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

                                   FORM 10-QSB

(Mark One)

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

                              For the quarterly period ended September 30, 1998

         / /   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

                               SIMTEK CORPORATION
--------------------------------------------------------------------------------
         (Exact name small business issuer as specified in its charter)

          Colorado                                              84-1057605
--------------------------------------------------------------------------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

      1465 Kelly Johnson Blvd. Suite 301; Colorado Springs, Colorado 80920
--------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (719) 531-9444
--------------------------------------------------------------------------------
                           (issuer's telephone number)
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes  X   No
                                                              ---     ---

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock, as of the latest practicable date.

           Class                             Outstanding at November 2,1998
--------------------------------------------------------------------------------
(Common Stock, $.01 par value)                          28,745,226

<PAGE>
<TABLE>
<CAPTION>
                                                SIMTEK CORPORATION



                                                       INDEX

                                       For Quarter Ended September 30, 1998

PART 1. FINANCIAL INFORMATION
         <S>          <C>                                                                         <C>
         ITEM 1                                                                                   Page
                                                                                                  ----
                      Balance Sheets as of September 30, 1998 and
                      December 31, 1997                                                             3

                      Statements of Income and Comprehensive Income for
                      the three months and nine months ended September 30,
                      1998 and 1997                                                                 4

                      Statements of Cash Flows for the nine months ended
                      September 30, 1998 and 1997                                                   5

                      Notes to Financial Statements                                                 6

         ITEM 2

                      Management's Discussion and Analysis of Results of
                      Operations and Financial Condition                                          7-8

PART II. OTHER INFORMATION

         ITEM 1       Legal Proceedings                                                             9

         ITEM 2       Changes in Securities                                                         9

         ITEM 3       Defaults upon Senior Securities                                               9

         ITEM 4       Matters Submitted to a Vote of Securities Holders                             9

         ITEM 5       Other Information                                                             9

         ITEM 6       Exhibits and Reports on Form 8-K                                              9

SIGNATURES                                                                                         10
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                                SIMTEK CORPORATION

                                                  BALANCE SHEETS

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

CURRENT ASSETS:
   <S>                                                                            <C>                    <C>
   Cash and cash equivalents...............................................       $   1,965,823          $    1,475,599
   Certificate of deposit..................................................             100,000                      -
   Accounts receivable - trade, net........................................           1,249,227                 921,798
   Inventory, net .........................................................           1,052,973                 641,264
   Deferred financing fees.................................................              11,191                      -
   Prepaid expenses and other..............................................              23,811                  17,960
                                                                                  -------------------------------------

       Total current assets................................................           4,403,025               3,056,621
Equipment and furniture, net...............................................             217,377                 177,821
Deferred financing fees....................................................              63,414                       -
                                                                                  -------------------------------------

TOTAL ASSETS...............................................................       $   4,683,816          $    3,234,442
                                                                                  =====================================

       LIABILITIES AND SHAREHOLDERS' EQUITY
       ------------------------------------

CURRENT LIABILITIES:
   Accounts payable:
       ZMD.................................................................       $      87,743          $      716,716
       Other...............................................................             477,568                 173,325
   Accrued expenses........................................................             327,786                 269,592
   Accrued wages...........................................................             221,475                 222,022
   Accrued vacation payable................................................              73,959                  62,401
   Payable to ZMD..........................................................             130,153                 130,153
                                                                                  -------------------------------------
       Total current liabilities...........................................           1,318,684               1,574,209

   Long term debt..........................................................           1,500,000                       -
                                                                                  -------------------------------------

       Total Liabilities...................................................           2,818,684               1,574,209


SHAREHOLDERS' EQUITY:
   Preferred stock, $1.00 par value, 2,000,000 shares
       authorized and none issued and outstanding .........................                   -                      -
   Common stock, $.01 par value, 80,000,000 shares authorized,
       28,745,226 and 28,679,185 shares issued and outstanding
       at September 30, 1998 and December 31, 1997, respectively...........             287,452                 286,792
   Additional paid-in capital..............................................          29,760,875              29,752,328
   Accumulated deficit.....................................................         (28,183,195)            (28,378,887)
                                                                                  -------------------------------------
   Shareholder's equity....................................................           1,865,132               1,660,233
                                                                                  -------------------------------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY.................................       $   4,683,816           $   3,234,442
                                                                                  =====================================

                    The accompanying notes are an integral part of these financial statements.
</TABLE>
                                                      -3-

<PAGE>
<TABLE>
<CAPTION>
                                                SIMTEK CORPORATION

                                   STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

                                                              Three Months Ended Sept. 30,            Nine Months Ended Sept. 30,
                                                              ----------------------------            ---------------------------
                                                                  1998              1997                  1998             1997
                                                                  ----              ----                  ----             ----
<S>                                                          <C>               <C>                   <C>              <C>
NET SALES..................................................  $  1,464,760      $  1,582,536          $  4,806,039     $  4,884,297

     Cost of sales.........................................       843,025           905,393             2,667,625        2,827,961
                                                             ---------------------------------------------------------------------

GROSS MARGIN...............................................       621,735           677,143             2,138,414        2,056,336

SELLING, GENERAL AND ADMINISTRATIVE
  EXPENSE:
     Design, research and development......................       284,871           204,858             1,000,755          870,899
     Administrative........................................       104,923           132,612               329,328          276,036
     Marketing.............................................       209,112           183,095               610,759          586,759
                                                             ---------------------------------------------------------------------

         Total selling, general and administrative
              expenses.....................................       598,906           520,565             1,940,842        1,733,694

INCOME FROM OPERATIONS.....................................        22,829           156,578               197,572          322,642
                                                             ---------------------------------------------------------------------

OTHER INCOME (EXPENSE):
     Interest income, net..................................       (10,977)           12,667                 7,791           39,711
     Other income (expense), net...........................         9,296            (1,546)                4,454            2,705
                                                             ---------------------------------------------------------------------

         Total other income (expense)......................        (1,681)           11,121                12,245           42,416
                                                             ---------------------------------------------------------------------

INCOME BEFORE INCOME TAXES.................................        21,148           167,699               209,817          365,058

     Provision for income taxes............................         3,765             1,620                14,125            1,620
                                                             ---------------------------------------------------------------------

NET INCOME AND COMPREHENSIVE
  INCOME...................................................  $      17,383     $    166,079          $    195,692     $    363,438
                                                             =====================================================================

BASIC AND DILUTED EPS......................................  $        0.00     $       0.01          $       0.01     $        .01
                                                             =====================================================================

BASIC WEIGHTED AVERAGE NUMBER OF
  SHARES OUTSTANDING.......................................     28,721,138       28,571,328            28,721,138       28,571,328

EFFECT OF DILUTIVE OPTIONS.................................      1,437,267        2,562,737             1,847,911        2,040,690
                                                             ---------------------------------------------------------------------

DILUTIVE SHARES OUTSTANDING................................     30,158,405       31,134,065            30,569,049       30,612,018
                                                             =====================================================================



                    The accompanying notes are an integral part of these financial statements.
</TABLE>
                                                      -4-

<PAGE>
<TABLE>
<CAPTION>
                                                   SIMTEK CORPORATION

                                                STATEMENTS OF CASH FLOWS


                                                                                      Nine Months Ended Sept. 30,
                                                                                      ---------------------------
                                                                                     1998                   1997
                                                                                     ----                   ----

CASH FLOWS FROM OPERATING ACTIVITIES:
     <S>                                                                       <C>                     <C>
     Net income ......................................................         $   195,692             $   363,438
     Adjustments to reconcile net income to net cash provided
        by (used in) operating activities:
           Depreciation...............................................             104,512                  94,629
           Deferred financing fees....................................               3,731                       -
           Changes in assets and liabilities:
           (Increase) decrease in:
               Accounts receivable....................................            (327,429)               (304,557)
               Inventory..............................................            (411,709)                (73,203)
               Prepaid expenses and other ............................              (5,851)                  9,728
           Increase (decrease) in:
               Accounts payable.......................................            (324,730)                 16,001
               Accrued expenses.......................................              69,205                 132,466
                                                                               -----------------------------------
        Net cash provided by (used in) operating activities...........            (696,579)                238,502
                                                                               -----------------------------------

CASH FLOWS USED IN INVESTING ACTIVITIES:
     Purchase of certificate of deposit ..............................            (100,000)                      -
     Purchase of equipment and furniture..............................            (144,068)                (75,146)
                                                                               ------------------------------------

     Net cash (used in) investing activities..........................            (244,068)                (75,146)

CASH FLOWS FROM FINANCING ACTIVITIES:
     Exercise of stock options........................................               9,207                  23,325
     Proceeds from convertible debenture..............................           1,500,000                       -
     Deferred financing costs.........................................             (78,336)                      -
                                                                               -----------------------------------

        Net cash provided by financing activities.....................           1,430,871                  23,325
                                                                               -----------------------------------

NET INCREASE IN CASH AND CASH EQUIVALENTS.............................             490,224                 186,681
                                                                               -----------------------------------

CASH AND CASH EQUIVALENTS, beginning of period........................           1,475,599                 964,456
                                                                               -----------------------------------

CASH AND CASH EQUIVALENTS, end of period..............................         $ 1,965,823             $ 1,151,137
                                                                               ===================================
SUPPLEMENTAL CASH FLOW INFORMATION:
     Cash paid for interest...........................................         $    42,152             $       851
                                                                               ===================================

     Cash paid for income taxes.......................................         $    14,125             $     1,620
                                                                               ===================================


                    The accompanying notes are an integral part of these financial statements.
</TABLE>
                                                      -5-

<PAGE>



                               SIMTEK CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

1. SIGNIFICANT ACCOUNTING POLICIES:

     The financial  statements  included herein are presented in accordance with
the  requirements  of Form  10-QSB and  consequently  do not  include all of the
disclosures  normally made in the registrant's annual Form 10-KSB filing.  These
financial statements should be read in conjunction with the financial statements
and notes thereto included in Simtek Corporation's Annual Report and Form 10-KSB
filed on March 24, 1998 for fiscal year 1997.

     In the opinion of management,  the unaudited  financial  statements reflect
all  adjustments  of a normal  recurring  nature  necessary  to  present  a fair
statement of the results of operations for the respective  interim periods.  The
year-end balance sheet data was derived from audited financial  statements,  but
does not  include all  disclosures  required by  generally  accepted  accounting
principles.

     In June, 1997, the Financial Accounting Standards Board issued Statement of
Financial  Accounting  Standards No. 130, Reporting  Comprehensive  Income ("FAS
130"). FAS 130, which is effective for fiscal years beginning after December 15,
1997,  defines  comprehensive  income as all  changes  in  shareholders'  equity
exclusive   of   transactions   with  owners,   such  as  capital   investments.
Comprehensive  income includes net income or loss, changes in certain assets and
liabilities that are reported directly in equity such as translation adjustments
on investments in foreign  subsidiaries,  and certain changes in minimum pension
liabilities.  The Company's comprehensive income was equal to its net income for
the three month and nine month periods ended September 30, 1998 and 1997.

     NEW PRONOUNCEMENTS - SFAS No. 133.  "Accounting for Derivative  Instruments
and Hedging  Activities,"  was issued In June 1998.  This statement  establishes
accounting and reporting  standards for derivative  instruments  and for hedging
activities.  It requires  that an entity  recognize  all  derivatives  as either
assets or liabilities  in the statement of financial  position and measure those
instruments  at fair  value.  This  statement  is  effective  for the  Company's
financial  statements  for the year ended  December 31, 2000 and the adoption of
this  standard  is not  expected  to have a  material  effect  on the  Company's
financial statements.

     SFAS  No.  132,   "Employers'   Disclosures   about   Pensions   and  Other
Postretirement  Benefits," was issued in February 1998.  This statement  revises
the disclosure requirement for pensions and other postretirement  benefits. This
statement is effective for the Company's financial statements for the year ended
December  31, 1998 and the  adoption of this  standard is not expected to have a
material effect on the Company's financial statements.

     SFAS No. 131,  "Disclosures  about  Segments of an  Enterprise  and Related
Information," was issued in June 1997. This statement  establishes  standard for
the way public business enterprises report information about operating segments.
It  also  establishes  standards  for  related  disclosure  about  products  and
services,  geographical  areas and major customers.  This statement is effective
for the Company's financial  statements for the year ended December 31, 1998 and
the adoption of this  standard is not expected to have a material  effect on the
Company's financial statements.





                                       -6-
<PAGE>
                               SIMTEK CORPORATION



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

RESULTS OF OPERATIONS:


     Simtek Corporation  ("Simtek" or the "Company")  recorded net product sales
of $1,464,760  for the third quarter of 1998 and  $4,806,039 for the nine months
ended September 30, 1998 down from the $1,582,536 recorded for the third quarter
1997 and the  $4,884,297  for the nine months  ended  September  30,  1997.  The
product sales were from the Company's 4 kilobit,  16 kilobit, 64 kilobit and 256
kilobit  nvSRAM  product  families.  The decreases  were due to lower demand for
semiconductor memories,  primarily in Japan and other areas in the far east, and
increased price pressures due to unfavorable  international currency valuations.
Two  distributors  and one direct  customer  of the  Company's  nvSRAM  products
account for  approximately  55% of the Company's net sales for the third quarter
1998. Products sold to distributors are re-sold to various end customers.

     In the third quarter 1998, the Company purchased wafers built on 1.2 micron
technology  from  Chartered   Semiconductor   Manufacturing  Plc.  of  Singapore
("Chartered")  to  support  sales  of its  high end 64  kilobit  industrial  and
military  devices.  The  Company  also  purchased  wafers  built  on 0.8  micron
technology  from  Chartered.  Sales of  devices  built with both types of wafers
purchased  from  Chartered  accounted  for  approximately  53% of the  Company's
revenue for the third quarter 1998. The balance of the Company's revenue for the
third  quarter 1998,  was primarily  from the sales of commercial 64 kilobit and
256 kilobit finished units purchased from Zentrum  Mikroelektronik  Dresden GmbH
("ZMD").

     Selling,  general and administrative  expenses saw an increase in the third
quarter of 1998 of  approximately  $78,000 over the third  quarter 1997. Of this
increase, $80,000 was primarily due to costs associated with the installation of
the 64 kilobit  and 256  kilobit  product  based on 0.8 micron  technology  into
Chartered.   Administration  saw  an  approximate  $28,000  decrease  which  was
primarily due to not incurring costs  associated with the  shareholders  meeting
held in 1997 and the  registration  statement  filed in 1997 to register  shares
underlying the warrants. The approximate $26,000 increase in Sales and Marketing
was primarily due to increased advertising.

     The Company  recorded a net income of $17,383 in the third  quarter of 1998
and a net income of $195,692  for the nine months  ended  September  30, 1998 as
compared  to a net income of  $166,079  for the third  quarter of 1997 and a net
income of $363,438 for the nine months ended September 30, 1997. The decrease in
net income was  primarily  due to  decreased  revenues  and  increased  selling,
general and administrative expenses.

     The change in cash flows from  operating  activities was primarily a result
of an increase in accounts  receivable  and inventory and a decrease in accounts
payable.  The accounts  receivable  increase  was due to an  increased  level of
billings  at the  end of the  period  which  averages  approximately  45 days to
receipt of payment.  Inventory  expenses  increased  so that the  Company  could
ensure product  availability  during the major  transition of  manufacturing  to
Chartered  Semiconductor  and due to wafer  purchases from Chartered to fill the
manufacturing pipeline. These inventory levels will be reduced as the transition
to Chartered is completed. Accounts payables were decreased to bring the Company
current with vendor's standard payment terms.

     The change in cash flows from investing  activities was due to purchases of
equipment  related to the  testing of the  Company's  64 kilobit and 256 kilobit
products built on 0.8 micron technology from wafers purchased from Chartered and
from  the  purchase  of a  restricted  certificate  of  deposit.  The  equipment
purchased  consisted  primarily of test  fixtures and burn-in  boards to support
products  manufactured at Chartered.  The certificate of deposit was established
to secure a  $250,000  line of credit.  The  change in cash flow from  financing
activities  is due to the  $1,500,000  financing  transaction  that the  Company
closed in June 1998.

                                       -7-

<PAGE>
                               SIMTEK CORPORATION


FUTURE RESULTS OF OPERATIONS

     The Company's  ability to remain  profitable  will depend  primarily on its
ability to continue reducing  manufacturing costs and increase net product sales
by increasing the  availability of existing  products and by the introduction of
new  products.  In the  third  quarter  1998,  the  Company  continued  to  ship
production  orders of all of its nvSRAM  product  families  along with  shipping
smaller  quantities to customers  interested in designing  this product into its
applications.  The Company is currently deciding which new or derivative product
it will develop next.

     As of  September  30, 1998,  the  Company's  backlog of unshipped  customer
orders  expected  to be filled  within  the next six  months  was  approximately
$800,000.  Orders may be canceled prior to 30 days before the scheduled shipping
date and,  therefore,  backlog should not be used as a measure of future product
sales.

LIQUIDITY AND CAPITAL RESOURCES

     ZMD continues to own  approximately  30% of the Company's  Common Stock and
may not exceed 30% without approval of Simtek's Board of Directors.

     The debenture entered into with Renaissance Capital Group of Dallas,  Texas
("Renaissance")  in June 1998,  allows for Renaissance to designate a nominee to
serve  as a  member  of the  Company's  Board of  Directors,  in the  event of a
monetary  default  under the  debenture  agreement,  Renaissance  may appoint an
additional nominee to serve as a member of the Company's Board of Directors.  As
of the date of this filing, Renaissance has not designated a nominee to serve as
a member of the Company's Board of Directors.

     Management  has  initiated  an  enterprise-wide   program  to  prepare  the
Company's computer and manufacturing systems and applications for the year 2000.
The Company  expects to incur  internal  staff costs as well as  consulting  and
other expenses  related to the year 2000 project.  At this point, the Company is
not able to  determine  the  estimated  cost for its year 2000  project  and, if
unresolved,  whether  the year 2000  issue  will have a  material  impact on the
operations of the Company.

                                       -8-

<PAGE>


                               SIMTEK CORPORATION


                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings - None

Item 2.  Changes in Securities - None

Item 3.  Defaults upon Senior Securities - None

Item 4.  Matters Submitted to a Vote of Securities Holders - None

Item 5.  Other Information - None

Item 6.  Exhibits and Reports on Form 8-K

         (a)   Exhibits
               --------

               Exhibit 27 - Financial Data Schedule

         (b)   Reports on Form 8-K
               -------------------

               Form  8-K  filed  July  27,  1998  announcing  "Simtek  Announces
               Financial Results for the Second Quarter of 1998"

               Form 8-K filed  August 5, 1998  announcing  "Simtek  Chairman Dr.
               Richard  Petritz Set to Leave  August 31; Says Company He Founded
               is "In Good Strong Hands"

               Form 8-K filed  September 24, 1998;  Second  Quarter 1998 Interim
               Report to Shareholders

                                       -9-

<PAGE>

                               SIMTEK CORPORATION


                                   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.



                                             SIMTEK CORPORATION
                                             (Registrant)



November 2, 1998                             By  /s/ Douglas Mitchell
                                                --------------------------------
                                                DOUGLAS MITCHELL
                                                Chief Executive Officer and
                                                  President
























                                      -10-