<TABLE> <S> <C>

<ARTICLE>                     5
<LEGEND>
THESE  SCHEDULES  CONTAIN  SUMMARY  FINANCIAL  INFORMATION  EXTRACTED  FROM  THE
CONSOLIDATED  BALANCE SHEETS AT MARCH 31, 1996, JUNE 30, 1996, AND SEPTEMBER 30,
1996 AND THE RELATED CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR THE
PERIODS  ENDED  MARCH  31,  1996,  JUNE 30,  1996,  AND  SEPTEMBER  30,  1996 OF
THREE-FIVE SYSTEMS,  INC. AND ITS SUBSIDIARIES (THE "COMPANY").  THESE SCHEDULES
ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO SUCH FINANCIAL  STATEMENTS.  THE
INFORMATION  PROVIDED FOR THE SIX MONTHS  ENDED JUNE 30, 1996 HAS BEEN  RESTATED
PURSUANT TO STATEMENT OF FINANCIAL  ACCOUNTING  STANDARDS  NO. 128, EARNINGS PER
SHARE  ("SFAS  NO.  128").  NO  OTHER  QUARTERLY  FINANCIAL  STATEMENTS  FOR THE
COMPANY'S  FISCAL YEAR ENDED DECEMBER 31, 1996 WERE RESTATED AS A RESULT OF SFAS
NO. 128. IN  ADDITION,  CERTAIN  ENTRIES ON EACH OF THESE  SCCHEDULES  HAVE BEEN
AMENDED FROM THE PREVIOUS  FINANCIAL DATA SCHEDULE FILED FOR EACH OF THE PERIODS
INDICATED.  THIS EXHIBIT SHALL NOT BE DEEMED FILED FOR THE PURPOSE OF SECTION 11
OF THE SECURITIES  ACT OF 1933 AND SECTION 18 OF THE SECURITIES  EXCHANGE ACT OF
1934, OR OTHERWISE  SUBJECT TO THE LIABILITY OF SUCH  SECTIONS,  NOR SHALL IT BE
DEEMED A PART OF ANY OTHER FILING WHICH  INCORPORATES  THIS REPORT BY REFERENCE,
UNLESS SUCH OTHER FILING EXPRESSLY INCORPORATES THIS EXHIBIT BY REFERENCE.
</LEGEND>
<RESTATED>
<MULTIPLIER>                  1,000
<CURRENCY>                    U.S. Dollars
       
<S>                           <C>                           <C>                           <C>                          
<PERIOD-TYPE>                 3-MOS                         6-MOS                         9-MOS                  
<FISCAL-YEAR-END>                        DEC-31-1996                   DEC-31-1996                   DEC-31-1996 
<PERIOD-START>                           JAN-01-1996                   JAN-01-1996                   JAN-01-1996 
<PERIOD-END>                             MAR-31-1996                   JUN-30-1996                   SEP-30-1996 
<EXCHANGE-RATE>                                    1                             1                             1 
<CASH>                                         6,295                         8,461                         9,878 
<SECURITIES>                                       0                             0                             0 
<RECEIVABLES>                                  6,325                         4,777                         5,334 
<ALLOWANCES>                                     639                           651                           648 
<INVENTORY>                                   15,801                        15,243                         6,215 
<CURRENT-ASSETS>                              29,679                        30,115                        29,851 
<PP&E>                                        38,593                        38,676                        38,731 
<DEPRECIATION>                                 5,676                         6,538                         7,397 
<TOTAL-ASSETS>                                62,955                        62,622                        61,522 
<CURRENT-LIABILITIES>                          5,965                         5,456                         8,343 
<BONDS>                                            0                             0                             0 
<PREFERRED-MANDATORY>                              0                            78                             0 
<PREFERRED>                                        0                             0                             0 
<COMMON>                                          77                             0                            78 
<OTHER-SE>                                         0                             0                             0 
<TOTAL-LIABILITY-AND-EQUITY>                  62,955                        62,622                        61,522 
<SALES>                                       18,082                        32,539                        45,657 
<TOTAL-REVENUES>                              18,082                        32,539                        45,657 
<CGS>                                         14,401                        26,345                        46,143 
<TOTAL-COSTS>                                 16,870                        31,105                        53,293 
<OTHER-EXPENSES>                                  27                            99                           116 
<LOSS-PROVISION>                                   0                             0                             0 
<INTEREST-EXPENSE>                                 0                             0                             0 
<INCOME-PRETAX>                                1,204                         1,487                        (7,510)
<INCOME-TAX>                                     482                           595                        (2,924)
<INCOME-CONTINUING>                              722                           892                        (4,586)
<DISCONTINUED>                                     0                             0                             0 
<EXTRAORDINARY>                                    0                             0                             0 
<CHANGES>                                          0                             0                             0 
<NET-INCOME>                                     722                           892                        (4,586)
<EPS-PRIMARY>                                   0.09                          0.12                         (0.59)
<EPS-DILUTED>                                   0.09                          0.11                         (0.59)
        

</TABLE>