<PAGE>


                    U. S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

            For the quarterly period ended September 30, 1999

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

                         COMMISSION FILE NUMBER: 0-25844


                         TAITRON COMPONENTS INCORPORATED
             (Exact Name of Registrant as Specified in Its Charter)

        CALIFORNIA                                        95-4249240
(State Or Other Jurisdiction of                        (I.R.S. Employer
Incorporation Or Organization)                         Identification No.)

                                25202 ANZA DRIVE
                         SANTA CLARITA, CALIFORNIA 91355
                    (Address Of Principal Executive Offices)

                                 (661) 257-6060
              (Registrant's Telephone Number, Including Area Code)

                                      NONE
      (Former Name, Address and Fiscal Year, if Changed Since Last Report)

Check 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
                               ---               ---

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date:

Class A Common Stock, $.001 par value, 5,145,196 shares outstanding as of
October 15, 1999
Class B Common Stock, $.001 par value, 762,612 shares outstanding as of
October 15, 1999

<PAGE>

PART I. FINANCIAL INFORMATION

      Item 1. Financial Statements

                         TAITRON COMPONENTS INCORPORATED

                      Condensed Consolidated Balance Sheets
                             (Dollars in Thousands)

<TABLE>
<CAPTION>

                                                                         September 30,     December 31,
                                Assets                                       1999              1998
                                                                             ----              ----
                                                                         (Unaudited)
<S>                                                                       <C>              <C>
Current assets:
    Cash and cash equivalents                                               $     65         $    364
    Trade accounts receivable, net                                             4,352            4,528
    Inventory                                                                 30,203           34,868
    Prepaid expenses                                                             392              360
    Other current assets                                                       1,238            1,151
                                                                            --------         --------
           Total current assets                                               36,250           41,271

Property and equipment, net                                                    6,329            2,976
Other assets                                                                      56              336
                                                                            --------         --------
           Total assets                                                     $ 42,635         $ 44,583
                                                                            ========         ========
                 Liabilities and Shareholders' Equity

Current liabilities:
    Current portion of long-term debt                                       $ 10,321         $ 10,920
    Trade accounts payable                                                     2,897            4,407
    Accrued liabilities and other                                                670              705
                                                                            --------         --------
           Total current liabilities                                          13,888           16,032
                                                                            --------         --------
Long-term debt, less current portion                                           3,439            3,455
                                                                            --------         --------
Shareholders' equity:
    Preferred stock, $.001 par value.  Authorized 5,000,000 shares;
      none issued or outstanding                                                  --               --
    Class A common stock, $.001 par value.  Authorized 20,000,000
      shares; 5,145,196 shares issued and outstanding.                             5                5
    Class B common stock, $.001 par value.  Authorized, issued and
      outstanding 762,612 shares.                                                  1                1
    Additional paid-in capital                                                11,573           12,179
    Foreign currency translation adjustment                                        8              (13)
    Retained earnings                                                         13,721           12,924
                                                                            --------         --------
           Total shareholders' equity                                         25,308           25,096
                                                                            --------         --------
           Total liabilities and shareholders' equity                       $ 42,635         $ 44,583
                                                                            ========         ========

</TABLE>

See accompanying notes to condensed consolidated financial statements


                                    Page 2
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

                  Condensed Consolidated Statements of Earnings
                (Dollars in thousands, except per share amounts)

<TABLE>
<CAPTION>

                                 Three months ended September 30,   Nine months ended September 30,
                                    ---------------------------      ----------------------------
                                       1999             1998            1999              1998
                                    -----------      -----------     -----------      -----------
                                    (Unaudited)     (Unaudited)     (Unaudited)       (Unaudited)

<S>                                 <C>              <C>             <C>              <C>
Net sales                           $     7,750      $     7,789     $    22,051      $    24,008

Cost of goods sold                        5,605            5,522          15,722           16,988
                                    -----------      -----------     -----------      -----------
Gross profit                              2,145            2,267           6,329            7,020

Selling, general and
    administrative expenses               1,506            1,347           4,449            3,924
                                    -----------      -----------     -----------      -----------
         Operating earnings                 639              920           1,880            3,096

Interest expense, net                       220              324             651              932
Other expense (income), net                 (39)               9            (155)              24
                                    -----------      -----------     -----------      -----------
         Earnings before income
            taxes                           458              587           1,384            2,140

Income tax expense                          189              239             587              862
                                    -----------      -----------     -----------      -----------
         Net earnings               $       269      $       348     $       797      $     1,278
                                    ===========      ===========     ===========      ===========
Basic earnings per share            $       .04      $       .06     $       .13      $       .21
                                    ===========      ===========     ===========      ===========
Diluted earnings per share          $       .04      $       .06     $       .13      $       .21
                                    ===========      ===========     ===========      ===========
Basic weighted average shares
    outstanding                       6,000,000        6,202,000       6,024,000        6,202,000
                                    ===========      ===========     ===========      ===========
Diluted weighted average shares
    outstanding                       6,085,000        6,202,000       6,078,000        6,229,000
                                    ===========      ===========     ===========      ===========

</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                    Page 3
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

                 Condensed Consolidated Statements of Cash Flows
                             (Dollars in thousands)

<TABLE>
<CAPTION>

                                                                        Nine months ended September 30,
                                                                             ----------------------
                                                                               1999          1998
                                                                              -------       -------
                                                                            (Unaudited)   (Unaudited)
<S>                                                                           <C>            <C>
Cash flows from operating activities:
    Net earnings                                                              $   797        $ 1,278
                                                                              -------        -------
    Adjustments to reconcile net earnings to net cash used in operating
      activities:
    Depreciation and amortization                                                 302            190
    Changes in:
      Trade accounts receivable                                                   176           (561)
      Inventory                                                                 4,665            826
      Prepaid expenses and other current assets                                   (32)           400
      Other assets                                                                192              6
      Trade accounts payable                                                   (1,510)          (906)
      Accrued liabilities and other                                               (35)          (343)
                                                                              -------        -------
              Total adjustments                                                 3,758           (387)
                                                                              -------        -------
              Net cash provided by operating activities                         4,555            890
                                                                              -------        -------
Cash flows from investing activities - Net cash used in acquisitions
    of property and equipment                                                  (3,654)          (996)
                                                                              -------        -------
Cash flows from financing activities:
    Borrowings on revolving line of credit and long term debt                   6,455          3,800
    Payments on revolving line of credit and long term debt                    (7,070)        (3,064)
    Repurchase of Class A Common Stock                                           (606)          (725)
    Exercise of stock options                                                      --             12
    Change in foreign currency translation                                         21            (17)
                                                                              -------        -------
              Net cash (used in) provided by financing activities              (1,200)             6
                                                                              -------        -------
              Net decrease in cash and cash equivalents                          (299)          (100)

Cash and cash equivalents, beginning of period                                    364            163
                                                                              -------        -------
Cash and cash equivalents, end of period                                      $    65        $    63
                                                                              =======        =======
Supplemental disclosure of cash flow information:
    Cash paid for interest                                                    $   786        $   947
                                                                              =======        =======
    Cash paid for income taxes                                                $   618        $   812
                                                                              =======        =======

</TABLE>

See accompanying notes to condensed consolidated financial statements


                                    Page 4
<PAGE>

                         TAITRON COMPONENTS INCORPORATED

                          Notes to Financial Statements

  (All amounts are unaudited except the balance sheet as of December 31, 1998)

(1)   BASIS OF PRESENTATION

      The condensed consolidated financial information furnished herein is
      unaudited, but, in the opinion of management, includes all adjustments
      (all of which are normal, recurring adjustments) in conformity with the
      accounting principles reflected in the financial statements included in
      the Annual Report on Form 10-K filed with the Securities and Exchange
      Commission for the year ended December 31, 1998. The results of operations
      for interim periods are not necessarily indicative of results to be
      achieved for full fiscal years.

      The accompanying unaudited condensed consolidated financial statements
      have been prepared in accordance with the instructions to Form 10-Q and,
      therefore, do not include all information and footnotes necessary for a
      fair presentation of financial position, results of operations and cash
      flows in conformity with generally accepted accounting principles. The
      unaudited condensed consolidated financial statements and notes should,
      therefore, be read in conjunction with the financial statements and notes
      thereto in the Annual Report on Form 10-K for the year ended December 31,
      1998.

(2)   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      PRINCIPLES OF CONSOLIDATION

      The unaudited condensed consolidated financial statements include the
      accounts of the Company and its majority-owned subsidiary. All significant
      intercompany transactions have been eliminated in consolidation.

      REVENUE RECOGNITION

      Revenue is recognized upon shipment of the merchandise. Reserves for
      doubtful accounts and customer returns are established based upon
      historical experience and management's estimates as shipments are made.
      Sales returns for the quarters ended September 30, 1999 and 1998
      aggregated to $298,000 and $258,000, respectively and for the nine months
      ended September 30, 1999 and 1998 aggregated to $692,000 and $763,000,
      respectively.

      ALLOWANCE FOR CUSTOMER RETURNS AND DOUBTFUL ACCOUNTS

      The allowance for doubtful accounts and customer returns at September 30,
      1999 and December 31, 1998 aggregated to $132,000 and $160,000,
      respectively.

      INVENTORY

      Inventory, consisting principally of products for resale, is stated at the
      lower of cost or market, using the first-in, first-out method. The value
      presented is net of valuation allowances of $1,490,000 and $1,593,000 at
      September 30, 1999 and December 31, 1998, respectively.

      RECLASSIFICATION

      The 1998 balances have been reclassified to conform with the 1999 balances
      where appropriate.


                                    Page 5
<PAGE>

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

RESULTS OF OPERATIONS

      We distribute a wide variety of transistors, diodes and other
semiconductors and optoelectronic devices and beginning in 1997, passive
components to other electronic distributors, original equipment manufacturers
and to contract manufacturers who incorporate them in their products.

      The following table sets forth, for the periods indicated, certain
operating amounts and ratios as a percentage of net sales.

<TABLE>
<CAPTION>

                                                   Three Month Period Ended             Nine Month Period Ended
                                                          September 30,                       September 30,
                                                          -------------                       -------------
                                                      1999             1998              1999               1998
                                                      ----             ----              ----               ----
                                                  (Unaudited)       (Unaudited)       (Unaudited)        (Unaudited)
                                                     (Dollars in thousands)                (Dollars in thousands)
                                                   ---------------------------         ----------------------------
<S>                                                  <C>              <C>              <C>              <C>
Net sales                                            $ 7,750          $ 7,789          $22,051          $24,008

Cost of goods sold                                     5,605            5,522           15,722           16,988

Gross profit                                           2,145            2,267            6,329            7,020
       % of net sales                                   27.7%            29.1%            28.7%            29.2%

Selling, general and administrative expenses           1,506            1,347            4,449            3,924
       % of net sales                                   19.4%            17.3%            20.2%            16.3%

Operating earnings                                       639              920            1,880            3,096
       % of net sales                                    8.2%            11.8%             8.5%            12.9%

Interest expense, net                                    220              324              651              932
       % of net sales                                    2.8%             4.2%             3.0%             3.9%

Net earnings                                         $   269          $   348          $   797          $ 1,278
       % of net sales                                    3.5%             4.5%             3.6%             5.3%

</TABLE>


                                    Page 6
<PAGE>

THREE MONTH PERIOD ENDED SEPTEMBER 30, 1999 COMPARED TO THE THREE MONTH PERIOD
ENDED SEPTEMBER 30, 1998

      Net sales for the three months ended September 30, 1999 were $7,750,000,
compared with net sales for the three months ended September 30, 1998 of
$7,789,000, a decrease of $39,000 or .5%. This sales decrease was attributable
principally to a decrease in the average per unit sales price on domestic sales.
Additionally, the sales decrease was partially offset by an increase in export
sales by approximately $376,000 or 59% as compared to the three months ended
September 30, 1998.

      Cost of goods sold increased by $83,000 to $5,605,000 for the three month
period ended September 30, 1999, an increase of 1.5% from the three month period
ended September 30, 1998. Gross profits decreased by $122,000 to $2,145,000 for
the three months ended September 30, 1999 from $2,267,000 for the same period in
1998. Gross profit as a percentage of net sales was 27.7% for the three months
ended September 30, 1999, a decrease from 29.1% for the same period in 1998. For
the three months ended September 30, 1999, the average unit selling price was
approximately 10.9% less than for the three months ended September 30, 1998. We
believe the decrease in gross profit is a result of industry wide decline in
demand for discrete semiconductors.

      Selling, general and administrative expenses ("SG&A") increased by
$159,000 or 11.8% for the three months ended September 30, 1999 compared to the
same period of 1998. These SG&A expenses, as a percentage of net sales,
increased to 19.4% for the three months ended September 30, 1999 from 17.3% for
the three months ended September 30, 1998. The increase is primarily
attributable to increased payroll and new operating costs incurred from opening
our newest office in New York and additional SG&A expenses from our subsidiary
in Mexico. Also, contributing to the increase are additional expenses related to
the purchase of our new warehouse and headquarters. At the end of June, 1999, we
purchased our new facilities for $3.3 million which increased depreciation and
maintenance fees during the third quarter. There was no such purchase or related
deprecation during the third quarter last year.

      Operating earnings decreased by $281,000 or 30.5% between the three month
period ended September 30, 1999 and 1998, and decreased as a percentage of net
sales to 8.2% from 11.8%. Operating earnings decreased principally as a result
of lower gross profit earned and higher SG&A expenses discussed above.

      Interest expense, net of interest income for the three months ended
September 30, 1999 decreased $104,000 compared to the three months ended
September 30, 1998. The decrease is due to lower borrowings as smaller purchases
of inventory were made during the current quarter as compared to the same
quarter last year. Additionally, the decrease in lower borrowings were partially
offset by financing the purchase of our new warehouse and headquarters mentioned
above.

      Income taxes were $189,000 in the three months ended September 30, 1999,
representing an effective tax rate of 41%, compared to $239,000 for the same
period in 1998, an effective tax rate of 41%.

      We had net earnings of $269,000 for the three months ended September 30,
1999 as compared with net earnings of $348,000 for the three months ended
September 30, 1998, a decrease of $79,000 or 22.7% for the reasons discussed
above. Net earnings as a percentage of net sales decreased to 3.5% from 4.5%.


                                    Page 7
<PAGE>

NINE MONTH PERIOD ENDED SEPTEMBER 30, 1999 COMPARED TO THE NINE MONTH PERIOD
ENDED SEPTEMBER 30, 1998

      Net sales for the nine months ended September 30, 1999 were $22,051,000,
compared with the nine months ended September 30, 1998 of $24,008,000, a
decrease of $1,957,000 or 8.2%. This sales decrease was attributable principally
to a decrease in the average per unit sales price on domestic sales.
Additionally, the decrease in sales was partially offset by an increase in
export sales of approximately $306,000 or 15% as compared to the nine months
ended September 30, 1998.

      Cost of goods sold decreased by $1,266,000 to $15,722,000 for the nine
months ended September 30, 1999, a decrease of 7.5% from the nine month period
ended September 30, 1998. Gross profits decreased by $691,000 to $6,329,000 for
the nine months ended September 30, 1999 from $7,020,000 for the same period in
1998 and decreased as a percentage of net sales to 28.7% from 29.2%. For the
nine months ended September 30, 1999, the average unit selling price was
approximately 9.9% less than for the nine months ended September 30, 1998. We
believe the decrease in gross profit is a result of industry wide decline in
demand for discrete semiconductors.

      Selling, general and administrative expenses increased by $525,000 or
13.4% for the nine months ended September 30, 1999 compared to the same
period of 1998. These costs, as a percentage of net sales, were 20.2% for the
nine months ended September 30, 1999 and 16.3% for the nine months ended
September 30, 1998. The increase is primarily attributable to increased
payroll and new operating costs incurred from opening our newest office in
New York and additional SG&A expenses from our subsidiary in Mexico. Also,
contributing to the increase is additional depreciation expense related to
the Oracle Application System ("Oracle") purchased last year. In July 1998,
we implemented Oracle which resulted in increased depreciation expense and
maintenance fees beginning in the same month. As such, there were no Oracle
related depreciation and maintenance fees during the first six months of last
year. Also, contributing to the increase are additional expenses related to
the purchase of our new warehouse and headquarters. At the end of June, 1999,
we purchased our new facilities for $3.3 million which increased depreciation
and maintenance fees during the third quarter. There was no such purchase or
related depreciation during the same period last year.

      Earnings from operations decreased by $1,216,000 or 39.3% for the nine
months ended September 30, 1999 compared to the same period of 1998 and
decreased as a percentage of net sales to 8.5% from 12.9%. This decrease in
earnings from operations is due principally to lower gross profit and higher
SG&A expenses discussed above.

      Interest expense, net of interest income, for the nine months ended
September 30, 1999 decreased by $281,000 compared to the nine months ended
September 30, 1998. The decrease is due to lower borrowings as smaller purchases
of inventory were made during the current nine months ended September 30, 1999
as compared to the same period last year. Additionally, the decrease in lower
borrowings were partially offset by financing the purchase of our new warehouse
and headquarters mentioned above.

      Income taxes were $587,000 for the nine months ended September 30, 1999,
representing an effective tax rate of 42% compared to $862,000 for the nine
months ended September 30, 1998, an effective tax rate of 40%.

      We had net earnings of $797,000 for the nine months ended September 30,
1999 compared to net earnings of $1,278,000 for the same period in 1998, a
decrease of $481,000 or 37.6% for the reasons discussed above. Net earnings as a
percentage of net sales decreased to 3.6% for the nine months ended September
30, 1999 compared to 5.3% for the same period in 1998.


                                    Page 8
<PAGE>

SUPPLY AND DEMAND ISSUES

      Beginning in 1996 and continuing through the current quarter ended
September 30, 1999, the supply of most products distributed by us has been more
than sufficient to meet customer's demand for these products. The weak demand
left suppliers with large amounts of uncommitted products. When the opportunity
arises, we may consider taking advantage of this situation by making
opportunistic purchases of suppliers' uncommitted capacity at favorable pricing.
However, since the later part of 1997, we also focused on reducing our overall
inventory on hand. We attempt to structure inventory levels in such a way as to
poise ourselves to take advantage of a recovery in the discrete semiconductor
market. At the same time, if the market recovery is slow in taking place,
inventory levels should not impose an unwarranted financial burden on our
earnings.

      Readers are cautioned that the foregoing statements are forward looking
and are necessarily speculative. There can be no guarantee that a recovery in
the discrete semiconductor market will take place. Also, if prices of components
held in inventory decline or if new technology is developed that displaces
products distributed by us and held in inventory, our business could be
materially adversely affected. See "Cautionary Statement Regarding Forward
Looking Information".

LIQUIDITY AND CAPITAL RESOURCES

      We have satisfied our liquidity requirements principally through cash
generated from operations and short-term commercial loans. A summary of our cash
flows resulting from our operating, investing and financing activities for the
nine months ended September 30, 1999 and 1998 are as follows:

<TABLE>
<CAPTION>

                                                      NINE MONTHS ENDED SEPTEMBER 30,
                                                       -----------------------------
                      (In thousands)                       1999               1998
                                                           ----               ----
                                                       (Unaudited)        (Unaudited)
<S>                                                      <C>            <C>
    Operating activities...................              $ 4,555        $   890
    Investing activities...................              $(3,654)       $  (996)
    Financing activities...................              $(1,200)       $     6

</TABLE>

      Cash flows provided by operating activities increased to $4,555,000 during
the nine months ended September 30, 1999, as compared to $890,000 during the
nine months ended September 30, 1998. The change is primarily due to lower
purchases of inventory. For example, in positioning ourselves as a "Discrete
Superstore," we have been required to carry large inventory levels. However,
since 1997, we have focused on utilizing our current inventory, thereby reducing
inventory through 1999. As a result, inventory has decreased from $34.9 million
at December 31, 1998 to $ 30.2 million at September 30, 1999, in turn,
contributing to an increase in cash flow provided by operating activities during
the current period ended September 30, 1999, as compared to the same time last
year. Additionally, cash flows generated by the decrease in inventory was
partially offset by a decrease in accounts payable and increase in accounts
receivable during the current nine month period as compared to the same time
last year.

      The discrete semiconductor products distributed by us are mature products,
used in a wide range of commercial and industrial products and industries. As a
result, we have never experienced any material amounts of product obsolescence.
We also attempt to control our inventory risks by matching large customer orders
with simultaneous orders to suppliers. Nonetheless, the high levels of inventory
carried by us increase the risks of price fluctuations and product obsolescence.

      Cash flows used in investing activities increased to $3,654,000 from
$996,000 during the nine months ended September 30, 1999 and 1998, respectively.
The increase is due primarily to the purchase of our new warehouse and
headquarters in the amount of $3.3 million. We anticipate moving into the
offices of our newly purchased building during the first quarter of 2000,
however, as of the date of this Report, our interior office improvements remain
in progress. Moreover, during the first nine months of fiscal 1998, we began to
purchase our Oracle Application System. There was no such Oracle purchase during
the current nine months ended September 30, 1999.


                                    Page 9
<PAGE>

      Cash flows used in financing activities changed to $1,200,000 from $6,000
cash provided during the nine months ended September 30, 1999 and 1998,
respectively. The change resulted from higher net repayments on our revolving
line of credit during the current nine month period as compared to the same time
last year.

       We believe that funds generated from operations and our bank revolving
lines of credit will be sufficient to finance our working capital and capital
expenditure requirements for the foreseeable future.

      As of the date of this Report, we had no commitments for other equity or
debt financing or other capital expenditures.

CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION

       Several of the matters discussed in this document contain forward looking
statements that involve risks and uncertainties. Such forward looking statements
are usually denoted by words or phrases such as "believes," "expects,"
"projects," "estimates," "anticipates," "will likely result," or similar
expressions. We wish to caution readers that all forward looking statements are
necessarily speculative and not to place undue reliance on such forward looking
statements, which speak only as of the date made, and to advise readers that
actual results could vary due to a variety of risks and uncertainties. Factors
associated with the forward looking statements that could cause the forward
looking statements to be inaccurate and could otherwise impact our future
results are set forth in detail in our most recent annual report on Form 10-K.
In addition to the other information contained in this document, readers should
carefully consider the information contained in our Form 10-K for the year ended
December 31, 1998 under the heading "Cautionary Statements and Risk Factors."

YEAR 2000

       Our Year 2000 Project ("Project") is proceeding on schedule. The Project
is addressing the issue of computer chips being unable to distinguish between
the year 1900 and the year 2000. The Project consists of three elements. First,
we are evaluating our Year 2000 readiness in both information technology ("IT")
and non-IT systems. Non-IT systems typically include embedded technology in
electronic equipment, such as microprocessors. Non-IT systems are more difficult
to assess and repair than IT systems. Second, for both IT and non-IT systems, we
are planning and implementing any necessary changes that we believe will make us
ready for the Year 2000. Third, we are evaluating the effect that third-parties
Year 2000 readiness may have on our business.

       PROJECT
       In 1997, in order to improve access to business information and to
prepare us for any future growth, we began a systems replacement project to
convert our then existing system to Oracle Application System. Oracle
Application System was implemented during the third quarter of 1998. Oracle has
represented that their products used by us are Year 2000 fully compliant meeting
the requirements set out by the British Standards Institute in DISC PD-2000-1 A
DEFINITION OF YEAR 2000 CONFORMITY REQUIREMENTS. Year 2000 conformity means that
neither performance nor functionality is affected by dates prior to, during and
after the year 2000. The other material computer software programs utilized by
us are supplied by vendors that also publish that their products are Year 2000
compliant. We believe that our IT systems are approximately 95% Year 2000
compliant now and if further evaluation uncovers a problem the software will be
replaced before December 31, 1999. We have evaluated our non-IT systems and
where necessary, replacement equipment was installed. We have also begun the
evaluation of third-parties Year 2000 readiness. This includes identifying and
prioritizing critical suppliers, customers and other third-parties by
communicating with them about their plans and progress in addressing the Year
2000 problem. These evaluations will be followed by the development of
contingency plans, which are scheduled to be developed and monitored through the
year 2000.


                                    Page 10
<PAGE>

       COSTS
       The total cost associated with required modifications to become Year 2000
compliant is not expected to be material to our financial position. The
estimated total cost of the Year 2000 Project is less than $25,000 and consists
principally of replacing old IT and Non-IT equipment where compliance with Year
2000 is in doubt. The cost of implementing the Oracle system and any resulting
equipment replacement or upgrades are not included in these costs estimates as
we did not accelerate the replacement of our old system due to Year 2000 issues.

       RISKS
       The failure to correct a material Year 2000 problem could result in an
interruption in, or a failure of, certain normal business activities or
operations. Such failure could materially and adversely affect our results of
operations, liquidity and financial condition. Due to the general uncertainty
inherent in the Year 2000 problem, resulting in part from the uncertainty of the
Year 2000 readiness of third-party suppliers and customers, we are unable to
determine at this time whether the consequences of Year 2000 failures will have
a material impact on our results of operations, liquidity or financial
condition. The Year 2000 Project is expected to significantly reduce our level
of uncertainty about the Year 2000 problem and, in particular, about the Year
2000 compliance and readiness of our material external third-parties. We believe
that, with the implementation of new business systems and completion of the
Project, as scheduled, the possibility of significant interruptions of normal
operations should be reduced.

PART II. OTHER INFORMATION

Item  1. through Item 5.

Not applicable

Item  6. Exhibits and Reports on Form 8-K

(a)   Exhibits:

         27 Financial Data Schedule

(b) Reports on Form 8-K:

               None


                                    Page 11
<PAGE>

       SIGNATURES

       In accordance with the requirements of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                 TAITRON COMPONENTS INCORPORATED

Date:    November 12, 1999                        By:   /s/ STEWART WANG
                                                       -------------------------
                                                  Stewart Wang
                                                  Chief Executive Officer
                                                  and Director

Date:    November 12, 1999                        By:  /s/ STEVEN H. DONG
                                                      --------------------------
                                                  Steven H. Dong
                                                  Chief Financial Officer
                                                  (Principal Accounting Officer)

                                    Page 12