<PAGE>

                      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: 1-14208

                                  MOSSIMO, INC.

               (Exact name of Registrant as specified in its charter)

                 DELAWARE                            33-0684524
       (State or other jurisdiction of         (I.R.S. Employer ID No.)
        incorporation or organization)

          2450 WHITE ROAD 2ND FLOOR
             IRVINE, CALIFORNIA                     92614-6250
           (Address of principal                    (Zip Code)
             executive offices)

                                    (949) 797-0200
                (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 any 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
                                               ---      ---

   Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.

            Common Stock, par value                    15,011,529
                $.001 per share              (Outstanding on November 9, 1998)
                    (Class)

                              Exhibit Index on Page 15

<PAGE>

                                    MOSSIMO, INC.

                                  INDEX TO FORM 10-Q

PART I - FINANCIAL INFORMATION

<TABLE>
<CAPTION>

ITEM 1 - Financial Statements:                                                                        Page
                                                                                                      ----
<S>                                                                                                   <C>

Condensed consolidated balance sheets as of September 30, 1998 (unaudited) and December 31, 1997 . .    2

Condensed consolidated statements of operations for the three months and
  nine months ended September 30, 1998 and 1997 (unaudited)  . . . . . . . . . . . . . . . . . . . .    3

Condensed consolidated statements of cash flows for the nine months
  ended September 30, 1998 and 1997 (unaudited)  . . . . . . . . . . . . . . . . . . . . . . . . . .    4

Notes to condensed consolidated financial statements . . . . . . . . . . . . . . . . . . . . . . . .    5


ITEM 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations . . .    8


PART II - OTHER INFORMATION

ITEM 1 - Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   13

ITEM 6 - Exhibits and Reports on Form 8-K  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   13


SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   14


EXHIBIT INDEX  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   15


EXHIBITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   16

</TABLE>

<PAGE>

                            MOSSIMO, INC. AND SUBSIDIARY
                       CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                                SEPT 30,          DECEMBER 31,
                                                                                  1998                1997
                                                                              ------------        ------------
                                                     ASSETS                    (UNAUDITED)
<S>                                                                           <C>                 <C>
CURRENT ASSETS:
  Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . .      $         97        $        655
  Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . .             1,401               2,473
  Due from factor, net . . . . . . . . . . . . . . . . . . . . . . . . .             3,043               4,001
  Refundable taxes . . . . . . . . . . . . . . . . . . . . . . . . . . .               346               5,505
  Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             9,832              14,437
  Prepaid expenses and other current assets. . . . . . . . . . . . . . .               312                 296
                                                                              ------------        ------------
    Total current assets . . . . . . . . . . . . . . . . . . . . . . . .            15,031              27,367

PROPERTY AND EQUIPMENT, net. . . . . . . . . . . . . . . . . . . . . . .             4,223               9,182
OTHER ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               222                 275
                                                                              ------------        ------------
                                                                              $     19,476        $     36,824
                                                                              ------------        ------------
                                                                              ------------        ------------

                                       LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Line of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . .      $      3,266        $      6,962
  Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . .             1,863               4,126
  Accrued liabilities. . . . . . . . . . . . . . . . . . . . . . . . . .             2,354               2,389
  Current portion of long-term debt. . . . . . . . . . . . . . . . . . .                27                  41
  S distribution note. . . . . . . . . . . . . . . . . . . . . . . . . .               307                 362
                                                                              ------------        ------------
    Total current liabilities. . . . . . . . . . . . . . . . . . . . . .             7,817              13,880

DEFERRED ROYALTY INCOME. . . . . . . . . . . . . . . . . . . . . . . . .               356                 450
DEFERRED RENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                33                  68
LONG-TERM DEBT, net of current portion . . . . . . . . . . . . . . . . .                15                  31

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
  Preferred stock, par value $.001; authorized
    shares 3,000,000, no shares issued or outstanding. . . . . . . . . .                 -                   -
  Common stock, par value $.001; authorized shares
    30,000,000, issued and outstanding
    15,011,529 - 1998 and 15,000,000 - 1997. . . . . . . . . . . . . . .                15                  15
  Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . .            31,428              31,386
  Accumulated deficit  . . . . . . . . . . . . . . . . . . . . . . . . .           (20,188)             (9,006)
                                                                              ------------        ------------
    Total stockholders' equity . . . . . . . . . . . . . . . . . . . . .            11,255              22,395
                                                                              ------------        ------------
                                                                              $     19,476        $     36,824
                                                                              ------------        ------------
                                                                              ------------        ------------

</TABLE>


    See accompanying notes to condensed consolidated financial statements.

                                         2

<PAGE>

                            MOSSIMO, INC. AND SUBSIDIARY
                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                       (IN THOUSANDS, EXCEPT PER SHARE DATE)

<TABLE>
<CAPTION>


                                                                        THREE MONTHS                 NINE MONTHS
                                                                        ENDED SEPT 30,               ENDED SEPT 30,
                                                                  ------------------------      ------------------------
                                                                     1998          1997           1998            1997
                                                                  ---------      ---------      ---------      ---------
                                                                        (UNAUDITED)                   (UNAUDITED)
<S>                                                               <C>            <C>            <C>            <C>
Net sales. . . . . . . . . . . . . . . . . . . . . . . . . .      $  11,001      $  16,450      $  36,931      $  58,077
Cost of sales. . . . . . . . . . . . . . . . . . . . . . . .          9,360         17,026         29,545         45,655
                                                                  ---------      ---------      ---------      ---------
  Gross profit . . . . . . . . . . . . . . . . . . . . . . .          1,641           (576)         7,386         12,422
Royalty income, net. . . . . . . . . . . . . . . . . . . . .            627            625          2,458          3,233
                                                                  ---------      ---------      ---------      ---------
                                                                      2,268             49          9,844         15,655
                                                                  ---------      ---------      ---------      ---------

OPERATING EXPENSES:
  General and administrative . . . . . . . . . . . . . . . .          3,119          3,005          8,752          9,279
  Selling. . . . . . . . . . . . . . . . . . . . . . . . . .          1,460          2,088          4,633          6,483
  Marketing. . . . . . . . . . . . . . . . . . . . . . . . .            392          1,607          1,444          5,393
  Design . . . . . . . . . . . . . . . . . . . . . . . . . .            523          1,087          1,805          3,003
  Lease restructuring. . . . . . . . . . . . . . . . . .                 -               -          3,798              -
                                                                  ---------      ---------      ---------      ---------
    Total operating expenses . . . . . . . . . . . . . . . .          5,494          7,787         20,432         24,158
                                                                  ---------      ---------      ---------      ---------
    Operating loss . . . . . . . . . . . . . . . . . . . . .         (3,226)        (7,738)       (10,588)        (8,503)
                                                                  ---------      ---------      ---------      ---------

OTHER EXPENSE:
  Other, net . . . . . . . . . . . . . . . . . . . . . . . .            (54)          (185)          (127)          (199)
  Interest, net. . . . . . . . . . . . . . . . . . . . . . .           (157)           (85)          (467)           (61)
                                                                  ---------      ---------      ---------      ---------
     Net other expense . . . . . . . . . . . . . . . . . . .           (211)          (270)          (594)          (260)
                                                                  ---------      ---------      ---------      ---------
Loss before benefit for income taxes . . . . . . . . . . . .         (3,437)        (8,008)       (11,182)        (8,763)
Benefit for income taxes . . . . . . . . . . . . . . . . . .              -         (3,203)             -         (3,505)
                                                                  ---------      ---------      ---------      ---------
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . .      $  (3,437)     $  (4,805)     $ (11,182)     $  (5,258)
                                                                  ---------      ---------      ---------      ---------
                                                                  ---------      ---------      ---------      ---------
Net loss per common share -
  Basic and diluted. . . . . . . . . . . . . . . . . . . . .      $    (.23)     $    (.32)     $    (.75)     $    (.35)
                                                                  ---------      ---------      ---------      ---------
                                                                  ---------      ---------      ---------      ---------

Weighted average common shares outstanding - 
  Basic and diluted. . . . . . . . . . . . . . . . . . . . .         15,011         15,000         15,011         15,000
                                                                  ---------      ---------      ---------      ---------
                                                                  ---------      ---------      ---------      ---------

</TABLE>



       See accompanying notes to condensed consolidated financial statements.

                                          3

<PAGE>

                            MOSSIMO, INC. AND SUBSIDIARY
                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                    FOR THE NINE MONTHS
                                                                       ENDED SEPT 30,
                                                                 -------------------------
                                                                    1998           1997
                                                                 ----------     ----------
                                                                        (UNAUDITED)
<S>                                                              <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . .     $  (11,182)    $   (5,258)
Adjustment to reconcile net loss to net cash used in
  operating activities:
  Depreciation and amortization. . . . . . . . . . . . . . .          1,398          1,211
  Write-down of in-store fixtures. . . . . . . . . . . . . .            463              -
  Loss on disposition of property and equipment. . . . . . .          2,917             87
  Deferred rent. . . . . . . . . . . . . . . . . . . . . . .            (35)           (22)
  Provision for doubtful receivables . . . . . . . . . . . .            278            130
  Deferred income taxes. . . . . . . . . . . . . . . . . . .              -             96
  Changes in:
    Accounts receivable. . . . . . . . . . . . . . . . . . .            794         (1,243)
    Due from factor. . . . . . . . . . . . . . . . . . . . .            958          5,809
    Inventories. . . . . . . . . . . . . . . . . . . . . . .          4,605         (2,679)
    Refundable taxes . . . . . . . . . . . . . . . . . . . .          5,159         (2,393)
    Prepaid expenses and other current assets. . . . . . . .            (96)          (376)
    Other assets . . . . . . . . . . . . . . . . . . . . . .            (16)            (7)
    Accounts payable . . . . . . . . . . . . . . . . . . . .         (2,263)        (2,051)
    Accrued liabilities. . . . . . . . . . . . . . . . . . .            (35)           626
                                                                 ----------     ----------
  Net cash flow from operating activities. . . . . . . . . .          2,945         (6,070)
                                                                 ----------     ----------

  CASH FLOWS FROM INVESTING ACTIVITITES:
Proceeds from sales of property and equipment. . . . . . . .            500              -
Payments for acquisition of property and equipment . . . . .           (319)        (6,031)
                                                                 ----------     ----------
    Net cash flow from investing activities. . . . . . . . .            181         (6,031)
                                                                 ----------     ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in line of credit . . . . . . . . . . . . . . . .         (3,696)         5,580
Proceeds from issuance of common stock . . . . . . . . . . .             42              -
Repayment of long-term debt. . . . . . . . . . . . . . . . .            (30)           (89)
                                                                 ----------     ----------
    Net cash flow from financing activities. . . . . . . . .         (3,684)         5,491
                                                                 ----------     ----------
NET CHANGE IN CASH AND CASH EQUIVALENTS. . . . . . . . . . .           (558)        (6,610)
CASH AND CASH EQUIVALENTS, beginning of period . . . . . . .            655          7,007
                                                                 ----------     ----------
CASH AND CASH EQUIVALENTS, end of period . . . . . . . . . .     $       97     $      397
                                                                 ----------     ----------
                                                                 ----------     ----------

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION -
  Cash paid during the period for:
    Interest . . . . . . . . . . . . . . . . . . . . . . . .     $      374     $      138
                                                                 ----------     ----------
                                                                 ----------     ----------
    Income taxes . . . . . . . . . . . . . . . . . . . . . .     $        -     $      142
                                                                 ----------     ----------
                                                                 ----------     ----------

</TABLE>


        See accompanying notes to condensed consolidated financial statements.

                                          4
<PAGE>

                            MOSSIMO, INC. AND SUBSIDIARY
                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.   ORGANIZATION AND ACCOUNTING POLICIES

ORGANIZATION
   Mossimo, Inc. and subsidiary ("Mossimo" or the "Company") designs, sources
and markets a lifestyle collection of contemporary men's and women's denim based
sportswear with fashion elements, and men's activewear bearing
Mossimo-Registered Trademark- trademarks.  The Company also designs, sources and
markets men's and women's eyewear, and licenses its trademarks for use in
collections of women's swimwear and bodywear, men's neckwear, men's tailored
clothing, men's hosiery and men's and women's accessories.  The Company
distributes its products to a diversified account base, including department
stores, specialty retailers, and sports and activewear stores located throughout
the United States, as well as one signature retail store and one outlet store in
Southern California.

   The accompanying unaudited interim consolidated financial statements of the
Company have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission ("SEC") for reporting on Form 10-Q.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles ("GAAP") for complete financial
statements.  The accompanying unaudited interim condensed consolidated financial
statements should be read in conjunction with the Company's consolidated
financial statements for the year ended December 31, 1997 on Form 10-K.

  In the opinion of management, the unaudited condensed consolidated financial
statements contain all adjustments, consisting only of normal recurring
adjustments, necessary for a fair statement of the consolidated balance sheets
as of September 30, 1998 and December 31, 1997, the consolidated statements of
operations for the three months and nine months ended September 30, 1998 and
1997, and the consolidated statements of cash flows for the nine months ended
September 30, 1998 and 1997.  Operating results for the three and nine months
ended September 30, 1998 are not necessarily indicative of the results that may
be expected for the entire fiscal year ending December 31, 1998.

  Certain reclassifications have been made in the audited consolidated 1997
financial statements to conform to the 1998 presentation.

LOSS PER SHARE
   The company computes loss per share pursuant to Statement of Financial
Accounting Standards ("SFAS") No. 128, EARNINGS PER SHARE, which requires the
dual presentation of Basic and Diluted earnings per share.  The Company adopted
this pronouncement in fiscal 1997 and has restated prior periods to reflect the
adoption of SFAS No. 128.  Common stock equivalents consisted of outstanding
stock options totaling 512,700 and 505,600 as of September 30, 1998 and 1997,
respectively.  Common stock equivalents have not been included in the
calculation of diluted loss per share as their effect would have been
anti-dilutive for all periods presented.

<TABLE>
<CAPTION>

                                                                            NINE MONTHS
                                                                         ENDED SEPTEMBER 30,
                                                                         -------------------
                                                                           1998       1997
                                                                          ------    ------
<S>                                                                       <C>        <C>
Basic weighted average shares outstanding during the period. . . . . .    15,011    15,000
Dilutive effect of stock options . . . . . . . . . . . . . . . . . . .         -         -
                                                                          ------    ------
Weighted average common shares outstanding
   Basic and diluted . . . . . . . . . . . . . . . . . . . . . . . . .    15,011    15,000
                                                                          ------    ------
                                                                          ------    ------
</TABLE>


                                          5
<PAGE>

2. CREDIT FACILITY

   In April 1998, the Company's credit facility was amended to provide for a
$15.0 million revolving credit line, which is collateralized by inventory,
receivables, machinery and equipment and tradenames.  The Company's borrowings
under the amended agreement are limited to eligible inventory and receivables.
Advances under the amended agreement bear interest at the prime rate plus 0.5%.
The Company's revolving line is committed through January 1, 1999 with an
extension through March 31, 1999, subject to certain conditions.

   Historically, the Company has sold a substantial portion of its trade
accounts receivable to a factor, which assumes the credit risk with respect to
the collection of nonrecourse accounts receivable in exchange for a fee.  The
factor approves the credit of the Company's customers prior to the sale.  If the
factor disapproves of a sale to a customer and the Company decides to proceed
with the sale, the Company bears the credit risk.  The factoring agreement is in
force until June 1, 2000.

3. LEASE RESTRUCTURING

   During the quarter ended June 30, 1998, the Company completed a lease
restructure resulting in a charge of $3.8 million. The lease restructure charge
includes (i) $2.7 million in corporate lease restructuring expenses and costs,
including the write-down of certain fixed assets; (ii) $900,000 for the
discontinuation of the Company's screen printing business; and (iii) $200,000
for closing the Company's  Pasadena retail store.  As of September 30, 1998 the
remaining reserve is $430,000.

4. COMMITMENTS AND CONTINGENCIES

   LITIGATION - On January 23, 1997, plaintiff Chaile Steinberg filed a
purported class action suit against the Company and certain other defendants on
behalf of individuals who purchased the Company's common stock in the initial
public offering pursuant to the Registration Statement and Prospectus
("Prospectus"), dated February 22, 1996, and on the open market from February
22, 1996 through January 14, 1997 (the "Class Period").  In addition to naming
the Company, the plaintiffs Igor Glaudnikov, Cara Debra Marks and Lois Burke
filed a second related action against the same defendants.  The two cases were
subsequently consolidated by court order, dated May 19, 1997.  Both Steinberg
and Glaudnikov (collectively, the "State Actions") contain identical factual
allegations, and only differ in the number of shares purchased by plaintiffs and
the California residence of two of the plaintiffs in the Glaudnikov action.

   The State Actions allege that defendants made false and misleading statements
and intentionally concealed material negative information in the Prospectus and
afterward during the Class Period, which artificially inflated prices for the
Company's common stock.  Plaintiffs contend that the class was damaged in an
unspecified amount as a result of this artificial inflation of the Company's
stock price.

   On September 23, 1997, a federal class action complaint was filed on behalf
of plaintiff James Frenkil by the same law firm that represents the plaintiffs
in the State Actions.  One of the named plaintiffs in the federal action is a
plaintiff in the State Actions.  The class period and precipitating events are
the same as in the State Actions, but the federal complaint purports to allege
violations of certain federal securities laws.  On October 17, 1997, the judge
stayed the federal action pending further development in the State Actions.

   Defendants filed demurrers in the State Actions, challenging the legal
sufficiency of the complaints.  On June 26, 1997, the judge sustained the
defendant's general demurrer to the complaints in the State Actions, finding
that neither complaint pleaded facts sufficient to constitute causes of action
against the defendants.  The judge sustained the demurrer as to four of the
causes of action with leave to amend, and as to the fifth cause of action for
unlawful, unfair or fraudulent business practices and false or misleading
advertising without leave to amend.  On July 9, 1998, plaintiffs filed their
first amended consolidated complaint.  Defendants have demurred to the first
amended consolidated complaint, which is set for hearing on March 9, 1999.

   Although the outcome of the litigation cannot be predicted, management
believes that the Company has meritorious defenses and intends to defend this
action with vigor.


                                          6
<PAGE>

   The Company is involved in certain other legal and administrative proceedings
and threatened legal and administrative proceedings arising in the normal course
of its business. While the outcome of such proceedings and threatened
proceedings cannot be predicted with certainty, in the opinion of management,
the ultimate resolution of these matters individually or in the aggregate will
not have a material adverse effect on the Company.



                                          7
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

   The following discussion includes the operations of Mossimo, Inc. and
subsidiary for each of the periods discussed.  This discussion and analysis
should be read in conjunction with the Company's Consolidated Financial
Statements for the year ended December 31, 1997 on Form 10-K.

RESULTS OF OPERATIONS

   THREE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

   Net sales decreased to $11.0 million during the third quarter of 1998 from 
$16.5 million in the corresponding quarter in 1997.  The decrease in net 
sales was primarily due to a 40% decline in sales for the men's line and a 
22% decline in sales for the women's line.  Net sales of the men's line, 
which represented 54% of the Company's net sales for the three months ended 
September 30, 1998, decreased to $5.9 million in the third quarter of 1998 
from $9.8 million in the third quarter of 1997.  The reduction was primarily 
in sales of activewear such as tees and tanks, knitwear, wovens and fleece.  
However, denim sales were relatively stable.  Net sales of the women's line, 
which represented 35% of the Company's net sales for the three months ended 
September 30, 1998, decreased to $3.8 million in the third quarter of 1998 
from $4.9 million in the third quarter of 1997.  This decline was primarily 
due to lower sales of quick response denim during the back to school season.  
Net sales of the Company's eyewear decreased approximately 71% during the 
third quarter of 1998 to $279,000 from $974,000 during the same period in 
1997.  The decline in the eyewear line was primarily due to reduced product 
releases, particularly in the Moss line, resulting from excess inventories 
with core customers.

   Gross profit increased to $1.6 million during the third quarter of 1998 from
a loss of $576,000 in the corresponding quarter in 1997.  Gross profit as a
percentage of net sales increased to 15% compared to a loss of 3.5% in the third
quarter of 1997.  The loss in the third quarter of 1997 was primarily due to a
$5.1 million write down of inventory, physical inventory shortages and
settlements with certain vendors.  Excluding off price sales and the $5.1
million write down, the gross profit in 1997 was 31%.  As optic's sales are
significantly below plan, an evaluation of the excess inventory was performed
which resulted in an additional $1.0 million write down.  Excluding off price
sales and the $1.0 million optic's inventory write down, the gross profit
percentage for the third quarter of 1998 was 38% versus 31% for the prior year's
quarter.

   Net royalty income during the third quarter of 1998 was $627,000 compared to
$625,000 in the third quarter of 1997.  Net royalty income was negatively
impacted by reduced royalty income from its accessory licensee.  Sales of the
Company's accessory licensee declined due to a reduction in product categories
offered during the third quarter of 1998 compared to the corresponding quarter
in 1997.  The negative impact was offset by increased net royalty income from
other licensees, such as the Company's swimwear licensee.

   Operating expenses decreased to $5.5 million during the third quarter of 1998
from $7.8 million in the corresponding quarter in 1997. General and
administrative expense increased to $3.1 million during the third quarter of
1998 from $3.0 million in the same period in 1997.  This increase was primarily
related to a $463,000 write down of certain in-store fixtures offset by reduced
staffing and cost cutting measures.  Selling expenses decreased to $1.5 million
during the third quarter in 1998 from $2.1 million during the same period in
1997 due to reduced sales commissions offset by an increased salary expense for
in house sales representatives.  Marketing expense decreased to $0.4 million
during the third quarter of 1998 from $1.6 million during the same period in
1997.  This decline is related to a reduction in print advertising and a delay
of the Company's photo shoot.  The Company is currently working on a new
advertising campaign which it expects to present in the first half of 1999.
Design expense decreased to $0.5 million in the third quarter of 1998 compared
to $1.1 million in the same period 1997, primarily due to reduced staffing and
overall cost cutting measures in the design department.


                                          8
<PAGE>

   NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997

Net sales decreased to $36.9 million during the nine months ended September 
30, 1998 from $58.1 million during the nine months ended September 30, 1997.  
The decrease in net sales was primarily due to a 56% decline in sales for the 
men's line and a 19% decline in the women's line.  Net sales of the men's 
line, which represented 45% of the Company's net sales for the nine months 
ended September 30, 1998, decreased to $16.7 million in the first nine months 
of 1998 from $37.9 million in the first nine months of 1997.  The decrease 
was primarily due to reduced activewear sales to specialty stores and chains 
and reduced sales to unprofitable accounts, partially offset by sales of the 
Moss line totaling $2.3 million.  Net sales of the women's line, which 
represented approximately 34% of the Company's net sales for the nine months 
ended September 30, 1998, decreased to $12.6 million for the first nine 
months of 1998 from $15.5 million for the first nine months of 1997.  This 
decline was primarily related to reduced denim sales in the third quarter of 
1998 and a reduction of sales to unprofitable accounts.  Net sales of the 
Company's eyewear decreased approximately 48% to $1.4 million during the 
first nine months of 1998 from $2.7 million in the same period last year.  
The decline in the eyewear line was primarily due to reduced product 
releases, particularly in the Moss line, resulting from excess inventories 
with core customers.

    Gross profit decreased to $7.4 million during the first nine months of 1998
from $12.4 million in the corresponding period in 1997.  Gross profit as a
percentage of net sales decreased to 20% during this period from 21% during the
same period in 1997.  The decrease was primarily a result of a decrease in net
sales as discussed above.  Gross profit as a percentage of net sales, excluding
excessive inventory sales, additional reserves and inventory shortages, remained
stable at 34% for the first nine months of 1998 as compared to the same period
in 1997.

    Net royalty income decreased to $2.5 million during the first nine months 
of 1998 from $3.2 million during the same period in 1997.   The decrease was 
primarily attributed to reduced sales by the Company's licensees that carry 
swimwear, bodywear and accessory product categories.  In addition, 
unfavorable foreign exchange rate variances from the Company's Australian 
licensee further impacted results.  Management believes that sales of the 
Company's swimwear licensee were negatively impacted, in part, by poor 
weather conditions on the West Coast.  Sales of the Company's accessory 
licensee declined due to a reduction in product categories offered during 
this period in 1998 compared to the corresponding period in 1997. 

   Operating expenses decreased to $20.4 million during the first nine months of
1998 from $24.2 million during the first nine months of 1997. Included in the
1998 operating expenses is a lease restructuring charge of $3.8 million, which
was finalized in the second quarter of 1998 and a $463,000 in-store fixture
reserve recorded in the third quarter of 1998.  The lease restructure charge
includes (i) $2.7 million in corporate lease restructuring expenses and costs,
including the write-down of certain fixed assets; (ii) $900,000 for the
discontinuation of the Company's screen printing business; and (iii) $200,000
for closing the Company's Pasadena retail store.

   During 1998, the Company reevaluated its office and facilities requirements
and agreed to relinquish its existing space for its corporate headquarters and
approximately half of the space for its warehouse/distribution.  This lease
restructuring relieved the Company of annual rental obligations of approximately
$1.0 million.  The Company has moved into its new corporate headquarters located
in Irvine, California and will be opening a new design studio in Santa Monica,
California.  The Company's annual rent obligation for both locations is
approximately $260,000. The Company, accordingly, will realize a reduction in
annual rental obligations of approximately $740,000.

   Operating expenses, excluding the lease restructuring charge, decreased to
$16.6 million during the first nine months of 1998 from $24.2 million during the
first nine months of 1997. This decrease was primarily due to reduced sales
commissions, reduced staffing, a reduction in print advertising, a delay in the
Company's photo shoot, the elimination of certain fashion shows and overall cost
cutting measures; offset by increased salary expense for in house sales
representatives and a write down of certain in-store fixtures.

   The Company had net interest expense of $467,000 during the first nine months
of 1998 compared to net interest expense of $61,000 during the first nine months
of 1997. In 1998, the Company increased borrowings on

                                          9
<PAGE>

the Company's credit facility primarily due to the loss sustained by the Company
in fiscal 1997.

   The Company recorded no tax benefit in 1998 as a result of its pretax loss
compared with a tax benefit of $3.5 million in 1997.  A tax benefit will be
recorded only to the extent the Company can apply for carryback claims in its
income tax returns.

LIQUIDITY AND CAPITAL RESOURCES

   The Company's primary cash requirements are to fund the Company's working
capital needs related to  inventories, accounts receivable, and property and
equipment acquisitions.  Net cash provided by operating activities totaled $2.9
million for the nine months ended September 30, 1998.  Cash utilized in
operating activities was comprised of the Company's net loss of $11.2 million
for the nine months ending September 30, 1998 and cash used to pay down accrued
liabilities of $2.3 million, offset by a Federal tax refund of $5.2 million, a
$4.6 million reduction in inventory and the non-cash charge of $2.9 million
associated with the write-down of assets related to the lease restructuring.  As
of September 30, 1998, working capital was approximately $7.2 million compared
to $13.5 million as of December 31, 1997.  The decline in working capital is
due to a $4.6 million reduction in inventory, the collection of the refundable
taxes and funding of the loss sustained by the Company during the first three
quarters of 1998, partially offset by reductions in current liabilities.

   The Company maintains a $15.0 million revolving credit line, which is 
collateralized by inventory, receivables, machinery and equipment and 
intangibles.  The Company's borrowings under the agreement, which was amended 
in April 1998, are limited to eligible inventory and receivables.  Advances 
under the amended agreement bear interest at the prime rate plus 0.5%.  The 
revolving line is committed through January 1, 1999 with an extension through 
March 31, 1999, subject to certain conditions.  As of September 30, 1998 the 
Company had $4.9 million available on the revolving line of credit.  The 
Company was also in compliance with all debt covenants.  The Company is 
currently working with its lenders to extend its credit line beyond 1999.  If 
the Company is unable to extend the credit line or secure other capital, it 
may have an adverse affect on the Company.

   Historically, the Company has sold a substantial portion of its trade
accounts receivable to a factor, which assumes the credit risk with respect to
the collection of nonrecourse accounts receivable in exchange for a fee.  The
factor approves the credit of the Company's customers prior to the sale.  If the
factor disapproves of a sale to a customer and the Company decides to proceed
with the sale, the Company bears the credit risk.  The factoring agreement is in
force through June 1, 2000.

   In 1997, the Company began cost cutting measures to more align its expense
level with its declining sales.  Accordingly, the Company has reduced staffing
levels, reduced compensation to existing staff and is reviewing other cost
cutting measures which are designed to reduce operating expenses in fiscal 1998.

SEASONALITY

   The Company's business is impacted by general seasonal trends that are
characteristic of the many companies in the apparel industry.  However, due
primarily to the declining sales experienced in 1997 and 1998, operating trends
have not reflected the normal apparel industry seasonality. In future years, the
Company expects that its sales may reflect greater seasonal trends.

FORWARD LOOKING INFORMATION

   This report on Form 10-Q contains certain forward-looking statements within
the meaning of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995.  Such forward-looking statements are based on the beliefs of
the Company's management as well as assumptions made by and information
currently available to the Company's management.  The words "anticipate",
"believe", "may", "estimate" and similar expressions, variations of such terms
or the negative of such terms as they relate to the Company or its management
when used in this document are intended to identify such forward-looking
statements.  Such statements are based on management's current expectations and
are subject to certain risks, uncertainties and assumptions.  Should one or more
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, the Company's actual results, performance or achievements could
differ materially from those


                                          10
<PAGE>

expressed in, or implied by such forward-looking statements.

NEW ACCOUNTING PRONOUNCEMENTS

   Effective January 1, 1998 the Company adopted the Financial Accounting
Standards Board's ("FASB") SFAS No. 130, REPORTING COMPREHENSIVE INCOME.  The
Company does not have any material amounts of comprehensive income to report.

   In June 1997, the FASB issued SFAS No. 131, DISCLOSURE ABOUT SEGMENTS OF AN
ENTERPRISE AND RELATED INFORMATION.  SFAS No. 131 establishes standards for the
way public companies report financial information about operating segments.  The
Company will adopt SFAS No. 131 in fiscal 1998, as required.  This statement may
affect disclosure and presentation in the financial statements but will not have
any impact on the Company's consolidated financial position, liquidity, cash
flows or results of operations.

YEAR 2000

General

   The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year.  The Company's
computer equipment and software and devices with embedded technology that are
date-sensitive may recognize a date using "00" as the year 1900 rather than the
year 2000.  This could result in a system failure or miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process transactions, send invoices, and engage in similar normal business
activities.

   The Company has assessed how it may be impacted by the Year 2000 issue and
has formulated and commenced implementation of a plan to address the known
aspects of the issue.

The Plan

   The Company's plan encompasses its information systems, production and
facilities equipment that utilize date/time oriented software of computer chips,
products, vendors and customers and will be carried out in four phases: 1)
assessment and development of a plan; 2) remediation; 3) testing; and 4)
implementation.

   With regard to information systems, production and facilities equipment and
products, the Company is substantially complete with the assessment and plan
development phase and is approximately 80% complete with its total planned
efforts including remediation, testing and implementation.  The Company expects
that its remediation efforts in these areas will be substantially completed by
early 1999.

   The Company is also reviewing the efforts of its vendors and customers to
become Year 2000 compliant.  Letters and questionnaires have been or are in the
process of being sent to all critical entities with which the Company does
business to assess their Year 2000 readiness.  To date, the Company has received
responses from approximately 95 percent of such third parties, and 100 percent
of the companies that have responded have provided written assurances that they
expect to address all of their known significant Year 2000 issues on a timely
basis.  The Company anticipates that these activities will be on-going for the
remainder of 1998 and all of 1999 and will include follow-up telephone
interviews and on-site meetings as considered necessary in the circumstances.
Although this review is continuing, the Company is not currently aware of any
vendor or customer circumstances that may have a material adverse impact on the
Company.  The Company will be looking for alternative suppliers where
circumstances warrant.  The Company can provide no assurance that Year 2000
compliance plans will be successfully completed by suppliers and customers in a
timely manner.

Cost

   The cost related to Year 2000 compliance is not expected to be significant
because the Company has been informed by the vendor of its internal accounting
software that upgrades that will bring such software into Year 2000 compliance
are currently available and will be provided to the Company under its existing
software


                                          11
<PAGE>

maintenance agreement.  The Company expects to effect the conversion of its
internal accounting system to such upgraded software by the end of 1998.  The
Company believes that necessary conversions of other operational systems can
also be accomplished through vendor upgrades and enhancements as provided under
its system maintenance agreements currently in effect.

Risk

   The Company believes that the Year 2000 issue will not pose significant
operational problems for the Company.  However, if all Year 2000  issues are not
properly identified, or assessment, remediation and testing are not affected in
a timely manner with respect to problems that are identified, there can be no
assurance that the Year 2000 issue will not have a material adverse impact on
the Company's results of operations or adversely affect the Company's
relationships with customers, vendors, or others.  Additionally, there can be no
assurance that the Year 2000 issues of other entities will not have a material
adverse impact on the Company's systems or results of operations.

Contingency Plan

   The Company has not yet begun a comprehensive analysis of the operational
problems and costs (including loss of revenue) that would be reasonable likely
to result from the failure by the Company and certain third parties to complete
efforts necessary to achieve Year 2000 compliance on a timely basis.  A
contingency plan has not been developed for dealing with the most reasonably
likely worst case scenario as such scenario has not yet been clearly identified.
The Company currently plans to begin such analysis and contingency planning by
March 1, 1999.

(The foregoing analysis contains forward-looking information.  See cautionary
statement at the end of the Management's Discussion and Analysis section.)



                                          12
<PAGE>

PART II - OTHER INFORMATION


ITEM 1 - LEGAL PROCEEDINGS (See Note 4 to Financial Statements)

ITEM 5 - OTHER

     John Brincko's contract as president and chief executive officer will 
expire on December 31, 1998 and will not be extended for the six month option 
period. The Company is currently considering alternatives with regards to a 
new chief executive officer.

     Effective November 9, 1998, Francesca Luzuriaga resigned from her position
as a director of the Company.  Concurrently with Francesca Luzuriaga's
resignation, the Board of Directors appointed Mr. John Stafford as a member of
the Compensation Committee and Mr. Robert Martini as a member of the Audit
Committee.


ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

     (a)  The following exhibits are included herein:

          3.1    Certificate of Incorporation of the Company*
          3.2    Bylaws of the Company*
          10.10  Lease, dated August 19, 1998, between the Registrant and the
                  Cornucopia, Inc.
          10.11  Lease, dated July 20, 1998, between the Registrant and 3002
                  Pennsylvania Avenue, LLC.
          27     Financial Data Schedule


     (b)  Reports on Form 8-K


          The Registrant did not file any reports on Form 8-K during the three
          months ended September 30, 1998.

       *  (Incorporated by reference from the Company's Registration Statement
          on Form S-1, File Number 33-80597)


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<PAGE>

                                     SIGNATURES


   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.


     Mossimo, Inc.


     November 16, 1998             /s/ John Brincko
                                   -------------------------
                                   John Brincko
                                   Chief Executive Officer and President
                                   (Principal Executive Officer)


     November 16, 1998             /s/ Thora Thoroddsen
                                   -------------------------
                                   Thora Thoroddsen
                                   Secretary, Treasurer and Controller
                                   (Principal Accounting Officer)



                                          14
<PAGE>


                                 INDEX TO EXHIBITS



   Exhibit
   Number      Description
--------------------------------------------------------------------------------

     3.1       Certificate  of Incorporation of the Company*

     3.2       Bylaws of the Company*

    10.10      Lease, dated August 19, 1998, between the Registrant and the
               Cornucopia, Inc.

    10.11      Lease, dated July 20, 1998, between the Registrant and 3002
               Pennsylvania Avenue, LLC.

     27        Financial Data Schedule

            *  (Incorporated by reference from the Company's Registration
               Statement on Form S-1, File Number 33-80597)




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