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

                                    FORM 10-Q
(Mark One)
     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28, 2003

                                       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 No. 0-11003
                               WEGENER CORPORATION

             (Exact name of registrant as specified in its charter)
       DELAWARE                                                  81-0371341
(State of incorporation)                                       (I.R.S. Employer
                                                             Identification No.)

11350 TECHNOLOGY CIRCLE, DULUTH, GEORGIA                          30097-1502
(Address of principal executive offices)                          (Zip Code)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (770) 623-0096

                  REGISTRANT'S WEB SITE: HTTP://WWW.WEGENER.COM

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days:

                     YES   X                       NO
                         -----                        -----

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the ExchangeAct).

                     YES                           NO   X
                         -----                        -----

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

Common Stock, $.01 par value                             12,341,751 Shares
----------------------------                        ----------------------------
           Class                                     Outstanding March 17, 2003

<PAGE>

                               WEGENER CORPORATION
                FORM 10-Q FOR THE QUARTER ENDED FEBRUARY 28, 2003

                                      INDEX

PART I. FINANCIAL INFORMATION

Item 1.   Consolidated Financial Statements

          Introduction ..................................................      3

          Consolidated Statements of Operations
          (Unaudited) - Three and Six Months Ended
          February 28, 2003 and March 1, 2002 ...........................      4

          Consolidated Balance Sheets - February 28,
          2003 (Unaudited) and August 30, 2002 ..........................      5

          Consolidated Statements of Shareholders' Equity
          (Unaudited) - Six Months Ended February 28,
          2003 and March 1, 2002 ........................................      6

          Consolidated Statements of Cash Flows
          (Unaudited) - Six Months Ended February 28,
          2003 and March 1, 2002 ........................................      7

          Notes to Consolidated Financial
          Statements (Unaudited) ........................................   8-14

Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations ...........................  15-19

Item 3.   Quantitative and Qualitative Disclosures About Market Risk ....     19

Item 4.   Controls and Procedures .......................................     19

PART II. OTHER INFORMATION

Item 1.   Legal Proceedings .............................................     20

Item 2.   None

Item 3.   None

Item 4.   Submission of Matters to a Vote of Security Holders ...........     20

Item 5.   Other Information .............................................     21

Item 6.   Exhibits and Reports on Form 8-K ..............................     21

          Signatures ....................................................     22

          Certifications ................................................     23

                                        2
<PAGE>

PART I. FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

                INTRODUCTION - CONSOLIDATED FINANCIAL STATEMENTS

The  consolidated  financial  statements  included  herein  have  been  prepared
pursuant to the rules and regulations of the Securities and Exchange Commission.
The  consolidated  balance  sheet as of  February  28,  2003;  the  consolidated
statements of  shareholders'  equity as of February 28, 2003, and March 1, 2002;
the  consolidated  statements of  operations  for the three and six months ended
February 28, 2003,  and March 1, 2002; and the  consolidated  statements of cash
flows for the six months ended February 28, 2003,  and March 1, 2002,  have been
prepared without audit.  The  consolidated  balance sheet as of August 30, 2002,
has  been  audited  by  independent   certified  public   accountants.   Certain
information and footnote  disclosures  normally included in financial statements
prepared in accordance with generally accepted  accounting  principles have been
condensed  or omitted  pursuant  to such  rules and  regulations,  although  the
Company  believes  that  the  disclosures   herein  are  adequate  to  make  the
information  presented not misleading.  It is suggested that these  consolidated
financial  statements be read in conjunction  with the financial  statements and
the notes thereto  included in the Company's  Annual Report on Form 10-K for the
fiscal year ended August 30, 2002, File No. 0-11003.

In the opinion of the Company,  the statements for the unaudited interim periods
presented  include all  adjustments,  which were of a normal  recurring  nature,
necessary to present a fair  statement  of the results of such interim  periods.
The results of operations for the interim periods  presented are not necessarily
indicative of the results of operations for the entire year.

                                        3
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                Three months ended                 Six months ended
                                           FEBRUARY 28,       March 1,       FEBRUARY 28,       March 1,
                                               2003             2002             2003             2002
----------------------------------------------------------------------------------------------------------

<S>                                        <C>              <C>              <C>              <C>
Revenue                                    $  5,219,152     $  5,860,702     $  9,164,270     $ 11,893,318
----------------------------------------------------------------------------------------------------------

Operating costs and expenses
    Cost of products sold                     3,344,855        3,776,353        5,988,765        7,843,075
    Selling, general and administrative         932,396        1,043,088        2,161,677        2,120,153
    Research and development                    754,146          626,648        1,409,660        1,290,493
----------------------------------------------------------------------------------------------------------

Operating costs and expenses                  5,031,397        5,446,089        9,560,102       11,253,721
----------------------------------------------------------------------------------------------------------

Operating income (loss)                         187,755          414,613         (395,832)         639,597
    Interest expense                            (17,302)         (11,878)         (31,969)         (29,964)
    Interest income                              13,204            3,211           32,912            5,478
----------------------------------------------------------------------------------------------------------

Earnings (loss) before income taxes             183,657          405,946         (394,889)         615,111

Income tax expense (benefit)                     67,000          150,000         (142,000)         227,000
----------------------------------------------------------------------------------------------------------

Net earnings (loss)                        $    116,657     $    255,946     $   (252,889)    $    388,111
----------------------------------------------------------------------------------------------------------

Net earnings (loss) per share:
    Basic                                  $        .01     $        .02     $       (.02)    $        .03
    Diluted                                $        .01     $        .02     $       (.02)    $        .03
----------------------------------------------------------------------------------------------------------

Shares used in per share calculation
    Basic                                    12,320,961       12,143,507       12,294,393       12,114,258
    Diluted                                  12,355,692       12,167,259       12,294,393       12,136,695
----------------------------------------------------------------------------------------------------------
</TABLE>

See accompanying notes to consolidated financial statements.

                                        4
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                     FEBRUARY 28,      August 30,
                                                                         2003             2002
--------------------------------------------------------------------------------------------------
ASSETS                                                               (UNAUDITED)
<S>                                                                  <C>              <C>
Current assets
    Cash and cash equivalents                                        $  4,785,697     $  5,117,756
    Accounts receivable                                                 3,088,191        3,037,762
    Inventories                                                         3,472,711        3,920,673
    Deferred income taxes                                               2,142,000        2,225,000
    Other                                                                 119,450           90,066
--------------------------------------------------------------------------------------------------

         Total current assets                                          13,608,049       14,391,257

Property and equipment, net                                             3,030,197        2,995,332
Capitalized software costs, net                                           677,674          641,710
Deferred income taxes                                                     848,000          623,000
Other assets, net                                                         642,062           48,556
--------------------------------------------------------------------------------------------------

                                                                     $ 18,805,982     $ 18,699,855
--------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
    Accounts payable                                                 $  1,805,655     $  1,424,101
    Accrued expenses                                                    1,448,393        1,409,369
    Customer deposits                                                     636,040          777,023
    Current maturities of long-term obligations                             6,120            6,120
--------------------------------------------------------------------------------------------------

          Total current liabilities                                     3,896,208        3,616,613

Long-term obligations, less current maturities                              1,306            4,294
--------------------------------------------------------------------------------------------------

          Total liabilities                                             3,897,514        3,620,907
--------------------------------------------------------------------------------------------------

Commitments and contingencies

Shareholders' equity
    Common stock, $.01 par value; 20,000,000 shares
        authorized; 12,341,751 shares issued                              123,418          123,146
    Additional paid-in capital                                         19,439,769       19,513,977
    Deficit                                                            (4,654,719)      (4,401,830)
    Less treasury stock, at cost                                               --         (156,345)
--------------------------------------------------------------------------------------------------

         Total shareholders' equity                                    14,908,468       15,078,948
--------------------------------------------------------------------------------------------------

                                                                     $ 18,805,982     $ 18,699,855
--------------------------------------------------------------------------------------------------
</TABLE>

See accompanying notes to consolidated financial statements.

                                        5
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                      Additional       Retained
                                               Common Stock             Paid-in        Earnings             Treasury Stock
                                               ------------                                                 --------------
                                          Shares         Amount         Capital        (Deficit)        Shares          Amount
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                      <C>           <C>            <C>             <C>                 <C>         <C>
Balance at August 31, 2001               12,314,575    $   123,146    $19,751,694     $(5,209,410)        269,588     $  (577,562)

    Treasury stock reissued through
       stock options and 401(k) plan             --             --       (153,597)             --        (112,576)        241,182
    Net earnings for the six months              --             --             --         388,111              --              --
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE at March 1, 2002                 12,314,575    $   123,146    $19,598,097     $(4,821,299)        157,012     $  (336,380)
-----------------------------------------------------------------------------------------------------------------------------------
Balance at August 30, 2002               12,314,575    $   123,146    $19,513,977     $(4,401,830)         72,977     $  (156,345)

    Treasury stock reissued through
       stock options and 401(k) plan         27,176            272        (74,208)             --         (72,977)        156,345
    Net loss for the six months                  --             --             --        (252,889)             --              --
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT FEBRUARY 28, 2003             12,341,751    $   123,418    $19,439,769     $(4,654,719)             --     $        --
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

See accompanying notes to consolidated financial statements.

                                        6
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                     Six months ended
                                                               FEBRUARY 28,       March 1,
                                                                   2003             2002
----------------------------------------------------------------------------------------------

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES
<S>                                                            <C>              <C>
    Net earnings (loss)                                        $   (252,889)    $    388,111
    Adjustments to reconcile net earnings (loss) to
           cash provided by operating activities
        Depreciation and amortization                               769,927          871,713
        Issuance of treasury stock for
            compensation expenses                                    82,409           74,185
        Provision for bad debt allowance                             35,000           80,000
        Provision for inventory reserves                            100,000          200,000
        Deferred income taxes                                      (142,000)         227,000
    Changes in assets and liabilities
            Accounts receivable                                     (85,429)        (310,485)
            Inventories                                             347,962        1,157,764
            Other assets                                            (29,384)          12,187
            Accounts payable and accrued expenses                   270,578         (630,356)
            Customer deposits                                      (140,983)          38,483
----------------------------------------------------------------------------------------------

                                                                    955,191        2,108,602
----------------------------------------------------------------------------------------------

CASH USED FOR INVESTMENT ACTIVITIES
    Property and equipment expenditures                            (368,987)        (105,425)
    Capitalized software additions                                 (419,269)        (228,428)
    License agreements, patents, and trademarks expenditures       (496,006)              --
----------------------------------------------------------------------------------------------

                                                                 (1,284,262)        (333,853)
----------------------------------------------------------------------------------------------

CASH USED FOR FINANCING ACTIVITIES
    Repayment of long-term debt                                      (2,988)         (41,715)
    Proceeds from stock options exercised                                --           13,400
----------------------------------------------------------------------------------------------

                                                                     (2,988)         (28,315)
----------------------------------------------------------------------------------------------

Increase (decrease) in cash and cash equivalents                   (332,059)       1,746,434
Cash and cash equivalents, beginning of period                    5,117,756        1,926,723
----------------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                       $  4,785,697     $  3,673,157
----------------------------------------------------------------------------------------------

Supplemental disclosure of cash flow information:
  Cash paid (received) during
    the six months for:
          Interest                                             $     31,969     $     29,964
          Income taxes                                         $         --     $    (99,440)
----------------------------------------------------------------------------------------------
</TABLE>

See accompanying notes to consolidated financial statements.

                                        7
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1    SIGNIFICANT ACCOUNTING POLICIES

Certain  significant  accounting  policies followed by the Company are described
below. A more complete discussion of these policies is included in Note 1 to the
Company's  audited  consolidated  financial  statements  included  in the annual
report on Form 10-K for the year ended August 30, 2002.

REVENUE RECOGNITION

The  Company's  revenue  recognition  policies  are  in  compliance  with  Staff
Accounting Bulletin No. 101, "Revenue  Recognition in Financial  Statements," as
published by the staff of the  Securities  and Exchange  Commission.  Revenue is
recognized  when persuasive  evidence of an agreement with the customer  exists,
products are shipped or title passes pursuant to the terms of the agreement with
the  customer,  the  amount  due from  the  customer  is fixed or  determinable,
collectibility is reasonably  assured,  and when there are no significant future
performance  obligations.  Service  revenues  are  recognized  at  the  time  of
performance.  The Company  recognizes  revenue in certain  circumstances  before
delivery has occurred (commonly referred to as "bill and hold" transactions). In
such  circumstances,  among other  things,  risk of ownership  has passed to the
buyer,  the buyer has made a written  fixed  commitment to purchase the finished
goods, the buyer has requested the finished goods be held for future delivery as
scheduled and  designated by them,  and no  additional  performance  obligations
exist by the Company. For these transactions,  the finished goods are segregated
from inventory and normal  billing and credit terms are granted.  As of February
28, 2003,  revenues to one customer in the amount of  $2,182,000  were  recorded
prior to delivery as bill and hold transactions.  At February 28, 2003, accounts
receivable for these revenues amounted to $1,774,000.

These policies require  management,  at the time of the  transaction,  to assess
whether the  amounts due are fixed or  determinable,  collection  is  reasonably
assured,  and if future  performance  obligations  exist.  These assessments are
based on the terms of the agreement with the customer,  past history, and credit
worthiness of the  customer.  If management  determines  that  collection is not
reasonably assured or future performance  obligations exist, revenue recognition
is deferred until these conditions are satisfied.

In accordance with EITF Issue 00-10,  "Accounting for Shipping and Handling Fees
and Costs," the Company included all shipping and handling billings to customers
in revenues, and freight costs incurred for product shipments have been included
in cost of products sold.

EARNINGS PER SHARE

Basic and diluted  net  earnings  per share were  computed  in  accordance  with
Statement of Financial Accounting Standards No. 128, "Earnings Per Share." Basic
net earnings per share is computed by dividing net earnings  available to common
shareholders  (numerator)  by the  weighted  average  number  of  common  shares
outstanding  (denominator) during the period and excludes the dilutive effect of
stock  options.  Diluted net  earnings  per share gives  effect to all  dilutive
potential common shares  outstanding  during a period.  In computing diluted net
earnings  per  share,  the  average  stock  price  for  the  period  is  used in
determining  the number of shares  assumed to be  reacquired  under the treasury
stock method from the exercise of stock options.

USE OF ESTIMATES

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the  reported  amounts  of assets  and  liabilities,  the  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could vary from these estimates.

                                        8
<PAGE>

FISCAL YEAR

The Company uses a fifty-two, fifty-three week year. The fiscal year ends on the
Friday  closest to August 31. Fiscal years 2003 and 2002 each contain  fifty-two
weeks.

NOTE 2    ACCOUNTS RECEIVABLE

Accounts receivable are summarized as follows:

                                               FEBRUARY 28,      August 30,
                                                   2003             2002
     -------------------------------------------------------------------------
                                                (UNAUDITED)

     Accounts receivable - trade                $3,394,469       $3,314,046
     Other receivables                              75,308           75,308
     -------------------------------------------------------------------------
                                                 3,469,777        3,389,354

     Less allowance for
         doubtful accounts                        (381,586)        (351,592)
     -------------------------------------------------------------------------

                                                $3,088,191       $3,037,762
     -------------------------------------------------------------------------

NOTE 3    INVENTORIES

Inventories are summarized as follows:

                                                FEBRUARY 28,    August 30,
                                                    2003           2002
     -------------------------------------------------------------------------
                                                 (UNAUDITED)

     Raw material                                $2,675,598     $2,917,924
     Work-in-process                              1,407,323      1,639,620
     Finished goods                               2,905,153      3,143,736
     -------------------------------------------------------------------------
                                                  6,988,074      7,701,280

     Less inventory reserves                     (3,515,363)    (3,780,607)
     -------------------------------------------------------------------------

                                                 $3,472,711     $3,920,673
     -------------------------------------------------------------------------

During the first six months of fiscal 2003 inventory  reserves were increased by
provisions  charged  to cost of sales  of  $100,000  and  reduced  by  inventory
write-offs  of  $365,000.  The  Company's  inventory  reserve  of  approximately
$3,515,000  at February  28,  2003 is to provide for items that are  potentially
slow moving,  excess,  or  obsolete.  Changes in market  conditions,  lower than
expected  customer  demand,  and rapidly  changing  technology  could  result in
additional obsolete and slow-moving  inventory that is unsaleable or saleable at
reduced  prices.  No  estimate  can be made of a range of  amounts  of loss from
obsolescence that are reasonably possible should the Company's sales efforts not
be successful.

                                        9
<PAGE>

NOTE 4    OTHER ASSETS

Other assets consisted of the following:

                                               FEBRUARY 28, 2003
     -------------------------------------------------------------------------
                                                  ACCUMULATED
                                      COST       AMORTIZATION       NET
     -------------------------------------------------------------------------
     License agreements            $  550,000     $  (27,500)    $  522,500
     Patents                           74,026             --         74,026
     Trademarks                        21,980             --         21,980
     Loan facility fees                50,000        (33,333)        16,667
     Other                              6,889             --          6,889
     -------------------------------------------------------------------------
                                   $  702,895     $  (60,833)    $  642,062
     -------------------------------------------------------------------------

                                               August 30, 2002
     -------------------------------------------------------------------------
                                                  Accumulated
                                      Cost       Amortization       Net
     -------------------------------------------------------------------------
     Loan facility fees            $   50,000     $   (8,333)    $   41,667
     Other                              6,889             --          6,889
     -------------------------------------------------------------------------
                                   $   56,889     $   (8,333)    $   48,556
     -------------------------------------------------------------------------

Amortization expense of other assets for the three and six months ended February
28, 2003, amounted to $40,000 and $52,500 respectively.  Amortization expense of
other  assets for the three and six months  ended  March 1,  2002,  amounted  to
$13,000 and $26,000 respectively.

The Company conducts an on-going review of its intellectual  property rights and
potential  trademarks.  During the second  quarter of fiscal  2003,  the Company
incurred $74,000 and $22,000 of legal expenses related to filing of applications
for various patents and  trademarks,  respectively.  Upon issuance,  these costs
will be amortized  over their  estimated  useful lives.  License  agreements are
amortized over their estimated useful life of five years. Loan facility fees are
amortized over twelve months.

NOTE 5    INCOME TAXES

For the six months ended  February 28, 2003,  income tax benefit of $142,000 was
comprised  of a deferred  federal and state  income tax benefit of $134,000  and
$8,000,  respectively.  Net deferred tax assets increased $142,000 to $2,990,000
principally due to an increase in net operating loss  carryforwards in the first
six  months.  Realization  of deferred  tax assets is  dependent  on  generating
sufficient  future taxable income prior to the expiration of the loss and credit
carryforwards.  Although  realization is not assured,  management believes it is
more likely than not that all of the deferred tax assets will be realized  based
on the Company's  backlog,  financial  projections  and operating  history.  The
amount of the  deferred  tax assets  considered  realizable,  however,  could be
reduced  in the near term if  estimates  of future  taxable  income  during  the
carryforward period are reduced.

At February 28, 2003, the Company had a federal net operating loss  carryforward
of  approximately  $2,265,000,  which  expires in fiscal  2020 and fiscal  2021.
Additionally,   the  Company  had  general   business  and  foreign  tax  credit
carryforwards of $98,000 expiring in fiscal 2004 and an alternative  minimum tax
credit of $138,000.

                                       10
<PAGE>

NOTE 6    EARNINGS PER SHARE (UNAUDITED)

The following tables represent required  disclosure of the reconciliation of the
numerators  and  denominators  of the basic and diluted net  earnings  per share
computations.

<TABLE>
<CAPTION>
                                                                     Three months ended
                                       ----------------------------------------------------------------------------
                                                FEBRUARY 28, 2003                          March 1, 2002
                                       ------------------------------------    ------------------------------------
                                                                     PER                                     Per
                                        EARNINGS       SHARES       SHARE       Earnings       Shares       share
                                       (NUMERATOR)  (DENOMINATOR)   AMOUNT     (Numerator)  (Denominator)   amount
                                       -----------  -------------   ------     -----------  -------------   ------
<S>                                    <C>           <C>           <C>         <C>           <C>           <C>
Net earnings                           $  116,657                              $  255,946
                                       ----------                              ----------

BASIC EARNINGS PER SHARE:
    Net earnings available
        to common shareholders         $  116,657    12,320,961    $    .01    $  255,946    12,143,507    $    .02

Effect of dilutive potential common shares:
        Stock options                          --        34,731                        --        23,752
                                       ------------------------                ------------------------
DILUTED EARNINGS  PER SHARE:
    Net earnings available
        to common shareholders         $  116,657    12,355,692    $    .01    $  255,946    12,167,259    $    .02
                                       ------------------------    --------    ------------------------    --------
</TABLE>


<TABLE>
<CAPTION>
                                                                      Six months ended
                                       ----------------------------------------------------------------------------
                                                FEBRUARY 28, 2003                          March 1, 2002
                                       ------------------------------------    ------------------------------------
                                                                     PER                                     Per
                                        EARNINGS       SHARES       SHARE       Earnings       Shares       share
                                       (NUMERATOR)  (DENOMINATOR)   AMOUNT     (Numerator)  (Denominator)   amount
                                       -----------  -------------   ------     -----------  -------------   ------
<S>                                    <C>           <C>           <C>         <C>           <C>           <C>
Net earnings (loss)                    $ (252,889)                             $  388,111
                                       ----------                              ----------

BASIC EARNINGS(LOSS) PER SHARE:
    Net earnings (loss) available
        to common shareholders         $ (252,889)   12,294,393    $   (.02)   $  388,111    12,114,258    $    .03

Effect of dilutive potential
    common shares:
        Stock options                          --            --                        --        22,437
                                       ------------------------                ------------------------

DILUTED EARNINGS (LOSS)  PER SHARE:
    Net earnings (loss) available
        to common shareholders         $ (252,889)   12,294,393    $   (.02)   $  388,111    12,136,695    $    .03
                                       ------------------------    --------    ------------------------    --------
</TABLE>

                                       11
<PAGE>

Stock  options   excluded  from  the  diluted  net  earnings  (loss)  per  share
calculation due to their anti-dilutive effect are as follows:

<TABLE>
<CAPTION>
                                          Three months ended                   Six months ended
                                    ---------------------------------------------------------------------
                                    FEBRUARY 28,        March 1,        FEBRUARY 28,        March 1,
                                        2003              2002              2003              2002
                                    ---------------------------------------------------------------------
<S>                                   <C>             <C>                <C>               <C>
Common stock options:
     Number of shares                    975,365         1,011,550         1,006,903         1,059,650
        Exercise price                $.91 TO $5.63   $1.41 to $5.63     $.91 TO $5.63     $1.00 to $5.63
                                    ---------------------------------------------------------------------
</TABLE>

NOTE 7    SEGMENT INFORMATION AND SIGNIFICANT CUSTOMERS (UNAUDITED)

In  accordance  with  Statement  of  Financial  Accounting  Standards  No.  131,
"Disclosure  about  Segments  of an  Enterprise  and Related  Information",  the
Company operates within a single reportable segment, the manufacture and sale of
satellite communications equipment.

In this single  operating  segment  the Company has three  sources of revenue as
follows:

<TABLE>
<CAPTION>
                                          Three months ended                   Six months ended
                                    ---------------------------------------------------------------------
                                    FEBRUARY 28,        March 1,        FEBRUARY 28,        March 1,
                                        2003              2002              2003              2002
                                    ---------------------------------------------------------------------
<S>                                 <C>               <C>               <C>               <C>
Product Line
    Direct Broadcast Satellite      $  4,692,143      $  5,640,263      $  8,174,711      $ 11,243,316
    Telecom and Custom Products          379,284           108,148           730,659           381,724
    Service                              147,725           112,291           258,900           268,278
                                    ---------------------------------------------------------------------
                                    $  5,219,152      $  5,860,702      $  9,164,270      $ 11,893,318
                                    ---------------------------------------------------------------------
</TABLE>

Revenues by geographic area are as follows:

<TABLE>
<CAPTION>
                                          Three months ended                   Six months ended
                                    ---------------------------------------------------------------------
                                    FEBRUARY 28,        March 1,        FEBRUARY 28,        March 1,
                                        2003              2002              2003              2002
                                    ---------------------------------------------------------------------
<S>                                 <C>               <C>               <C>               <C>
Geographic Area
    United States                   $  5,005,811      $  5,633,243      $  8,760,977      $ 11,229,372
    Latin America                         95,359            89,131           151,759           375,574
    Canada                                52,985            35,754           119,715            86,892
    Europe                                53,777           101,171           106,051           137,156
    Other                                 11,220             1,403            25,768            64,324
                                    ---------------------------------------------------------------------
                                    $  5,219,152      $  5,860,702      $  9,164,270      $ 11,893,318
                                    ---------------------------------------------------------------------
</TABLE>

                                       12
<PAGE>

All of the  Company's  long-lived  assets  are  located  in the  United  States.
Customers  representing 10% or more of the respective  period's  revenues are as
follows:

<TABLE>
<CAPTION>
                                          Three months ended                   Six months ended
                                    ---------------------------------------------------------------------
                                    FEBRUARY 28,        March 1,        FEBRUARY 28,        March 1,
                                        2003              2002              2003              2002
                                    ---------------------------------------------------------------------
<S>                                 <C>               <C>               <C>               <C>

     Customer 1                             39.5%             19.2%             44.2%             18.2%
     Customer 2                             21.5%             53.1%             16.0%             41.7%
     Customer 3                              (a)               (a)               (a)              12.0%
</TABLE>

     (a)  Revenues for the period were less than 10% of total revenues.

NOTE 8    COMMITMENTS

During  the  second  quarter  of  fiscal  2003,  the  Company   entered  into  a
manufacturing and purchasing  agreement for certain finished goods  inventories.
The  agreement  committed the Company to purchase  $2,062,000,  over an eighteen
month period,  beginning in the third  quarter of fiscal 2003. In addition,  the
Company  maintains  a  cancelable  manufacturing  and  purchasing  agreement  of
finished  goods  inventories  for  which the  Company  has firm  customer  order
commitments.  The  Company  had  outstanding  purchase  commitments  under  this
agreement of $1,545,000 at February 28, 2003.  Pursuant to the above agreements,
at February  28,  2003,  the Company  had  outstanding  letters of credit in the
amount of $1,545,000.

NOTE 9    GUARANTEES

Warranty
The Company  warrants its  products  for a twelve month period  beginning at the
date of shipment.  The warranty  provides for repair or replacement of defective
products  returned  during the warranty  period at no cost to the customer.  The
Company  expenses  costs for routine  warranty  repairs as incurred.  Additional
provisions are made for non-routine warranty repairs based on estimated costs to
repair at the point in time in which the warranty claim is  identified.  Accrued
warranty  provisions  amount to  $96,000 at  February  28,  2003.  There were no
changes  to the  warranty  accrual  for the three and six  month  periods  ended
February 28,2003.

Letters of Credit
Wegener  Communications  Inc.,  the  Company's  wholly owned  subsidiary,  (WCI)
provides  in the  ordinary  course of  business,  standby  letters  of credit to
certain  suppliers  pursuant to  manufacturing  and  purchasing  agreements.  At
February 28, 2003, outstanding letters of credit amounted to $1,545,000.

Financing Agreements
The Company guarantees the bank loan facility of WCI. The bank facility provides
a maximum  available  credit  limit of  $5,000,000.  At February  28,  2003,  no
balances were outstanding on the loan facility.

NOTE 10   STOCK OPTIONS

During the first six months of fiscal 2003  options for 19,000  shares of common
stock were granted to outside  directors at a weighted average exercise price of
$1.00. During the first six months of fiscal 2003, options for 114,000 shares of
common stock at a weighted  average  exercise price of $1.42 were forfeited.  At
February 28, 2003, options for 1,340,425 shares of common stock were outstanding
with a weighted average exercise price of $1.68 and with exercise prices ranging
from $.63 to $5.63. At February 28, 2003, options for 1,000,075 shares of common
stock were available for issuance under the 1998 Incentive Plan.

                                       13
<PAGE>

NOTE 11   RECENT ACCOUNTING PRONOUNCEMENTS

In  November  2002,  the  FASB  issued  FASB  Interpretation  No.  45,  (FIN 45)
"Guarantor's  Accounting and Disclosure  Requirements for Guarantees,  Including
Indirect  Guarantees  of  Indebtedness  of  Others."  FIN  45  requires  certain
guarantees  to be recorded at fair value  regardless of the  probability  of the
loss. The adoption did not have a material impact on the Company's  consolidated
financial statements.

In  January  2003,  the  FASB  issued  FASB  Interpretation  No.  46,  (FIN  46)
"Consolidation of Variable Interest Entities,  an Interpretation of ARB No. 51."
FIN 46 requires  certain  variable  interest  entities to be consolidated by the
primary  beneficiary of the entity if the equity  investors in the entity do not
have the  characteristics  of a  controlling  financial  interest or do not have
sufficient  equity at risk for the  entity to  finance  its  activities  without
additional  subordinated  financial  support  from  other  parties.  FIN  46  is
effective immediately for all new variable interest entities created or acquired
after January 31, 2003. For variable interest entities created or acquired prior
to  February  1, 2003,  the  provisions  of FIN 46 must be applied for the first
interim or annual period  beginning  after June 15, 2003.  The Company  believes
that the adoption of this standard will have no material impact on its financial
position and results of operations.

In December  2002,  the FASB issued SFAS No. 148,  "Accounting  for  Stock-Based
Compensation - Transition  and  Disclosure."  SFAS No. 148 provides  alternative
methods  of  transition  for a  voluntary  change  to the fair  value  method of
accounting for stock-based employee  compensation as originally provided by SFAS
No. 123 "Accounting for Stock-Based  Compensation."  Additionally,  SFAS No. 148
amends the  disclosure  requirements  of SFAS No. 123 in both annual and interim
financial  statements.  The  disclosure  requirements  shall  be  effective  for
financial reports for interim periods beginning after December 15, 2002. We will
adopt the disclosure portion of this statement for the fiscal quarter ending May
30, 2003.  The adoption will not have any impact on the  Company's  consolidated
financial position or results of operations.

                                       14
<PAGE>

WEGENER CORPORATION AND SUBSIDIARIES

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

This information  should be read in conjunction with the consolidated  financial
statements and the notes thereto included in Item 1 of this Quarterly Report and
the audited consolidated financial statements and notes thereto and Management's
Discussion and Analysis of Financial Condition and Results of Operations for the
year ended August 30, 2002,  contained in the  Company's  2002 Annual  Report on
Form 10-K.

Certain  statements  contained in this filing are  "forward-looking  statements"
within the meaning of the Private Securities Litigation Reform Act of 1995, such
as  statements  relating  to  financial  results,  future  business  or  product
development  plans,  research  and  development  activities,  capital  spending,
financing  sources  or  capital   structure,   the  effects  of  regulation  and
competition,  and are thus  prospective.  Such  forward-looking  statements  are
subject to risks,  uncertainties  and other  factors,  which could cause  actual
results to differ  materially  from future results  expressed or implied by such
forward-looking  statements.  Potential risks and uncertainties include, but are
not limited to, economic  conditions,  customer plans and  commitments,  product
demand,  governmental regulation,  rapid technological developments and changes,
performance  issues with key  suppliers  and  subcontractors,  delays in product
development   and  testing,   availability   of  materials,   new  and  existing
well-capitalized  competitors, and other uncertainties detailed in the Company's
Form  10-K for the year  ended  August  30,  2002,  and from time to time in the
Company's periodic Securities and Exchange Commission filings.

The  Company,  through  Wegener  Communications,   Inc.  (WCI),  a  wholly-owned
subsidiary,  designs and manufactures  communications transmission and receiving
equipment for the business broadcast,  data communications,  cable and broadcast
radio and television industries.

RESULTS OF OPERATIONS
THREE AND SIX MONTHS ENDED  FEBRUARY  28, 2003  COMPARED TO THREE AND SIX MONTHS
ENDED MARCH 1, 2002

The operating  results for the three and six month  periods  ended  February 28,
2003  were  net  earnings  of  $117,000  or $ .01 per  share  and a net  loss of
$(253,000)  or $(.02) per  share,  respectively,  compared  to net  earnings  of
$256,000  or $ .02 per share and net  earnings  of  $388,000 or $ .03 per share,
respectively, for the three and six month periods ended March 1, 2002.

REVENUES - The Company's  revenues for the three months ended  February 28, 2003
decreased $642,000 or 10.9% to $5,219,000 from $5,861,000.  Revenues for the six
months ended February 28, 2003 decreased  $2,729,000 or 22.9% to $9,164,000 from
$11,893,000.

Direct Broadcast Satellite (DBS) revenues (including service revenues) decreased
$913,000  or 15.9% in the  second  quarter  of fiscal  2003 to  $4,840,000  from
$5,753,000 in the same period of fiscal 2002.  For the six months ended February
28,  2003,  DBS  revenues  decreased  $3,078,000  or  26.7% to  $8,434,000  from
$11,512,000 for the six months ended March 1, 2002. The decrease in revenues was
a result of a lower  backlog of orders at the  beginning of fiscal 2003 compared
to the  beginning of fiscal 2002.  Revenues and order backlog are subject to the
timing of significant orders from customers, and as a result, revenue levels may
fluctuate  from quarter to quarter.  DBS  revenues  were  adversely  impacted by
delayed purchasing  decisions in the digital satellite  transmission  market and
delayed product  introductions by the Company.  The second quarter and first six
months of fiscal  2002  included  shipments  of  network  equipment  to  Roberts
Communications  to provide  television  coverage  of  horseracing  to  off-track
betting venues throughout the United States. Additionally,  the first six months
of fiscal 2002  included  shipments of digital  receivers to FOX Digital and FOX
Sports Net for their broadcast and cable television networks.

Telecom and Custom Products Group revenues  increased  $271,000 or 250.7% in the
second  quarter of fiscal 2003 to $379,000  from  $108,000 in the same period of
fiscal  2002.  For the six months ended  February  28, 2003,  Telecom and Custom
Products  Group revenues  increased  $349,000 or 91.4% to $731,000 from $382,000
for the six months  ended March 1, 2002.  The increase in revenues for the three
and six month  periods was mainly due to increased  shipments of cue and control
equipment to provide local commercial insertion capabilities to cable television
operators.

For the three months ended February 28, 2003, two customers  accounted for 39.5%
and 21.5% of revenues,  respectively.  For the three months ended March 1, 2002,
two customers each accounted for 53.1% and 19.2% of revenues,  respectively. For
the

                                       15
<PAGE>

six months ended February 28, 2003, two customers  accounted for 44.2% and 16.0%
of  revenues,  respectively.  For the six  months  ended  March 1,  2002,  three
customers accounted for 41.7%, 18.2%, and 12.0% of revenues, respectively. Sales
to a  relatively  small number of major  customers  have  typically  comprised a
majority  of the  Company's  revenues  and that trend is  expected  to  continue
throughout fiscal 2003 and beyond.  Future revenues are subject to the timing of
significant  orders from  customers and are  difficult to forecast.  As a result
future revenue levels may fluctuate  significantly from quarter to quarter.  The
Company's backlog is comprised of undelivered,  firm customer orders,  which are
scheduled  to  ship  within  eighteen  months.  The  backlog  was  approximately
$13,200,000  at February 28, 2003,  compared to  $10,700,000 at August 30, 2002,
and  $14,810,000  at March 1,  2002.  One  customer  accounted  for 74.8% of the
backlog at February 28, 2003. The total multi-year backlog at February 28, 2003,
was approximately $29,700,000.

GROSS PROFIT MARGINS - The Company's gross profit margin  percentages were 35.9%
and 34.7% for the three and six month periods ended February 28, 2003,  compared
to 35.6% and 34.1% for the three  and six month  periods  ended  March 1,  2002.
Gross profit margin  dollars  decreased  $210,000 and $875,000 for the three and
six month  periods ended  February 28, 2003,  compared to the same periods ended
March 1, 2002.  The  decreases  in margin  dollars  for the three and six months
ended February 28, 2003,  were mainly due to lower revenues  during the periods.
For the six months  ended  February  28, 2003,  gross  margin  percentages  were
favorably  impacted by a product mix with lower variable cost  components  which
was offset by higher unit fixed costs due to lower  revenues.  Profit margins in
the three and six  month  periods  of fiscal  2003  included  inventory  reserve
charges of $100,000 and $100,000  compared to $100,000 and $200,000 for the same
periods of fiscal 2002.

SELLING, GENERAL AND ADMINISTRATIVE - Selling, general and administrative (SG&A)
expenses  decreased  $111,000 or 10.6% to $932,000  for the three  months  ended
February 28, 2003, from $1,043,000 for the three months ended March 1, 2002. For
the six months ended February 28, 2003, SG&A expenses  increased $42,000 or 2.0%
to  $2,162,000  from  $2,120,000  for the same period  ended March 1, 2002.  The
decrease in SG&A expenses in the second quarter of fiscal 2003 was mainly due to
lower bad debt provisions,  depreciation,  and marketing expenses.  In the first
six months of fiscal 2003, SG&A professional fees increased  $299,000 mainly due
to an  increase in legal  expenses  related to a  complaint  filed by  StarGuide
Digital Networks, Inc. against WCI primarily alleging patent infringement.  (See
Part II,  Item 1. Legal  Proceedings.)  The  increase in  professional  fees was
offset by reductions in administrative and corporate overhead expenses,  outside
sales  agents  commissions,  marketing  expenses,  depreciation,  and  bad  debt
provisions.  As a percentage of revenues, SG&A expenses were 17.9% and 23.6% for
the three and six month periods ended  February 28, 2003,  compared to 17.8% and
17.8% for the same periods of fiscal 2002.

RESEARCH AND  DEVELOPMENT  - Research and  development  expenditures,  including
capitalized software development costs, were $979,000, or 18.8% of revenues, and
$1,829,000,  or 20.0% of  revenues,  for the three and six month  periods  ended
February 28, 2003, compared to $735,000,  or 12.5% of revenues,  and $1,519,000,
or 12.8% of revenues,  for the same periods of fiscal 2002. Capitalized software
development  costs  amounted to $225,000 and $419,000 for the second quarter and
first six months of fiscal 2003  compared to $108,000  and $228,000 for the same
periods of fiscal 2002. The increases in  capitalized  software costs are due to
increased   expenditures  on  COMPEL  network  control   software  and  software
associated  principally  with the iPump Media Server and Unity 200 digital audio
receiver  products.  Research and development  expenses,  excluding  capitalized
software expenditures,  were $754,000, or 14.4% of revenues, and $1,410,000,  or
15.4% of  revenues,  for the three  and six  months  ended  February  28,  2003,
compared  to  $627,000,  or  10.7%  of  revenues,  and  $1,290,000,  or 10.9% of
revenues,  for the same periods of fiscal 2002. The increase in expenses for the
three and six months ended February 28, 2003 included higher personnel  expenses
and engineering  consulting costs. The expenditures for research and development
for the second half of fiscal 2003 are expected to continue at a rate similar to
that of the first half of fiscal 2003.

INTEREST  EXPENSE - Interest  expense  increased $5,000 to $17,000 for the three
months ended February 28, 2003, from $12,000 for the three months ended March 1,
2002. For the six months ended  February 28, 2003,  interest  expense  increased
$2,000 to $32,000  from  $30,000  for the same period  ended March 1, 2002.  The
increases for the three and six month periods in fiscal 2003 were  primarily due
to an increase in the average outstanding letter of credit commitment balances.

INTEREST  INCOME - Interest income was $13,000 and $33,000 for the three and six
month  periods  ended  February 28, 2003,  compared to $3,000 and $5,000 for the
same periods  ended March 1, 2002.  The  increases  for the three and six months
ended  February  28,  2003 were  mainly due to higher  average  cash  equivalent
balances.

INCOME TAX  EXPENSES - For the six months ended  February  28, 2003,  income tax
benefit of $142,000 was comprised of a deferred federal and state tax expense of
$134,000 and $8,000, respectively. Net deferred tax assets decreased $142,000 in
the first six months of fiscal 2003 to $2,290,000,  principally due to increases
in net operating loss carryforwards  during the period.  Realization of deferred
tax assets is dependent on generating  sufficient future taxable income prior to
the expiration of the loss and credit carryforwards. Although realization is not
assured, management believes it is more likely than not that all of the

                                       16
<PAGE>

deferred  tax assets will be realized.  The amount of the tax assets  considered
realizable,  however,  could be reduced in the near term if estimates of further
taxable income during the carryforward period are reduced.

CRITICAL ACCOUNTING POLICIES

The Company's  consolidated financial statements are prepared in accordance with
accounting  principals  generally accepted in the United States of America which
require  management to make  estimates and  judgements  that affect the reported
amounts of assets,  liabilities,  revenues, and expenses, as well as disclosures
of contingent  assets and  liabilities at the date of the financial  statements.
These  estimates  are reviewed on an ongoing  basis and are based on  historical
experience  and various  other  assumptions  and factors that are believed to be
reasonable  under the  circumstances,  the  results  of which form the basis for
making  judgements  about the carrying value of assets and liabilities  that are
not readily  apparent form other  sources.  Actual results may differ from these
estimates under different assumptions or future conditions.

We  believe  the  following  critical   accounting   policies  affect  our  more
significant judgements and estimates used in the preparation of our consolidated
financial statements.

REVENUE  RECOGNITION  -  The  Company's  revenue  recognition  policies  are  in
compliance  with Staff  Accounting  Bulletin No. 101,  "Revenue  Recognition  in
Financial  Statements," as published by the staff of the Securities and Exchange
Commission.  Revenue is recognized when persuasive evidence of an agreement with
the customer exists,  products are shipped or title passes pursuant to the terms
of the agreement with the customer, the amount due from the customer is fixed or
determinable,  collectibility  is  reasonably  assured,  and when  there  are no
significant future performance  obligations.  Service revenues are recognized at
the time of performance. The Company recognizes revenue in certain circumstances
before  delivery  has  occurred   (commonly  referred  to  as  "bill  and  hold"
transactions). In such circumstances,  among other things, risk of ownership has
passed to the buyer,  the buyer has made a written fixed  commitment to purchase
the finished  goods,  the buyer has  requested  the  finished  goods be held for
future  delivery  as  scheduled  and  designated  by  them,  and  no  additional
performance  obligations  exist by the  Company.  For  these  transactions,  the
finished goods are segregated from inventory and normal billing and credit terms
are granted.  As of February 28, 2003, revenues to one customer in the amount of
$2,182,000  were recorded  prior to delivery as bill and hold  transactions.  At
February  28,  2003,   accounts   receivable  for  these  revenues  amounted  to
$1,774,000.

These policies require  management,  at the time of the  transaction,  to assess
whether the  amounts due are fixed or  determinable,  collection  is  reasonably
assured,  and if future  performance  obligations  exist.  These assessments are
based on the terms of the agreement with the customer,  past history, and credit
worthiness of the  customer.  If management  determines  that  collection is not
reasonably assured or future performance  obligations exist, revenue recognition
is deferred until these conditions are satisfied.

INVENTORY  RESERVES - Inventories  are valued at the lower of cost (at standard,
which  approximates  actual  cost on a  first-in,  first-out  basis) or  market.
Inventories include the cost of raw materials, labor and manufacturing overhead.
The Company  makes  inventory  reserve  provisions  for  obsolete or slow moving
inventories as necessary to properly reflect inventory value. These reserves are
to provide for items that are  potentially  slow  moving,  excess,  or obsolete.
Changes in market  conditions,  lower than expected customer demand, and rapidly
changing  technology  could  result  in  additional  obsolete  and  slow  moving
inventory  that is unsaleable or saleable at reduced  prices which could require
additional inventory reserve provisions. At February 28, 2003, inventories,  net
of reserve provisions, amounted to $3,473,000.

CAPITALIZED   SOFTWARE  COSTS  -  Software  development  costs  are  capitalized
subsequent to  establishing  technological  feasibility.  Capitalized  costs are
amortized  based on the larger of the amounts  computed using (a) the ratio that
current  gross  revenues  for each  product  bears to the total of  current  and
anticipated  future gross  revenues  for that  product or (b) the  straight-line
method over the  remaining  estimated  economic  life of the  product.  Expected
future  revenues and  estimated  economic  lives are subject to revisions due to
market conditions, technology changes, and other factors resulting in shortfalls
of expected  revenues or reduced economic lives which could result in additional
amortization expense or write-offs.  At February 28, 2003,  capitalized software
costs, net of accumulated amortization, amounted to $678,000.

DEFERRED TAX ASSET VALUATION  ALLOWANCE - Deferred tax assets are recognized for
deductible temporary differences,  net operating loss carryforwards,  and credit
carryforwards  if it is more  likely  than  not that  the tax  benefits  will be
realized.  Realization  of the  Company's  deferred  tax assets is  dependent on
generating  sufficient future taxable income prior to the expiration of the loss
and  credit  carryforwards.  Although  realization  is not  assured,  management
believes it is more likely than not that all of the  deferred tax assets will be
realized based on the Company's backlog, financial projections and operating

                                       17
<PAGE>

history. The amount of the deferred tax assets considered  realizable,  however,
could be reduced if estimates of future taxable  income during the  carryforward
period are reduced. Any reduction in the realizable value of deferred tax assets
would result in a charge to income tax expense in the period such  determination
was made.  At February 28, 2003,  deferred tax assets  amount to  $2,990,000  of
which  approximately  $792,000 relates to net operating loss carryforwards which
expire in fiscal 2020 and 2021 and $98,000 of general  business  and foreign tax
credits  expiring  in  fiscal  2004 and an  alternative  minimum  tax  credit of
$138,000.

ACCOUNTS  RECEIVABLE  VALUATION - The Company maintains  allowances for doubtful
accounts for estimated  losses  resulting from the inability of its customers to
make required payments.  If the financial  condition of the Company's  customers
were to  deteriorate,  resulting  in an  impairment  of  their  ability  to make
payments,  additional  allowances  would be  required.  At  February  28,  2003,
accounts  receivable  net  of  allowances  for  doubtful  accounts  amounted  to
$3,088,000.

LIQUIDITY AND CAPITAL RESOURCES
SIX MONTHS ENDED FEBRUARY 28, 2003

At February 28, 2003, the Company's  primary  sources of liquidity were cash and
cash  equivalents  of $4,786,000 and a $5,000,000  bank loan facility.  Cash and
cash equivalents decreased $332,000 during the first six months of fiscal 2003.

During  the first  six  months of fiscal  2003,  operating  activities  provided
$955,000 of cash. Net loss adjusted for non-cash  expenses  provided $592,000 of
cash,  while changes in accounts  receivable and customer  deposit balances used
$226,000 of cash. Changes in accounts payable and accrued expenses, inventories,
and other assets provided  $589,000 of cash.  Cash used by investing  activities
for property and equipment  expenditures and capitalized  software additions was
$788,000. Other investing activities used $496,000 of cash for license agreement
expenditures  and legal  expenses  related  to the  filing of  applications  for
various  patents and  trademarks.  Financing  activities used cash of $3,000 for
scheduled repayments of long-term debt.

WCI's bank loan facility provides a maximum available credit limit of $5,000,000
with sublimits as defined.  The loan facility  matures on June 30, 2003, or upon
demand,  and requires an annual  facility fee of 1% of the maximum credit limit.
The loan facility  consists of a term loan and a revolving line of credit with a
combined  borrowing  limit of $5,000,000,  bearing  interest at the bank's prime
rate (4.25% at February 28, 2003).  While no assurances maybe given, the Company
believes it will be able to renew the loan facility with the existing bank prior
to maturity.

The term loan facility  provides for a maximum of $1,000,000 of indebtedness for
advances of up to 80% of the cost of equipment acquisitions.  Principal advances
are payable  monthly over sixty  months with a balloon  payment due at maturity.
The revolving line of credit is subject to availability  advance formulas of 80%
against eligible accounts receivable; 20% of eligible raw materials inventories;
20% of  eligible  work-in-process  kit  inventories;  and 40% to 50% of eligible
finished goods inventories. Advances against inventory are subject to a sublimit
of  $2,000,000.  At February  28,  2003,  no balances  were  outstanding  on the
revolving  line of  credit  or the  equipment  term  loan  portions  of the loan
facility.  Additionally,  at February 28, 2003,  approximately $2,003,000 net of
outstanding  letters  of credit in the amount of  $2,153,000  was  available  to
borrow under the advance formulas.

The Company is required  to  maintain a minimum  tangible  net worth with annual
increases  at each fiscal  year end  commencing  with  fiscal year 2003,  retain
certain key employees,  limit expenditures of the Company to $600,000 per fiscal
year,  and maintain  certain  financial  ratios,  and is  precluded  from paying
dividends.  At February 28, 2003,  the Company was in  compliance  with all loan
facility  covenants.  The Company  believes that the amended loan facility along
with cash and cash equivalent  balances will be sufficient to support operations
through fiscal 2003.

During  the  second  quarter  of  fiscal  2003,  the  Company   entered  into  a
manufacturing and purchasing  agreement for certain finished goods  inventories.
The  agreement  committed the Company to purchase  $2,062,000,  over an eighteen
month period,  beginning in the third  quarter of fiscal 2003. In addition,  the
Company  maintains  a  cancelable  manufacturing  and  purchasing  agreement  of
finished  goods  inventories  for  which the  Company  has firm  customer  order
commitments.  The  Company  had  outstanding  purchase  commitments  under  this
agreement of $1,545,000 at February 28, 2003.  Pursuant to the above agreements,
at February  28,  2003,  the Company  had  outstanding  letters of credit in the
amount of $1,545,000.

The  Company  has never paid cash  dividends  on its  common  stock and does not
intend to pay cash dividends in the foreseeable future.

                                       18
<PAGE>

A summary of the Company's long-term contractual  obligations as of February 28,
2003 consisted of:

                                        OPERATING         PURCHASE
                           DEBT          LEASES          COMMITMENTS
                          ------        ---------        -----------
     Fiscal 2003          $3,100        $115,000         $2,534,000
     Fiscal 2004           4,300         224,000          1,073,000
     Fiscal 2005              --         114,000                 --
     Fiscal 2006              --           2,000                 --
                          ------        ---------        -----------
     Total                $7,400        $455,000         $3,607,000
                          ------        ---------        -----------

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company's exposure to market rate risk for changes in interest rates relates
primarily to its  revolving  line of credit and cash  equivalents.  The interest
rate on  certain  advances  under  the line of  credit  and term  loan  facility
fluctuates with the bank's prime rate.  There were no borrowings  outstanding at
February 28, 2003 subject to variable interest rate fluctuations.

At  February  28,  2003,  the  Company's  cash  equivalents  consisted  of  bank
commercial paper in the amount of $2,575,000 and variable rate municipals in the
amount of $2,000,000.  The cash  equivalents  have maturities of less than three
months and therefore are subject to minimal market risk.

The Company does not enter into derivative financial instruments.  All sales and
purchases are denominated in U.S. dollars.

ITEM 4.   CONTROLS AND PROCEDURES

Within 90 days prior to the filing date of this report,  the Company carried out
an evaluation, under the supervision and with the participation of the Company's
management,  including the Chief Executive Officer (CEO) and the Chief Financial
Officer (CFO), of the effectiveness of the design and operation of the Company's
disclosure controls and procedures.  Based on that evaluation, the Company's CEO
and CFO have concluded that the Company's disclosure controls and procedures (as
defined in Rule 13a-14 of the  Securities  Exchange Act of 1934, as amended) are
effective.  There have been no  significant  changes in the  Company's  internal
controls or in other  factors that could  significantly  affect  these  internal
controls subsequent to the completion of this evaluation.

                                       19
<PAGE>

PART II. OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

          On June 25, 2002, a complaint was filed in the U.S. District Court for
          the District of Nevada by StarGuide Digital  Networks,  Inc., a Nevada
          corporation, against WCI. (StarGuide Digital Network, Inc., Plaintiff,
          v. Wegener Communications, Inc., and John Scaggs, Defendants) alleging
          that WCI had infringed two United States patents held by StarGuide. On
          July 10, 2002,  StarGuide filed its First Amended  Complaint and added
          John Scaggs,  an employee of WCI, as a defendant.  StarGuide filed its
          Second  Amended  Complaint  on July 17,  2002.  Counts I and II of the
          Second Amended Complaint alleged claims of patent infringement against
          WCI relating to two U.S. patents.  The remaining counts related to the
          employment  of John  Scaggs by WCI,  his brief  decision  to become an
          employee  of  StarGuide,  and  alleged  acts  of  misappropriation  of
          StarGuide's trade secrets by WCI and John Scaggs. The plaintiff sought
          preliminary  and  permanent  injunctions  enjoining  WCI from  further
          patent  infringement,  compensatory  damages,  enhanced  and  punitive
          damages for any willful  infringement or  interference  with contract,
          and costs and attorney's  fees. WCI timely answered the complaints and
          denied all  liability in full.  In addition,  WCI filed  counterclaims
          against  StarGuide  seeking  declaratory  judgements  that WCI was not
          infringing  the  patents  in suit  and that  the  patents  in suit are
          invalid or  otherwise  unenforceable.  During  the  second  quarter of
          fiscal 2003,  WCI and John Scaggs  reached an agreement with StarGuide
          settling all disputes between the parties. The terms of the settlement
          are confidential but included StarGuide's grant of limited licenses to
          WCI  under a  number  of  StarGuide  patents.  WCI has  agreed  to pay
          StarGuide a running  royalty on certain  products.  Management  of the
          Company  believes that the settlement will not have a material adverse
          effect on the Company's financial condition or results of operations.

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

On January 21, 2003, the Annual Meeting of Shareholders  was held and the shares
present voted on the following matters:

          (1.) The shareholders  approved the election of the following  nominee
               to the Board of Directors:

                    Robert A. Placek  (Class II Director)
                              10,870,855 votes FOR
                                 423,320 votes WITHHELD

               The terms of office of Thomas G. Elliott and James H. Morgan, Jr.
               as Class III  directors,  and Joe K. Parks and C. Troy  Woodbury,
               Jr. as Class II  directors,  continued  subsequent  to the Annual
               Meeting.

          (2.) The  appointment of BDO Seidman,  LLP as auditors for the Company
               for the fiscal year 2003 was approved with 11,030,987  votes FOR,
               201,078 votes AGAINST, and 62,110 votes ABSTAINING.

                                       20
<PAGE>

ITEM 5.   OTHER INFORMATION

Following the Company's  2003 Annual Meeting of  Stockholders  which was held on
January 21, 2003,  the Company was  contacted by the Nasdaq Stock Market and was
informed by Nasdaq  representatives  that Nasdaq  believes that James H. Morgan,
Jr. does not meet the  definition  of  "independent  director"  for  purposes of
serving  on the audit  committee  of the  board of  directors.  Mr.  Morgan is a
partner in the law firm which  serves as outside  legal  counsel to the Company.
Nasdaq representatives informed the Company that in Nasdaq's view, all fees paid
to the law firm of which Mr.  Morgan is a partner  should be deemed to be direct
compensation  to Mr. Morgan  individually  (which must not exceed $60,000 in any
fiscal  year under the Nasdaq  independent  director  definition).  The  Company
disagreed  with  Nasdaq's  interpretation  and  engaged in  several  substantive
discussions with Nasdaq regarding the issue, but Nasdaq's position  continues to
be that Mr. Morgan is not independent under its rules.  However, as permitted by
the  Nasdaq  rules,  the  board  of  directors  of  the  Company  has  made  the
determination  that,  although  Nasdaq  does  not  deem  Mr.  Morgan  to  be  an
independent  director,  Mr. Morgan's continued service on the audit committee is
in the  best  interests  of the  Company  and its  stockholders  because  of Mr.
Morgan's  knowledge of and  experience in financial and tax matters.  Therefore,
Mr. Morgan will continue to serve as a member of the Company's audit  committee.
In addition,  on February 19, 2003,  the Company  announced that it had expanded
its board of directors and elected  Wendell H. Bailey as a director.  Mr. Bailey
does meet the definition of "independent director" under Nasdaq regulations, and
has been  elected  to serve as a member of the audit  committee  of the board of
directors.  Therefore,  the Company's audit committee is currently  comprised of
Thomas G. Elliot, Joe K. Parks, Wendell H. Bailey and James H. Morgan, Jr.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  Exhibits:

               99.1 Certification of Chief Executive Officer Regarding  Periodic
                    Report Containing  Financial  Statements Pursuant to Section
                    906 of the Sarbanes-Oxley Act of 2002.

               99.2 Certification of Chief Financial Officer Regarding  Periodic
                    Report Containing  Financial  Statements Pursuant to Section
                    906 of the Sarbanes-Oxley Act of 2002.

          (b)  Reports on Form 8-K - No  reports  on Form 8-K were filed  during
               the quarter ended February 28, 2003.

                                       21
<PAGE>

                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
Registrant  has duly  caused  this  Report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.

                                        WEGENER CORPORATION
                                        -------------------
                                           (Registrant)


Date: April 10, 2003                    By: /s/ Robert A. Placek
                                            ------------------------------------
                                                Robert A. Placek
                                                President
                                                (Principal Executive Officer)


Date: April 10, 2003                    By: /s/ C. Troy Woodbury, Jr.
                                            ------------------------------------
                                                C. Troy Woodbury, Jr.
                                                Treasurer and Chief
                                                Financial Officer
                                                (Principal Financial and
                                                Accounting Officer)

                                       22
<PAGE>

  CERTIFICATION OF CHIEF EXECUTIVE OFFICER REGARDING PERIODIC REPORT CONTAINING
 FINANCIAL STATEMENTS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Robert A. Placek, the Chief Executive Officer of Wegener Corporation, certify
that:

(1)  I have  reviewed this  quarterly  report on Form 10-Q for the quarter ended
     February 28, 2003 of Wegener Corporation;

(2)  Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

(3)  Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

(4)  The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     (b)  evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     (c)  presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of our disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

(5)  The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of the registrant's board of directors (or persons performing the
     equivalent function):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

(6)  The  registrant's  other  certifying  officer and I have  indicated in this
     quarterly  report  whether  there  were  significant  changes  in  internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

                                        Date: April 10, 2003


                                        /s/ Robert A. Placek

                                        NAME: ROBERT A. PLACEK
                                        TITLE: CHAIRMAN OF THE BOARD, PRESIDENT
                                               AND CHIEF EXECUTIVE OFFICER

                                       23
<PAGE>

  CERTIFICATION OF CHIEF FINANCIAL OFFICER REGARDING PERIODIC REPORT CONTAINING
 FINANCIAL STATEMENTS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, C. Troy Woodbury,  Jr., the Chief Financial  Officer of Wegener  Corporation,
certify that:

(1)  I have  reviewed  this  quarterly  report on Form 10-Q for the period ended
     February 28, 2003 of Wegener Corporation;

(2)  Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

(3)  Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

(4)  The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     (b)  evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     (c)  presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of our disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

(5)  The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of the registrant's board of directors (or persons performing the
     equivalent function):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

(6)  The  registrant's  other  certifying  officer and I have  indicated in this
     quarterly  report  whether  there  were  significant  changes  in  internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.

                                        Date: April 10, 2003


                                        /s/ C. Troy Woodbury, Jr.

                                        NAME: C. TROY WOODBURY, JR.
                                        TITLE: TREASURER AND CHIEF
                                               FINANCIAL OFFICER

                                       24