<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                               -------------------
                                    FORM 10-Q

(Mark One)

[X]     Quarterly report pursuant to Section 13 or 15(d) of the Securities
        Exchange Act of 1934

                 For the quarterly period ended March 31, 1999

                                       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 0-18053

                                   LASERSCOPE
             (Exact name of Registrant as Specified in Its Charter)

                CALIFORNIA                               77-0049527
      (State or Other Jurisdiction                    (I.R.S. Employer 
     of Incorporation or Organization)               Identification No.)

              3052 ORCHARD DRIVE, SAN JOSE, CALIFORNIA 95134-2011
                    (Address of Principal Executive Offices)

       Registrant's Telephone Number, Including Area Code: (408) 943-0636

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

                               Yes [X]   No [ ]

The number of shares of Registrant's common stock issued and outstanding as of
April 30, 1999 was 12,545,947.


<PAGE>   2
                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                            <C>

PART I.  FINANCIAL INFORMATION                                                                                    3
  Item 1. Financial Statements                                                                              3
          Condensed Consolidated Balance Sheets                                                             3
          Condensed Consolidated Statements of Operations                                                   4
          Condensed Consolidated Statements of Cash Flows                                                   5
          Notes to Condensed Consolidated Financial Statements                                              6

  Item 2. Management's Discussion and Analysis of
            Financial Condition and Results of Operations                                                   7
          Results of Operations                                                                             8
          Liquidity and Capital Resources                                                                  10
          Year 2000                                                                                        11
  Item 3. Quantitative and Qualitative Disclosures About Market Risk                                       12

PART II.  OTHER INFORMATION                                                                                      14
  Item 1. Legal Proceedings                                                                                14
  Item 2. Changes in Securities                                                                            14
  Item 3. Defaults Upon Senior Securities                                                                  14
  Item 4. Submission of Matters to a Vote of Security Holders                                              14
  Item 5. Other Information                                                                                14
  Item 6. Exhibits and Reports on Form  8-K                                                                14

SIGNATURES                                                                                                       14
</TABLE>


                                       2
<PAGE>   3
PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS:

                                   LASERSCOPE
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                    MARCH 31,        DECEMBER 31,
(thousands)                                                           1999               1998
-------------------------------------------------------------------------------------------------
<S>                                                               <C>                <C>         
ASSETS
Current assets:
     Cash and cash equivalents                                    $      2,061       $      1,456
     Accounts receivable, net                                           13,092             12,433
     Inventories                                                        12,947             14,084
     Other current assets                                                  838                867
                                                                  ------------       ------------

              Total current assets                                      28,938             28,840

Property and equipment, net                                              5,121              5,146
Developed technology and other intangibles, net                          3,056              2,089
Other assets                                                               495                518
                                                                  ------------       ------------

              Total assets                                        $     37,610       $     36,593
                                                                  ============       ============

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
     Accounts payable                                             $      4,595       $      5,360
     Accrued compensation                                                2,025              1,659
     Short-term bank loans                                               5,402              3,538
     Other current liabilities                                           4,856              4,561
                                                                  ------------       ------------

         Total current liabilities                                      16,878             15,118

Obligations under capital leases                                           720                786
Mortgages and other long-term loans                                      1,693              1,693
                                                                  ------------       ------------

         Total long-term liabilities                                     2,413              2,479

Commitments and contingencies

Minority interest                                                          178                325

Shareholders' equity:
         Common stock                                                   51,268             51,268
         Accumulated deficit                                           (32,266)           (31,627)
         Accumulated other comprehensive income                           (490)              (599)
         Notes receivable from shareholders                               (371)              (371)
                                                                  ------------       ------------

              Total shareholders' equity                                18,141             18,671
                                                                  ------------       ------------

              Total liabilities and shareholders' equity          $     37,610       $     36,593
                                                                  ============       ============
</TABLE>


See Notes to Condensed Consolidated Financial Statements


                                       3
<PAGE>   4
                                   LASERSCOPE
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                      THREE MONTHS ENDED
                                                                           MARCH 31,
(thousands, except per share amounts)                               1999               1998
----------------------------------------------------------------------------------------------
<S>                                                              <C>                <C>       
Net revenues                                                     $   11,866         $   13,591
Cost of sales                                                         6,356              7,021
                                                                 ----------         ----------

Gross margin                                                          5,510              6,570

Operating expenses:
     Research and development                                         1,383              1,331
     Selling, general and administrative                              4,622              5,345
                                                                 ----------         ----------

                                                                      6,005              6,676

Operating loss                                                         (495)              (106)
Interest income (expense) and other, net                                (12)                40
                                                                 ----------         ----------

Loss before income taxes and minority interest                         (507)               (66)
Provision for income taxes                                               96                109
                                                                 ----------         ----------

Loss before minority interest                                          (603)              (175)

Minority interest                                                        36                 55
                                                                 ----------         ----------

Net loss                                                         $     (639)        $     (230)
                                                                 ==========         ==========

Basic and diluted net loss per share                             $    (0.05)        $    (0.02)
                                                                 ==========         ==========

Shares used in basic and diluted per share calculations              12,532             12,356
                                                                 ==========         ==========
</TABLE>




See Notes to Condensed Consolidated Financial Statements


                                       4
<PAGE>   5
                                   LASERSCOPE
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                            THREE MONTHS ENDED
                                                                                                 MARCH 31,
(thousands)                                                                               1999              1998
-------------------------------------------------------------------------------------------------------------------
<S>                                                                                    <C>               <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net loss                                                                          $     (639)       $     (230)
     Adjustments to reconcile net income to
         cash used by operating activities:
         Depreciation and amortization                                                        674               745
         Increase (decrease) from changes in:
              Accounts receivable                                                            (659)             (618)
              Inventories                                                                   1,137              (764)
              Other current assets                                                             29                23
              Other assets                                                                     --                --
              Accounts payable                                                             (1,293)             (526)
              Accrued compensation                                                            366               217
              Other current liabilities                                                       295              (499)
              Minority interest                                                                36                55
                                                                                       ----------        ----------

Cash used by operating activities                                                             (54)           (1,597)
                                                                                       ----------        ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures                                                                    (498)             (280)
     NWL acquisition                                                                         (750)               --
     Other                                                                                    109                25
                                                                                       ----------        ----------

Cash used by investing activities                                                          (1,139)             (255)
                                                                                       ----------        ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Payments on obligations under capital leases                                             (66)              (44)
     Proceeds from the sale of common stock under stock plans                                  --                69
     Proceeds from bank loans                                                               2,567               813
Repayment of bank loans                                                                      (703)              (67)
                                                                                       ----------        ----------

Cash provided by financing activities                                                       1,798               771
                                                                                       ----------        ----------

Increase (decrease) in cash and cash equivalents                                              605            (1,081)
Cash and cash equivalents, beginning of period                                              1,456             2,465
                                                                                       ----------        ----------

Cash and cash equivalents, end of period                                               $    2,061        $    1,384
                                                                                       ==========        ==========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: 
         Cash paid during the period for:
              Interest                                                                 $       90        $       88
              Income taxes                                                             $        2        $        3
</TABLE>


See Notes to Condensed Consolidated Financial Statements


                                       5
<PAGE>   6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:

1.       The accompanying condensed consolidated financial statements include
         Laserscope (the "Company") and its wholly and majority-owned
         subsidiaries. All intercompany transactions and balances have been
         eliminated. While the financial information in this report is
         unaudited, in the opinion of management, all adjustments (which include
         only normal recurring adjustments) necessary to present fairly the
         financial position and results of operations as of and for the periods
         indicated have been recorded. It is suggested that these consolidated
         financial statements be read in conjunction with the consolidated
         financial statements and the notes thereto for the year ended December
         31, 1998 included in the Company's annual report on Form 10-K for the
         year ended December 31, 1998. The results of operations for the three
         month period ended March 31, 1999 are not necessarily indicative of the
         results expected for the full year.

2.       Inventory was comprised of the following (in thousands):

<TABLE>
<CAPTION>
                                                       MARCH 31,      DECEMBER 31,
                                                         1999             1998 
                                                     ------------     ------------
<S>                                                  <C>              <C>         
         Sub-assemblies and purchased parts          $      9,101     $      9,371
         Finished goods                                     3,846            4,713
                                                     ------------     ------------
                                                     $     12,947     $     14,084
                                                     ============     ============
</TABLE>

3.       Basic net income (loss) per share is calculated using the weighted
         average of common stock outstanding. Diluted net income per share is
         calculated using the weighted average of common stock outstanding plus
         dilutive common equivalent shares from stock options. Options to
         purchase approximately 2,621,000 and 2,222,000 shares of common stock
         were outstanding at March 31, 1999 and 1998, respectively, but were not
         included in the computation of diluted earnings (loss) per share
         because the Company reported losses for the periods that ended at these
         dates and, therefore, the effect would be anti-dilutive.

4.       The Company considers cash equivalents to be short-term financial
         instruments that are readily convertible to cash, subject to no more
         than insignificant interest rate risk and that have original maturities
         of three months or less. At March 31, 1999 and December 31, 1998, the
         Company's cash equivalents were in the form of institutional money
         market accounts and totaled $0.1 million and $0.4 million,
         respectively. At March 31, 1999 and December 31, 1998, the Company had
         no investments in debt or equity securities.

5.       During the year ended December 31, 1998, the Company adopted Statement
         of Financial Accounting Standards No. 130, "Reporting Comprehensive
         Income" (SFAS 130). SFAS 130 requires translation adjustments, which
         prior to adoption were reported in shareholders' equity, to be included
         in comprehensive income (loss). The total comprehensive loss during the
         quarters ended March 31, 1999 and 1998 consisted of (in thousands):

<TABLE>
<CAPTION>
                                              THREE MONTHS ENDED
                                                   MARCH 31,
                                             1999            1998
                                          ----------      ----------
<S>                                       <C>             <C>        
         Net loss                         $     (639)     $     (230)
         Translation adjustments                 109              25
                                          ----------      ----------
         Comprehensive loss               $     (530)     $     (205)
                                          ==========      ==========
</TABLE>


                                       6
<PAGE>   7
6.       During the year ended December 31, 1998, Laserscope adopted Statement
         of Financial Accounting Standards No. 131, "Disclosures about Segments
         of an Enterprise and Related Information" (SFAS 131). SFAS 131 changed
         the way companies report selected segment information in annual
         financial statements and requires those companies to report selected
         segment information in interim financial reports to shareholders.
         During all periods presented, the Company conducted its business
         predominantly within one industry segment: the medical systems
         business.

7.       In January 1999, pursuant to an agreement between Laserscope and the
         minority interest owners of NWL Laser-Technologie GmbH ("NWL") to
         purchase the remaining interest in NWL, the Company paid approximately
         $0.8 million in cash, and agreed to pay an additional $0.5 million on
         April 15, 1999, to acquire an additional 27% interest in NWL, bringing
         Laserscope's ownership interest in NWL to 79%. The approximate purchase
         price allocation for the transaction is $1.1 million for intangible
         assets (including developed technology, distribution and workforce) and
         $0.2 million for additional interest in tangible assets. The Company
         expects to pay an additional $1.0 million in January 2001 for the
         remaining interest in NWL.

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

Except for the historical information contained in this Quarterly Report on Form
10-Q, the matters discussed herein are forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that all forward-looking statements are subject to
certain risks and uncertainties that could cause the actual results to differ
materially from those projected. Factors that could cause actual results to
differ materially include, but are not limited to, the risks associated with the
acquisition of NWL Laser-Technologie, GmbH ("NWL"), including the integration of
the operations and assets acquired and the assumption of the liabilities assumed
by Laserscope, the timing of orders and shipments, the Company's ability to
balance its inventory and production schedules, the timely development,
clearance by the F.D.A. and other regulatory agencies and market acceptance of
new products and surgical/therapeutic procedures, the impact of competitive
products and pricing, the Company's ability to raise capital on terms acceptable
to the Company, or at all, the Company's ability to expand further into
international markets, and public policy relating to health care reform in the
United States and other countries.

The Company intends to continue expansion of its operations outside of the
United States and to enter additional international markets, requiring
significant management attention and financial resources and further subjecting
the Company to the risks of operating internationally. These risks include
unexpected changes in regulatory requirements, delays resulting from difficulty
in obtaining export licenses for certain technology, customs, tariffs and other
barriers and restrictions, and the burdens of complying with a variety of
foreign laws. The Company is also subject to general geopolitical risks in
connection with its international operations, such as political and economic
instability and changes in diplomatic and trade relationships. The Company
cannot predict whether quotas, duties, taxes or other charges or restrictions
will be imposed by the United States, Japan, countries in the European Union or
other countries upon the import or export of Laserscope's products in the
future, or what effect any such actions would have on its business, financial
condition or results of operations. In addition, fluctuations in currency
exchange rates may negatively affect the Company's ability to compete in terms
of price against products denominated in local currencies. There can be no
assurance that


                                       7
<PAGE>   8
regulatory, geopolitical and other factors will not adversely affect the
Company's operations in the future or require Laserscope to modify its current
business practices. Many currently installed computer systems and software
products are coded to accept only two digit entries in the date field. Beginning
in the year 2000, these date fields need to accept four digit entries to
distinguish 21st century dates from 20th century dates. As a result, in
approximately seven months, computer systems and/or software used by many
companies may need to be upgraded to comply with such "Year 2000" requirements.
Significant uncertainty exists concerning the potential effects associated with
any noncompliance. Any Year 2000 compliance problem encountered by Laserscope,
its suppliers, its service providers or its customers could have a material
adverse effect on the Company's financial condition and operating results. Other
risks are detailed from time to time in the Company's press releases and other
public disclosure filings with the U.S. Securities and Exchange Commission
(SEC), copies of which are available upon request from the Company. The
forward-looking statements included herein speak only as of the date hereof.
Laserscope assumes no obligation to update any forward-looking statements
included herein.

RESULTS OF OPERATIONS: 

The following discussion should be read in conjunction with the unaudited
consolidated financial statements and notes thereto included in Part I -- Item 1
of this Quarterly Report and the audited financial statements and notes
contained in the Company's Annual Report on Form 10-K for the year ended
December 31, 1998 and the Management's Discussion and Analysis of Financial
Condition and Results of Operations contained therein. Net revenues for the
quarter ended March 31, 1999 were $11.9 million, a decrease of approximately 13%
from net revenues of $13.6 million in the corresponding quarter of 1998. The
decrease in net revenues during the first quarter of 1999 compared to the first
quarter of 1998 is due primarily to the Company discontinuing sales of AMS
products and, to a lesser extent, decreasing sales of services. AMS products
contributed revenues of approximately $2.0 million during the first quarter of
1998. Laserscope sold the assets and liabilities related to the AMS product line
in November 1998, and had no sales of these products during the first quarter of
1999. These decreases were offset partially by increased revenues from shipments
of laser products. 

Revenues from the sales of laser systems were approximately 60% of total net
revenues during the quarter ended March 31, 1999, compared to approximately 49%
of total net revenues during the same period in 1998. In dollars, these revenues
increased approximately 8% which reflects a combination of higher unit shipments
and higher average unit prices. The higher unit shipments were principally of
PDT and aesthetic lasers in the United States and aesthetic and general surgical
lasers in Europe. The higher average unit prices reflect the higher mix of PDT
units sold in the United States and lower shipments to customers in Asia.
Despite higher laser system revenues in the United States during the first
quarter of 1999 compared to the first quarter of 1998, the Company expects that
its revenue mix trends in the U.S. market will generally shift toward
lower-priced office lasers, that economic conditions in the Pacific Rim region
will continue to negatively affect Laserscope's revenues and that growth in
revenues from the sales of laser equipment, if any, will be derived from
continued growth in the European region.


                                       8
<PAGE>   9
Revenues from the sales of disposable supplies and instrumentation comprised
approximately 26% of total net revenues during the quarter ended March 31, 1999,
compared to approximately 23% of total net revenues in the corresponding period
in 1998. In dollars, these revenues decreased approximately 1%. The decrease is
due principally to decreased shipments of disposable supplies. The Company 
believes that trends in sales of laser equipment in the United States, which
have trended towards lower-priced office lasers for aesthetic procedures and 
away from lasers to be used in the hospital for non-aesthetic procedures, have
resulted in decreased sales of disposable supplies and instrumentation. Office
lasers used in aesthetic procedures, although often times carrying accompanying
one-time sales of instrumentation, generally do not create a stream of sales of
disposable supplies. The Company expects that revenues from the sales of
instrumentation and disposable supplies will depend on Laserscope's ability to
increase its installed base of systems, and to promote and develop surgical
procedures which use these products. 

Laserscope's service revenues during the quarter ended March 31, 1999 were 13%
lower than service revenues during the corresponding quarter of 1998. This
decrease is principally attributable to lower domestic revenues as a result of
reduced service contract revenues from hospitals. The Company believes that
future revenues depend on increases to the installed base of lasers as well as
the acceptance of its service contracts by its customers. 

The Company believes that acceptance of lasers in aesthetic surgery,
dermatology, urology and ear, nose and throat surgery will continue to be
important to its business. In addition, the Company expects that the adoption of
photodynamic therapy by medical practitioners will be important to its business.
The Company continues to invest in developing new instrumentation for emerging
surgical applications and in educating surgeons in the United States and
internationally to encourage the adoption of such new applications. Penetration
of the international market is generally increasing, and the Company continues
to view expansion of international sales as important to its success. During the
first quarter of 1999, international revenues accounted for 48% of total net
revenues, compared to 37% of total net revenues during the first quarter of
1998. The increase as a percentage of total net revenues is due principally to
the discontinuance of sales of AMS products which were sold by the Company only
in the United States, and, to a lesser extent, higher international revenues.

Gross margin as a percentage of net revenues for the quarter ended March 31,
1999 was 46%, compared to 48% for the corresponding quarter in 1998. The
decrease is primarily attributable to product mix shifts in the United States
and Europe as well as manufacturing inefficiencies related to the phase out of
certain CO2 and YAG product lines. Laserscope expects that gross margin as a
percentage of revenues for the remainder of 1999 may vary from quarter to
quarter as the Company continues to balance production volumes and inventory
levels with product demand and as product and distribution mix varies.

Research and development expenses are the result of activities related to the
development of new laser, instrumentation and disposable products and the
enhancement of Laserscope's existing products. In the first quarter of 1999,
amounts spent in research and development increased approximately 4% compared to
the corresponding quarter of 1998. As a percentage of net revenues, these
expenses were approximately 12% and 10% in the quarters ended March 31, 1999 and
March 31, 1998, respectively. The increase in spending is due to increased laser
product development activity in the United States. The Company expects that
amounts spent in research and development will remain at similar levels during
the remainder of 1999.


                                       9
<PAGE>   10
Selling, general and administrative expenses decreased approximately 14% in the
quarter ended March 31, 1999, compared to the corresponding quarter of 1998. As
a percentage of revenue, these expenses were approximately 39% in the first
quarters of each of 1999 and 1998. The decrease in spending is principally due
to Laserscope's discontinuance of the AMS product line after the sale of the
assets and liabilities related to such product line in November 1998. The
Company expects amounts spent in selling, general and administrative expenses to
remain at similar levels during the remainder of 1999 as the Company continues
to invest in international expansion, marketing programs and educational
support. 

In each of the quarters ended March 31, 1999 and March 31, 1998,
Laserscope recorded income tax provisions of $0.1 million due to profits
reported by NWL in Germany.

LIQUIDITY AND CAPITAL RESOURCES:

Total assets and liabilities as of March 31, 1999 were $37.6 million and $19.5
million respectively, compared to assets and liabilities of $36.6 million and
$17.9 million at December 31, 1998. Working capital decreased $1.6 million from
$13.7 million at December 31, 1998 to $12.1 million at March 31, 1999, while
cash and cash equivalents increased $0.6 million during the period. The net
increase in cash and cash equivalents was due principally to increased
short-term bank borrowings of $1.9 million partially an offset by investing
activities of $1.1 million.

Cash used by operating activities was the combined result of a net loss of $0.6
million, increases to accounts receivable totaling $0.7 million and reductions
in accounts payable of $1.3 million. These uses were partially offset by
depreciation and amortization of $0.6 million, a decrease to inventory of $1.1
million and increases to accrued compensation and other current liabilities of
$0.4 million and $0.3 million, respectively. Cash used by investing activities
consisted of an additional investment in NWL of $0.8 million, capital
expenditures of $0.5 million and other comprehensive income of $0.1 million.
Cash provided by financing activities primarily consisted of net increases in
short-term bank loans of $1.9 million.

Laserscope has in place a $4.5 million revolving bank line of credit line that
expires in November 1999 under which the collateral provisions allow for
approximately $4.5 million in borrowings and under which $4.4 million in
borrowings were outstanding at March 31, 1999. In addition, the Company has a
term loan of $500,000 outstanding that matures in July 2000. NWL has in place
various bank lines totaling approximately $2.0 million that expire in 1999 and
under which $500,000 in borrowings were outstanding at March 31, 1999.

The Company anticipates that future changes in cash and working capital depend
on a number of factors, including management's ability to manage effectively
non-cash assets such as inventory and accounts receivable. Laserscope competes
in a competitive industry where technological changes and acceptance of new and
alternative procedures by its customers is rapid. Management's ability to
anticipate and adapt to these changes will significantly affect the Company's
investment in inventory and the potential for inventory valuation adjustments.
Historically, a source of liquidity for the Company has been the sale of its
common stock under stock plans, principally employee stock option and stock
purchase plans. To the extent that the market price of the common stock
discourages the exercise of stock options, this source of liquidity may be
unavailable. At March 31, 1999, options to purchase approximately 2.6 million
shares of the Company's common stock were outstanding, of which 1.4 million were
exercisable


                                       10
<PAGE>   11
at a weighted average exercise price of $2.00. Finally, the level of
profitability of the Company will have a significant effect on cash resources.

From time to time, the Company may also consider the acquisition of, or evaluate
investments in, certain products and businesses complementary to the Company's
business. Any such acquisition or investment may require additional capital
resources. The Company financed the Heraeus Surgical, Inc. and NWL acquisitions
using its existing cash resources. While the Company believes its remaining cash
resources will be sufficient to fund its operating needs for the next twelve
months, additional financing through its bank lines of credit or other sources
will be required for the Company's currently anticipated long term needs. There
can be no assurance that such additional financing will be available on terms
acceptable to the Company, or at all.

YEAR 2000

As described earlier, the year 2000 computer issue creates a risk for
Laserscope. If internal systems do not correctly recognize date information when
the year changes to 2000, there could be a material adverse effect on the
Company's operations. The risk for the Company exists in four areas: (i)
Information systems and equipment used by the Company to operate its business;
(ii) systems used by the Company's suppliers; (iii) the products sold by the
Company; and (iv) the potential for reduced spending by customers for
Laserscope's products and services as a result of significant spending on year
2000 issues and related adverse effects of such issues on the customer's
business. The Company is currently evaluating its exposure in all of these
areas.

Laserscope has completed its evaluation of its internal information systems and
equipment and has projects underway to upgrade systems and equipment that are
already known to the Company to be year 2000 non-compliant. The Company expects
to have substantially completed these projects by the end of May 1999 At this
time, Laserscope has not determined a most reasonably likely worst case scenario
if its year 2000 compliance efforts are unsuccessful with respect to its
internal systems. The Company has not developed contingency plans if upgrade or
replacement of non-compliant systems is not feasible. The Company will consider
the need for such contingency plans upon completion of its upgrade projects at
the end of May 1999. For the year 2000 non-compliance issues identified to date,
the cost of upgrade or replacement has been less than $100,000 through March 31,
1999. The Company expects to spend an additional $100,000 through December 31,
1999 for system and equipment upgrades and replacements which it expects to
capitalize. Laserscope does not expect that the cost of year 2000-related
upgrades or replacements will materially affect its operating results. The
Company intends to fund such compliance efforts through working capital
generated by operations. If implementation of replacement systems is delayed, or
if significant new non-compliance issues are identified, the Company's results
of operations or financial condition could be adversely affected. However, the
Company believes that it will be able to complete its year 2000 compliance
review and make any necessary system modifications prior to any adverse
consequences.

Laserscope has also contacted its critical suppliers to determine
whether such suppliers' operations and the products and services they provide to
the Company are year 2000 compliant, and is currently in the process of
evaluating responses. The Company expects to complete this process by the end of
June 1999 for all critical suppliers. Where practical, the Company will attempt
to mitigate its risks with respect to the failure of its suppliers to be year
2000 ready. In the event that suppliers are not year 2000 compliant, the Company
may need to seek alternative


                                       11
<PAGE>   12
sources. Any such failures by critical suppliers could have a material adverse
effect on the Company's results of operations or financial condition.

Laserscope believes that the majority of the products it sells are year 2000
compliant in all material respects; however, because all customer situations
cannot be anticipated, the Company may see an increase in warranty and other
claims as a result of the year 2000 transition. While litigation regarding year
2000 compliance issues is expected to escalate, the Company does not believe
that the effect of customer claims is reasonably likely to materially affect the
Company's results of operations or financial condition. 

Year 2000 compliance is an issue for virtually all businesses whose systems and
applications may require significant hardware and software upgrades or
modifications. Companies owning and operating such systems may plan to devote a
substantial portion of their information systems' spending to fund such
upgrades and modifications and divert spending away from the purchase of the
Company's products and services. Such changes in customers' spending patterns 
could have an adverse effect on the Company's sales, but the effect on
operating results and financial condition is not known at this time.

ITEM 3.  QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to a variety of risks, including changes in interest
rates affecting the return on its investments, outstanding debt balances and
foreign currency fluctuations. In the normal course of business, the Company
employs established policies and procedures to manage its exposure to
fluctuations in interest rates and foreign currency values.

INTEREST RATE RISK

The Company's exposure to market rate risk for changes in interest rates relates
primarily to the Company's investment and debt portfolios. Laserscope has not
used derivative financial instruments in its investment or debt portfolios. The
Company invests its excess cash in money market funds and commercial paper. The
Company's debt financing consists mainly of bank loans requiring either fixed or
variable rate interest payments. Investments in and borrowings under both
fixed-rate and floating-rate interest-earning instruments carry a degree of
interest rate risk. On the investment side, fixed-rate securities may have their
fair market value adversely affected due to a rise in interest rates, while
floating-rate securities may produce less income than expected if interest rates
fall. In addition, Laserscope's future investment income may fall short of
securities analyst expectations due to changes in interest rates or the Company
may suffer losses in principal if forced to sell securities which have declined
in market value due to changes in interest rates. On the debt side, borrowings
that require fixed-rate interest payments require greater than current market
rate interest payments if interest rates fall, while floating rate borrowings
may require greater interest payments if interest rates rise. Additionally, the
Company's future interest expense may be greater than expected due to changes in
interest rates.

FOREIGN CURRENCY RISK

International revenues were 48% of total revenues in the quarter ended March 31,
1999, compared to 37% of total revenues during the comparable period in 1998.
International sales are made through international distributors and wholly- and
majority-owned subsidiaries with payments to Laserscope typically denominated in
the local currencies of the United Kingdom, France and Germany, and in U.S.
dollars in the rest of the world. The Company's international business is
subject to risks typical of an international business, including, but not
limited to, differing economic conditions, changes in political climate,
differing tax structures, other


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regulations and restrictions, and foreign exchange rate volatility. Accordingly,
the Company's future results could be materially adversely affected by changes
in these or other factors. The effect of foreign exchange rate fluctuations on
the Company in the quarters ended March 31, 1999 and 1998 were not material, and
the Company does not engage in hedging transactions for speculative or trading
purposes.


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<PAGE>   14
PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

The Company is a party to a number of legal proceedings arising in the ordinary
course of business. While it is not feasible to predict or determine the outcome
of the actions brought against it, the Company believes that the ultimate
resolution of these claims will not ultimately have a material adverse effect on
its financial position or results of operations.

ITEM 2.  CHANGES IN SECURITIES

         Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         Not applicable.

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

         Not applicable.

ITEM 5.  OTHER ITEMS

         Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits filed herewith (numbered in accordance with Item 601
                  of Regulation S-K):

Exhibit
Number                             Description
-------                            -----------

10.11F            Loan Modification Agreement between the Registrant and Silicon
                  Valley Bank dated March 30, 1999.

         (b)      Reports on Form 8-K: None

                                   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.

                                  LASERSCOPE
                                  Registrant

                                  /s/  Dennis LaLumandiere
                                  ------------------------------------------
                                  Dennis LaLumandiere
                                  Vice President of Finance
                                    and Chief Financial Officer
                                    (Principal Financial and Accounting Officer)

Date:  May 13, 1999


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<PAGE>   15
                                 EXHIBIT INDEX


Exhibit  10.11F     Loan Modification Agreement between the Registrant and
                    Silicon Valley Bank dated March 30, 1999.

Exhibit 27          Financial Data Schedule