SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


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

         For the quarterly period ended September 30, 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 0-27316


                          Molecular Devices Corporation
             (Exact name of registrant as specified in its charter)

         Delaware                                               94-2914362

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

                               1311 Orleans Drive
                           Sunnyvale, California 94089
          (Address of principal executive offices, including zip code)


                                 (408) 747-1700
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                                    YES_X_ NO __

As of November 12, 1998,  9,449,191 shares of the Registrant's Common Stock were
outstanding.


<PAGE>

                          MOLECULAR DEVICES CORPORATION

               FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1998
<TABLE>

                                      Index
<CAPTION>

                                                                                                               PAGE
PART I.  FINANCIAL INFORMATION                                                                               NUMBER


<S>                                                                                                              <C>               
               ITEM 1.   FINANCIAL STATEMENTS (Unaudited)

                         CONDENSED CONSOLIDATED BALANCE SHEETS
                         September 30, 1998 and December 31, 1997.........................................       3

                         CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                         Three and Nine Months Ended September 30, 1998 and 1997..........................       4

                         CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                         Nine Months Ended September 30, 1998 and 1997....................................       5

                         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.............................       6

              ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                         CONDITION AND RESULTS OF OPERATIONS..............................................       8

              ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
                         MARKET RISK......................................................................      10



PART II. OTHER INFORMATION


              ITEM 1.    LEGAL PROCEEDINGS................................................................      11

              ITEM 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS........................................      11

              ITEM 3.    DEFAULTS UPON SENIOR SECURITIES..................................................      11

              ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..............................      11

              ITEM 5.    OTHER INFORMATION................................................................      11

              ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K.................................................      11

SIGNATURE.................................................................................................      12
</TABLE>

                                       2
<PAGE>

                          PART I: FINANCIAL INFORMATION
                          ITEM 1: FINANCIAL STATEMENTS
                          MOLECULAR DEVICES CORPORATION
                      CONDENSED CONSOLIDATED BALANCE SHEETS
               (In thousands, except share and per share amounts)


                                                     September 30,  December 31,
                                                        1998           1997
                                                      --------       --------
ASSETS:                                              (unaudited)      
  Current assets:                                                     
     Cash and cash equivalents                        $ 30,810       $ 26,773
     Accounts receivable, net                           11,471          8,899
     Inventories                                         3,992          3,465
     Deferred tax asset                                  1,372          1,867
     Other current assets                                  533            122
                                                      --------       --------
          Total current assets                          48,178         41,126

Equipment and leasehold  improvements, net               1,772          1,497
Other assets                                               270            168
                                                      --------       --------
                                                      $ 50,220       $ 42,791
                                                      ========       ========
LIABILITIES AND STOCKHOLDERS' EQUITY                                 
  Current liabilities:                                               
     Accounts payable                                 $  2,349       $  1,316
     Accrued liabilities                                 3,768          3,050
     Deferred revenue                                    1,210          1,008
                                                      --------       --------
          Total current liabilities                      7,327          5,374
                                                                     
  Stockholders' equity:                                              
     Preferred stock, no par value;                                  
       3,000,000 authorized                                          
       no shares issued or outstanding                    --             --
     Common stock, $.001 par value;                                  
       30,000,000 shares authorized;                                 
       9,429,173 and 9,331,599 shares issued                         
       and outstanding, at September 30, 1998                        
       and December 31, 1997, respectively                   9              9
     Additional paid-in capital                         41,600         40,302
     Retained earnings (accumulated deficit)             2,122         (2,546)
     Deferred compensation                                (694)          (148)
     Accumulated translation adjustment                   (144)          (200)
                                                      --------       --------
          Total stockholders' equity                    42,893         37,417
                                                      --------       --------
                                                      $ 50,220       $ 42,791
                                                      ========       ========
                                                                   
        The accompanying notes are an integral part of these statements.

                                       3
<PAGE>
<TABLE>
                                              MOLECULAR DEVICES CORPORATION

                                       CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                        (In thousands, except per share amounts)
                                                       (unaudited)
<CAPTION>
                                                                            Three Months Ended      Nine Months Ended
                                                                               September 30,          September 30,
                                                                             1998        1997        1998       1997
                                                                           --------    --------    --------    --------

<S>                                                                        <C>         <C>         <C>         <C>     
REVENUES                                                                   $ 11,901    $  9,527    $ 34,114    $ 27,650

COST OF REVENUES                                                              4,424       3,481      12,648      10,547
                                                                           --------    --------    --------    --------

GROSS MARGIN                                                                  7,477       6,046      21,466      17,103
                                                                           --------    --------    --------    --------

OPERATING EXPENSES:
     Research and development                                                 1,324       1,229       4,195       3,415
     Write-off of acquired in-process research & development                    876        --           876        --
     Selling, general and administrative                                      3,511       2,927      10,002       8,595
                                                                           --------    --------    --------    --------

          Total operating expenses                                            5,711       4,156      15,073      12,010
                                                                           --------    --------    --------    --------

INCOME FROM OPERATIONS                                                        1,766       1,890       6,393       5,093
Other income, net                                                               437         284       1,196         859
                                                                           --------    --------    --------    --------

INCOME BEFORE INCOME TAXES                                                    2,203       2,174       7,589       5,952
Income tax provision                                                           (848)       (804)     (2,922)     (2,240)
                                                                           --------    --------    --------    --------

NET INCOME                                                                 $  1,355    $  1,370    $  4,667    $  3,712
                                                                           ========    ========    ========    ========

BASIC NET INCOME PER SHARE                                                 $   0.14    $   0.15    $   0.50    $   0.41
                                                                           ========    ========    ========    ========

DILUTED NET INCOME PER SHARE                                               $   0.14    $   0.14    $   0.48    $   0.38
                                                                           ========    ========    ========    ========

SHARES USED IN COMPUTING BASIC NET INCOME PER SHARE                           9,413       9,137       9,388       9,082
                                                                           ========    ========    ========    ========

SHARES USED IN COMPUTING DILUTED NET INCOME PER SHARE                         9,705       9,770       9,718       9,702
                                                                           ========    ========    ========    ========
<FN>

                             The accompanying notes are an integral part of these statements
</FN>
</TABLE>
                                                           4
<PAGE>

                          MOLECULAR DEVICES CORPORATION

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (unaudited)

                                                              Nine Months Ended
                                                                September 30,
                                                              1998        1997
                                                             ------      ------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                    4,667       3,712
Adjustments to reconcile net income to net
  cash provided by operating activities:
     Depreciation and amortization                              570         509
     Loss on disposal of fixed assets                          --            27
     Amortization of deferred compensation                      236         102
     (Increase) decrease in assets:
          Accounts receivable                                (2,572)     (2,713)
          Inventories                                          (527)     (1,847)
          Deferred tax asset                                    495         911
          Other current assets                                 (411)         25
     Increase (decrease) in liabilities:
          Accounts payable                                    1,033         335
          Accrued liabilities                                   872         416
          Deferred revenue                                      202         233
                                                             ------      ------

Net cash provided by operating activities                     4,565       1,710
                                                             ------      ------

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures                                           (844)       (503)
Other assets                                                   (102)         61
                                                             ------      ------

Net cash used in investing activities                          (946)       (442)
                                                             ------      ------

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment on promissory notes                                  --        (1,500)
Issuance of common stock, net                                   362         425
                                                             ------      ------

Net cash provided by (used in) financing activities             362      (1,075)
                                                             ------      ------

EFFECT OF EXCHANGE RATE CHANGES ON CASH                          56        (196)

Net (decrease) increase in cash and cash equivalents          4,037          (3)
Cash and cash equivalents at beginning of period             26,773      23,727
                                                             ------      ------

Cash and cash equivalents at end of period                   30,810      23,724
                                                             ======      ======

       The accompanying notes are an integral part of these statements.

                                        5
<PAGE>

                          MOLECULAR DEVICES CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note 1. Basis of Presentation

The accompanying  unaudited condensed consolidated financial statements included
herein have been prepared by the Company,  without audit,  pursuant to the rules
and regulations of the Securities and Exchange  Commission.  Certain information
and footnote  disclosures  normally included in financial statements prepared in
accordance with generally accepted accounting  principles have been condensed or
omitted  pursuant to such rules and  regulations,  although the Company believes
the disclosures  which are made are adequate to make the  information  presented
not misleading. These condensed consolidated financial statements should be read
in conjunction with the consolidated  financial statements and the notes thereto
included in the  Company's  Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, as filed with the Securities and Exchange Commission on March
26, 1998.

The  unaudited  condensed  consolidated  financial  statements  included  herein
reflect all adjustments (which include only normal, recurring adjustments) which
are, in the opinion of management, necessary to state fairly the results for the
periods  presented.  The  results  for the three and nine  month  periods  ended
September 30, 1998 are not necessarily  indicative of the results to be expected
for the entire fiscal year ending December 31, 1998.

The  preparation  of  financial  statements  in  conformity  with GAAP  requires
management to make estimates and assumptions that affect the amounts reported in
the financial  statements and  accompanying  notes.  Actual results could differ
from those estimates.

Certain  reclassifications  have been made to the financial  statements  for the
three month and nine month periods ended  September 30, 1997 to conform with the
1998 presentation for those periods.

Note 2.  New Accounting Standards

As of January 1, 1998,  the Company  adopted  Statement of Financial  Accounting
Standards No. 130 (SFAS 130).  SFAS 130  establishes new rules for the reporting
of  comprehensive  income and its  components;  however,  the  adoption  of this
Statement  had no impact on the Company's  net income or  stockholders'  equity.
SFAS 130  requires  unrealized  gains or  losses  from  the  translation  of the
Company's  foreign  subsidiaries'  financial  statements,   which  are  reported
separately  in  stockholders'  equity,  to be  included  in other  comprehensive
income. Comprehensive income was approximately $1.5 and $1.2 for the three month
periods ended September 30, 1998 and 1997,  respectively.  Comprehensive  income
was approximately $4.7 million and $3.5 million for the nine month periods ended
September 30, 1998 and 1997, respectively.

Note 3. Inventories

Inventories consist of (in thousands):

                                    September 30, 1998     December 31, 1997
                                    ------------------     -----------------
 

Finished goods                         $        1,753       $       2,051
Work in process                                   771                 565
Raw materials and subassemblies                 1,468                 849
                                       ---------------      --------------
                                       $        3,992       $       3,465
                                       ===============      ==============

Note 4. Write-Off of Acquired In-Process Research & Development

On August  28,  1998 the  Company  acquired  the  rights to a  Telecentric  Lens
Luminometer  technology from Affymax Research  Institute,  a subsidiary of Glaxo
Welcome.  Under the  agreement,  the  Company  received  the rights to  develop,
manufacture,  market and distribute  commercial systems based on this technology
in exchange for payment of up-front  consideration  and continuing  royalties to
Affymax based on future product sales.

The $876,000  write-off of acquired  in-process  research and development during
the quarter  represents  the entire  amount of up-front  consideration  that has
been,  or will be,  paid to Affymax  as well as all  related  transaction  costs
associated with this technology license agreement.

Based on the stage of development  of this  technology and the assessment of the
time and resources needed to complete product development,  the Company believes
that the  acquired  technology  has not yet reached  economic  or  technological
feasibility.

                                       6
<PAGE>

Note 5. Net Income Per Share
<TABLE>

Basic net income per share is  computed  using the  weighted  average  number of
shares of common stock  outstanding and diluted net income per share is computed
using the  weighted  average  number of shares of common stock  outstanding  and
dilutive  common  equivalent  shares from  outstanding  stock options (using the
treasury stock method). Computation of earnings per share is as follows:
<CAPTION>
                                                             Three Months Ended      Nine Months Ended
                                                               September 30,          September 30,
                                                               1998     1997          1998     1997
                                                              ------   ------        ------   ------
                                                                                    
<S>                                                           <C>      <C>           <C>      <C>   
Net Income                                                    $1,355   $1,370        $4,667   $3,712
                                                                                    
Denominator for basic EPS - weighted average                                        
common shares outstanding                                      9,413    9,137         9,388    9,082
                                                                                    
Effect of dilutive securities - employee stock options           292      633           330      620
                                                              ------   ------        ------   ------
                                                                                    
Denominator for diluted EPS - weighted                                              
 average common shares outstanding plus dilutive                                    
 securities                                                    9,705    9,770         9,718    9,702
                                                              ------   ------        ------   ------
                                                                                    
BASIC NET INCOME PER SHARE                                    $ 0.14   $ 0.15        $ 0.50   $ 0.41
                                                              ======   ======        ======   ======
                                                                                    
DILUTED NET INCOME PER SHARE                                  $ 0.14   $ 0.14        $ 0.48   $ 0.38
                                                              ======   ======        ======   ======
</TABLE>

                                       7                                  
<PAGE>

                          MOLECULAR DEVICES CORPORATION


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

Except for the historical information contained herein, the following discussion
contains  forward-looking  statements that involve risks and uncertainties.  The
Company's  actual results could differ  materially  from those  discussed  here.
Factors that could cause or contribute to such differences  include, but are not
limited to, those discussed in this section,  as well as those identified in the
Company's  Annual  Report on Form 10-K for the year ended  December  31, 1997 as
filed with the Securities and Exchange Commission on March 26, 1998.

The  following  discussion  should  be read in  conjunction  with the  unaudited
condensed consolidated financial statements and notes thereto included in Part I
- Item 1 of  this  Quarterly  Report  and  the  audited  consolidated  financial
statements  and notes  thereto  and  Management's  Discussion  and  Analysis  of
Financial  Condition and Results of Operations  for the year ended  December 31,
1997  contained in the  Company's  1997 Annual  Report on Form 10-K for the year
ended December 31, 1997 as filed with the Securities and Exchange  Commission on
March 26, 1998. The results for the three and nine month periods ended September
30, 1998 are not  necessarily  indicative  of the results to be expected for the
entire fiscal year ending December 31, 1998.

Results of Operations - Three and Nine Months Ended September 30, 1998 and 1997.

REVENUES.  Revenues for the third quarter of 1998 increased 25% to approximately
$11.9 million from  approximately $9.5 million in the third quarter of 1997. All
three product  families showed  increased  levels of revenue.  Maxline  revenues
increased  primarily due to greater sales of new SPECTRAmax  products worldwide.
Cell Analysis  revenues  increased due to both greater volume shipments of FLIPR
products  worldwide  and  the  introduction  of new  FLIPR  products.  Threshold
revenues  increased  due to  greater  volume  shipments  to  military  customers
worldwide.

Revenues for the first nine months of 1998 increased 23% to approximately  $34.1
million from  approximately  $27.7 million in the same period of 1997. All three
product families,  again, showed increased levels of revenue consistent with the
same trends discussed above for the third quarter.

GROSS MARGIN.  Gross margin decreased to 62.8% in the third quarter of 1998 from
63.5% in the third quarter of 1997.  The gross margin  increased to 62.9% in the
first nine months of 1998 from 61.9% in the same period of 1997.  The  decreased
margin for the third quarter of 1998 as compared to 1997 relates  primarily to a
shift  in the  product  mix to an  increased  proportion  of lower  margin  Cell
Analysis  products in the third quarter of 1998.  The  increased  margin for the
first nine months of 1998 is due to increased sales of new higher margin Maxline
products,  improved  margins on sales of Cell  Analysis  products and  increased
sales of higher margin Threshold products.

RESEARCH  AND  DEVELOPMENT.  Research  and  development  expenses  for the third
quarter of 1998  increased by 8% to  approximately  $1.3 million (11.1% of total
revenues)  from  approximately  $1.2 million  (12.9% of total  revenues) for the
third  quarter of 1997.  Research  and  development  expenses for the first nine
months of 1998  increased by 23% to  approximately  $4.2 million (12.3% of total
revenues) from approximately $3.4 million (12.4% of total revenues) for the same
period of 1997. The increased  spending for the third quarter and the first nine
months relates  primarily to additional  development  expenses  required for new
Maxline and FLIPR products.

WRITE-OFF OF ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT.  The Company recorded
an $876,000  charge  during the third  quarter of 1998 due to the  write-off  of
acquired   in-process   research  and  development   related  to  the  Company's
acquisition of technology rights from Affymax Research  Institute,  a subsidiary
of Glaxo Wellcome (See Note 3 of "Notes to  Consolidated  Financial  Statements"
included  in Part I-  Item 1).  The  $876,000  represents  the entire  amount of
up-front  consideration  that has,  or will be,  paid to  Affymax as well as all
related  transaction  costs associated with this technology  license  agreement.
Based on the stage of development  of this  technology and the assessment of the
time  and  resources  needed  to  complete  product  development  based  on this
technology,  the  Company  believes  that the  acquired  technology  has not yet
reached economic or technological feasibility.

SELLING,  GENERAL  AND  ADMINISTRATIVE.   Selling,  general  and  administrative
expenses for the third quarter of 1998  increased by 20% to  approximately  $3.5
million  (29.5% of total  revenues)  from  approximately  $2.9 million (30.7% of
total   revenues)  for  the  third  quarter  of  1997.   Selling,   general  and
administrative  expenses  for the first nine months of 1998  increased by 16% to
approximately  $10 million  (29.3% of total  revenues) from  approximately  $8.6
million  (31.1% of total  revenues)  for the same period of 1997.  The increased
spending in 1998 was primarily due to increased expenditures on marketing, sales
and service related activities.  Selling, general and administrative expenses as
a  percentage  of total  revenues  has dropped  for both  periods as a result of
continued positive operating leverage.

OTHER INCOME (NET). Net other income,  consisting  primarily of interest income,
for the third  quarter and first nine months of 1998  increased  by 54% and 39%,
respectively,  over the same periods in the prior year due to

                                       8
<PAGE>

increased   interest  income  resulting  from  higher  cash  balances  (provided
primarily by operating activities) for both periods.

INCOME TAX  PROVISION.  Income tax  provisions of $800,000 and $2.9 million were
recorded in the third  quarter and first nine months of 1998,  respectively,  as
compared to $800,000 and $2.2 million in the same periods of the prior year. The
38.5%  effective  tax rate for 1998 has  increased  from the 37.6% rate for 1997
primarily due to anticipated  decreased tax benefits from the Company's  Foreign
Sales Corporation.

Liquidity and Capital Resources.

The Company had cash and cash  equivalents  of  approximately  $30.8  million at
September 30, 1998,  compared to $26.8 million at December 31, 1997.  During the
first nine months of 1998, the Company generated  approximately $4.6 million and
$362,000 from operations and financing  activities,  respectively,  as partially
offset by  approximately  $946,000 used in investing  activities.  The cash flow
from operations relates primarily to the Company's earnings.  The cash flow from
financing  activities  relates solely to stock option exercises,  while the cash
used in investing activities relates primarily to capital additions.

The Company believes that its existing capital resources and cash expected to be
generated from future  operations  will be sufficient to fund its operations and
anticipated capital  expenditures  through at least 1999. However, the Company's
future  liquidity and capital  requirements  will depend upon numerous  factors,
including the resources the Company  devotes to  developing,  manufacturing  and
marketing its  products,  the extent to which the  Company's  products  generate
market acceptance and demand, potential acquisition opportunities that may arise
and other factors. As such, there can be no assurances that the Company will not
require additional financing within this time frame and, therefore,  the Company
may in the future seek to raise additional  funds through bank facilities,  debt
or equity offerings or other sources of capital.  Additional  funding may not be
available when needed or on terms acceptable to the Company,  which could have a
material  adverse  effect on the  Company's  business,  financial  condition and
results of operations.

Factors That May Affect Future Results

The  Company's  business,  financial  condition  and results of  operations  are
subject to various risk factors,  including  those described below and elsewhere
in this report.

o    Uncertainty of Future  Operating  Results.  Future  operating  results will
     depend on many factors,  including demand for the Company's  products,  the
     levels and timing of government and private sector funding of life sciences
     research activities,  the timing of the introduction of new products by the
     Company or by competing companies, the integration of acquired products and
     technology into  manufacturing  and distribution  processes,  the Company's
     ability to control  costs and its  ability  to  attract  and retain  highly
     qualified  personnel.  Furthermore,  the  Company's  gross  margins  can be
     significantly  affected by many factors,  including  shifts in product mix,
     the mix of  direct  sales as  compared  with  sales  through  distributors,
     competitive  price  pressures  or  quarterly  fluctuations  in sales levels
     relative to fixed costs.

o    Fluctuations in Quarterly Operating Results;  Lack of Backlog.  The Company
     manufactures  its products to forecast  rather than to outstanding  orders,
     and products are typically  shipped  within 30 to 90 days of purchase order
     receipt. As a result, the Company does not believe the amount of backlog at
     any  particular  date is  indicative  of its  future  level of  sales.  The
     Company's  manufacturing  procedures may in certain instances create a risk
     of excess or inadequate  inventory levels if orders do not match forecasts.
     The Company's  expense levels are based, in part, on expected future sales.
     If sales  levels in a  particular  quarter  do not meet  expectations,  the
     Company may not be able to adjust operating expenses  sufficiently  quickly
     to compensate  for the shortfall,  and the Company's  results of operations
     may be materially  adversely  affected.  Many of the Company's products are
     subject to long customer procurement processes.  Accordingly, the timing of
     capital  equipment  purchases  by  customers  is  expected to be uneven and
     difficult to predict.  In addition,  a significant portion of the Company's
     revenues is typically  derived  from sales of a small number of  relatively
     high-priced  systems,  and  sales  of  such  products  may  increase  as  a
     percentage  of revenue  in the  future.  Delays in  receipt of  anticipated
     orders of such products could lead to substantial  variability from quarter
     to quarter.  In addition,  the Company has historically  received  purchase
     orders and made a significant  portion of each quarter's  product shipments
     near the end of the quarter.  If that pattern continues,  even short delays
     in the  receipt of orders or  shipment  of products at the end of a quarter
     could have a material  adverse  effect on  results of  operations  for that
     quarter. The Company typically experiences a decrease in the level of sales
     in the first  calendar  quarter as  compared  to the fourth  quarter of the
     preceding  year  because of  budgetary  and  capital  equipment  purchasing
     patterns  in  the  life  sciences  industry.  The  Company  also  typically
     experiences a decrease in product revenues in the third quarter compared to
     the second quarter,  related to seasonality primarily associated with lower
     European and  academic  sales  during the summer  months.  Revenues for the
     third quarter of 1998  nominally  exceeded  second quarter 1998 revenues by
     approximately  $34,000  primarily  due to the phasing in of new Maxline and
     Cell  Analysis  products.  The  Company  believes  that the  third  quarter
     seasonality  trend may recur in the future as the Company increases efforts
     to further  penetrate  European  Markets.  Operating  results in any period
     should not be  considered  indicative of the results to be expected for any
     future period.

                                       9
<PAGE>

o    Dependency on New Products;  Rapid Technological  Change. The life sciences
     instrumentation  market is characterized by rapid technological  change and
     frequent  new product  introductions.  The  Company's  future  success will
     depend on its ability to enhance its  current  products  and to develop and
     introduce,  on a timely basis, new products that address the evolving needs
     of its customers.

o    Reliance on Sole Source Suppliers. Certain components used in the Company's
     products are  currently  purchased  from single  sources.  Any delay in the
     manufacture  of such  components  could  materially  adversely  affect  the
     Company's business, financial condition and results of operations.

o    Year 2000  Compliance.  The  Company has  completed  an  assessment  of its
     internal and external  Year 2000 risks and  continues to monitor,  validate
     and implement the identified  corrective  actions.  The Company's  internal
     business  systems have been reviewed and plans have been defined to achieve
     Year  2000  compliance.   Many  of  the  Company's  systems  are  presently
     compliant.  Those that are not primarily  require  upgrades,  many of which
     will be acquired for nominal  charges  from the  original  providers by mid
     1999.

     All of the Company's products that are currently manufactured and supported
     are Year 2000 compliant.  There is an installed base of Company products no
     longer  distributed that are not Year 2000 compliant,  all of which have an
     identified  upgrade  path  which our  customers  can  purchase  to  achieve
     compliance.

     Our Year 2000 vendor  compliance  process has been  established  and we are
     currently in the early stages of  implementation  and assessment which will
     include  questionnaires  of our key  vendors.  In  addition,  we have  been
     collecting and assessing customer compliance data based upon questionnaires
     we have received as their  vendor.  Upon  completion  of this process,  any
     required contingency plans will be developed.

     At this time, the Company  believes  there are no  significant  incremental
     costs   anticipated  to  achieve  both  internal  and  external  Year  2000
     compliance.  However,  there  can be no  assurances  that  the  vendors  or
     customers  of the  Company  will be in  compliance  and the  Company has no
     control over whether such vendors or customers  will be in compliance  with
     Year 2000 requirements. Any failure on the part of the Company's vendors or
     customers,  which could include  inability to deliver or purchase  product,
     could  materially  adversely  affect  the  Company's  business,   financial
     condition and results of operations.

o    Other  Factors.  The  Company's  business  is  affected  by other  factors,
     including: (i) the possibility that the introduction or announcement of new
     products would render  existing  products  obsolete or result in a delay or
     decrease in purchase orders for existing products; (ii) the extent to which
     and the timing in which the Company's  products achieve market  acceptance;
     (iii) the capital  spending  policies  of the  Company's  customers  (which
     depend on  various  factors,  including  the  resources  available  to such
     customers,   the  spending  priorities  among  various  types  of  research
     equipment  and  the  policies   regarding   capital   expenditures   during
     recessionary periods), including those policies of universities, government
     research  laboratories and other institutions whose funding is dependent on
     grants from  government  agencies;  (iv)  competition  in the life sciences
     instrumentation  market  which is highly  competitive  and  expected by the
     Company to  increase;  (v) the  Company's  ability  to obtain and  maintain
     patent and other  intellectual  property  protection  for its  products and
     technology; (vi) compliance with governmental regulations,  including those
     promulgated  by the United Sates Food and Drug  Administration  and similar
     state and foreign  agencies;  and (vii) the extent of the  Company's  sales
     outside the United States, which involve certain specific risks,  including
     risks related to currency fluctuations,  imposition of government controls,
     export license requirements, restrictions on export of critical technology,
     political  and  economic  instability  or  conflicts,  trade  restrictions,
     changes in  tariffs  and  taxes,  difficulties  in  staffing  and  managing
     international  operations and international  distributor  relationships and
     general economic conditions.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable.

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<PAGE>

                          MOLECULAR DEVICES CORPORATION


PART II.      OTHER INFORMATION


ITEM 1.       LEGAL PROCEEDINGS

     The Company is not currently a party to any material legal proceedings.


ITEM 2.       CHANGES IN SECURITIES AND USE OF PROCEEDS

     Not applicable.


ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

     None.


ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

ITEM 5.       OTHER INFORMATION

Pursuant to the  Company's  bylaws,  stockholders  who wish to bring  matters or
propose   nominees  for  director  at  the  Company's  1999  annual  meeting  of
stockholders must provide specified  information to the Company between February
20, 1999 and March 22, 1999 (unless  such matters are included in the  Company's
proxy  statement  pursuant to Rule 14a-8 under the  Securities  Exchange  Act of
1934, as amended).


ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

         (a)  Exhibits

              10.20   "Exclusive License and Technical Support Agreement"
                      with Affymax
              10.21   Employee Offer Letter for Tim Harkness
              10.22   Employee Offer Letter for Tony Lima
              10.23   Employee Offer Letter for John Senaldi
              27.1    Financial Data Schedule
              27.2    RESTATED Financial Data Schedule

         (b)  Reports on Form 8-K

              No  reports  on Form 8-K  were  filed by the  Company  during  the
              quarter ended September 30, 1998.

                                       11
<PAGE>

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.


                            MOLECULAR DEVICES CORPORATION
 

                            By: Timothy A. Harkness//                
                            ---------------------------------------------------
                            Vice President, Finance and Chief Financial Officer
                            (Duly Authorized and Principal Financial and
                            Accounting Officer)

                            Date: November 13, 1998


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