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 June 30, 1998

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
    Exchange Act of 1934

                       Commission file number 001-13601

                           OYO GEOSPACE CORPORATION
            (Exact Name of Registrant as Specified in Its Charter)


          DELAWARE                                          76-0447780
      (State or Other                                         (I.R.S.
      Jurisdiction of                                        Employer
      Incorporation or                                    Identification
       Organization)                                           No.)


                         12750 SOUTH KIRKWOOD, SUITE 200
                              STAFFORD, TEXAS 77477
                   (Address of Principal Executive Offices)

                                 (281) 494-8282
              (Registrant's telephone number, including area code)

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 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 [ ]

There were 5,310,990 shares of the Registrant's Common Stock outstanding as of
the close of business on August 6, 1998.
<PAGE>
                           TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION                                     PAGE
                                                                  NUMBER

   Item 1. Financial Statements                                      3

   Item 2.  Management's Discussion and Analysis 
of Financial Condition and Results of Operations                    10

PART II.  OTHER INFORMATION

   Item 2.  Changes in Securities and Use of Proceeds               14

   Item 6.  Exhibits and Reports on Form 8-K                        14

                                       2
<PAGE>
                     PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                   REPORT OF INDEPENDENT ACCOUNTANTS

Board of Directors
OYO Geospace Corporation and Subsidiaries

      We have reviewed the accompanying consolidated balance sheet of OYO
Geospace Corporation and Subsidiaries as of June 30, 1998, the related
consolidated statements of operations for the three months and nine months ended
June 30, 1998 and 1997, and the consolidated statement of cash flows for the
nine months ended June 30, 1998 and 1997. These financial statements are the
responsibility of the Company's management.

      We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express an opinion or any form of assurance on
such financial statements.

      Based on our review, we are not aware of any material modifications that
should be made to the aforementioned financial statements for them to be in
conformity with generally accepted accounting principles.

      We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of September 30, 1997, and the
related consolidated statements of operations, changes in shareholder's equity,
and cash flows for the year then ended (not presented herein) and, in our report
dated November 3, 1997, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth in
the accompanying consolidated balance sheet as of September 30, 1997, is fairly
stated, in all material respects, in relation to the consolidated balance sheet
from which it has been derived.

/s/ PricewaterhouseCoopers LLP

Houston, Texas
July 27, 1998

                                       3
<PAGE>
               OYO GEOSPACE CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED BALANCE SHEETS
                             (in thousands)

                                                         JUNE 30,  SEPTEMBER 30,
                  ASSETS                                   1998        1997
                                                         --------    --------
                                                        (unaudited)
Current assets:
   Cash and cash equivalents .........................   $  2,936    $  2,488
   Trade accounts and notes receivable, net ..........     15,468       6,494
   Inventories .......................................     18,732      15,035
   Deferred income tax ...............................      2,111       1,115
   Prepaid expenses and other ........................        630         132
                                                         --------    --------

      Total current assets ...........................     39,877      25,264

Rental equipment, net ................................      2,672       2,394
Property, plant and equipment, net ...................     14,944       6,108
Goodwill and other intangible assets, net ............      4,575       1,006
Other assets .........................................        279         306
                                                         --------    --------
      Total assets ...................................   $ 62,347    $ 35,078
                                                         ========    ========

   LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Current portion of long-term debt and notes payable   $     37    $  1,500
   Accounts payable ..................................      6,636       3,048
   Accrued expenses and other ........................      4,420       3,716
   Income tax payable ................................        822         860
                                                         --------    --------
      Total current liabilities ......................     11,915       9,124

Long-term debt .......................................        963        --
Deferred income tax ..................................      1,416         854
                                                         --------    --------
      Total liabilities ..............................     14,294       9,978
                                                         --------    --------
Commitments and contingencies ........................       --          --

Stockholders' equity:
   Preferred stock ...................................       --          --
   Common stock ......................................         54          40
   Additional paid-in capital ........................     29,130       9,785
   Retained earnings .................................     21,119      15,554
   Cumulative foreign currency translation adjustments       (563)       (279)
   Unearned compensation-restricted stock awards .....     (1,687)       --
                                                         --------    --------
      Total stockholders' equity .....................     48,053      25,100
                                                         --------    --------
      Total liabilities and stockholders' equity .....   $ 62,347    $ 35,078
                                                         ========    ========

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       4
<PAGE>
                    OYO GEOSPACE CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
               (in thousands, except share and per share amounts)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                   THREE MONTHS ENDED            NINE MONTHS ENDED
                                                ------------------------    --------------------------
                                                  JUNE 30,    JUNE 30,        JUNE 30,        JUNE 30, 
                                                   1998         1997            1998           1997
                                                ----------   -----------    -----------    -----------
<S>                                             <C>          <C>            <C>            <C>        
Sales .......................................   $   18,484   $    12,452    $    50,047    $    30,454
Cost of sales ...............................       11,057         7,471         29,161         18,023
                                                ----------   -----------    -----------    -----------
Gross profit ................................        7,427         4,981         20,886         12,431

Operating expenses:
   Selling, general and administrative ......        3,086         2,264          8,921          5,959
   Research and development .................        1,833           598          3,854          1,772
                                                ----------   -----------    -----------    -----------
      Total operating expenses ..............        4,919         2,862         12,775          7,731
                                                ----------   -----------    -----------    -----------
Income from operations ......................        2,508         2,119          8,111          4,700

Other income (expense):
   Interest expense .........................         --            (222)           (28)          (441)
   Interest income ..........................           86            25            300             69
   Other, net ...............................           65            95            180            249
                                                ----------   -----------    -----------    -----------
      Total other income (expense), net .....          151          (102)           452           (123)
                                                ----------   -----------    -----------    -----------
Income before provision for income taxes ....        2,659         2,017          8,563          4,577
Provision for income taxes ..................          816           760          2,997          1,726
                                                ----------   -----------    -----------    -----------
Net income ..................................   $    1,843   $     1,257    $     5,566    $     2,851
                                                ==========   ===========    ===========    ===========
Basic earnings per share ....................   $     0.35   $      0.31    $      1.12    $      0.71
                                                ==========   ===========    ===========    ===========
Diluted earnings per share ..................   $     0.34   $      0.31    $      1.10    $      0.71
                                                ==========   ===========    ===========    ===========
Weighted average shares outstanding - Basic .    5,309,790     4,000,000      4,991,798      4,000,000

Weighted average shares outstanding - Diluted    5,438,377     4,000,000      5,082,983      4,000,000
</TABLE>
               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       5
<PAGE>
                    OYO GEOSPACE CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)
<TABLE>
<CAPTION>
                                                          NINE MONTHS     NINE MONTHS  
                                                             ENDED           ENDED
                                                         JUNE 30, 1998    JUNE 30, 1997
                                                            --------       -------
<S>                                                         <C>            <C>    
Cash flows from operating expenses:                                      
   Net income ...........................................   $  5,566       $ 2,851
   Adjustments to reconcile net income to                                
      net cash provided by operating activities:                         
      Deferred income tax ...............................       (874)         (109)
      Depreciation and amortization .....................      1,747         1,053
      Amortization of restricted stock awards ...........        241          --
      Bad debt expense ..................................        109            79
     Effects of changes in operating assets                              
       and liabilities:                                                  
     Trade accounts and notes receivable ................     (8,100)       (2,943)
     Inventories ........................................     (2,575)         (428)
     Prepaid expenses and other assets ..................       (503)          (80)
     Accounts payable ...................................      3,508           430
     Accrued expenses and other .........................        184           277
     Income tax payable .................................       (156)        1,124
                                                            --------       -------
      Net cash (used in) provided by                                     
        operating activities ............................       (853)        2,254
                                                                         
Cash flows from investing activities:                                    
   Capital expenditures .................................     (9,426)       (2,572)
   Investment in business acquisition, net                               
     of cash acquired ...................................     (2,688)         --
   Proceeds from sale of equipment ......................        249           595
                                                            --------       -------
      Net cash used in investing activities .............    (11,865)       (1,977)
                                                            --------       -------
Cash flows from financing activities:                                    
   Net proceeds from initial public offering ............     14,627          --
   Increase in notes payable to banks ...................      1,000          --
   Decrease in notes payable to banks ...................     (2,407)         (701)
   Decrease in receivable from Parent ...................       --           1,487
                                                            --------       -------
      Net cash provided by financing activities .........     13,220           786
                                                            --------       -------
Effect of exchange rate on cash .........................        (54)           64
                                                            --------       -------
Increase in cash and cash equivalents ...................        448         1,127
Cash and cash equivalents, beginning of period ..........      2,488           780
                                                            --------       -------
Cash and cash equivalents, end of period ................   $  2,936       $ 1,907
                                                            ========       =======
</TABLE>
               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       6
<PAGE>
               OYO GEOSPACE CORPORATION AND SUBSIDIARIES

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.   BASIS OF PRESENTATION

   The consolidated balance sheet of OYO Geospace Corporation and its
subsidiaries (the "Company") at September 30, 1997 has been condensed from the
Company's audited consolidated financial statements at that date. The
consolidated balance sheet at June 30, 1998, the consolidated statements of
operations for the three months and nine months ended June 30, 1998 and 1997 and
the consolidated statements of cash flows for the nine months ended June 30,
1998 and 1997 have been prepared by the Company, without audit. In the opinion
of management, all adjustments, consisting of normal recurring adjustments,
necessary to present fairly the consolidated financial position, results of
operations and cash flows have been made. The results of operations for the
three months and nine months ended June 30, 1998 are not necessarily indicative
of the operating results for a full year or of future operations.

   Certain information and footnote disclosures normally included in financial
statements presented in accordance with generally accepted accounting principles
have been omitted. The accompanying consolidated financial statements should be
read in conjunction with the financial statements and notes thereto contained in
the Company's Registration Statement on Form S-1 (Registration No. 333-36727) as
filed with the Securities and Exchange Commission on November 18, 1997.


2.  INITIAL PUBLIC OFFERING

   In November 1997, the Company completed an initial public offering (the
"Offering") of its common stock by selling 2,300,000 common shares, including
1,150,000 common shares owned by its parent, OYO Corporation U.S.A. ("OYO
U.S.A."). After deducting underwriting discounts and offering expenses, the net
proceeds from the Offering were $29.3 million, which were split equally between
the Company and OYO U.S.A. Immediately following the Offering, OYO U.S.A. held
approximately 55% of the outstanding stock of the Company.


3.  EARNINGS PER COMMON SHARE

   Effective October 1, 1997, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 128, Earnings Per Share ("SFAS 128"). SFAS
128 simplifies the computation of earnings per share by replacing the primary
and fully diluted presentations with the new basic and diluted presentations.
Basic earnings per common share is computed by dividing income available for
common shareholders by the weighted average number of common shares outstanding
for the period. Diluted earnings per common share is computed by dividing income
available for common shareholders by the sum of the weighted average number of
common shares outstanding and the effect of all dilutive potential common shares
outstanding for the period All prior period earnings per share amounts have been
restated to conform with SFAS No.
128.

                                       7
<PAGE>
   The following table summarizes the calculation of net earnings and weighted
average common shares and common equivalent shares outstanding for purposes of
the computation of earnings per share:
<TABLE>
<CAPTION>
                                                                        THREE MONTHS ENDED               NINE MONTHS ENDED
                                                              ---------------------------------   ---------------------------------
                                                               JUNE 30, 1998     JUNE 30, 1997     JUNE 30, 1998     JUNE 30, 1997
                                                              ---------------   ---------------   ---------------   ---------------
<S>                                                           <C>               <C>               <C>               <C>            
Net earnings available to common
  stockholders (in thousands) .............................   $         1,843   $         1,257   $         5,566   $         2,851
                                                              ===============   ===============   ===============   ===============
Divided by weighted average common shares and common 
 share equivalents:
   Weighted average common shares .........................         5,309,790         4,000,000         4,991,798         4,000,000
   Weighted average common share
     equivalents ..........................................           128,587              --              91,185              --
                                                              ---------------   ---------------   ---------------   ---------------
Total weighted average common shares
  and common share equivalents ............................         5,438,377         4,000,000         5,082,983         4,000,000
                                                              ===============   ===============   ===============   ===============
Basic earnings per common share ...........................   $          0.35   $          0.31   $          1.12   $          0.71
                                                              ===============   ===============   ===============   ===============
Diluted earnings per common share .........................   $          0.34   $          0.31   $          1.10   $          0.71
                                                              ===============   ===============   ===============   ===============
</TABLE>
4.  INVENTORIES

   Inventories consisted of the following (in thousands):

                                                    JUNE 30,      SEPTEMBER 30,
                                                     1998             1997
                                                    -------         -------
                                                  (unaudited)
Finished goods ............................         $ 2,725         $ 3,385
Work in process ...........................           4,636           2,641
Raw materials and subcomponents ...........          11,371           9,009
                                                    -------         -------
                                                    $18,732         $15,035
                                                    =======         =======

5.  LONG-TERM DEBT

   In June 1998, the Company borrowed $1.0 million under the terms of a fifteen
year amortizing mortgage loan collateralized by the Company's corporate office
facility. The mortgage loan bears interest at a fixed rate of 7.55% per annum.

   In June 1998, the Company obtained from Bank of America, N.A. (the "Bank") a
$10.0 million working capital line of credit (the "Credit Agreement") that
expires in June 2000. Borrowings under the Credit Agreement are subject to
borrowing base restrictions based on consolidated net income plus consolidated
interest expense, income taxes, depreciation and amortization. Borrowings under
the Credit Agreement are collateralized by the Company's accounts receivable and
inventory. At the Company's option, interest on borrowings is based on the
Bank's prime rate or offshore rate. The Credit Agreement prohibits the payment
of cash dividends on the Company's common stock, limits capital expenditures,
limits additional indebtedness to $7.5 million, requires the maintenance of
certain financial amounts and contains other covenants customary in transactions
of this type. As of June 30, 1998, there were no borrowings outstanding under
the Credit Agreement, and the borrowing base under the Credit Agreement was
$10.0 million.

                                       8
<PAGE>
6.  ACQUISITION

   On February 3, 1998, the Company acquired 100% of the outstanding common
stock of JRC/Concord Technologies, Inc. ("Concord") as well as certain
intellectual property related to the business of Concord from Jimmy R. Cole, Jr.
for a purchase price of $6.4 million, consisting, after adjustments, of cash
payments totaling $3.6 million (including acquisition related costs of $0.1
million) and the issuance of 159,120 shares of the Company's common stock valued
at approximately $2.8 million. The purchase price was determined through
arm's-length negotiations with Mr. Cole, who had no prior relationship to the
Company or any of its affiliates or directors, officers or associates thereof.
The cash portion of the purchase price was funded with a portion of the net
proceeds of the Company's initial public offering. Concord, located in Houston,
Texas, designs and manufactures equipment used in connection with deepwater
marine seismic surveys. The Company will continue the business of Concord,
including the continued devotion of its plant and other assets to its business.
Mr. Cole continues to serve as the president of Concord.

   The allocation of the total purchase price, including related expenses, for
Concord based on the estimated fair value of the net assets acquired, at the
date of acquisition, is as follows:

      Net tangible assets.....................        $  2,734
      Intangible assets.......................           3,658
                                                      --------
         Total purchase price allocation......        $  6,392
                                                      ========

   Intangible assets are being amortized using the straight-line method over
fifteen years.

7.  SUPPLEMENTAL NONCASH INVESTING AND FINANCING ACTIVITIES

   During the nine months ended June 30, 1998, the Company increased its
additional paid-in capital by approximately $1.9 million and recorded a
corresponding increase in unearned compensation representing the issuance of
restrictive stock awards to employees, which awards vest ratably over four
years.

   Components of cash used for the acquisition of Concord and intellectual
property related to the business of Concord, as reflected in the Consolidated
Statement of Cash Flows for the nine months ended June 30, 1998 are as follows
(in thousands):

      Fair value of current assets, net of cash acquired..       $  2,069
      Fair value of noncurrent assets.....................          1,762
      Fair value of intangible assets.....................          3,658
      Liabilities assumed.................................         (1,996)
      Common stock issued at closing......................         (2,805)
                                                                 -------- 
      Cash paid, net of cash acquired.....................       $  2,688
                                                                 ========

                                       9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

   The following analysis of the financial condition and results of operations
of the Company should be read in conjunction with the Consolidated Financial
Statements and Notes related thereto included elsewhere in this Form 10-Q.

OVERVIEW

   OYO Geospace designs and manufactures instruments and equipment used in the
acquisition and processing of seismic data for the oil and gas industry and for
the commercial graphics industry worldwide.

   Demand for the Company's products used in the acquisition and processing of
seismic data is dependent primarily upon the level of worldwide oil and gas
exploration activity. That activity, in turn, is dependent primarily upon
prevailing oil and gas prices. Historically, the markets for oil and gas have
been volatile, and such markets are likely to continue to be volatile. In recent
months, oil and gas prices have fallen sharply. This trend may indicate a
moderation of the Company's sales in fiscal periods following June 30, 1998.
However, as it is impossible to predict future oil and gas price movements with
certainty, no assurance can be given as to the level of future demand for the
Company's products.

RESULTS OF OPERATIONS

   The following table sets forth for the three months and nine months ended
June 30, 1998 and 1997, the percentage of certain statement of operations items
to total sales:

                                              THREE MONTHS       NINE MONTHS 
                                             ENDED JUNE 30,     ENDED JUNE 30,
                                             --------------     ---------------
                                             1998     1997      1998      1997
                                             -----    -----     -----    -----
Sales ....................................   100.0%   100.0%    100.0%   100.0%
Cost of sales ............................    59.8     60.0      58.3     59.2
Gross profit .............................    40.2     40.0      41.7     40.8
Selling, general and
administrative ...........................    16.7     18.2      17.8     19.6
Research and development .................     9.9      4.8       7.7      5.8
Income from operations ...................    13.6     17.0      16.2     15.4
Other income (expense), net ..............     0.8     (0.8)      0.9     (0.4)
Income before provision for
income taxes .............................    14.4     16.2      17.1     15.0
Provision for income taxes ...............     4.4      6.1       6.0      5.7
Net income ...............................    10.0     10.1      11.1      9.4

FISCAL YEAR 1998 COMPARED TO FISCAL YEAR 1997.

   Sales for the three months and nine months ended June 30, 1998 increased $6.0
million, or 48.4%, and $19.6 million, or 64.3%, from the corresponding periods
of the prior year. The increase in sales was, in part, attributable to filling
orders from the strong demand of the previous quarter and sales generated by
Concord Technologies, Inc. ("Concord"), which the Company acquired on February
3, 1998. The Company expects that sales of its seismic products will return to
more moderate levels in the fourth quarter.

   Cost of sales for the three months and nine months ended June 30, 1998
increased $3.6 million, or 48.0%, and $11.1 million, or 61.8%, from the
corresponding periods of the prior year. Cost of sales decreased as a percentage
of total sales to 59.8% and 58.3% in the three months and nine months ended June
30, 1998 from 60.0% and 59.2% in the corresponding periods of the prior year.
This percentage decrease was generally attributable to increased efficiencies as
a result of the higher sales volume during the three months and nine months
ended June 30, 1998. Should sales return to more moderate levels in future
quarters, the Company could experience lower gross profit margins.

                                       10
<PAGE>
   Selling, general and administrative expenses for the three months and nine
months ended June 30, 1998 increased $0.8 million, or 36.3%, and $3.0 million,
or 49.7%, from the corresponding period of the prior year, primarily
attributable to increased administrative expenses necessary to support higher
sales and the acquisition of Concord. Selling, general and administrative
expenses decreased as a percentage of total sales to 16.7% and 17.8% in the
three months and nine months ended June 30, 1998 from 18.2% and 19.6% in the
corresponding periods of the prior year, principally reflecting the impact of
higher sales volume and the leveraging of certain fixed expenses.

   Research and development expenses for the three months and nine months ended
June 30, 1998 increased $1.2 million, or 206.5%, and $2.1, million or 117.5%,
from the corresponding periods of the prior year. Research and development
expenses increased as a percentage of total sales to 9.9% and 7.7% in the three
months and nine months ended June 30, 1998 from 4.8% and 5.8% in the
corresponding periods of the prior year, principally resulting from an increase
in expenditures targeted at new product development.

   Other income (expense), net increased as a percentage of total sales to 0.8%
and 0.9% in the three months and nine months ended June 30, 1998 from (0.8)% and
(0.4)% in the corresponding periods of the prior year. This increase was
primarily attributable to a decrease in interest expense as a result of the
Company using a portion of the net proceeds of the Offering to repay outstanding
indebtedness and interest income earned on the temporary investment of the
remainder of such proceeds.

   The Company's effective tax rate for the three months and nine months ended
June 30, 1998 was 30.7% and 35.0% compared to 37.7% in each of the corresponding
periods of the prior year. The decrease in the Company's effective tax rate is
principally the result of the implementation of certain tax strategies during
the three months ended June 30, 1998 designed to reduce the Company's domestic
and foreign income tax expense. The larger rate reduction for the three months
ended June 30, 1998 results from the cumulative adjustment required to reflect
the expected annualized tax rate.

LIQUIDITY AND CAPITAL RESOURCES

   At June 30, 1998, the Company had $2.9 million in cash and cash equivalents.
For the nine months ended June 30, 1998, cash used in operating activities was
$0.8 million principally resulting from increases in accounts receivable and
inventories offset by net income and an increase in accounts payable. The
increases in the Company's working capital accounts are a result of continued
growth in the demand for the Company's products.

   For the nine months ended June 30, 1998, the Company used approximately $11.9
million in investing activities, consisting of capital expenditures of $9.4
million and a business acquisition of approximately $2.7 million, net of cash
acquired. The Company estimates that its capital expenditures in fiscal 1998
will be $12.0 million, including $4.0 million for the construction of an
additional manufacturing facility, $1.8 million for additional rental equipment,
and $1.5 million for the purchase of new office space.

   Financing activities for the nine months ended June 30, 1998 generated $13.2
million of cash, principally resulting from the net proceeds from the Company's
initial public offering totaling $14.6 million. A portion of these proceeds were
used to repay outstanding bank borrowings of $2.4 million.

   Prior to the Offering, the Company relied on various intercompany
arrangements with OYO U.S.A. for its financing requirements. Following the
Offering, OYO U.S.A. and its affiliates are no longer guaranteeing any
indebtedness for the Company's benefit. The Company obtained a working capital
line of credit in June 1998, under which the Company is able to borrow up to
$10.0 million. The Credit Agreement expires in June 2000 and is collateralized
by the Company's accounts receivable and inventory. The Credit Agreement
prohibits the payment of cash dividends on the Company's common stock, limits
capital expenditures, limits additional indebtedness to $7.5 million, requires
the maintenance of certain financial amounts and contains other covenants
customary in transactions of this type. There were no borrowings outstanding at
June 30, 1998 under the Credit Agreement, and the borrowing base under the
Credit Agreement was $10.0 million.

                                       11
<PAGE>
   The Company obtained a $1.0 million mortgage loan in June 1998 secured by the
Company's corporate office facility. The Company purchased this facility in
December 1997 for $1.5 million in cash including renovations. The Company is
considering the mortgage of additional facilities. However, there can be no
assurance that the Company will be successful in obtaining such loans or that
such loans will be available to the Company on terms the Company considers
reasonable

   The Company believes that the combination of cash flow from operations,
borrowing availability under the Credit Agreement and the net proceeds from the
Offering should provide the Company with sufficient capital resources and
liquidity to fund its operations through fiscal 1999 and support its acquisition
and expansion program. However, there can be no assurance that such sources of
capital will be sufficient to support an acquisition and expansion program
through fiscal 1999 or in the long-term or otherwise support the Company's
capital requirements, and the Company may be required to issue additional debt
or equity securities in the future to meet its capital requirements.

   Inflation has not had a significant impact on the Company's operations to
date.

ACQUISITION

   On February 3, 1998, the Company acquired 100% of the outstanding common
stock of Concord as well as certain intellectual property related to the
business of Concord, for a purchase price of $6.4 million, consisting of cash
payments totaling $3.6 million (including acquisition related costs of $0.1
million) and the issuance of 159,120 shares of the Company's common stock valued
at approximately $2.8 million. The purchase price was determined through
arm's-length negotiations with Mr. Cole, who had no prior relationship to the
Company or any of its affiliates or directors, officers or associates thereof.
Concord, located in Houston, Texas, designs and manufactures equipment used in
connection with deepwater marine seismic surveys. The Company is continuing the
business of Concord, including the continued devotion of its plant and other
assets to its business.

RECENT ACCOUNTING PRONOUNCEMENTS

   In June 1997, the FASB issued Statement of Financial Accounting Standards No.
130, "Reporting Comprehensive Income" ("SFAS 130"). SFAS 130 establishes
standards for reporting and display of comprehensive income and its components
(revenues, expenses, gains and losses) in a full set of general-purpose
financial statements. It requires (a) classification of the components of other
comprehensive income by their nature in a financial statement and (b) the
display of the accumulated balance of the other comprehensive income separate
from retained earnings and additional paid-in capital in the equity section of a
statement of financial position. SFAS 130 is effective for years beginning after
December 15, 1997 and is not expected to have a material impact on the Company's
financial statements.

   In June 1997, the FASB issued Statement of Financial Accounting Standards No.
131, "Disclosure about Segments of an Enterprise and Related Information" ("SFAS
131"). SFAS 131 establishes standards for reporting information about operating
segments in annual financial statements and requires selected information about
operating segments in interim financial reports issued to shareholders. It also
establishes standards for related disclosures about products and services,
geographic areas and major customers. SFAS 131 is effective for financial
statements for periods beginning after December 15, 1997 and is not expected to
have a material impact on the Company's financial statements.

   In February 1998, the FASB issued Statement of Financial Accounting Standards
No. 132, "Employers' Disclosure about Pensions and Other Postretirement
Benefits" ("SFAS 132). SFAS 132 standardizes the disclosure requirements for
pensions and other postretirement benefits to the extent practicable. It also
requires additional information on changes in the benefit obligations and fair
values of plan assets. SFAS 132 is effective for years beginning after December
15, 1997 and is not expected to have a material impact on the Company's
financial statements.

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<PAGE>
YEAR 2000 ISSUES

   The "Year 2000 problem" is the result of computer programs being written
using two digits rather than four to define the applicable year. Any programs
that have time-sensitive software may recognize a date using "00" as the year
1900 rather than the year 2000. This could result in a major system failure or
miscalculations in affected computer and operational systems.

   The Company has initiated a program of upgrading its internal accounting and
manufacturing software to make that software more efficient and compatible
Company-wide (the "Upgrade"). In connection with the Upgrade, all of the
Company's internal accounting and manufacturing software will become Year 2000
compliant. The Company expects that the Upgrade will be complete by the end of
fiscal 1998. The Company has been informed by the suppliers of substantially all
of the Company's software that all of those suppliers' software that will be
used by the Company following the Upgrade is Year 2000 compliant. The software
from these suppliers is used for financial and manufacturing purposes. However,
there can be no assurances that Year 2000 problems will not occur with respect
to the Company's computer systems. Further, the Company is in the process of
reviewing the operational computers built into its manufacturing equipment to
determine whether or not that equipment may be effected by the Year 2000
problem. The Company does not expect that it will incur material expenditures in
discovering and addressing any Year 2000 problems it may have. However, the Year
2000 problem may impact customers, suppliers, shippers and other entities with
which the Company transacts business, and the Company cannot predict the effect
of the Year 2000 problem on those entities or how those entities' Year 2000
problems may indirectly effect the Company.

FORWARD LOOKING STATEMENTS

This Form 10-Q includes "forward-looking" statements which are subject to the
"Safe Harbor" provisions of Section 27A of the Securities Exchange Act of 1933
and Section 21E of the Securities Exchange Act of 1934. All statements other
than statements of historical fact included herein, including statements about
potential future products and markets, the Company's future financial position,
business strategy and other plans and objectives for future operations, are
forward-looking statements. Although the Company believes the expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to have been correct, and actual
results may differ materially from such forward-looking statements. Additional
important factors that could cause actual results to differ materially from the
Company's expectations are disclosed in the Company's Registration Statement on
Form S-1 (Reg. No. 333-36727), filed with the Securities and Exchange
Commission, under the heading "Risk Factors" and elsewhere. Further, all written
and verbal forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by such factors.

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                           PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

(d) The Company completed an initial public offering (the "Offering") of its
common stock, par value $.01 per share ("Common Stock") pursuant to a
Registration Statement on Form S-1 (Registration No. 333-36727) (the
"Registration Statement"), which was declared effective by the Securities and
Exchange Commission at 11:00 a.m. Eastern Standard Time on November 20, 1997.

The net proceeds of the Offering to the Company were approximately $14.6
million. From the effective date of the Registration Statement through June 30,
1998, the Company used a portion of the net proceeds of the Offering to repay
$4.9 million of outstanding indebtedness, including $1.5 million of which was
outstanding as of September 30, 1997. The Company incurred additional
indebtedness of $2.5 million from October 1, 1997 to November 26, 1997, which
resulted from the Company's growing working capital needs, primarily to fund
increases in accounts receivable and inventories resulting from increases in
sales, as well as to pay fiscal 1997 accrued bonuses. The remaining indebtedness
of $0.9 million was incurred by Concord prior to the acquisition. The Company
used $3.6 million of the net proceeds of the Offering in connection with the
acquisition of Concord. See "Acquisition" above. The remaining net proceeds of
the Offering have been invested in working capital.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a) The following exhibits are filed with this Quarterly Report.

10.1 Promissory Note, dated as of June 23, 1998, made by and between the Company
     and Ameritas Life Insurance Corp.

10.2 Business Loan Agreement, dated as of June 26, 1998, made by and between the
     Company and Bank of America.

10.3 Security Agreements, dated as of June 26, 1998, made by OYO Geospace
     Corporation and its Subsidiaries in favor of Bank of America.

10.4 Business Loan Continuing Guaranty Agreements, dated as of June 26, 1998,
     made by OYO Geospace Corporation and its Subsidiaries in favor of Bank of
     America.

15.1 Awareness Letter of Independent Accountants

27.1 Financial Data Schedule

(b) The Company did not file any reports on Form 8-K during the quarter for
which this report is filed.

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                               SIGNATURES

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


                                                OYO GEOSPACE CORPORATION



                                                Date: August 3, 1998
                                                By: /s/ Gary D. Owens
                                            Gary D. Owens, Chairman of the Board
                                           President and Chief Executive Officer
                                                 (duly authorized officer)

                                                Date: August 3, 1998
                                                By: /s/ Thomas T. McEntire
                                                   Thomas T. McEntire
                                                 Chief Financial Officer
                                               (principal financial officer)

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