<PAGE>   1

------------------------------------------------------------------------------- 
                                 UNITED STATES
                       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 (No Fee Required) For the quarter ended May 1, 1998

         OR

[___]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (No Fee Required) For the transition period from
________________________ to _______________________

Commission File No. 0-29396

                    AUTOLOGIC INFORMATION INTERNATIONAL, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                     13-3855697
-------------------------------                       -------------------
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                         Identification No.)

1050 Rancho Conejo Boulevard, Thousand Oaks, CA              91320
------------------------------------------------           ---------
    (Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code:      (805) 498-9611


                                 Not Applicable
              ----------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                         if Changed Since Last Report)


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 reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes  X   No ---     ---

The number of shares of common stock outstanding as of June 2, 1998 was
5,787,970.

<PAGE>   2


                         PART I - FINANCIAL INFORMATION

ITEM 1--FINANCIAL STATEMENTS

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                                                 May 1,     October 31,
                                                                                                  1998         1997
                                                                                                  ----         ----
                                                                                               (Unaudited)
ASSETS                                                                                          (Dollars in thousands)
<S>                                                                                            <C>          <C>      
CURRENT ASSETS
   Cash and cash equivalents                                                                   $  11,859    $   9,452
   Accounts receivable less allowance for doubtful
     accounts of $1,880 (1998) and $1,828 (1997)                                                  14,205       17,529
   Inventories-See Note C                                                                         10,908        8,229
   Deferred income tax benefit-See Note D                                                          4,182        4,085
   Prepaid expenses and other assets                                                               2,532        2,670
                                                                                               ---------    ---------
         Total current assets                                                                     43,686       41,965

PROPERTY AND EQUIPMENT, at cost net of
   accumulated depreciation and amortization
   of $5,922 (1998) and $5,462 (1997)                                                              5,394        5,931

DEFERRED INCOME TAX BENEFIT-See Note D                                                             3,833        3,833

EXCESS OF PURCHASE PRICE OVER NET ASSETS
   ACQUIRED, net of amortization of $1,240 (1998)
   and $964 (1997)-See Note B                                                                      1,513        1,789

OTHER ASSETS                                                                                         128           78
                                                                                               ---------    ---------

                                                                                               $  54,554    $  53,596
                                                                                               =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
   Accounts payable                                                                            $   4,633    $   5,372
   Payable to Volt-See Note E                                                                         91          265
   Accrued payroll and related liabilities                                                         3,095        3,165
   Accrued expenses                                                                                1,431        1,752
   Accrued restructuring costs                                                                     1,265        1,521
   Customer advances                                                                               5,238        4,103
   Income taxes payable-See Note D                                                                   680           --
                                                                                               ---------    ---------
         Total current liabilities                                                                16,433       16,178

STOCKHOLDERS' EQUITY-See Notes B and H
   Preferred stock, par value $0.01
     Authorized-1,000,000 shares; issued - none                                                       --           --
   Common stock, par value $0.01
     Authorized - 12,000,000 shares; issued and
         outstanding 5,787,970 shares in 1998 and 1997                                                58           58
   Paid-in capital                                                                               112,620      112,620
   Accumulated deficit                                                                           (74,557)     (75,260)
                                                                                               ---------    ---------
                                                                                                  38,121       37,418
                                                                                               ---------    ---------
                                                                                               $  54,554    $  53,596
                                                                                               =========    =========
</TABLE>


                             See accompanying notes.

                                       2
<PAGE>   3

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                   For the Three               For the                  
                                                    Months Ended           Six Months Ended        
                                                --------------------    ----------------------
                                                  May 1,      May 2,      May 1,      May 2,
                                                   1998        1997        1998        1997
                                                   ----        ----        ----        ----
                                          (Dollars in thousands, except per share and share amounts)
REVENUES
<S>                                              <C>         <C>         <C>         <C>     
   Systems and equipment                         $ 15,906    $ 13,614    $ 27,988    $ 24,859
   Customer service and support                     6,642       6,299      12,602      13,149
                                                 --------    --------    --------    --------
                                                   22,548      19,913      40,590      38,008
                                                 --------    --------    --------    --------

OPERATING COSTS AND EXPENSES
   Cost of systems and equipment                    8,793       7,301      14,574      13,902
   Cost of customer service and support             5,109       4,511       9,700       9,351
                                                 --------    --------    --------    --------
     Gross margin                                   8,646       8,101      16,316      14,755

   Operating expenses                               7,283       7,092      14,377      14,168
   Charges from Volt-See Note E
     Rent                                             194         194         395         395
     General and administrative                         9           9          18          18
                                                 --------    --------    --------    --------

OPERATING INCOME                                    1,160         806       1,526         174
                                                 --------    --------    --------    --------

OTHER INCOME (EXPENSE)
   Interest income                                    121          64         228          95
   Foreign exchange gain (loss)                      (124)       (127)       (570)        134
   Other, net                                          14        (138)         10        (264)
                                                 --------    --------    --------    --------
                                                       11        (201)       (332)        (35)
                                                 --------    --------    --------    --------

INCOME FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES                                 1,171         605       1,194         139

INCOME TAX PROVISION--Note D                          481         165         491         223
                                                 --------    --------    --------    --------

INCOME (LOSS) FROM CONTINUING OPERATIONS              690         440         703         (84)

LOSS FROM DISCONTINUED OPERATIONS-Note G               --          --          --        (203)
                                                 --------    --------    --------    --------

NET INCOME (LOSS)                                $    690    $    440    $    703    $   (287)
                                                 ========    ========    ========    ========

BASIC AND DILUTED EARNINGS (LOSS)
     PER SHARE CONTINUING OPERATIONS             $   0.12    $   0.08    $   0.12    $  (0.01)

BASIC AND DILUTED EARNINGS (LOSS)
     PER SHARE DISCONTINUED OPERATIONS           $     --    $     --    $     --    $  (0.04)
                                                 --------    --------    --------    --------

BASIC AND DILUTED NET INCOME (LOSS)
     PER SHARE--See Note H                           0.12        0.08        0.12       (0.05)
                                                 ========    ========    ========    ========

Average number of shares outstanding - Basic        5,788       5,783       5,788       5,788
                                                 ========    ========    ========    ========

Average number of shares outstanding - Diluted      5,789       5,783       5,789       5,788
                                                 ========    ========    ========    ========
</TABLE>


                             See accompanying notes

                                       3
<PAGE>   4

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY



<TABLE>
<CAPTION>
                                                                   Common Stock
                                                                  $0.01 Par Value             
                                                              ------------------------          Paid-In          Accumulated
                                                              Shares            Amount          Capital            Deficit
                                                              ------            ------          -------          ------------
                                                               (Dollars in thousands)
<S>                                                           <C>             <C>              <C>               <C>        
Balance at October 31, 1997                                   5,787,970       $       58       $  112,620        $  (75,260)
   Net income for the six months (unaudited)                         --               --               --               703
                                                             ----------       ----------       ----------        ----------
Balance at May 1, 1998 (unaudited)                            5,787,970       $       58       $  112,620        $  (74,557)
                                                             ==========       ==========       ==========        ==========
</TABLE>





                             See accompanying notes



                                       4
<PAGE>   5

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                                  For the Six Months Ended
                                                                  ------------------------
                                                                     May 1,      May 2,
                                                                      1998        1997
                                                                      ----        ----
                                                                   (Dollars in thousands)


CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                 <C>        <C>     
   Net income (loss)                                                $   703    $  (287)
   Adjustments to reconcile net income (loss) to net
     cash applied to operating activities:
       Depreciation                                                   1,094      1,118
       Amortization                                                     276        276
       Provision for doubtful accounts                                   30        624
       Loss (gain) on foreign currency translation                       24       (371)
       Loss on dispositions of property and equipment                    76         65
       Deferred income taxes                                            (97)        --
       Changes in operating assets and liabilities:
         Decrease in accounts receivable                              2,973      6,771
         (Increase) decrease in inventories                          (2,679)     3,028
         Decrease (Increase) in prepaid expenses and other assets        80       (529)
         Decrease in accounts payable                                  (680)    (6,011)
         Decrease in accrued expenses                                  (616)    (1,819)
         Increase (decrease) in customer advances                     1,178        (76)
         Increase (decrease) in income taxes payable                    680       (338)
         Decrease in payable to Volt                                   (174)      (696)
                                                                    -------    -------

Net cash provided by continuing operations                            2,868      1,755
                                                                    -------    -------

       Loss on sale of discontinued operations                           --         75
       Loss from discontinued operations                                 --        128
       Net cash applied to discontinued operations                       --        (81)
                                                                    -------    -------
       Net cash provided by discontinued operations                      --        122

NET CASH PROVIDED BY
    OPERATING ACTIVITIES                                              2,868      1,877
                                                                    -------    -------
</TABLE>


                             Continued on next page


                                       5

<PAGE>   6

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                   For the Six Months Ended
                                                                                   ------------------------
                                                                                   May 1,            May 2,
                                                                                    1998              1997
                                                                                    ----              ----
                                                                                    (Dollars in thousands)
<S>                                                                           <C>               <C>          

CASH FLOWS FROM INVESTING ACTIVITIES
     Proceeds from disposal of property and equipment                         $          145    $         110
     Purchases of property and equipment                                                (778)            (800)
                                                                              --------------    ------------- 

NET CASH APPLIED TO INVESTING ACTIVITIES                                                (633)            (690)
                                                                              --------------    ------------- 

   Effect of exchange rate changes on cash                                               172              604
                                                                              --------------    ------------- 

NET INCREASE IN CASH  AND CASH EQUIVALENTS                                             2,407            1,791

Cash and cash equivalents, beginning of period                                         9,452            6,133
                                                                              --------------    ------------- 

CASH AND CASH EQUIVALENTS, END OF PERIOD                                      $       11,859    $       7,294
                                                                              ==============    ============= 


SUPPLEMENTAL CASH TRANSACTIONS Cash paid during the period:
     Interest expense                                                         $            3    $           9
     Income tax                                                               $          258    $         461
</TABLE>



SUPPLEMENTAL NON-CASH TRANSACTIONS

On January 2, 1997,  the  Digiflex  division of the  Company was  disposed of in
exchange for 10,500 shares of the Company's stock (See Note G).



                             See accompanying notes



                                       6
<PAGE>   7

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE A--Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in  accordance  with the  instructions  for Form 10-Q and Article 10 of
Regulation  S-X and,  therefore,  do not include all  information  and footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements.  However, in the opinion of management,  the accompanying  unaudited
condensed consolidated financial statements contain all adjustments  (consisting
of normal recurring  accruals)  considered  necessary for a fair presentation of
the Company's  financial  position at May 1, 1998 and results of operations  for
the three  months  and six months  ended May 1, 1998 and May 2,  1997,  and cash
flows for the six months  ended May 1, 1998 and May 2, 1997.  Operating  results
for interim  periods are not  necessarily  indicative of the results that may be
expected for a full fiscal year.

These statements should be read in conjunction with the financial statements and
footnotes  included  in the  Company's  Annual  Report on Form 10-K for the year
ended  October  31,  1997.  The  accounting  policies  used in  preparing  these
financial  statements  are the  same as  those  described  in that  Report.  The
Company's fiscal year ends on the Friday nearest October 31.

NOTE B--FORMATION OF THE COMPANY AND MERGER

The Company was  incorporated in Delaware on September 5, 1995 as a wholly-owned
subsidiary of Volt Information  Sciences,  Inc.  ("Volt").  On January 29, 1996,
pursuant to the terms of an Agreement  and Plan of Merger dated October 5, 1995,
as subsequently  amended (the "Merger Agreement"),  among the Company,  Volt and
Information International, Inc. ("Triple-I"), Volt contributed to the capital of
Autologic,  Incorporated  ("Autologic") and certain foreign subsidiaries of Volt
("Volt  Subsidiaries")  the amounts  Autologic or such subsidiaries owed to Volt
and,  subsequent  thereto,  caused Autologic to merge with and into the Company.
Volt also  assigned to the Company all of the issued and  outstanding  shares of
the Volt Subsidiaries. In addition, pursuant to the Merger Agreement, on January
29, 1996, following approval by its stockholders,  Triple-I merged with and into
the Company.

As the Company,  Autologic and the Volt  Subsidiaries were under common control,
the merger of Autologic  and the transfer of the stock of the Volt  Subsidiaries
to the Company has been accounted for on a pooling of interest basis. The merger
of Triple-I has been accounted for under the purchase  method of accounting and,
accordingly,  the purchase price,  which was based on the quoted market price of
the Triple-I common stock at the time the general terms of the acquisition  were
agreed to and announced,  plus the value of stock options issued in exchange for
outstanding  stock options of Triple-I,  has been  allocated to net assets based
upon their  estimated fair values.  The $2,753,000  excess of the purchase price
over the estimated fair value of Triple-I's  identifiable assets,  including the
estimated future tax benefits of Triple-I's net operating loss carryforwards and
deductible  temporary  differences,  was recorded on the  effective  date of the
merger and is being amortized over a five-year period.

NOTE C--INVENTORIES

Inventories consist of:

<TABLE>
<CAPTION>
                   May 1,   October 31,
                    1998      1997
                    ----      ----
                (Dollars in thousands)

<S>               <C>       <C>    
Service parts     $ 2,471   $ 2,318
Materials           4,673     3,653
Work-in-process     1,614       965
Finished goods      2,150     1,293
                  -------   -------
                  $10,908   $ 8,229
                  =======   =======
</TABLE>


                                       7
<PAGE>   8

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Continued
                                   (Unaudited)

NOTE D--INCOME TAXES

The Company  applies the liability  method of accounting  for deferred  taxes in
accordance with Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes." Under this method,  deferred tax assets and  liabilities  are
determined based on differences between the financial reporting and tax bases of
assets and  liabilities  and are measured  using tax rates and tax laws that are
scheduled  to be in  effect  when the  differences  are  scheduled  to  reverse.
Significant  components of the income tax provision  attributable  to operations
are as follows:


<TABLE>
<CAPTION>
                          For the Three Months Ended   For the Six Months Ended
                          --------------------------   ------------------------
                             May 1,         May 2,        May 1,        May 2,
                              1998           1997          1998          1997
                              ----           ----          ----          ----
                                           (Dollars in thousands)
<S>                          <C>            <C>           <C>            <C>  
Current Taxes:
   Federal                   $ 446          $  --         $ 464          $  --
   State and local              70             --            80             --
   Foreign                     213            165            44            223
                             -----          -----         -----          -----
     Total current             729            165           588            223
                             -----          -----         -----          -----
Deferred Taxes:
   Federal                    (216)            --           (77)            --
State and local                (32)            --           (20)            --
   Foreign                      --             --            --             --
                             -----          -----         -----          -----
     Total deferred           (248)            --           (97)            --
                             -----          -----         -----          -----

Total income tax provision   $ 481          $ 165         $ 491          $ 223
                             =====          =====         =====          =====
</TABLE>


Deferred  income taxes  reflect the net tax effects of changes in the  temporary
differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.

As described in Note B, as of the date of the mergers,  a deferred tax asset was
established  representing  the estimated  future tax benefit  anticipated  to be
realized  from  the  use of  Triple-I's  net  operating  loss  carryforward  and
deductible   temporary   differences  and  the  Company's  deductible  temporary
differences existing at the date of mergers to reduce anticipated taxable income
of the Company to be realized  subsequent to the mergers.  The Company  believes
that it is more likely than not that such tax benefits will be realized based on
the combined  companies' past and  anticipated  future results of operations and
after  considering  provisions  of the tax law,  such as the change in ownership
provisions, that restrict the future use of Triple-I's tax benefits.

NOTE E--CHARGES FROM VOLT

Volt incurs  certain  costs on behalf of the Company  which are reflected in the
results of operations. During the quarter ended May 1, 1998 and May 2, 1997, the
Company  incurred  $9,000 in legal fees payable to Volt under a $3,000 per month
retainer  arrangement  that provides the Company access to Volt's in-house legal
staff.


                                       8
<PAGE>   9

           AUTOLOGIC INFORMATION INTERNATIONAL, INC. AND SUBSIDIARIES
         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Continued
                                   (Unaudited)


NOTE F--RELATED PARTY TRANSACTIONS

A three-year lease, commencing on the effective date of the mergers, was entered
into between the Company,  as lessee, and a wholly-owned  subsidiary of Volt, as
lessor,  for space  previously  occupied by  Autologic as its  headquarters  and
manufacturing  facility in Thousand Oaks,  California.  Pursuant to the terms of
the  lease,  as amended in  December  1996,  the  Company's  Board of  Directors
established  a new rental rate based on  prevailing  rates in the general  area,
which  resulted in a slight  decrease in rent.  During the remaining term of the
lease,  the Company's  Board of Directors may again,  unilaterally,  but in good
faith and utilizing certain reasonableness standards,  redetermine whether there
should be a further  increase or decrease in the base rent and/or  increase  (if
the space is then  available) or decrease the amount of rented space.  The lease
also provides for the Company to pay all real estate taxes, insurance, utilities
and  repairs  related to the  facility.  During the period  from the date of the
mergers  through  May 1,  1998,  the  Company  paid  rent  to  Volt  aggregating
$1,780,000.


NOTE G--DISCONTINUED OPERATIONS

On January 2, 1997, the Company  disposed of the assets of, and discontinued the
operations of, Digiflex, its advertisement delivery division, which was acquired
at the end of January 1996.  Digiflex was sold in exchange for the retirement of
10,500  shares  of  the  Company's  stock,  which  was  previously  held  by  an
unaffiliated  party.  The loss from  discontinued  operations  for the six month
period ended May 2, 1997,  all incurred in the three month period ended  January
31, 1997,  includes an  operating  loss of $128,000 on revenues of $82,000 and a
loss on disposal of $75,000;  no realizable income tax benefits are available to
be allocated to the loss.

NOTE H--PER SHARE DATA

During the quarter  ended  January 30, 1998,  the Company  adopted  Statement of
Financial  Accounting  Standards No. 128,  "Earning Per Share," (SFAS 128) which
required a change in the method  used to compute  earnings  per share.  SFAS 128
replaces  primary and fully  diluted  earnings  per share with basic and diluted
earnings per share,  respectively.  Basic earnings per share is calculated using
the weighted  average number of common shares  outstanding  for the period,  and
excludes  stock options and other dilutive  securities  that could result in the
issuance of common stock.  Diluted  earnings per share  reflects the dilution to
earnings  that would  occur if  securities,  stock  options  and other  dilutive
securities result in the issuance of common stock.

NOTE I--RECENT ACCOUNTING PRONOUNCEMENTS

Statement of Financial Accounting  Standards No. 130 (SFAS No. 130),  "Reporting
Comprehensive  Income," and Statement of Financial  Accounting Standards No. 131
(SFAS No.  131),  "Disclosures  about  Segments  of an  Enterprise  and  Related
Information,"  were  issued  in June  1997.  SFAS No.  130 and SFAS No.  131 are
effective  for fiscal years  beginning  subsequent  to December  15, 1997,  and,
therefore,  will be adopted by the Company for its 1999 fiscal year. The Company
does not  expect the  adoption  of SFAS No. 130 or SFAS No. 131 to result in any
material  changes  in its  disclosure  or to have any  impact  on the  Company's
consolidated results of operations, financial position or cash flows.

In October 1997, the American  Institute of Certified Public  Accountants issued
SOP 97-2,  "Software Revenue  Recognition,"  which provides guidance on applying
generally  accepted  accounting  principles in  recognizing  revenue on software
transactions  and will supersede SOP 91-1. The Company will be required to apply
the  provisions  of SOP 97-2 to  transactions  entered into during  fiscal 1999.
Management  anticipates  that  the  adoption  of this  guidance  will not have a
material impact on its financial condition or results of operations.


                                        9
<PAGE>   10

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

General

In  order  to  keep  investors  informed  of  the  Company's  future  plans  and
objectives,  this Report (and other reports and statements issued by the Company
and its officers from time to time) contain  certain  statements  concerning the
Company's future results, future performance,  intentions, objectives, plans and
expectations that are or may be deemed to be "forward-looking  statements".  The
Company's  ability  to do this  has  been  fostered  by the  Private  Securities
Litigation Reform Act of 1995 which provides a "safe harbor" for forward-looking
statements to encourage companies to provide prospective  information so long as
those statements are accompanied by meaningful cautionary statements identifying
important  factors that could cause  actual  results to differ  materially  from
those  discussed  in the  statement  . The  Company  believes  it is in the best
interests of investors to take advantage of the "safe harbor" provisions of that
Act.  Such  forward-looking  statements  are  subject  to a number  of known and
unknown risks and  uncertainties  that could cause the Company's actual results,
performance  and  achievements  to differ  materially  from those  described  or
implied in the  forward-looking  statements.  Factors,  in  addition  to general
economic and business  conditions (both in the United States and in the overseas
markets where the Company  distributes  products) that could cause or contribute
to such differences  include,  but are not limited to, the Company's  ability to
meet competition in its highly  competitive  markets,  intense price competition
and  pressure  on  margins;   the   Company's   ability  to  maintain   superior
technological capability in markets characterized by rapidly changing technology
and frequent new product introductions; the Company's ability to foresee changes
and to identify,  develop and commercialize  innovative and competitive products
and systems in a timely and cost effective manner;  the continuing  availability
of components,  sub-assemblies,  parts and end items;  the Company's  ability to
successfully expand its market base beyond its traditional newspaper market; the
Company's   ability  to   attract   and  retain   certain   classifications   of
technologically  qualified personnel,  particularly in the areas of research and
development  and customer  service;  and the Company's  ability to generate cash
flows and obtain  financing  to support its  operations  and growth,  as well as
other factors discussed in the Company's Annual Report on Form 10-K for the year
ended  October  31,  1997,  and  from  time  to time in  other  Company  reports
thereafter  filed with the  Securities and Exchange  Commission,  including this
Report.

Three months ended May 1, 1998 compared to three months ended May 2, 1997

Results of Operations

Revenues in the three  months  ended May 1, 1998  increased  by  $2,635,000,  or
13.2%,  consisting of an increase of $2,292,000,  or 16.8%,  in sales of systems
and  equipment  and an increase of $343,000,  or 5.4%,  in customer  service and
support sales.  The increase in sales of systems and equipment was due primarily
to increased sales in the domestic  operations offset, in part, by a decrease in
systems  and  equipment  sales  in  the  international  operations.  All  of the
international  decline  was due to lower sales in the Pacific Rim as a result of
the economic  problems in Asia, which may continue to impair sales in the region
until the Pacific Rim currencies  strengthen.  The increase in customer  service
and  support  sales  is  due  primarily  to  increased  sales  in  the  domestic
operations.  The  markets in which the  segment  competes  are marked by rapidly
changing  technology,  with  sales  in the  second  quarter  of  fiscal  1998 of
equipment introduced within the last three years comprising approximately 84% of
equipment sales.

Gross profit margins expressed as a percentage of sales from systems, equipment,
customer  service and support revenues  decreased by 2.4 percentage  points from
40.7% in 1997 to 38.3% in the second quarter of 1998 consisting of a decrease of
1.6 percentage  points on systems and equipment and a decrease of 5.3 percentage
points in  customer  service and support  margins.  The  decrease in systems and
equipment  margins was due  principally  to the sale of a greater  proportion of
lower margin  products.  The decline in customer service and support margins was
due primarily to higher material costs associated with the domestic operations.

Operating expenses at $7,283,000 increased by $191,000, or 2.7%, from $7,092,000
in the second quarter of 1997 due primarily to higher development costs incurred
in the development of the Company's proprietary computer-to-plate product during
the  current  year.  However,  expressed  as a  percentage  of sales,  operating
expenses decreased by 3.3 percentage points from 35.6% in 1997 to 32.3% in 1998.

The $57,000 increase in interest income in the second quarter of fiscal 1998 was
due to higher  average  (over the three month  period) cash balances than in the
comparable period in the prior year.



                                       10
<PAGE>   11

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

The Company had a foreign  exchange loss in the second quarter of fiscal 1998 of
$124,000  compared to $127,000 in the second  quarter of fiscal 1997. The losses
in both periods were due to unfavorable  currency  movements in the European and
Pacific currency  markets.  To reduce the potential  adverse impact from foreign
currency  changes  on  the  Company's  foreign  currency  receivables  and  firm
commitments, foreign currency options and forward contracts are purchased.

Other expense, net, changed from an expense of $138,000 in fiscal 1997 to income
of $14,000 in fiscal 1998 due to a decrease of several  items of expense in this
category.

The income tax provision in the three month reported  fiscal 1998 period was 41%
of pretax income and was higher than the statutory  rate of 34% due primarily to
state taxes and relatively higher foreign tax rates. The tax provision of 27% of
pre-tax income in the second quarter of fiscal 1997 was lower than the statutory
rate due to taxes on foreign earnings without U.S. tax benefit.

Six months ended May 1, 1998 compared to six months ended May 2, 1997

Results of Operations

Revenues in the six months ended May 1, 1998  increased by  $2,582,000,  or 6.8%
consisting  of an  increase  of  $3,129,000,  or 12.6% in sales of  systems  and
equipment  offset,  in part,  by a decrease  of  $547,000,  or 4.2% in  customer
service and support sales. The increase in sales of systems and equipment is due
primarily to increased sales in the domestic  operations  offset,  in part, by a
decrease in systems and equipment sales in the international operations. Most of
the international  decline was due to lower sales in the Pacific Rim as a result
of the  economic  problems in Asia,  which may  continue to impair  sales in the
region  until the Pacific Rim  currencies  strengthen.  The decrease in customer
service sales was due primarily to a decline in contract  service  revenue,  the
effects  of the  stronger  US dollar on  currency  conversion  of  international
contracts and lower customer service parts sales.

Gross profit margins expressed as a percentage of sales from systems, equipment,
customer  service and support  revenue  increased by 1.4 percentage  points from
38.8% in 1997 to  40.2% in the  second  half of 1998 due to an  increase  of 3.9
percentage  points on systems and equipment offset, in part, by a 5.9 percentage
point decline in customer service margins. The increase in systems and equipment
margins was due primarily to a favorable mix of sales of higher margin  products
and lower manufacturing costs during the current year. This is a continuation of
a trend started mid fiscal 1997  resulting  from  consolidation  of products and
operations plus on-going cost reduction efforts. The decline in customer service
margins was due primarily to lower customer  service and support  revenues,  and
higher material costs associated with the domestic operations.

Operating  expenses  increased by $209,000,  or 1.5%, in the first six months of
fiscal 1998 over to the prior year comparable  period.  However,  expressed as a
percentage  of sales  operating  expenses  declined from 37.3% in fiscal 1997 to
35.4% in fiscal 1998.

The  $133,000  increase  in  interest  income in  fiscal  1998 was due to higher
average  (over the  six-month  period) cash balances in the first half of fiscal
1998 than in the comparable period in the prior year.

The Company had a foreign  exchange  loss in the first six months of fiscal 1998
of $570,000  compared to a $134,000 gain in the first six months of fiscal 1997.
The  gain  in 1997  was  due to  favorable,  and  the  loss  in 1998  was due to
unfavorable,  currency movement in the European and Pacific currency markets. To
reduce the adverse impact from foreign currency changes on the Company's foreign
currency receivables and firm commitments,  foreign currency options and forward
contracts are purchased.

Other expense, net, changed from an expense of $264,000 in fiscal 1997 to income
of  $10,000  in 1998 due to a  decrease  of  several  items of  expense  in this
category.

The income tax provision in the six month reported fiscal 1998 period was 41% of
pretax  income and was higher than the  statutory  rate of 34% due  primarily to
state taxes and relatively  higher foreign tax rates. The tax provision for 1997
relates to taxes on foreign earnings without U.S. tax benefit.


                                       11
<PAGE>   12

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

On January 2, 1997, the Company  disposed of the assets of, and discontinued the
operations of, Digiflex, its advertisement delivery division, which was acquired
at the end of January 1996.  The loss from  discontinued  operations for the six
month  period  ended May 2, 1997,  all  incurred in the three month period ended
January 31, 1997,  includes an operating loss of $128,000 on revenues of $82,000
and a loss on  disposal  of  $75,000;  no  realizable  income tax  benefits  are
available to be allocated to the loss.

Liquidity and Capital Resources

During  the first  six  months of fiscal  1998,  operating  activities  provided
$2,868,000  of cash.  The Company  generated  cash from its profit of  $703,000,
supplemented by non-cash charges aggregating  $1,403,000 consisting  principally
of depreciation of $1,094,000,  goodwill  amortization of $276,000,  a provision
for doubtful accounts of $30,000, a loss on foreign translation of $24,000 and a
loss on dispositions of property and equipment of $76,000 offset,  in part, by a
deferred  income tax charge of $97,000.  In  addition,  cash was provided by net
changes in assets and  liabilities  of $762,000,  primarily due to a decrease in
accounts  receivable  of  $2,973,000,   an  increase  in  customer  advances  of
$1,178,000  and an  increase in income  taxes  payable of  $680,000.  These were
offset by uses of cash to  support  growth  (primarily  inventory  increases  of
$2,679,000) and to reduce accounts  payable by $680,000 and accrued  expenses by
$616,000.

Investing  activities  used cash of $778,000  for the  purchase of property  and
equipment,  offset,  in part,  by  $145,000  in  proceeds  from the  disposal of
property and equipment.

As a result of the foregoing,  during the six months ended May 1, 1998, cash and
cash equivalents  increased by $2,407,000.  The Company's  working capital as of
May 1,  1998  was  $27,253,000,  which  includes  $11,859,000  in cash  and cash
equivalents.  These  resources  are  anticipated  to be  sufficient  to meet the
Company's  liquidity and capital needs for the near term in the normal course of
business.

On May 15,  1997,  the  Company  obtained a revolving  line of credit,  which is
guaranteed by Volt, in the amount of $2,250,000 with Wells Fargo Bank. Under the
terms and  conditions of the line of credit,  the Company may borrow,  repay and
re-borrow,  from time to time, up to the full amount of the line,  with interest
at the higher of the bank's prime rate or the Federal Funds Rate plus .5%. There
were  no  borrowings  outstanding  under  this  agreement  as of  May  1,  1998.
Subsequent to the end of the quarter,  the revolving  line of credit was allowed
to expire, as the Company's  current cash resources are considered  adequate and
management believes that similar agreements with similar terms will be available
in the future, if necessary.


                                       12
<PAGE>   13

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

At the Company's  1998 Annual  Meeting of  Shareholders  held on April 22, 1998,
stockholders:

(a) Elected the  following  to serve as  Directors of the Company to serve until
the 1999 Annual Meeting of the Stockholders, by the following votes:

<TABLE>
<CAPTION>
                                               For                 Votes Withheld
                                               ---                 --------------

<S>                                         <C>                        <C>  
Leroy M. Bell                               5,502,401                  3,530

Dennis D. Doolittle                         5,502,459                  3,472

Alden L. Edwards                            5,502,533                  3,398

EuGene L. Falk                              5,503,533                  2,398

James J. Groberg                            5,503,533                  2,398

Paul H. McGarrell                           5,503,533                  2,398

Jerome Shaw                                 5,503,502                  2,429

William Shaw                                5,503,533                  2,398
</TABLE>


(b) Ratified the action of the Board of  Directors in  appointing  Ernst & Young
LLP as the Company's  independent  public accountants for the fiscal year ending
October 30, 1998 by the following vote:

For:     5,504,038            Against:     444              Abstain:     1,449



                                       13
<PAGE>   14

                           PART II - OTHER INFORMATION

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

(a)      Exhibits:

         15       Independent Accountants' Report on Review of Interim
                  Financial Information from Ernst & Young LLP

         27       Financial Data Schedule

(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed during the quarter ended May 1, 1998.

                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the Company has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.


                                 AUTOLOGIC INFORMATION INTERNATIONAL, INC.

Dated:  Thousand Oaks, California
        June 12, 1998

                                 BY: /s/Anthony F. Marrelli 
                                     -----------------------------------------
                                      Anthony F. Marrelli
                                      Vice President and Chief Financial Officer



                                       14
<PAGE>   15


Exhibit Index

Exhibit       Description
-------       -----------
15            Independent Accountants' Report on Review of Interim Financial 
              Information from Ernst & Young LLP

27            Financial Data Schedule






                                       15