,000 for the quarter ended September 30, 1998.

Restructuring

        In November 1999, the Company announced a restructuring plan to reduce
annual operating expenses. The plan includes closing 86 underperforming
Company-owned centres in the United States, which represent 16% of the total
United States Company-owned centres, and a staff reduction of approximately 15%
at the Company's corporate headquarters. The restructuring is expected to result
in a pre-tax charge of approximately $6.4 million in the quarter ending December
31, 1999, principally relating to lease buyouts, fixed asset writeoffs,
severance and other termination costs. The 86 underperforming centres are
scheduled to be closed not later than November 30, 1999. The centres which will
be closed had revenues of approximately $4.5 million and direct operating
expenses of approximately $5.3 million for the quarter ended September 30, 1999.

Year 2000

        The Company is in the process of remediating both its information
technology ("IT") and non-IT systems with respect to the "year 2000" millenium
change. The Company utilizes two primary IT systems: the corporate office
system, which includes the general ledger and related applications, and the
point-of-sale system, which is used at each of the 549 Company-owned centres in
North America to record sales to customers. With respect to the corporate office
system, the Company determined that its then-current system, implemented in
1991, was not year 2000 compliant. Accordingly, the Company accelerated the
planned replacement of this system by purchasing a new corporate office system
in the first quarter of fiscal 1999. The implementation process for this new
system is substantially complete, with all critical software functions having
been placed in service by June 1, 1999. The cost of the new corporate office
system software of $189,000 was capitalized and is being amortized over the five
year estimated useful life of the new software. The cost of new hardware, which
was purchased in January 1999 for the corporate office system, was $201,000 and
is being depreciated over the five year



                                     - 9 -
<PAGE>   10

                                  (Continued)

estimated useful life of the new hardware. Application development and
implementation costs, principally fees paid to external consultants, are
estimated to be $920,000, of which $863,000 has been paid as of September 30,
1999, and are being capitalized as incurred.

        With respect to the point-of-sale system, there are two basic
components: the software and the hardware. The point-of-sale software has been
assessed, and estimated costs to modify this software to effect year 2000
compliance totaling approximately $400,000, of which $391,000 has been paid as
of September 30, 1999, are being expensed as incurred. The point-of-sale
hardware is essentially a personal computer ("PC") configuration of two to four
PCs at each Company-owned and franchised centre in North America. The Company
completed an analysis of the hardware at these centres and concluded, based upon
a study performed by an independent consultant engaged by the Company, that
substantially all of this hardware required replacement. The estimated cost to
replace and install this hardware is approximately $9,000 per Company-owned
centre, or $4,950,000 in aggregate, which is being leased over a 48 month
period. As of September 30, 1999, the Company had successfully installed the new
hardware in 463 centres, representing 84% of the total Company-owned centres to
be installed. The installation of the new hardware will continue through the
planned completion date of November 30, 1999. Substantially all of these costs
will be capitalized and depreciated over their estimated useful life of four
years.

        The Company believes, based upon inquiries of its franchisees, that a
majority of the franchisees will acquire the point-of-sale hardware being
installed at the Company's centres, and the remainder will acquire their own
year 2000 compliant hardware or operate manually.

        With respect to non-IT systems, the Company has assessed its embedded
systems contained in the corporate office building and Company-owned centre
locations. This assessment focused principally on the Company's telephone system
hardware and software. The Company believes that all significant non-IT systems
are year 2000 compliant.

        The final area of significance pertaining to the Company's year 2000
planning relates to third parties with whom the Company transacts business. This
includes the Company's food suppliers, banks, advertising agencies,
telecommunications suppliers, and utility providers. The Company has sent
written questionnaires to significant suppliers and vendors in an effort to
assess their year 2000 readiness and the effect these third parties could have
on the Company. The Company plans to maintain communication with significant
suppliers and vendors with respect to this issue.

        The Company does not separately track the internal costs, principally
comprised of compensation costs for the Information Systems department, incurred
with respect to the year 2000 project.

        Although the Company believes that its planning, as detailed above, will
enable the Company to be adequately prepared for the year 2000, a contingency
plan is also being developed. With respect to the point-of-sale system, the
Company has a manual back-up system which was the Company's primary
point-of-sale system from the Company's inception in 1983 through 1990. The
Company believes that this manual point-of-sale system could be utilized in the
event of a delay in the implementation of the plan to have the point-of-sale
system year 2000 compliant. With respect to the corporate office system, the
Company believes that its newly implemented system is year 2000 compliant.

        The statements set forth above relating to the Company's analysis and
plans with respect to the year 2000 issue in many cases constitute
forward-looking statements which are necessarily



                                     - 10 -
<PAGE>   11


                                  (Continued)
speculative. Actual results may differ materially from those described above.
The factors that could cause actual results to differ materially include,
without limitation, the following: the Company's assessment of the impact of
year 2000 is ongoing and further analysis and study, as well as the testing and
implementation of planned solutions, could disclose additional remedial work,
with the resultant additional time and expense, necessary to permit the
Company's IT and non-IT systems to be year 2000 compliant; third-party
consultants and software and hardware suppliers could fail to meet timetables
and projected cost estimates; third party suppliers of products and services to
the Company could make mistakes in their advice to the Company with respect to
their year 2000 readiness, and their failure to be year 2000 compliant could
have a material adverse effect on the Company; and, the Company's estimates of
the periods of time and costs necessary to complete certain analysis and
implementation could be impacted by future events and conditions such as a
shortage of personnel, including Company employees and outside consultants, to
perform the necessary analysis and remediation work.

Legal Proceedings

        The Company, along with other weight loss programs and certain
pharmaceutical companies, has been named as a defendant in an action filed in
the Second Judicial District Court, State of Nevada, Washoe County (the "Nevada
Litigation"). The action was commenced in August 1999 by a group of four
plaintiffs, who are seeking to maintain the action as a class action on behalf
of all persons in the State of Nevada who have purchased and used fenfluramine,
dexfenfluramine and phentermine, alone or in combination, and who have not yet
been diagnosed as having pulmonary heart disease or hypertension and/or valvular
heart disease, but who are allegedly at an increased risk of developing such
illnesses. The complaint includes claims against the Company and other
defendants for alleged breach of express and implied warranties concerning the
safety of using fenfluramine, dexfenfluramine and phentermine, and for alleged
negligence in the advertising, warning, marketing and sale of these drugs. The
complaint seeks a Court-supervised program funded by the defendants through
which class members would undergo periodic medical testing, preventative
screening and monitoring, as well as incidental damages not to exceed $75,000
per each class member, and costs of litigation including expert and attorney's
fees.

        The Company has tendered the Nevada Litigation to its insurance
carriers. The claims have not progressed sufficiently for the Company to
estimate a range of possible loss, if any. The Company intends to defend the
matter vigorously.

Financial Condition

        At September 30, 1999, the Company had cash, cash equivalents, and
short-term investments totalling $38,943,000 compared to $42,014,000 at June 30,
1999. The decrease in cash, cash equivalents, and short-term investments
resulted principally from $2,042,000 of net cash used in operating activities
and $1,461,000 used for the purchase of property and equipment. The Company
believes that its cash, cash equivalents, and short-term investments and its
cash flow from operations will be adequate for its needs in the foreseeable
future.

Recent Accounting Pronouncement

        In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("SFAS 133"), which establishes accounting
and reporting standards for derivative instruments and hedging activities.



                                     - 11 -
<PAGE>   12

                                  (Continued)

SFAS 133 requires the recognition of all derivative instruments as either assets
or liabilities in the balance sheet and measurement of those derivative
instruments at fair value. SFAS 133, as amended, is effective for all fiscal
quarters of fiscal years beginning after June 15, 2000. The Company does not
currently hold derivative instruments or engage in hedging activities. The
adoption of SFAS 133 is not expected to have a material impact on the Company's
financial position or results of operations.



                                     - 12 -
<PAGE>   13

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        The Company is exposed to a variety of risks, including changes in
interest rates affecting the return on its investments and the cost of its debt,
and foreign currency fluctuations.

        At September 30, 1999, the Company maintains a portion of its cash and
cash equivalents in financial instruments with original maturities of three
months or less. The Company also maintains a short-term investment portfolio
containing financial instruments with original maturities of greater than three
months but less than twelve months. These financial instruments, principally
comprised of high quality commercial paper, are subject to interest rate risk
and will decline in value if interest rates increase. Due to the short duration
of these financial instruments, an immediate 10 percent increase in interest
rates would not have a material effect on the Company's financial condition or
results of operations. The Company has not used derivative financial instruments
in its investment portfolio.

        The Company's long-term debt at September 30, 1999 is comprised of a
note payable to a bank, secured by the Company's corporate office building, with
a total balance of $5,669,000 and a capital lease agreement covering certain
computer hardware with a total balance of $2,727,000. The note payable bears
interest at the London Interbank Offered Rate plus one percent, with quarterly
interest rate adjustments, and the capital lease is at a fixed rate. Due to the
relative immateriality of the long-term debt, an immediate 10 percent change in
interest rates would not have a material effect on the Company's financial
condition or results of operations.

        Approximately 22% of the Company's revenues for the quarter ended
September 30, 1999 were generated from foreign operations, located principally
in Australia and Canada. In the quarter ended September 30, 1999, the Company
was subjected to a 7% weighted average increase in the Australian and Canadian
currencies in relation to the U.S. dollar compared to the quarter ended
September 30, 1998. Currently, the Company does not enter into forward exchange
contracts or other financial instruments with respect to foreign currency.



                                     - 13 -
<PAGE>   14

PART II - OTHER INFORMATION

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

        (a)     Exhibits

                10.     Trademark License Agreement dated July 30, 1999 between
                        Jenny Craig, Inc and Balance Bar Company (1)

                27.     Financial Data Schedule

        (b)     No reports on Form 8-K have been filed during the quarter for
                which this report is filed.

     ----------
     (1)  The Company has requested confidential treatment for portions of this
          agreement.


                                     - 14 -
<PAGE>   15

                                    SIGNATURE

        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.


                                        JENNY CRAIG, INC.

                                        By: /S/ James S. Kelly
                                           -------------------------------------
                                           James S. Kelly
                                           Vice President,
                                           Chief Financial Officer,
                                           and Treasurer



Date: November 12, 1999



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