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 May 30, 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                                12,371,251 Shares
----------------------------                           -------------------------
           Class                                       Outstanding June 30, 2003

<PAGE>

                               WEGENER CORPORATION
                  FORM 10-Q FOR THE QUARTER ENDED MAY 30, 2003

                                      INDEX

PART I.   FINANCIAL INFORMATION

Item 1.   Consolidated Financial Statements

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

          Consolidated Statements of Operations
          (Unaudited) - Three and Nine Months Ended
          May 30, 2003 and May 31, 2002 .......................................4

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

          Consolidated Statements of Shareholders' Equity
          (Unaudited) - Nine Months Ended May 30,
          2003 and May 31, 2002 ...............................................6

          Consolidated Statements of Cash Flows
          (Unaudited) - Nine Months Ended May 30,
          2003 and May 31, 2002 ...............................................7

          Notes to Consolidated Financial
          Statements (Unaudited) ...........................................8-15

Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations .............................16-20

Item 3.   Quantitative and Qualitative Disclosures About Market Risk..........20

Item 4.   Controls and Procedures.............................................20

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings...................................................21
Item 2.   None
Item 3.   None
Item 4.   None
Item 5.   Other Information...................................................22
Item 6.   Exhibits and Reports on Form 8-K ...................................22

          Signatures..........................................................23

          Certifications .....................................................24

                                       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 May 30, 2003; the consolidated  statements
of  shareholders'  equity as of May 30, 2003, and May 31, 2002; the consolidated
statements of operations  for the three and nine months ended May 30, 2003,  and
May 31, 2002; and the consolidated  statements of cash flows for the nine months
ended May 30, 2003,  and May 31, 2002,  have been prepared  without  audit.  The
consolidated  balance  sheet  as of  August  30,  2002,  has  been  examined  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                 Nine months ended
                                              MAY 30,          May 31,          MAY 30,          May 31,
                                               2003             2002             2003             2002
----------------------------------------------------------------------------------------------------------
<S>                                        <C>              <C>              <C>              <C>
Revenue                                    $  6,254,459     $  6,290,810     $ 15,418,729     $ 18,184,128
----------------------------------------------------------------------------------------------------------

Operating costs and expenses
    Cost of products sold                     3,812,723        4,092,591        9,801,488       11,935,666
    Selling, general and administrative       1,592,032        1,005,889        3,753,709        3,126,042
    Research and development                    654,545          582,003        2,064,205        1,872,496
----------------------------------------------------------------------------------------------------------

Operating costs and expenses                  6,059,300        5,680,483       15,619,402       16,934,204
----------------------------------------------------------------------------------------------------------

Operating income (loss)                         195,159          610,327         (200,673)       1,249,924
    Interest expense                            (17,996)         (19,425)         (49,965)         (49,389)
    Interest income                              14,805           14,596           47,717           20,074
----------------------------------------------------------------------------------------------------------

Earnings (loss) before income taxes             191,968          605,498         (202,921)       1,220,609

Income tax expense (benefit)                     69,000          226,000          (73,000)         453,000
----------------------------------------------------------------------------------------------------------

Net earnings (loss)                        $    122,968     $    379,498     $   (129,921)    $    767,609
==========================================================================================================

Net earnings (loss) per share:
    Basic                                  $        .01     $        .03     $       (.01)    $        .06
    Diluted                                $        .01     $        .03     $       (.01)    $        .06
==========================================================================================================

Shares used in per share calculation
    Basic                                    12,351,158       12,185,519       12,313,314       12,138,011
    Diluted                                  12,488,212       12,350,796       12,313,314       12,159,661
==========================================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

                                       4
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                             MAY 30,        August 30,
                                                              2003             2002
---------------------------------------------------------------------------------------
ASSETS                                                     (UNAUDITED)

Current assets
<S>                                                       <C>              <C>
    Cash and cash equivalents                             $  5,096,944     $  5,117,756
    Accounts receivable                                      4,233,834        3,037,762
    Inventories                                              2,660,501        3,920,673
    Deferred income taxes                                    2,143,000        2,225,000
    Other                                                      192,824           90,066
---------------------------------------------------------------------------------------

         Total current assets                               14,327,103       14,391,257

Property and equipment, net                                  3,002,131        2,995,332
Capitalized software costs, net                                892,015          641,710
Deferred income taxes                                          778,000          623,000
Other assets, net                                              632,726           48,556
---------------------------------------------------------------------------------------

                                                          $ 19,631,975     $ 18,699,855
=======================================================================================

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
    Accounts payable                                      $  2,154,097     $  1,424,101
    Accrued expenses                                         1,938,121        1,409,369
    Customer deposits                                          479,150          777,023
    Current maturities of long-term obligations                  5,876            6,120
---------------------------------------------------------------------------------------

          Total current liabilities                          4,577,244        3,616,613

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

          Total liabilities                                  4,577,244        3,620,907
---------------------------------------------------------------------------------------

Commitments and contingencies

Shareholders' equity
    Common stock, $.01 par value; 20,000,000 shares
        authorized; 12,371,251 shares issued                   123,713          123,146
    Additional paid-in capital                              19,462,769       19,513,977
    Deficit                                                 (4,531,751)      (4,401,830)
    Less treasury stock, at cost                                    --         (156,345)
---------------------------------------------------------------------------------------

         Total shareholders' equity                         15,054,731       15,078,948
---------------------------------------------------------------------------------------

                                                          $ 19,631,975     $ 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>
                                               Common Stock           Additional      Retained              Treasury Stock
                                               ------------             Paid-in       Earnings              --------------
                                          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             --             --       (200,575)             --        (158,415)        339,387
    Net earnings for the nine months             --             --             --         767,609              --              --
---------------------------------------------------------------------------------------------------------------------------------

BALANCE at May 31, 2002                  12,314,575   $    123,146   $ 19,551,119    $ (4,441,801)        111,173    $   (238,175)
=================================================================================================================================

Balance at August 30, 2002               12,314,575   $    123,146   $ 19,513,977    $ (4,401,830)         72,977    $   (156,345)

    Issuance of shares through
       stock options and 401(k) plan         56,676            567        (51,208)             --         (72,977)        156,345
    Net loss for the nine months                 --             --             --        (129,921)             --              --
---------------------------------------------------------------------------------------------------------------------------------

BALANCE AT MAY 30, 2003                  12,371,251   $    123,713   $ 19,462,769    $ (4,531,751)             --    $         --
=================================================================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

                                       6
<PAGE>

                      WEGENER CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                    Nine months ended
                                                                  MAY 30,         May 31,
                                                                   2003            2002
-------------------------------------------------------------------------------------------
CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES
<S>                                                            <C>             <C>
    Net earnings (loss)                                        $   (129,921)   $    767,609
    Adjustments to reconcile net earnings (loss) to
           cash provided by operating activities
        Depreciation and amortization                             1,201,085       1,287,577
        Issuance of treasury stock for
            compensation expenses                                    82,409         113,431
        Provision for bad debt allowance                             65,000         155,000
        Provision for inventory reserves                            100,000         300,000
        Deferred income taxes                                       (73,000)        564,000
       Warranty reserves                                            (20,000)             --
    Changes in assets and liabilities
            Accounts receivable                                  (1,261,072)     (1,564,542)
            Inventories                                           1,160,172       2,093,329
            Other assets                                           (102,758)         32,334
            Accounts payable and accrued expenses                 1,128,748        (422,271)
            Customer deposits                                      (297,873)        (23,616)
-------------------------------------------------------------------------------------------

                                                                  1,852,790       3,302,851
-------------------------------------------------------------------------------------------

CASH USED FOR INVESTMENT ACTIVITIES
    Property and equipment expenditures                            (504,222)       (123,644)
    Capitalized software additions                                 (861,467)       (368,267)
    License agreements, patents, and trademarks expenditures       (526,670)             --
-------------------------------------------------------------------------------------------

                                                                 (1,892,359)       (491,911)
-------------------------------------------------------------------------------------------

CASH USED FOR FINANCING ACTIVITIES
    Repayment of long-term debt                                      (4,538)        (43,178)
    Loan facility fees                                                   --          (5,536)
    Proceeds from stock options exercised                            23,295          25,381
-------------------------------------------------------------------------------------------

                                                                     18,757         (23,333)
-------------------------------------------------------------------------------------------

Increase (decrease) in cash and cash equivalents                    (20,812)      2,787,607
Cash and cash equivalents, beginning of period                    5,117,756       1,926,723
-------------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                       $  5,096,944    $  4,714,330
===========================================================================================

Supplemental disclosure of cash flow information:
    Cash paid (received) during the nine months for:
          Interest                                             $     49,965    $     49,389
          Income taxes                                                   --    $   (210,499)
===========================================================================================
</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 May 30,
2003,  revenues to one customer in the amount of $2,582,000  were recorded prior
to delivery as bill and hold transactions.  At May 30, 2003, accounts receivable
for these revenues amounted to $1,483,000.

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 revenue,  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.

STOCK BASED COMPENSATION

The Company has adopted the disclosure only provisions of Statement of Financial
Accounting Standard (SFAS) No 123, "Accounting for Stock-Based Compensation," as
amended by SFAS No. 148,  "Accounting for Stock-Based  Compensation - Transition
and Disclosure," but applies  Accounting  Principles Board Opinion (APB) No. 25,
"Accounting  for Stock  Issued to  Employees"  and  related  interpretations  in
accounting for its plans.  Under APB No. 25, when the exercise price of employee
stock  options  equals the market price of the  underlying  stock on the date of
grant, no compensation expense is recognized.

                                       8
<PAGE>

The following table includes disclosures required by SFAS No. 123, as amended by
SFAS No. 148 and  illustrates the effect on net earnings (loss) and net earnings
(loss)  per share as if the  Company  had  applied  the fair  value  recognition
provisions of SFAS No. 123:

<TABLE>
<CAPTION>
                                  Three months ended            Nine months ended
                               ------------------------------------------------------
                                 MAY 30,       May 31,        MAY 30,        May 31,
                                  2003          2002           2003           2002
-------------------------------------------------------------------------------------
Net earnings (loss)
<S>                            <C>           <C>            <C>            <C>
   As Reported                 $  122,968    $  379,498     $ (129,921)    $  767,609
   Deduct:
       Compensation cost
       using the fair value
       method, net of tax              --       (20,654)       (47,663)      (102,330)
-------------------------------------------------------------------------------------
   Pro Forma                   $  122,968    $  358,844     $ (177,584)    $  665,279
=====================================================================================
Earnings (loss) per share
   As Reported
       Basic                   $      .01    $      .03     $     (.01)    $      .06
       Diluted                        .01           .03           (.01)           .06
   Pro Forma
       Basic                          .01           .03           (.01)           .05
       Diluted                        .01           .03           (.01)           .05
=====================================================================================
</TABLE>

The fair  value of each  option  was  estimated  on the date of grant  using the
Black-Scholes   option  pricing  model  with  the  following   weighted  average
assumptions:

                                 Three months ended         Nine months ended
                                ------------------------------------------------
                                MAY 30,      May 31,       MAY 30,       May 31,
                                 2003         2002          2003          2002
--------------------------------------------------------------------------------
Risk free interest rate           --          4.97%         4.84%         4.97%
Expected term                     --        3 years       3 YEARS       3 years
Volatility                        --            75%           75%           75%
Expected annual dividends         --           none          NONE          none

The weighted  average fair value of options granted during the nine months ended
May 30, 2003 was $ .52 and for the three and nine months  ended May 31, 2002 was
$ .44 and $ .47,  respectively.  No options were granted during the three months
ended May 30, 2003.

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.

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.

                                       9
<PAGE>

NOTE 2 ACCOUNTS RECEIVABLE

Accounts receivable are summarized as follows:

                                                MAY 30,        August 30,
                                                 2003             2002
     ---------------------------------------------------------------------
                                              (UNAUDITED)

     Accounts receivable - trade             $  4,559,248     $  3,314,046
     Other receivables                             75,205           75,308
     ---------------------------------------------------------------------

                                                4,634,453        3,389,354
     ---------------------------------------------------------------------

     Less allowance for
          doubtful accounts                      (400,619)        (351,592)
     ---------------------------------------------------------------------

                                             $  4,233,834     $  3,037,762
     =====================================================================

NOTE 3 INVENTORIES

Inventories are summarized as follows:

                                                MAY 30,        August 30,
                                                 2003             2002
     ---------------------------------------------------------------------
                                              (UNAUDITED)

     Raw material                            $  2,269,767     $  2,917,924
     Work-in-process                            1,227,997        1,639,620
     Finished goods                             2,678,100        3,143,736
     ---------------------------------------------------------------------
                                                6,175,864        7,701,280

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

                                             $  2,660,501     $  3,920,673
     =====================================================================

During the first nine 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 May  30,  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.

                                       10
<PAGE>

NOTE 4 OTHER ASSETS

Other assets consisted of the following:

                                                 MAY 30, 2003
     ----------------------------------------------------------------------
                                      COST        ACCUMULATED        NET
                                                 AMORTIZATION
     ----------------------------------------------------------------------
     License agreements            $  570,000     $  (55,000)    $  515,000
     Patents                           81,341             --         81,341
     Trademarks                        25,329             --         25,329
     Loan facility fees                50,000        (45,833)         4,167
     Other                              6,889             --          6,889
     ----------------------------------------------------------------------
                                   $  733,559     $ (100,833)    $  632,726
     ======================================================================

                                                August 30, 2002
     ----------------------------------------------------------------------
                                      Cost        Accumulated        Net
                                                 Amortization
     ----------------------------------------------------------------------
     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 nine months ended May 30,
2003,  amounted to $40,000 and $92,500,  respectively.  Amortization  expense of
other  assets for the three and nine  months  ended May 31,  2002,  amounted  to
$12,000 and $39,000, respectively.

The Company conducts an on-going review of its intellectual  property rights and
potential  trademarks.  During  the nine  months of  fiscal  2003,  the  Company
incurred $81,000 and $25,000 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 nine  months  ended May 30,  2003,  income tax  benefit  of $73,000  was
comprised  of a deferred  federal  and state  income tax  benefit of $69,000 and
$4,000,  respectively.  Net deferred tax assets increased  $73,000 to $2,921,000
principally due to an increase in net operating loss  carryforwards in the first
nine 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 May 30, 2003,  the Company had a federal net operating loss  carryforward  of
approximately  $2,277,000,  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.

                                       11
<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
                                     --------------------------------------------------------------------------------
                                                   MAY 30, 2003                             May 31, 2002
                                     --------------------------------------    --------------------------------------
                                                                    PER                                       Per
                                      EARNINGS        SHARES       SHARE         Earnings      Shares        share
                                     (NUMERATOR)  (DENOMINATOR)    AMOUNT      (Numerator)  (Denominator)    amount
                                     ----------    ----------    ----------    ----------    ----------    ----------
<S>                                  <C>           <C>           <C>           <C>           <C>           <C>
     Net earnings                    $  122,968                                $  379,498
                                     ==========                                ==========
     BASIC EARNINGS PER SHARE:
       Net earnings available
         to common shareholders      $  122,968    12,351,158    $      .01    $  379,498    12,185,519    $      .03

     Effect of dilutive
       potential common shares:
         Stock options                       --       137,054                          --       165,277
                                     ------------------------                  ------------------------

     DILUTED EARNINGS  PER SHARE:
       Net earnings available
         to common shareholders      $  122,968    12,488,212    $      .01    $  379,498    12,350,796    $      .03
                                     ========================    ==========    ========================    ==========

<CAPTION>
                                                                     Nine months ended
                                     --------------------------------------------------------------------------------
                                                  MAY 30, 2003                             May 31, 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)                  $ (129,921)                               $  767,609
                                     ==========                                ==========
BASIC EARNINGS(LOSS) PER SHARE:
  Net earnings (loss) available
    to common shareholders           $ (129,921)   12,313,314    $     (.01)   $  767,609    12,138,011    $      .06

Effect of dilutive potential
  common shares:
    Stock options                            --            --                          --        21,650
                                     ------------------------                  ------------------------

DILUTED EARNINGS (LOSS) PER SHARE:
  Net earnings (loss) available
    to common shareholders           $ (129,921)   12,313,314    $     (.01)   $  767,609    12,159,661    $      .06
                                     ========================    ==========    ========================    ==========
</TABLE>

                                       12
<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                   Nine months ended
                           --------------------------------------------------------------------
                              MAY 30,           May 31,            MAY 30,           May 31,
                               2003              2002               2003              2002
                           --------------------------------------------------------------------
Common stock options:
<S>                        <C>               <C>               <C>               <C>
    Number of shares          761,050           907,550           1,303,425         1,016,409
    Exercise price         $1.41 TO $5.63    $1.41 to $5.63    $ .84 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               Nine months ended
                                   ------------------------------------------------------------
                                      MAY 30,         May 31,         MAY 30,         May 31,
                                       2003            2002            2003            2002
                                   ------------------------------------------------------------
Product Line
<S>                                <C>             <C>             <C>             <C>
    Direct Broadcast Satellite     $  5,826,093    $  5,680,666    $ 14,000,804    $ 16,923,982
    Telecom and Custom Products         282,334         519,194       1,012,994         900,918
    Service                             146,032          90,950         404,931         359,228
                                   ------------------------------------------------------------
                                   $  6,254,459    $  6,290,810    $ 15,418,729    $ 18,184,128
                                   ============================================================

Revenues by geographic area are as follows:

<CAPTION>
                                        Three months ended               Nine months ended
                                   ------------------------------------------------------------
                                      MAY 30,         May 31,         MAY 30,         May 31,
                                       2003            2002            2003            2002
                                   ------------------------------------------------------------
Geographic Area
<S>                                <C>             <C>             <C>             <C>
    United States                  $  6,028,665    $  5,896,795    $ 14,789,642    $ 17,126,167
    Latin America                        44,807         150,693         196,566         526,266
    Canada                               88,120          77,789         207,835         164,680
    Europe                               21,893          34,364         127,943         171,521
    Other                                70,974         131,169          96,743         195,494
                                   ------------------------------------------------------------
                                   $  6,254,459    $  6,290,810    $ 15,418,729    $ 18,184,128
                                   ============================================================
</TABLE>

                                       13
<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:

                         Three months ended               Nine months ended
                       -------------------------------------------------------
                       MAY 30,         May 31,         MAY 30,         May 31,
                        2003            2002            2003            2002
                       -------------------------------------------------------

     Customer 1         31.6%           36.2%           39.1%           24.4%
     Customer 2         26.8%           13.3%           20.4%           31.9%
     Customer 3         12.2%            (a)             (A)             (a)
     Customer 4          (A)            10.8%            (A)            11.6%

     (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 two
manufacturing and purchasing  agreements for certain finished goods inventories.
The   agreements   committed  the  Company  to  purchase   $2,116,000   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 $1,561,000 at May 30, 2003.  Pursuant to the above  agreements,  at
May 30,  2003,  the Company had  outstanding  letters of credit in the amount of
$2,681,000.

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 amounted to $76,000 at May 30, 2003. For the three and nine
month periods ended May 30, 2003, the accrual was reduced by $20,000.

Letters of Credit
Wegener  Communications  Inc.,  the  Company's  wholly owned  subsidiary  (WCI),
provides standby letters of credit in the ordinary course of business to certain
suppliers pursuant to manufacturing and purchasing agreements.  At May 30, 2003,
outstanding letters of credit amounted to $2,681,000.

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 May 30, 2003, no balances
were outstanding on the loan facility.

NOTE 10 STOCK OPTIONS

During the first nine 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 nine months of fiscal 2003,  options for 121,500 shares
of common stock at a weighted average exercise price of $1.47 were forfeited. At
May 30, 2003, options for 1,303,425 shares of common stock were outstanding with
a weighted average exercise price of $1.69 and with exercise prices ranging from
$.63 to $5.63.  At May 30, 2003,  options for  1,000,075  shares of common stock
were available for issuance under the 1998 Incentive Plan. Additionally,  during
the first nine months of fiscal 2003  options for 13,000 and 16,500  shares with
exercise prices of $ .84 and $ .75, respectively, were exercised.

                                       14
<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. The
Company adopted the disclosure  portion of this statement for the fiscal quarter
ending May 30,  2003.  The  adoption  did not have any  impact on the  Company's
consolidated financial position or results of operations.

In May 2003,  the FASB  issued SFAS No. 150,  Accounting  for Certain  Financial
Instruments with  Characteristics  of both Liabilities and Equity. The Statement
establishes standards for how an issuer classifies and measures in its statement
of financial position certain financial instruments with characteristics of both
liabilities  and  equity.  It  requires  that an  issuer  classify  a  financial
instrument  that is  within  its  scope  as a  liability  (or an  asset  in some
circumstances)  because that financial  instrument embodies an obligation of the
issuer.  Many of such  instruments  were  previously  classified as equity.  The
statement is effective for financial  instruments entered into or modified after
May 31, 2003,  and  otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003, except for mandatory  redeemable financial
instruments  of  nonpublic  entities.  The  Statement  is to be  implemented  by
reporting  the  cumulative  effect  of a  change  in  accounting  principle  for
financial  instruments  created before the issuance of the date of the Statement
and  still  existing  at  the  beginning  of the  interim  period  of  adoption.
Restatement  is not  permitted.  Management  believes  that the adoption of this
Statement will not have a significant impact on the financial position,  results
of operations or cash flows of the Company.

                                       15
<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 NINE MONTHS ENDED MAY 30, 2003 COMPARED TO THREE AND NINE MONTHS ENDED
MAY 31, 2002

The  operating  results for the three and nine month  periods ended May 30, 2003
were net earnings of $123,000 or $ .01 per share and a net loss of $(130,000) or
$ ( .01) per share, respectively,  compared to net earnings of $379,000 or $ .03
per share and $768,000 or $ .06 per share, respectively,  for the three and nine
month periods ended May 31, 2002.

REVENUES - The  Company's  revenues for the three months ended May 30, 2003 were
$6,254,000,  down less than 1% from revenues of $6,291,000  for the three months
ended  May 31,  2002.  Revenues  for the nine  months  ended  May 30,  2003 were
$15,419,000,  down 15.2% from revenues of $18,184,000  for the nine months ended
May 31, 2002.  Direct  Broadcast  Satellite  (DBS) revenues  (including  service
revenues)  increased  $200,000  or 3.5% in the third  quarter of fiscal  2003 to
$5,972,000  from  $5,772,000  in the same  period of fiscal  2002.  For the nine
months  ended  May 30,  2003,  DBS  revenues  decreased  $2,877,000  or 16.6% to
$14,406,000  from  $17,283,000  for the nine  months  ended  May 31,  2002.  The
decrease  in  revenues  for the nine  months 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 first nine months of fiscal  2002  included  shipments  of network
equipment  to Roberts  Communications  to provide  television  coverage of horse
racing to off-track betting venues  throughout the United States.  Additionally,
the first nine 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  decreased  $237,000 or 45.6% in the
third  quarter of fiscal  2003 to $282,000  from  $519,000 in the same period of
fiscal 2002. For the nine months ended May 30, 2003, Telecom and Custom Products
Group revenues  increased  $112,000 or 12.4% to $1,013,000 from $901,000 for the
nine months  ended May 31,  2002.  The decrease in revenues for the three months
ended May 30, 2003,  was due to completion of shipments of orders for commercial
insertion  equipment.  The  increase in revenues  for the nine month  period was
primarily due to an increase in orders from a distributor to provide  commercial
insertion equipment to a cable television operator.

                                       16
<PAGE>

For the three months ended May 30, 2003,  three  customers  accounted for 31.6%,
26.8%, and 12.2% of revenues,  respectively.  For the three months ended May 31,
2002,  three  customers  accounted  for  36.2%,  13.3%,  and 10.8% of  revenues,
respectively.  For the nine months ended May 30, 2003,  two customers  accounted
for 39.1% and 20.4% of revenues, respectively. For the nine months ended May 31,
2002,  three  customers  accounted  for  31.9%,  24.4%  and  11.6% 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,  the Company  expects future revenue levels to fluctuate
from quarter to quarter. The Company's backlog is comprised of undelivered, firm
customer  orders,  which are  scheduled to ship within  eighteen  months.  WCI's
backlog was approximately  $12,300,000 at May 30, 2003,  compared to $10,700,000
at August 30,  2002,  and  $13,000,000  at May 31,  2002.  The total  multi-year
backlog at May 30, 2003, was approximately $26,000,000.

GROSS PROFIT MARGINS - The Company's gross profit margin  percentages were 39.0%
and 36.4% for the three and nine month periods  ended May 30, 2003,  compared to
34.9% and 34.4% for the three and nine month periods  ended May 31, 2002.  Gross
profit margin dollars  increased  $244,000 and decreased  $631,000 for the three
and nine month periods ended May 30, 2003,  respectively,  from the same periods
ended May 31,  2002.  Gross  profit  margin  percentages  for the three and nine
months  ended May 30, 2003 were  favorably  impacted by a product mix with lower
variable cost components and lower inventory reserve provisions. The increase in
margin  dollars  for the third  quarter of fiscal  2003 was due to the  improved
margin  percentages and lower  inventory  reserve  provisions.  The decreases in
margin  dollars for the nine months  ended May 30, 2003 were mainly due to lower
revenues  during the period.  Profit margins in the three and nine month periods
of fiscal 2003  included no inventory  reserve  charges and charges of $100,000,
respectively,  compared to $200,000  and $400,000 for the same periods of fiscal
2002.

SELLING, GENERAL AND ADMINISTRATIVE - Selling, general and administrative (SG&A)
expenses  increased  $586,000 or 58.3% to $1,592,000  for the three months ended
May 30, 2003,  from  $1,006,000  for the three  months ended May 31, 2002.  SG&A
expenses in the third  quarter of fiscal  2003  included  $809,000 in  corporate
legal and  professional  fees  related  to  defending  the  Company  against  an
unsolicited, hostile takeover attempt by Radyne ComStream, Inc. SG&A expenses in
the third quarter of fiscal 2003 were partially  offset by a separate  insurance
reimbursement  of $265,000  for a portion of legal  costs  expensed in the first
quarter  of  fiscal  2003  related  to a lawsuit  against  WCI  alleging  patent
infringement.  (See Part II,  Item I. Legal  Proceedings).  For the nine  months
ended May 30, 2003, SG&A expenses increased $628,000 or 20.1% to $3,754,000 from
$3,126,000  for the same period ended May 31, 2002.  SG&A  expenses in the first
nine months of fiscal 2003 included the $809,000 in legal and professional  fees
related to defending the Company against an unsolicited hostile takeover attempt
by Radyne  ComStream,  Inc.  These expenses were offset by decreases of $181,000
primarily  due to lower  depreciation,  bad debt  provisions,  and outside sales
agent  commissions  which  were  offset  by  higher  legal  fees of WCI,  net of
insurance reimbursements.  As a percentage of revenues, SG&A expenses were 25.5%
and 24.3% for the three and nine month periods ended May 30, 2003,  respectively
compared to 16.0% and 17.2% for the same periods of fiscal 2002.

RESEARCH AND  DEVELOPMENT  - Research and  development  expenditures,  including
capitalized  software  development  costs, were $1,097,000 or 17.5% of revenues,
and $2,926,000 or 19.0% of revenues,  for the three and nine month periods ended
May 30, 2003, compared to $722,000 or 11.5% of revenues, and $2,241,000 or 12.3%
of  revenues  for  the  same  periods  of  fiscal  2002.   Capitalized  software
development  costs  amounted to $442,000 and $861,000 for the third  quarter and
first nine months of fiscal 2003  compared to $140,000 and $368,000 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 $655,000 or 10.5% of revenues,  and  $2,064,000 or
13.4% of revenues for the three and nine months ended May 30, 2003,  compared to
$582,000 or 9.3% of revenues,  and  $1,872,000 or 10.3% of revenues for the same
periods of fiscal 2002.  The increases in expenses for the three and nine months
ended May 30, 2003, are mainly due to higher personnel  expenses and engineering
consulting  costs.  The expenditures for research and development for the fourth
quarter  of fiscal  2003 are  expected  to be  comparable  to those of the third
quarter.

INTEREST  EXPENSE - Interest  expense  decreased $1,000 to $18,000 for the three
months ended May 30, 2003 as compared to fiscal 2002.  For the nine months ended
May 30, 2003, interest expense increased $1,000 to $50,000 as compared to fiscal
2002.

INTEREST INCOME - Interest income was $15,000 and $48,000 for the three and nine
month periods  ended May 31, 2002,  compared to $15,000 and $20,000 for the same
periods ended May 31, 2002.  The increase for the nine months ended May 30, 2003
was due to higher average cash equivalent balances.

                                       17
<PAGE>

INCOME TAX EXPENSES - For the nine months ended May 30, 2003, income tax benefit
of $73,000 was comprised of a deferred  federal and state tax benefit of $69,000
and $4,000, respectively. Net deferred tax assets increased $73,000 in the first
nine months of fiscal 2003 to  $2,921,000,  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 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 future taxable income
during the carryforward period are reduced.

CRITICAL ACCOUNTING POLICIES

The Company's  consolidated financial statements are prepared in accordance with
accounting  principles  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 from 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 May 30,  2003,  revenues  to one  customer in the amount of
$2,582,000 were recorded prior to delivery as bill and hold transactions. At May
30, 2003, accounts receivable for these revenues amounted to $1,483,000.

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 May 30, 2003,  inventories,  net of
reserve provisions, amounted to $2,660,501.

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 May 30, 2003, capitalized software costs,
net of accumulated amortization, amounted to $892,000.

                                       18
<PAGE>

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
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 May 30, 2003, deferred tax assets amounted to $2,921,000,  of which
approximately  $797,000 relates to net operating loss carryforwards which expire
in fiscal  2020 and 2021,  $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 May 30, 2003,  accounts
receivable net of allowances for doubtful accounts amounted to $4,234,000.

LIQUIDITY AND CAPITAL RESOURCES
NINE MONTHS ENDED MAY 30, 2003

At May 30, 2003, the Company's  primary  sources of liquidity were cash and cash
equivalents  of $5,100,000 and a $5,000,000  bank loan  facility.  Cash and cash
equivalents decreased $21,000 during the first nine months of fiscal 2003.

During the first  nine  months of fiscal  2003,  operating  activities  provided
$1,853,000 of cash. Net loss adjusted for non-cash expenses provided  $1,226,000
of cash, while changes in accounts receivable and customer deposit balances used
$1,559,000  of  cash.   Changes  in  accounts  payable  and  accrued   expenses,
inventories and other assets provided $2,186,000 of cash. Cash used by investing
activities  for property and equipment  expenditures  and  capitalized  software
additions was $1,366,000.  Other investing  activities used $527,000 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 $4,500 for  scheduled  repayments  of  long-term  debt.  Proceeds  from stock
options exercised provided $23,000 of cash.

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, 2004, 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 May 30, 2003).

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 May 30, 2003, no balances were  outstanding on the revolving
line of  credit  or the  equipment  term  loan  portions  of the loan  facility.
Additionally,  at May 30,  2003,  approximately  $2,598,000  net of  outstanding
letters of credit in the amount of $2,681,000  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 $1,400,000 in fiscal
2003 and $600,000 in each fiscal year  thereafter,  maintain  certain  financial
ratios, and is precluded from paying dividends. At May 31, 2003, the Company was
in compliance with all loan facility  covenants.  The Company  believes that the
loan facility along with cash and cash equivalent balances will be sufficient to
support operations over the next twelve months.

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   $2,116,000   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 $1,561,000 at May 30, 2003.  Pursuant to the above  agreements,  at
May 30,  2003,  the Company had  outstanding  letters of credit in the amount of
$2,681,000.

                                       19
<PAGE>

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

A summary of the Company's long-term contractual  obligations as of May 30, 2003
consisted of:


                                           OPERATING         PURCHASE
                           DEBT             LEASES         COMMITMENTS
                        ----------        ----------        ----------
     Fiscal 2003        $    1,600        $   58,000        $2,099,000
     Fiscal 2004             4,300           224,000         1,578,000
     Fiscal 2005                --           114,000                --
     Fiscal 2006                --             4,000                --
     Fiscal 2007                --             2,000                --
     Thereafter                 --             3,600                --
                        ----------        ----------        ----------

     Total              $    5,900        $  405,600        $3,677,000
                        ==========        ==========        ==========

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
May 30, 2003 subject to variable interest rate fluctuations.

At May 30, 2003, the Company's  cash  equivalents  consisted of bank  commercial
paper in the amount of $2,875,000 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.

                                       20
<PAGE>

PART II. OTHER INFORMATION


ITEM 1.   LEGAL PROCEEDINGS

          Radyne ComStream Inc. and WC Acquisition Corporation,  Plaintiffs,  v.
          Wegener Corporation, Defendant, Civil Action No. 03-421-KAJ

          On  April  23,  2003,  WC  Acquisition  Corporation,  a  wholly  owned
          subsidiary  of  Radyne   ComStream,   Inc.,   commenced  an  all-cash,
          all-shares  tender  offer  for  all  outstanding   shares  of  Wegener
          Corporation (Wegener) common stock not already owned by WC Acquisition
          Corporation.  Wegener's  Board of Directors  appointed an  Independent
          Committee  to  investigate   the  offer,   and  after   reviewing  the
          Independent Committee's recommendation, Wegener's Board issued a press
          release which  reflected  their findings that the offer was priced too
          low and  therefore  tendering  shares was not in the best  interest of
          Wegener's shareholders.  On April 24, 2003, Radyne ComStream, Inc. and
          WC  Acquisition  Corporation  filed a complaint  in the U.S.  District
          Count for the District of Delaware against Wegener arising out of this
          tender offer. The Plaintiffs  assert they are entitled to relief under
          the  Declaratory  Judgment Act ss. 2201,  and have  requested that the
          Court enter a  declaratory  judgment that the public  disclosures  and
          documents  filed with the  Securities  and Exchange  Commission by the
          Plaintiffs, in connection with the tender offer, fully comply with all
          applicable  laws.  The  Plaintiffs  also  seek an  injunction  against
          Wegener, as well as against its agents and employees,  from making any
          false or misleading  statements with respect to the tender offer.  The
          Complaint  also seeks an award of  Plaintiffs'  costs in bringing  the
          action as well as applicable  attorneys' fees. Wegener filed an answer
          to this Complaint on May 15, 2003,  and denied all of the  substantive
          allegations  of the  Complaint.  In its answer,  Wegener also asserted
          counterclaims, alleging that the tender offer was illegal, and done in
          violation of ss. 14 of the Williams Act.  Following the termination of
          Radyne's tender offer, this action was voluntarily dismissed.

          Radyne ComStream,  Inc. and WC Acquisition Corporation Plaintiffs,  v.
          Wegener  Corporation,  Robert A. Placek,  Thomas G.  Elliot,  James H.
          Morgan,  Jr., C. Troy Woodbury,  Jr., Wendell Bailey and Joe K. Parks,
          Defendants, Civil Action No. 20279-NC

          On April 24, 2003, WC Acquisition  Corporation  and Radyne  ComStream,
          Inc. commenced an action against Wegener,  Robert A. Placek, Thomas G.
          Elliot,  James H. Morgan,  Jr., C. Troy Woodbury,  Jr., Wendell Bailey
          and Joe K. Parks in the Court of Chancery for the State of Delaware in
          and for  New  Castle  County.  Each of the  individuals  named  in the
          Complaint as Defendants  are (or were)  officers  and/or  directors of
          Wegener.  Plaintiffs  assert that they are entitled to relief  against
          the  individual  defendants  for breaches of their  fiduciary  duties.
          Plaintiffs  assert that these  individuals  violated  their  duties by
          failing  to approve  the  tender  offer and  proposed  merger,  and by
          failing to exempt the tender  offer from  Section  203 of the  General
          Corporation  Law of the State of Delaware.  Plaintiffs  further assert
          that  these  individuals  violated  their  duties by failing to render
          inapplicable Article Eighth of Wegener's Certificate of Incorporation,
          and  by  adopting   anti-takeover   devices.  The  Plaintiffs  seek  a
          declaration  that  the  individual   defendants  have  breached  their
          fiduciary  duties.  Plaintiffs  also seek to have the Court compel the
          Defendants to approve the proposed acquisition,  as well as enjoin the
          Defendants from applying Section 203 of the General Corporation Law of
          the State of Delaware and Article  Eighth of Wegener's  Certificate of
          Incorporation.  The  Plaintiffs  further  seek an  injunction  against
          Wegener, its agents and its employees, from adopting any other measure
          which could impede the acquisition or other attempts by the Plaintiffs
          to acquire Wegener,  including  bringing any action to enforce Section
          203  or  Article  Eighth  or  adopting  any  additional  anti-takeover
          devices.  The Complaint  also seeks an award of  Plaintiffs'  costs in
          bringing the action,  as well as applicable  attorneys' fees.  Wegener
          filed an answer to this  Complaint on May 19, 2003,  and denied all of
          the   substantive   allegations  of  the   Complaint.   Following  the
          termination  of Radyne's  tender offer, a stipulation of dismissal was
          filed, and an order of dismissal is expected to be entered in the near
          future.

                                       21
<PAGE>

          Jerry Leuch,  Plaintiff, v. Robert A. Placek, Thomas G. Elliot, Joe K.
          Parks, C. Troy Woodbury, Jr., Wendell Bailey, Ned Mountain and Wegener
          Corporation, Civil Action No.20361-NC

          On June 20, 2003,  Jerry Leuch  commenced an action styled as a direct
          class action against Robert A. Placek, Thomas G. Elliot, Joe K. Parks,
          C. Troy  Woodbury,  Jr.,  Wendell  Bailey,  Ned  Mountain  and Wegener
          Corporation in the Court of Chancery of the State of Delaware,  In and
          For New Castle  County.  The  Plaintiff  alleges  that the  individual
          defendants have violated their  fiduciary  duties due to him and other
          shareholders,  the  members of an  alleged  class of  shareholders  of
          Wegener  Corporation.  The relief  Plaintiff  seeks is as follows:  an
          order  that  this  action is  properly  styled  as a class  action;  a
          declaration that the Defendants have breached their fiduciary  duties;
          an  injunction  against  the  Defendants  continuing  their  allegedly
          unlawful conduct; and a direction to the Defendants to account for the
          damages they have allegedly caused.  The Complaint also seeks an award
          of  Plaintiff's  costs in bringing the action,  as well as  applicable
          attorneys' and experts'  fees.  The  Defendants  have not yet answered
          this  complaint  as the  time  to do so has  not  yet  run,  but  will
          vigorously  oppose this  litigation.  This complaint is  substantively
          similar to a complaint  which was commenced in Fulton County,  Georgia
          and was  subsequently  voluntarily  dismissed by the Plaintiff in that
          action.

ITEM 5.   OTHER INFORMATION


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  meets 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.
The Company's audit committee is currently comprised of Thomas G. Elliot, Joe K.
Parks, and Wendell H. Bailey.

On April 28, 2003,  James H. Morgan,  Jr.  resigned as a member of the Company's
Board of Directors.

On May 16,  2003,  Ned L.  Mountain  was elected to the Board of  Directors as a
Class III  director,  to fill the  vacancy  created  by the  resignation  of Mr.
Morgan.  Mr. Mountain's term will expire in 2004. Mr. Mountain is Executive Vice
President of WCI.


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K


     (a)  Exhibits:

          4.1  Loan and  Security  Agreement  - Fifth  Amendment  dated June 27,
               2003,  by and between  Wegener  Communications,  Inc. and LaSalle
               National Bank respecting  $5,000,000  combined  revolving  credit
               note and term note.

          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:

          Current  Report on Form 8-K dated as of May 1, 2003,  and filed May 6,
          2003,  disclosing Amended and Restated By-laws of Wegener  Corporation
          (Exhibit  3.1) and  Stockholder  Rights  Agreement  dated as of May 1,
          2003, between Wegener Corporation and Securities Transfer Corporation,
          as Rights Agent (Exhibit 4.1).

          Current  Report on Form 8-K dated June 17, 2003,  furnishing its press
          release  regarding its results for the third fiscal  quarter ended May
          30, 2003.

                                       22
<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:  July 9, 2003           By: /s/ Robert A. Placek
                                  ---------------------------------
                                    Robert A. Placek
                                    President
                                    (Principal Executive Officer)



Date:  July 9, 2003           By: /s/ C. Troy Woodbury, Jr.
                                  ---------------------------------
                                    C. Troy Woodbury, Jr.
                                    Treasurer and Chief
                                    Financial Officer
                                    (Principal Financial and Accounting Officer)

                                       23
<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
     May 30, 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: July 9, 2003

                                        /s/ Robert A. Placek

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

                                       24
<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 May
     30, 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: July 9, 2003

                                        /s/ C. Troy Woodbury, Jr.

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

                                       25
<PAGE>