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

                                   FORM 10-Q

             [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES EXCHANGE ACT OF 1934

                 For the quarterly period ended April 30, 1998

                                       OR

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

         For the transition period from _____________ to ______________

                         Commission file number 0-27022

                           OPTICAL CABLE CORPORATION
             (Exact name of registrant as specified in its charter)

            VIRGINIA                                   54-1237042
(State or other jurisdiction of incorporation       (I.R.S. Employer
         or organization)                          Identification No.)

                              5290 CONCOURSE DRIVE
                            ROANOKE, VIRGINIA 24019
          (Address of principal executive offices, including zip code)

                                 (540) 265-0690
              (Registrant's telephone number, including area code)

                                      N/A
        (Former name, former address and former fiscal year, if changed
                               since last report)

         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.
(1) Yes  X   No     (2) Yes  X  No
       ----    ---          ---    ----

         As of June 8, 1998, 38,212,536 shares of the registrant's Common Stock,
no par value, were outstanding.  Of these outstanding shares,  36,000,000 shares
were  held by  Robert  Kopstein,  Chairman  of the  Board,  President  and Chief
Executive Officer of the registrant.

<PAGE>

                           OPTICAL CABLE CORPORATION
                                 FORM 10-Q INDEX
                         SIX MONTHS ENDED APRIL 30, 1998

<TABLE>
<CAPTION>

                                                                                PAGE

<S>       <C>                                                                   <C>
PART I.   FINANCIAL INFORMATION

          ITEM 1. Financial Statements

                  Condensed Balance Sheets - April 30, 1998 and October 31,
                   1997.............................................................2

                  Condensed Statements Of Income - Three Months And Six
                   Months Ended April 30, 1998 And 1997.............................3

                  Condensed Statement Of Changes In Stockholders' Equity -
                   Six Months Ended April 30, 1998..................................4

                  Condensed Statements Of Cash Flows - Six Months Ended
                   April 30, 1998 And 1997..........................................5

                  Condensed Notes To Condensed Financial Statements...............6-8

          ITEM 2. Management's Discussion And Analysis Of Financial
                   Condition And Results Of Operations...........................9-12

PART II.  OTHER INFORMATION

          ITEM 4. Submission Of Matters To A Vote Of Security Holders..............13

          ITEM 6. Exhibits And Reports On Form 8-K.................................14

SIGNATURES.........................................................................15
</TABLE>

<PAGE>

                         PART I. FINANCIAL INFORMATION~

ITEM 1.   FINANCIAL STATEMENTS

                           OPTICAL CABLE CORPORATION
                            CONDENSED BALANCE SHEETS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                     April 30,      October 31,
                           ASSETS                                                      1998            1997
                                                                                       ----            ----
<S>                                                                               <C>              <C>
Current assets:
   Cash and cash equivalents                                                      $     517,642    $   985,807
   Trade accounts receivable, net of allowance for doubtful
      accounts of $255,400 at April 30, 1998 and $307,400
      at October 31, 1997                                                             8,257,730      9,931,276
   Other receivables                                                                    241,460        540,102
   Due from employees                                                                     6,584          3,534
   Income taxes refundable                                                              169,423              -
   Inventories                                                                       13,274,436     12,019,443
   Prepaid expenses                                                                     127,884        121,046
   Deferred income taxes                                                                177,596         81,484
                                                                                   -------------    -----------
        Total current assets                                                         22,772,755     23,682,692

Other assets, net                                                                        42,451         50,953
Property and equipment, net                                                          11,325,121     11,480,433
                                                                                   ------------     ----------
        Total assets                                                              $  34,140,327   $ 35,214,078
                                                                                   ============     ==========

               LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable and accrued expenses                                          $   3,255,043   $  2,593,256
   Accrued compensation and payroll taxes                                               560,624        612,736
   Income taxes payable                                                                 104,135        564,999
                                                                                    -----------     ----------
        Total current liabilities                                                     3,919,802      3,770,991

Deferred income taxes                                                                   102,475         64,382
                                                                                    -----------     ----------
        Total liabilities                                                             4,022,277      3,835,373
                                                                                    -----------     ----------

Stockholders' equity:
   Preferred stock, no par value, authorized 1,000,000 shares;
      none issued and outstanding                                                             -              -
   Common stock, voting; no par value, authorized 100,000,000
      shares; issued and outstanding 38,288,136 shares at
      April 30, 1998 and 38,675,416 shares at October 31, 1997                       13,798,041     18,594,116
   Retained earnings                                                                 16,320,009     12,784,589
                                                                                    -----------    -----------
        Total stockholders' equity                                                   30,118,050     31,378,705

Commitments and contingencies

                                                                                    -----------    -----------
        Total liabilities and stockholders' equity                                $  34,140,327   $ 35,214,078
                                                                                    ===========    ==========
</TABLE>

      See accompanying condensed notes to condensed financial statements.

                                       2

<PAGE>

                           OPTICAL CABLE CORPORATION
                         CONDENSED STATEMENTS OF INCOME
                                  (Unaudited)

<TABLE>
<CAPTION>

                                                          Three Months Ended               Six Months Ended
                                                             April 30,                         April 30,
                                                   ------------------------------    ------------------------------
                                                       1998             1997             1998             1997
                                                   -------------    -------------    -------------    -------------

<S>                                              <C>              <C>              <C>              <C>
Net sales                                        $   11,689,100   $   10,645,571   $   23,562,215   $   23,136,882
Cost of goods sold                                    6,612,485        6,352,983       13,416,692       13,492,629
                                                   -------------   -------------    -------------    -------------
       Gross profit                                   5,076,615        4,292,588       10,145,523        9,644,253

Selling, general and administrative expenses          2,444,208        2,258,486        4,727,434        4,397,062
                                                   -------------   -------------    -------------    -------------

       Income from operations                         2,632,407        2,034,102        5,418,089        5,247,191
                                                   -------------   -------------    -------------    -------------

Other income (expense):
    Interest income                                      13,955            3,909           40,564            9,069
    Interest expense                                       (195)            (897)            (195)         (11,098)
    Other, net                                              275           (1,308)          (3,144)          (5,486)
                                                   -------------   -------------    -------------    -------------

       Other income (expense), net                       14,035            1,704           37,225           (7,515)
                                                   -------------   -------------    -------------    -------------
       Income before income tax expense               2,646,442        2,035,806        5,455,314        5,239,676

Income tax expense                                      933,994          723,283        1,919,894        1,846,792
                                                   -------------   -------------    -------------    -------------

       Net income                                $    1,712,448   $    1,312,523   $    3,535,420   $    3,392,884
                                                 ==============   ==============   ==============   ==============


Earnings per share (note 5):
    Earnings per common share                    $        0.045   $        0.034   $        0.092   $        0.088
                                                 ==============   ==============   ==============   ==============

    Earnings per common share -
       assuming dilution                         $        0.044   $        0.034   $        0.091   $        0.087
                                                 ==============   ==============   ==============   ==============
</TABLE>

      See accompanying condensed notes to condensed financial statements.

                                       3

<PAGE>

                            OPTICAL CABLE CORPORATION
             CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                               Six Months Ended April 30, 1998
                                             ----------------------------------------------------------------------
                                                     Common Stock                                         Total
                                             -------------------------------         Retained        Stockholders'
                                                Shares            Amount              Earnings           Equity
                                                ------            ------              --------           ------

<S>                                           <C>           <C>                  <C>               <C>
Balances at October 31, 1997                   38,675,416    $   18,594,116       $   12,784,589    $   31,378,705

Net income                                              -                 -            3,535,420         3,535,420
Repurchase of common stock                       (462,130)       (4,983,200)                   -        (4,983,200)
Stock options exercised                            74,850           187,125                    -           187,125
                                             -------------     -------------        -------------     -------------

Balances at April 30, 1998                     38,288,136    $   13,798,041       $   16,320,009    $   30,118,050
                                             --==========    ==============       ==============    ==============
</TABLE>

      See accompanying condensed notes to condensed financial statements.

                                       4

<PAGE>

                           OPTICAL CABLE CORPORATION~
                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                          Six Months Ended
                                                                                              April 30,
                                                                                    -------------------------------
                                                                                        1998              1997
                                                                                        ----              ----

<S>                                                                               <C>               <C>
Cash flows from operating activities:
   Net income                                                                     $    3,535,420    $    3,392,884
   Adjustments  to  reconcile  net  income  to net cash 
      provided  by  operating activities:
        Depreciation and amortization                                                    374,770           346,648
        Bad debt expense (recovery)                                                      (53,015)          (71,632)
        Deferred income taxes                                                            (58,019)          (18,512)
        (Increase) decrease in:
          Trade accounts receivable                                                    1,726,561         1,571,627
          Other receivables                                                              298,642           (94,996)
          Due from employees                                                              (3,050)           (2,650)
          Income taxes refundable                                                       (169,423)          (77,516)
          Inventories                                                                 (1,254,993)            4,218
          Prepaid expenses                                                                (6,838)         (122,702)
        Increase (decrease) in:
          Accounts payable and accrued expenses                                          905,408        (2,203,053)
          Accrued compensation and payroll taxes                                         (52,112)          (90,657)
          Income taxes payable                                                          (460,864)         (237,926)
                                                                                    -------------     -------------
              Net cash provided by operating activities                                4,782,487         2,395,733
                                                                                    -------------     -------------

Cash flows from investing activities:
   Purchase of property and equipment                                                   (454,577)       (2,980,342)
                                                                                    -------------     -------------

              Net cash used in investing activities                                     (454,577)       (2,980,342)
                                                                                    -------------     -------------

Cash flows from financing activities:
   Net payments on notes payable                                                               -          (744,000)
   Repurchase of common stock                                                         (4,983,200)                -
   Proceeds from exercise of stock options                                               187,125                 -
                                                                                    -------------     -------------
              Net cash used in financing activities                                   (4,796,075)         (744,000)
                                                                                    -------------     -------------
Net decrease in cash and cash equivalents                                               (468,165)       (1,328,609)

Cash and cash equivalents at beginning of period                                         985,807         1,677,739
                                                                                    -------------     -------------

Cash and cash equivalents at end of period                                        $      517,642    $      349,130
                                                                                  ==============    ==============
</TABLE>

      See accompanying condensed notes to condensed financial statements.

                                       5

<PAGE>

                            OPTICAL CABLE CORPORATION
                CONDENSED NOTES TO CONDENSED FINANCIAL STATEMENTS
                        SIX MONTHS ENDED APRIL 30, 1998
                                  (Unaudited)

(1)      GENERAL

         The accompanying  unaudited  condensed  financial  statements have been
         prepared in accordance with generally  accepted  accounting  principles
         for interim  financial  reporting  information and the  instructions to
         Form 10-Q and Article 10 of Regulation  S-X.  Accordingly,  they do not
         include all of the information and notes required by generally accepted
         accounting principles for complete financial statements. In the opinion
         of management, all material adjustments (consisting of normal recurring
         accruals)  considered  necessary  for a  fair  presentation  have  been
         included. Operating results for the six months ended April 30, 1998 are
         not necessarily  indicative of the results that may be expected for the
         fiscal year ending October 31, 1998. The unaudited  condensed financial
         statements and condensed  notes are presented as permitted by Form 10-Q
         and do not contain certain information included in the Company's annual
         financial statements and notes. For further  information,  refer to the
         financial statements and notes thereto included in the Company's annual
         report on Form 10-K for the fiscal year ended October 31, 1997.


(2)      INVENTORIES

         Inventories  at April 30,  1998 and  October  31,  1997  consist of the
         following:

                                                 April 30,           October 31,
                                                  1998                  1997
                                                  ----                  ----


         Finished goods                       $  5,076,856        $   4,854,697
         Work in process                         2,596,063            1,976,970
         Raw materials                           5,533,222            5,125,044
         Production supplies                        68,295               62,732
                                                -----------         ------------

                                              $ 13,274,436        $  12,019,443
                                               ===========         ============

(3)      NOTES PAYABLE

         On  February  25,  1998,  the  Company  and its  bank  executed  a loan
         commitment letter,  which renewed its $5 million secured revolving line
         of credit available for general corporate  purposes and its $10 million
         secured line of credit to fund potential acquisitions, mergers or joint
         ventures.  The lines of credit bear  interest at 1.50 percent above the
         monthly LIBOR rate and are equally

                                                                     (Continued)

                                       6

<PAGE>

                           OPTICAL CABLE CORPORATION
               CONDENSED NOTES TO CONDENSED FINANCIAL STATEMENTS
                                  (Unaudited)

(3)      (CONTINUED)

         and ratably  secured by the  Company's  accounts  receivable,  contract
         rights, inventory,  furniture and fixtures, machinery and equipment and
         general  intangibles.  The lines of credit will expire on February  28,
         1999, unless renewed or extended.


(4)      STOCKHOLDERS' EQUITY

         On October 29, 1997,  the Company's  Board of Directors  authorized the
         repurchase  of up to $5 million of the  Company's  common  stock in the
         open market or in privately negotiated transactions.  On April 7, 1998,
         the  Company's   Board  of  Directors   expanded  the  Company's  share
         repurchase  program by authorizing the repurchase of an aggregate of up
         to $10 million of the  Company's  common  stock.  During the six months
         ended April 30, 1998,  the Company  repurchased  462,130  shares of its
         common stock for $4,983,200.

         Subsequent  to April 30,  1998 and  through  June 5, 1998,  the Company
         repurchased  77,100 additional shares of its common stock in connection
         with its share repurchase program.

         On March 10, 1998, the Company's  stockholders approved an amendment to
         the Company's articles of incorporation to increase the total number of
         authorized  shares of common  stock of the Company from  50,000,000  to
         100,000,000.


(5)      EARNINGS PER SHARE

         In February  1997,  the  Financial  Accounting  Standards  Board issued
         Statement of Financial Accounting Standards No. 128, Earnings per Share
         (SFAS No. 128).  SFAS No. 128  establishes  new standards for computing
         and  presenting  earnings per share (EPS) and applies to entities  with
         publicly held common stock or potential  common stock.  It replaces the
         presentation  of primary EPS with a presentation  of basic EPS. It also
         requires dual  presentation of basic and diluted EPS on the face of the
         income  statement for all entities with complex capital  structures and
         requires a reconciliation of the numerator and denominator of the basic
         EPS  computation  to the numerator and  denominator  of the diluted EPS
         computation.

         Basic  EPS  excludes  dilution  and  is  computed  by  dividing  income
         available  to common  stockholders  by the  weighted-average  number of
         common  shares  outstanding  for the period.  Diluted EPS  reflects the
         potential dilution that could occur if securities or other contracts to
         issue  common stock were  exercised  or converted  into common stock or
         resulted  in the  issuance  of common  stock  that  then  shared in the
         earnings of the entity.

                                                                     (Continued)

                                        7

<PAGE>

                           OPTICAL CABLE CORPORATION
               CONDENSED NOTES TO CONDENSED FINANCIAL STATEMENTS

                                  (Unaudited)

(5)      (CONTINUED)

         SFAS No. 128 was  required  to be adopted by the Company at January 31,
         1998. SFAS No. 128 also requires  restatement of all  prior-period  EPS
         data previously  presented.  The following is a  reconciliation  of the
         numerators and  denominators of the basic and diluted EPS  computations
         for the periods presented:

<TABLE>
<CAPTION>

                                                          Net Income          Shares            Per Share
THREE MONTHS ENDED APRIL 30, 1998                        (Numerator)       (Denominator)         Amount
---------------------------------                        -------------     -------------       ------------
<S>                                                   <C>                    <C>             <C>
Earnings per common share                             $     1,712,448        38,359,633      $        0.045
Effect of dilutive stock options                                    -           303,518        ============
                                                         ------------      ------------
Earnings per common share - assuming dilution         $     1,712,448        38,663,151      $        0.044
                                                         ============      ============        ============

THREE MONTHS ENDED APRIL 30, 1997
---------------------------------
Earnings per common share                             $     1,312,523        38,675,416      $        0.034
Effect of dilutive stock options                                    -           349,075        ============
                                                         ------------     -------------
Earnings per common share - assuming dilution         $     1,312,523        39,024,491      $        0.034
                                                         ============     =============        ============

SIX MONTHS ENDED APRIL 30, 1998
-------------------------------
Earnings per common share                             $     3,535,420         38,485,488     $        0.092
Effect of dilutive stock options                                    -            292,728       ============
                                                         ------------      -------------
Earnings per common share - assuming dilution         $     3,535,420         39,778,216     $        0.091
                                                         ============      =============       ============

SIX MONTHS ENDED APRIL 30, 1997
-------------------------------
Earnings per common share                             $     3,392,884         38,675,416     $        0.088
Effect of dilutive stock options                                    -            349,501       ============
                                                         ------------      -------------
Earnings per common share - assuming dilution         $     3,392,884         39,024,917     $        0.087
                                                         ============      =============       ============
</TABLE>

         Stock  options  that could  potentially  dilute basic EPS in the future
         that were not included in the  computation of diluted EPS because to do
         so would  have been  antidilutive  totaled  232,500  for the six months
         ended April 30, 1998.

                                       8

<PAGE>

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

GENERAL

Except  for the  historical  data set forth  herein,  the  following  discussion
contains certain forward-looking  information.  The Company's actual results may
differ  materially  from these  projected  results.  Factors that could cause or
contribute to such differences  include,  but are not limited to, level of sales
to key  customers,  actions  by  competitors,  fluctuations  in the price of raw
materials, the Company's dependence on a single manufacturing facility,  ability
to protect its  proprietary  manufacturing  technology,  dependence on a limited
number of suppliers and technological changes and introductions of new competing
products.

RESULTS OF OPERATIONS

THREE MONTHS ENDED APRIL 30, 1998 AND 1997

Net Sales

Net sales  consists  of gross sales of  products,  less  discounts,  refunds and
returns. Net sales increased 9.8 percent to $11.7 million in second quarter 1998
from $10.6 million for the same period in 1997.  This increase was  attributable
to an  increase  of  approximately  22 percent in  international  sales over the
second quarter of 1997.

Gross Profit Margin

Cost of goods sold  consists of the cost of  materials,  compensation  costs and
overhead related to the Company's manufacturing operations.  The Company's gross
profit  margin  (gross  profit as a percentage  of net sales)  increased to 43.4
percent in second  quarter 1998 from 40.3 percent in second  quarter 1997.  This
increase was due to reduced raw fiber prices, the Company's product mix sold and
the ratio of net sales  attributable  to the Company's  distributors  during the
period.   During  second  quarter  1998,  sales  from  orders  $50,000  or  more
approximated  18 percent  compared to 15 percent  for second  quarter  1997.  In
addition,  during second quarter 1998, net sales to distributors approximated 50
percent versus 73 percent for the same period in 1997. Discounts on large orders
and on  sales to  distributors  are  generally  greater  than  for  sales to the
Company's other customer base.

Selling, General and Administrative Expenses

Selling,  general and administrative  expenses consist of the compensation costs
(including  sales  commissions)  for  sales  and  marketing  personnel,   travel
expenses,  customer  support  expenses,  trade show expenses,  advertising,  the
compensation cost for administration,  finance and general management personnel,
as well as legal  and  accounting  fees.  Selling,  general  and  administrative
expenses as a percentage  of net sales were 20.9 percent in second  quarter 1998
compared to 21.2  percent in second  quarter  1997.  This lower  percentage  was
primarily  the  result  of the fact  that net  sales  for  second  quarter  1998
increased 9.8 percent  compared to second quarter 1997,  while selling,  general
and administrative expenses increased 8.2 percent.

                                       9

<PAGE>

Income Before Income Tax Expense

Income before income tax expense  increased 30.0 percent to $2.6 million for the
three months ended April 30, 1998  compared to $2.0 million for the three months
ended April 30,  1997.  This was  primarily  due to the  increased  gross profit
margin, offset by increased selling, general and administrative expenses.

Income Tax Expense

Income tax expense  increased  $211,000 to $934,000  for the three  months ended
April 30,  1998  compared  to  $723,000  for the same  period in 1997 due to the
increase in income before income tax expense.  The Company's  effective tax rate
was 35.3 percent  during the three months ended April 30, 1998  compared to 35.5
percent for the same period in 1997.

Net Income

Net income for second quarter 1998 was $1.7 million compared to $1.3 million for
second quarter 1997. Despite an increase in income tax expense of $211,000,  net
income increased  $400,000 due to the $611,000  increase in income before income
tax expense.

SIX MONTHS ENDED APRIL 30, 1998 AND 1997

Net Sales

Net sales  consists  of gross sales of  products,  less  discounts,  refunds and
returns.  Net sales  increased  1.8 percent to $23.6  million for the six months
ended April 30, 1998 from $23.1 million for the same period in 1997. This slight
increase  was  attributable  to the 9.8 percent  increase in net sales in second
quarter 1998 compared to the same period in 1997 as described above, offset by a
4.9 percent  decrease in net sales in first  quarter  1998  attributable  to the
completion  of shipments  for a large  international  military  project in first
quarter 1997 and the delay of large  potential  orders in first quarter 1998 due
to adverse weather conditions or economic uncertainty.

Gross Profit Margin

Cost of goods sold  consists of the cost of  materials,  compensation  costs and
overhead related to the Company's manufacturing operations.  The Company's gross
profit  margin  (gross  profit as a percentage  of net sales)  increased to 43.1
percent for the six months  ended  April 30, 1998 from 41.7  percent for the six
months ended April 30, 1997.  This increase was due to reduced raw fiber prices,
the Company's  product mix sold and the ratio of net sales  attributable  to the
Company's  distributors during the period. During the six months ended April 30,
1998,  sales from orders $50,000 or more  approximated 27 percent compared to 21
percent for the six months ended April 30, 1997. In addition, for the six months
ended April 30, 1998, net sales to  distributors  approximated 52 percent versus
62 percent for the same period in 1997.  Discounts  on large orders and on sales
to  distributors  are generally  greater than for sales to the  Company's  other
customer base.

Selling, General and Administrative Expenses

Selling,  general and administrative  expenses consist of the compensation costs
(including  sales  commissions)  for  sales  and  marketing  personnel,   travel
expenses,  customer  support  expenses,  trade show expenses,  advertising,  the
compensation cost for administration,  finance and general management personnel,
as well as legal  and  accounting  fees.  Selling,  general  and  administrative
expenses as a

                                       10

<PAGE>

percentage  of net sales were 20.1  percent  for the six months  ended April 30,
1998  compared to 19.0  percent for the six months  ended April 30,  1997.  This
higher  percentage  was  primarily the result of the fact that net sales for the
six months  ended April 30,  1998  increased  1.8  percent  compared to the same
period in 1997, while selling, general and administrative expenses increased 7.5
percent.

Income Before Income Tax Expense

Income before  income tax expense  increased 4.1 percent to $5.5 million for the
six months  ended  April 30, 1998  compared  to $5.2  million for the six months
ended April 30,  1997.  This was  primarily  due to the  increased  gross profit
margin, offset by increased selling, general and administrative expenses.

Income Tax Expense

Income tax expense  increased  $73,000 to $1.9  million for the six months ended
April 30, 1998  compared to $1.8  million for the same period in 1997 due to the
increase in income before income tax expense.  The Company's  effective tax rate
was 35.2 percent during the six months ended April 30, 1998 and 1997.

Net Income

Net income for the six months ended April 30, 1998 was $3.5 million  compared to
$3.4  million for the six months  ended April 30,  1997.  Despite an increase in
income tax expense of $73,000, net income increased $143,000 due to the $216,000
increase in income before income tax expense.

FINANCIAL CONDITION

Total assets at April 30, 1998 were $34.1  million,  a decrease of $1.1 million,
or 3.0 percent from  October 31, 1997.  This  decrease was  primarily  due to an
increase of $1.3 million in  inventories,  offset by decreases in trade accounts
receivable of $1.7 million and cash and cash equivalents of $468,000.

Total  stockholders'  equity at April 30, 1998  decreased  $1.3 million,  or 4.0
percent from October 31, 1997 with net income retained, offset by the repurchase
of common stock in the amount of $5.0 million accounting for the decrease.

LIQUIDITY AND CAPITAL RESOURCES

During the first six months of fiscal years 1998 and 1997, the Company's primary
capital  needs  have  been to fund  working  capital  requirements  and  capital
expenditures as needed.  The Company also repaid some bank  indebtedness  during
the first six  months of fiscal  year  1997.  The  Company's  primary  source of
financing has been cash provided from  operations.  The Company  maintains  bank
lines of credit;  however, there were no balances outstanding under the lines as
of the end of fiscal year 1997 or the second quarter of fiscal year 1998.

On  February  25,  1998,  the Company  and its bank  executed a loan  commitment
letter,  which renewed its $5 million secured revolving line of credit available
for general  corporate  purposes  and its $10 million  secured line of credit to
fund potential acquisitions,  mergers or joint ventures. The lines of credit are
equally and  ratably  secured by the  Company's  accounts  receivable,  contract
rights, inventory,  furniture and fixtures,  machinery and equipment and general
intangibles.  The lines of credit  will  expire on  February  28,  1999,  unless
renewed or  extended.  As of the date  hereof,  the  Company  has no  additional
material  sources of  financing.  The Company  believes  that its cash flow from
operations and available lines of credit will be adequate to fund its operations
for at least the next twelve months.

                                       11

<PAGE>

On October 29, 1997, the Company's Board of Directors  authorized the repurchase
of up to $5  million  of the  Company's  common  stock in the open  market or in
privately  negotiated  transactions.  On April 7, 1998,  the Company's  Board of
Directors  expanded the Company's  share  repurchase  program by authorizing the
repurchase of an aggregate of up to $10 million of the  Company's  common stock.
Through April 30, 1998, the Company has repurchased  approximately  $5.0 million
of the Company's  common stock.  The repurchases  were funded through cash flows
from operating activities. The Company intends to use excess working capital and
other sources as appropriate to finance the remaining share repurchase program.

Cash flows from operations were  approximately $4.8 million and $2.4 million for
the six months  ended  April 30,  1998 and 1997,  respectively.  Cash flows from
operations  for the six months ended April 30, 1998 were  primarily  provided by
operating income, a decrease in trade accounts receivable of $1.7 million and an
increase in accounts  payable and  accrued  expenses of  $905,000,  offset by an
increase in inventory of $1.3 million and income taxes paid of $2.6 million. For
the six months ended April 30, 1997,  cash flows from  operations were primarily
provided by operating income and a decrease in trade accounts receivable of $1.6
million,  offset by a decrease in accounts  payable and accrued expenses of $2.2
million and income taxes paid of $2.2 million.

Net cash used in investing activities was for expenditures related to facilities
and  equipment  and was $455,000 and $3.0 million for the six months ended April
30, 1998 and 1997,  respectively.  The Company's  expansion of its  headquarters
facilities was  substantially  completed as of January 31, 1997. As of April 30,
1998, there were no material commitments for additional capital expenditures.

Net cash used in financing  activities was $4.8 million and $744,000 for the six
months  ended  April  30,  1998 and  1997,  respectively.  The net cash  used in
financing   activities  for  the  six  months  ended  April  30,  1998  included
approximately  $5.0 million  related to the  Company's  common stock  repurchase
program,  offset by proceeds from exercise of stock options of $187,000. The net
cash used in  financing  activities  for the six  months  ended  April 30,  1997
consisted of repayment of debt outstanding under the Company's line of credit of
$744,000.

DERIVATIVES

The Company does not use derivatives or other off-balance sheet instruments such
as future contracts, forward obligations, interest rate swaps, or options.

YEAR 2000

Many  computer  software  systems are  designed to read only the last two digits
whenever a year is entered.  This could cause  problems  when the year "2000" is
entered.  Some software  systems might  recognize  this as the year 1900, or not
recognize  the  date  at all.  The  Company  is  reviewing  all of its  computer
applications  to determine  whether any Year 2000 problems  exist and expects to
have a reasonable plan in place to address Year 2000 issues by October 31, 1998.
Given the  Company's  software  and  hardware  and the  nature of its  industry,
management  does not consider the cost of addressing the Year 2000 issue to be a
material event or uncertainty  that would cause reported  financial  information
not to be indicative of future operating results or financial condition.

NEW ACCOUNTING STANDARDS

There have been no accounting pronouncements issued during the period that would
have a material  effect on the  financial  position,  results of  operations  or
liquidity of the Company.

                                       12

<PAGE>

                           PART II. OTHER INFORMATION

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

The  following  information  is  furnished  for matters  submitted  to a vote of
security holders during the three months ended April 30, 1998:

(a) The Annual Meeting of Shareholders of Optical Cable  Corporation was held on
    March 10, 1998.

(b) The name of each director elected at the meeting follows:

       Robert Kopstein
       Luke J. Huybrechts
       Kenneth W. Harber
       Randall H. Frazier
       John M. Holland

(c) A brief  description of each matter voted upon at the meeting and the number
    of votes cast for, against or withheld, as well as the number of abstentions
    and  broker  non-votes,  as  to  each  such  matter,  including  a  separate
    tabulation with respect to each nominee for office follows:

    1.  To elect the following  five  directors to serve for the terms of office
        specified in the proxy  statement  and until their  successors  are duly
        elected and qualified.

<TABLE>
<CAPTION>

                                                                Votes          Votes            Broker
          Director                            Votes for         against       abstaining       non-votes
          --------                            ---------         -------       ----------       ---------

<S>                                          <C>                 <C>             <C>             <C>
          Robert Kopstein                    37,657,556          0               26,392          827,988
          Luke J. Huybrechts                 37,640,976          0               42,972          827,988
          Kenneth W. Harber                  37,640,776          0               43,172          827,988
          Randall H. Frazier                 37,655,241          0               28,707          827,988
          John M. Holland                    37,655,641          0               28,307          827,988
</TABLE>  

    2.  To  ratify  the  selection  of  KPMG  Peat  Marwick  LLP as  independent
        accountants for the Company for the fiscal year 1998.

<TABLE>
<CAPTION>

                           Votes                Votes                Broker  
        Votes for         against             abstaining           non-votes 
        ---------         -------             ----------           --------- 
         <S>               <C>                 <C>                 <C>       
         37,650,597        8,339               25,012              827,988   
                                  
</TABLE>

    3.  To amend the Amended and Restated  Articles of Incorporation to increase
        the total  number of  authorized  shares of common  stock of the Company
        from 50,000,000 to 100,000,000.

<TABLE>
<CAPTION>

                           Votes                Votes                Broker 
        Votes for         against             abstaining           non-votes
        ---------         -------             ----------           ---------
        <S>                 <C>                   <C>                 <C>     
        37,495,285          109,018               79,645              827,988 
         
</TABLE>

                                       13

<PAGE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)  Exhibits  required by Item 601 of  Regulation  S-K for the six months ended
     April 30, 1998.

     See Index to Exhibits.

(b) Reports on Form 8-K filed during the three months ended April 30, 1998.

     A current report on Form 8-K was filed on April 7, 1998 announcing that the
     Board of Directors of the Company  expanded the Company's stock  repurchase
     plan by authorizing  the repurchase of an aggregate of up to $10 million of
     the  Company's  common  stock,  which is an increase of $5 million in stock
     repurchases authorized by the Board of Directors in October 1997.

INDEX TO EXHIBITS

3.1  Amended and Restated Articles of Incorporation of Optical Cable Corporation
     (as amended by stockholders' action on March 10, 1998).

10.6 Loan Agreement, dated April 25, 1997, between Optical Cable Corporation and
     First Union National Bank of Virginia,  as amended by  Modification  Number
     One to the Loan Agreement, dated March 5, 1998.

10.8 Promissory Note, dated April 25, 1997,  issued by Optical Cable Corporation
     to First Union  National  Bank of Virginia in the amount of $5 million,  as
     amended by  Modification  Number One to the ($5 million)  Promissory  Note,
     dated as of March  __, 1998, and the  related  Sweep  Plus  Loan/Investment
     Services Description,  and Promissory Note, dated April 25, 1997, issued by
     Optical Cable  Corporation  to First Union National Bank of Virginia in the
     amount of $10 million,  as amended by  Modification  Number One to the ($10
     million) Promissory Note, dated as of March __, 1998.

27   Financial Data Schedule.

                                       14

<PAGE>

                                   SIGNATURES

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

                                            OPTICAL CABLE CORPORATION
                                                     (Registrant)

Date:  June 10, 1998                        /s/Robert Kopstein
                                            ------------------------------------
                                            Robert Kopstein
                                            Chairman of the Board, President and
                                             Chief Executive Officer



Date: June 10, 1998                         /s/Kenneth W. Harber
                                            ------------------------------------
                                            Kenneth W. Harber
                                            Vice President of Finance, Treasurer
                                             and Secretary
                                            (principal financial  and accounting
                                             officer)

                                       15