<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 MARCH 31, 1998

                                       OR

          ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                 FOR THE TRANSITION PERIOD FROM _______ TO _______

                         COMMISSION FILE NUMBER 0-11365

                              LASER PHOTONICS, INC.
                              ---------------------
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                      DELAWARE                           59-2058100
                      --------                           ----------
           (STATE OR OTHER JURISDICTION OF            (I.R.S. EMPLOYER
           INCORPORATION OR ORGANIZATION)            IDENTIFICATION NO.)

     6865 FLANDERS DRIVE, SUITE G, SAN DIEGO, CA            92121
     -------------------------------------------            -----
      (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)             (ZIP CODE)

        REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (619) 455-7030
                                                           --------------

                                       N/A
                                       ---
              (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
                         IF CHANGED SINCE LAST REPORT)

              APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
                   PROCEEDING DURING THE PRECEDING FIVE YEARS

   INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL DOCUMENTS AND
   REPORTS REQUIRED TO BE FILED BY SECTION 12, 13, OR 15(d) OF THE SECURITIES
   EXCHANGE ACT OF 1934 SUBSEQUENT TO THE DISTRIBUTION OF SECURITIES
                       UNDER A PLAN CONFIRMED BY A COURT.

                                  YES X   NO
                                     ---    ---
        AS OF MARCH 31, 1998, 9,295,694 SHARES OF COMMON STOCK, PAR VALUE $.01
PER SHARE, WERE OUTSTANDING.


                                       1

<PAGE>


                                     INDEX

<TABLE>
<CAPTION>
                                                                               Page
                                                                             Number
                                                                             ------
<S>                                                                          <C>
PART I   FINANCIAL INFORMATION

         Item 1   Financial Statements:
                  Condensed Consolidated Balance Sheets                           3
                  as of March 31, 1998 and December 31, 1997

                  Condensed Consolidated Statements of Operations for the         4
                  Three Months ended March 31, 1998 and 1997

                  Condensed Consolidated Statements of Cash Flow for the          5
                  Three Months ended March 31, 1998 and 1997

                  Notes to Condensed Consolidated Financial Statements            6

         Item 2   Management's Discussion and Analysis                            7
                  of Financial Condition and Results of Operations


PART II  OTHER INFORMATION

                  Exhibits and Reports of Form 8-K                                8


                  Signatures                                                      9
</TABLE>

                                       2

<PAGE>

                          PART I FINANCIAL INFORMATION
                           ITEM 1 FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS
Laser Photonics, Inc. and Subsidiaries

<TABLE>
<CAPTION>
ASSETS                                                                    MARCH 31, 1998       December 31, 1997 *
                                                                            (UNAUDITED)
<S>                                                                       <C>                  <C>         
CURRENT ASSETS
     Cash and cash equivalents                                                  $    814,647      $  1,225,932
     Accounts receivable, net                                                        253,830           343,465
     Inventory                                                                       889,422           951,209
     Prepaid expenses and other assets                                               132,264            91,463
                                                                                ------------      ------------
         TOTAL CURRENT ASSETS                                                      2,090,163         2,612,069

PROPERTY AND EQUIPMENT, net                                                          199,195           141,432

PREPAID LICENSE FEE, net                                                           3,892,078         3,958,333
OTHER                                                                                 64,821           100,515
GOODWILL, NET                                                                        866,034           995,955
                                                                                ------------      ------------

TOTAL ASSETS                                                                    $  7,112,291      $  7,808,304
                                                                                ------------      ------------
                                                                                ------------      ------------

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
     Notes Payable - Current portion                                            $    535,875      $    610,004
     Accounts Payable                                                                891,559           859,559
     Accrued payroll and related expenses                                            368,600           400,222
     Other Accrued liabilities                                                       618,592           631,808
     Deferred revenue                                                                   --              95,000
                                                                                ------------      ------------
         TOTAL CURRENT LIABILITIES                                                 2,414,626         2,596,593

NOTES PAYABLE, LESS CURRENT PORTION                                                  282,559           282,559

SHAREHOLDERS' EQUITY (DEFICIT)
     Common stock                                                                     92,957            92,471
     Additional paid-in-capital                                                   14,680,829        14,625,564
     Accumulated Deficit                                                         (10,358,680)       (9,788,883)
                                                                                ------------      ------------
         TOTAL SHAREHOLDERS' EQUITY (DEFICIT)                                      4,415,106         4,929,152
                                                                                ------------      ------------

                                                                                $  7,112,291      $  7,808,304
                                                                                ------------      ------------
                                                                                ------------      ------------
</TABLE>

*Condensed from audited financial statements.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS.


                                       3

<PAGE>

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Laser Photonics, Inc. and Subsidiaries

<TABLE>
<CAPTION>
                                                       Three months ended
-----------------------------------------------------------------------------------
                                              MARCH 31, 1998         March 31, 1997
                                                 (UNAUDITED)            (unaudited)

<S>                                           <C>                    <C>        
REVENUES
     Sales                                      $ 1,004,500           $   937,368
     Other                                           95,000                  --
                                                -----------           -----------
                                                  1,099,500               937,368
COSTS AND EXPENSES
     Cost of Sales                                  466,832               649,313
     Selling, General & Administrative              603,618               226,445
     Research & Development                         296,713               132,541
     Depreciation and Amortization                  267,462               173,854
                                                -----------           -----------

LOSS FROM OPERATIONS                               (535,125)             (244,785)

     Interest Expense                                42,991                93,294
     Other expenses (income), net                    (8,319)               37,360
                                                -----------           -----------

NET LOSS                                        ($  569,797)          ($  375,439)
                                                -----------           -----------
                                                -----------           -----------

BASIC AND DILUTED LOSS PER SHARE                ($     0.06)          ($     0.06)
                                                -----------           -----------
                                                -----------           -----------


Weighted Average Shares                           9,267,083             6,172,591
                                                -----------           -----------
                                                -----------           -----------
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS.


                                       4

<PAGE>

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Laser Photonics, Inc.


<TABLE>
<CAPTION>
                                                                                       Three months ended
-------------------------------------------------------------------------------------------------------------------
                                                                              MARCH 31, 1998        March 31, 1997
                                                                                 (UNAUDITED)           (unaudited)
<S>                                                                           <C>                   <C>       
CASH FLOWS FROM OPERATING ACTIVITIES
     Net Loss                                                                 ($  569,797)          ($375,439)
     Adjustments to reconcile net loss to net cash used in operating
     activities:
         Depreciation and Amortization                                            267,462             173,854
         Stock issued to pay legal fees                                            20,000              39,375
     Changes in operating assets and liabilities:
         Current assets                                                            85,482              18,968
         Current liabilities                                                     (107,838)            100,200
                                                                              -----------           ---------
              NET CASH USED IN OPERATING ACTIVITIES                              (304,691)            (43,042)
                                                                              -----------           ---------

CASH FLOWS FROM INVESTING ACTIVITIES
     Capital expenditures                                                         (68,216)            (22,226)
     Advances from related parties                                                   --                65,268
                                                                              -----------           ---------
              NET CASH PROVIDED BY (USED IN)  INVESTING
   ACTIVITIES                                                                     (68,216)             43,042
                                                                              -----------           ---------

CASH FLOWS FROM FINANCING ACTIVITIES
     Principal payments on debt                                                   (74,129)                  0
     Proceeds from issuance of common stock                                        35,751                   0
                                                                              -----------           ---------
                  NET CASH USED IN  FINANCING ACTIVITIES                          (38,378)                  0
                                                                              -----------           ---------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                                                                 (411,285)                  0

CASH AND CASH EQUIVALENTS, beginning of period                                  1,225,932                   0
                                                                              -----------           ---------

CASH AND CASH EQUIVALENTS, end of period                                      $   814,647           $       0
                                                                              -----------           ---------
                                                                              -----------           ---------
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONDENSED CONSOLIDATED 
FINANCIAL STATEMENTS.


                                       5

<PAGE>

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                     LASER PHOTONICS, INC. AND SUBSIDIARIES
                                 March 31, 1997

1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The condensed consolidated balance sheets as of March 31, 1998 and December 
31, 1997, and the related condensed consolidated statements of operations and 
cash flow for the three months ended March 31, 1998 and 1997 have been 
prepared by the Company without audit. In the opinion of management, the 
condensed consolidated financial statements contain all adjustments, 
consisting of normal recurring accruals, necessary to present fairly the 
financial position of Laser Photonics, Inc. and subsidiaries as of March 31, 
1998 and the results of their operations and cash flows for the three months 
ended March 31, 1998 and 1997.

Certain information and footnote disclosures normally included in financial 
statements prepared in accordance with generally accepted accounting 
principles have been condensed or omitted. It is suggested that these 
condensed consolidated financial statements be read in conjunction with the 
consolidated financial statements and notes thereto included in the Company's 
report on Form 10-K for the year ended December 31, 1997.

Certain reclassifications have been made to the prior year's condensed 
consolidated financial statements to conform with the current presentation. 
Such reclassifications had no effect on net loss.

2. INVENTORY

Inventory consists of the following:


<TABLE>
<CAPTION>
                        March 31,         December 31,
                          1998                1997
                        ---------         ------------
<S>                     <C>               <C>     
  Raw Materials          $394,733             $435,583
Work in Process           426,573              435,854
 Finished Goods            68,116               79,772
                        ---------         ------------
TOTAL INVENTORY          $889,422             $951,209
                        ---------         ------------
                        ---------         ------------
</TABLE>

3. SUBSEQUENT EVENTS

On April 8, 1998, the Company entered into a letter of intent to sell certain 
assets, subject to the assumption of certain liabilities, to a third party. 
The completion of the transaction is subject to numerous items, including but 
not limited to, the final identification of specific assets and liabilities 
to be transferred and the execution of a final written agreement. The 
proposed sales price is $1,300,000 which would result in an approximate gain 
of $300,000 to the Company


                                       6

<PAGE>

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

RESULTS OF OPERATIONS

Revenues for the three months ended March 31, 1998 increased by $162,132 to 
$1,099,500 compared to $937,368 for the three months ended March 31, 1997. 
The increase was due to the final milestone payment pursuant to the Baxter 
Agreement which included the sale of two excimer lasers, offset by decreases 
in sales from the operations of the Company's Florida and Massachusetts 
operations.

Gross margin increased by $344,613 for the three months ended March 31, 1998 
compared to the three months ended March 31, 1997 due primarily to the gross 
margin earned on the sale of the two excimer lasers to Baxter.

Operating expenses increased by $634,953 for the three months ended March 31, 
1998 compared to the three months ended March 31, 1997. The increase was due 
to increases in consulting and professional fees, D&O insurance, marketing 
expenses, and increased funding of research and development activities.

Interest expense decreased by $50,303 for the three months ended March 31, 
1998 compared to the three months ended March 31, 1997 primarily due to the 
purchase of a subsidiary's note payable through the issuance of common stock 
during the year ended December 31, 1997.

Net loss increased by $194,358 to $569,797 for the three months ended March 
31, 1998 compared to $375,439 for the three months ended March 31, 1997. The 
increase in the net loss was due to the increase in operating expenses offset 
by increases in revenues and gross margin.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 1998, the Company had cash and cash equivalents of $814,647 
which is a decrease of $411,285 since December 31, 1997. The Company has 
utilized cash generated from the sale of common stock and from the Baxter 
agreement during 1997 to fund marketing activities, increased research and 
development activities, investments in inventory to support anticipated sales 
of excimer lasers to Baxter and to pay off certain liabilities.

Capital expenditures in the three months ended March 31, 1998 of $68,216 
related to purchases of equipment and the construction of a laser to be used 
as a demonstration model.

Cash flows used in financing activities for the three months ended March 31, 
1998 of $38,378 was due to principal payments on debt offset by proceeds from 
the issuance of common stock.

SUBSEQUENT EVENTS

On April 8, 1998, the Company entered into a letter of intent to sell certain 
assets, subject to the assumption of certain liabilities, to a third party. 
The completion of the transaction is subject to numerous items, including but 
not limited to, the final identification of specific assets and liabilities 
to be transferred and the execution of a final written agreement. The 
proposed sales price is $1,300.000 which would result in an approximate gain 
of $300,000 to the Company


                                       7

<PAGE>





                          PART II. OTHER INFORMATION

<TABLE>

<C>           <S>                                                      <C>
ITEM 1        Legal Proceedings:  See December 31, 1997 10-K

ITEM 2        Changes in Securities                                    None

ITEM 3        Defaults Upon Senior Securities                          None

ITEM 4        Submission of Matters to Vote of
              Security Holders

              As of February 4, 1998, the Company's stockholders
              adopted a resolution by the written consent of
              4,764,241 shares, or 51.36% of the issued and
              outstanding Common Stock, for the purpose of
              increasing the authorized number of shares of Common
              Stock of the Company from 10,000,000 shares to
              15,000,000 shares.

ITEM 5        Other Information                                        None

ITEM 6        Exhibits and Reports on Form 8-K

              a)  Exhibits
                   27  Financial Data Schedule
              b)  Reports on Form 8-K                                  None
</TABLE>


                                       8

<PAGE>

SIGNATURES TO FORM 10-Q
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

                                       LASER PHOTONICS, INC.
                                       ----------------------------
                                       (Registrant)




Date:        May 7, 1998               By: /s/ Raymond A. Hartman
                                          -------------------------
                                           Raymond A. Hartman
                                           Chief Executive Officer



Date:        May 7, 1998               By: /s/ Chaim Markheim
                                          -------------------------
                                          Chaim Markheim
                                          Chief Financial Officer


                                       9