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


             QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


         For the quarter ended:                      Commission File Number:
         September 26, 1998                          0-13544

                          BEN & JERRY'S HOMEMADE, INC.
             (Exact name of registrant as specified in its charter)

         VERMONT                            03-0267543
         (State of incorporation)           (I.R.S. Employer Identification No.)



         30 Community Drive
         South Burlington, Vermont                   05403-6828
         (Address of principal executive offices)    (Zip code)


         Registrant's telephone number, including area code:

                              (802) 651-9600


         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 shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                                    YES X NO

         Indicate  the number of shares  outstanding  of each of the  classes of
common stock outstanding as of the latest practicable date.  6,266,809 shares of
Class A Common Stock and 852,794  shares of Class B Common Stock  outstanding as
of November 5, 1998.



<PAGE>

                                      INDEX


PART I: FINANCIAL INFORMATION                                          PAGE NO.

     Condensed Consolidated Balance Sheets
              September 26, 1998 and December 27, 1997                    1-2

     Condensed Consolidated Statements of Income
              Thirteen and thirty-nine weeks ended
              September 26, 1998 and September 27, 1997                    3

     Condensed Consolidated  Statements  of Cash  Flows  Thirty-nine
              weeks ended September 26, 1998 and September 27, 1997

     Notes to Condensed Consolidated Financial Statements                 5-6

     Management's Discussion and Analysis of Financial
     Condition and Results of Operations                                  7-17


 PART II: OTHER INFORMATION

     Item 1 - Legal Proceedings                                           18
 
     Item 6-Exhibits and Reports on Form 8-K                              19


 SIGNATURES                                                               19

 Exhibit 1                                                                1

<PAGE>


                          BEN & JERRY'S HOMEMADE, INC.
                 Form 10-Q for quarter ended September 26, 1998



                           BEN & JERRY'S HOMEMADE, INC
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
           (All numbers in tables in thousands except per share data)
                                   (Unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  statements and with the  instructions  to Form 10-Q and Rule 10-01 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been  included.  Operating  results for the three and nine month  periods  ended
September  26, 1998 are not  necessarily  indicative  of the results that may be
expected for the year ended December 26, 1998. For further information, refer to
the  consolidated  financial  statements and footnotes  thereto  included in the
Company's  Annual  Report on Form 10-K for the year  ended  December  27,  1997.
Certain prior period amounts have been reclassified for comparative purposes.

2. INVENTORIES

                                                   September 26,    December 27,
                                                            1998            1997
                                                   -------------    ------------
   Frozen dessert products and ingredients               $10,848         $10,294
   Paper goods                                               788             536
   Food, beverage and gift items                             480             292
                                                   -------------    ------------
             Total                                       $12,116         $11,122
                                                   =============    ============


3. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

                                                   September 26,    December 27,
                                                            1998            1997
                                                  --------------    ------------
  Trade accounts payable                                 $ 9,092         $ 3,832
  Accrued expenses                                        14,034          10,313
  Accrued payroll and related costs                        2,822           2,076
  Accrued promotional costs                                8,078           3,581
  Accrued marketing costs                                  4,777           2,230
  Accrued insurance expense                                1,450           1,234
  Income taxes payable                                     1,438                
                                                  --------------    ------------
           Total                                         $41,691         $23,266
                                                  ==============    ============


<PAGE>



                           BEN & JERRY'S HOMEMADE, INC
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
           (All numbers in tables in thousands except per share data)
                                   (Unaudited)


4.   COMPREHENSIVE INCOME

As of December  28,  1997 the  Company  adopted  Statement  No.  130,  Reporting
Comprehensive  Income (FAS 130). FAS 130 establishes new rules for the reporting
and display of comprehensive income and its components; however, the adoption of
this  statement  had no  impact on the  Company's  net  income or  shareholders'
equity.  Statement  130  requires  unrealized  gains or losses on the  Company's
available-for-sale  securities  and foreign  currency  translation  adjustments,
which prior to adoption were reported separately in shareholders'  equity, to be
included in other comprehensive income.

Total  comprehensive  income for the  thirteen  weeks ended  September  26, 1998
amounted to $2,878,000 compared to $2,527,000 for the same period in 1997. Total
comprehensive income for the thirty-nine weeks ended September 26, 1998 amounted
to $5,389,000 compared to $3,208,000 for the same period in 1997.

5. ADOPTION OF NEW ACCOUNTING PRONOUNCEMENTS

In June 1997, the Financial Accounting Standards Board issued Statement No. 131,
Disclosure  about Segments of an Enterprise and Related  Information  (FAS 131).
FAS 131 establishes  standards for public companies to report  information about
operating  segments in financial  statements,  and supercedes FAS 14,  Financial
Reporting for Segments of a Business Enterprise, but retains the requirements to
report  information about major customers.  FAS 131 is effective in fiscal 1998.
The Company does not believe the adoption of this statement will have a material
impact on the Company's financial statements.

In June 1998, the Financial Accounting Standards Board issued Statement No. 133,
Accounting for Derivative  Instruments and Hedging Activities (FAS 133). FAS 133
establishes  standards  for  public  companies  regarding  the  recognition  and
measurement of derivatives  and hedging  activities.  The statement is effective
for years  beginning  after June 15,  1999.  The  Company  does not  believe the
adoption  of  this  statement  will  have a  material  impact  on the  Company's
financial  statements  based on the nature and  extent of the  Company's  use of
derivative instruments at the present time.



<PAGE>



           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

Results of Operations

The following  table sets forth certain items as a percentage of net sales which
are  included  in the  Company's  Consolidated  Statements  of  Income  and  the
percentage increase (decrease) of such items as compared to the prior period:



<TABLE>
<CAPTION>
                                             Percentage of Net Sales
                                     Thirteen Weeks           Thirty-nine Weeks              Percentage Increase (Decrease)
                                        Ended                     Ended                          1998 Compared to 1997        
                                 -------------------------------------------------      -------------------------------------
<S>                             <C>           <C>           <C>           <C>          <C>                 <C>                     
                                Sept. 26,     Sept. 27,     Sept. 26,     Sept. 27,     Thirteen Weeks     Thirty-nine Weeks
                                    1998          1997          1998          1997               Ended                 Ended
                                ---------     ---------     ---------     ---------     --------------     -----------------
Net sales                          100.0%       100.0%        100.0%        100.0%           29.2%                 20.5%
Cost of sales                       62.5%        61.7%         64.0%         64.7%           30.8%                 19.2%
                                ---------     ---------     ---------     ---------     --------------     ------------------
Gross profit                        37.5%        38.3%         36.0%         35.3%           26.7%                 22.9%
Selling, general and
 administrative expenses            31.0%        30.0%         31.1%         31.1%           33.7%                 20.5%
                                ---------     ---------     ---------     ---------     --------------     ------------------
Operating income                     6.5%         8.3%          4.9%          4.2%            1.6%                 41.4%

Other income (expense)               0.5%       - 0.1%          0.2%         -0.4%          555.9%                169.4%
                                ---------     ---------     ---------     ---------     --------------     ------------------

Income before income taxes           7.0%         8.2%          5.1%          3.8%           11.0%                 63.2%
Income taxes                         2.5%         3.1%          1.8%          1.4%            5.3%                 54.8%
                                ---------     ---------     ---------     ---------     --------------     ------------------

Net income                           4.5%         5.1%          3.3%          2.4%           14.4%                 68.3%
                                =========     =========     =========     =========     ==============     ==================

</TABLE>


Thirteen Weeks Ended September 26, 1998 and September 27, 1997

Net Sales

Net sales for the thirteen  weeks ended  September 26, 1998  increased  29.2% to
$64.5 million compared to $50.0 million for the same period in 1997. Pint volume
increased  14.7%  compared  to the same  period  in 1997,  which  was  primarily
attributable  to the Company's  original line of products.  This volume increase
was combined with a domestic price increase of approximately  3.3% on pints sold
to distributors  that went into effect in July 1998. Unit volume of 2 1/2-gallon
bulk container  products increased 30% compared to the same period in 1997. Also
contributing  to the  increase in sales this  quarter was the 1998 launch of the
Company's new  single-serving  products in Japan and the  introduction  of a new
line of  premium  plus ice  cream,  Newman's  Own(TM)  All  Natural  Ice  Cream,
manufactured  and sold under a license  agreement  with Paul Newman and Newman's
Own. 
<PAGE>

Packaged sales (primarily pints) represented 76% of total net sales in the third
quarter  of 1998  compared  to 82% in  1997.  Net  sales  of 2 1/2  gallon  bulk
containers represented approximately 11% of total net sales in the third quarter
of 1998,  compared to 9% in 1997.  Net sales of novelty  products  accounted for
approximately  10% of total net sales in the third quarter of 1998,  compared to
6% in 1997. Net sales from the Company's  retail stores  represented 3% of total
net sales in the third quarters of 1998 and 1997.

International  sales  were  $7.0  million  during  the  third  quarter  of 1998,
representing  11% of net sales,  as compared  to $700,000 in 1997,  or 1% of net
sales.  The increase in 1998 was primarily due to higher sales to Japan,  Europe
and Canada. However, for the fourth quarter of 1998, management anticipates that
international sales as a percentage of total sales will be lower.



Cost of Sales and Gross profit

Cost of sales in the third quarter of 1998 increased  approximately $9.5 million
or 30.8% from the same period in 1997 and overall  gross  profit as a percentage
of net sales was 37.5% in the third  quarter of 1998 as compared to 38.3% in the
comparable period last year. The lower gross profit as a percentage of net sales
resulted from substantial  increases in dairy commodity  costs,  which have been
partially  offset by favorable  manufacturing  variances  resulting  from better
plant utilization due to higher volumes.

The  Company  experienced  substantial  increases  in dairy  prices in the third
quarter of 1998  compared to the same  period  last year.  In response to higher
dairy costs the Company  instituted a price increase  effective July 15, 1998 of
approximately  3.3% for its packaged pint products and 4.3% for its 2 1/2 gallon
bulk containers. If dairy commodity prices begin to rise again to higher levels,
there is the  possibility  that these costs will not be passed on to  customers,
which will negatively  impact future gross profit  margins.  See Risk Factors in
the "Forward-Looking Statements" section.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 33.7% to $20.0 million in
the  third  quarter  of 1998 from  $15.0  million  for the same  period in 1997.
Selling,  general  and  administrative  expenses  were 31.0% of net sales in the
third quarter of 1998 as compared to 30.0% for the comparable  period last year.
The $5.0 million dollar increase primarily reflects increased promotional and
marketing costs  including  increased radio  advertising,  in-store  programs to
drive product trial and brand awareness,  the continued  rollout of the new pint
package design and international costs.


<PAGE>



Other Income (Expense)

Interest income  increased  $109,000 in the third quarter of 1998 as compared to
the same period in the prior year.  The  increase in interest  income was due to
higher average invested balances  throughout the period.  Other income increased
$263,000 as compared to the same period in the prior year primarily due to gains
associated with foreign currency exchange.

Income Taxes

Income taxes  increased  approximately  $82,000 due to the increase in income in
1998 as compared to 1997. The Company  anticipates an effective rate of 36.0% in
1998 compared to 38.0% in the prior year.

Net Income

As a result of the foregoing, net income for the third quarter of 1998 increased
14.4% to $2.9  million  from $2.5  million  for the third  quarter of 1997.  Net
income was 4.5% of net sales in the third  quarter of 1998  compared  to 5.1% in
1997.  Diluted net income per share increased 14.7% to $.39 per common share for
the third  quarter of 1998  compared to a diluted net income per common share of
$.34 for the third quarter of 1997.

Thirty-Nine Weeks Ended September 26, 1998 and September 27, 1997

Net Sales

Net sales for the thirty-nine  weeks ended September 26, 1998 increased 20.5% to
$164.9  million  compared to $136.8  million  for the same period in 1997.  Pint
volume  increased 8.7% compared to the same period in 1997,  which was primarily
attributable  to the Company's  original line of products.  This volume increase
was  combined  with a price  increase  of  approximately  3.3% of pints  sold to
distributors  that went into effect in July 1998.  Unit  volume of 2  1/2-gallon
bulk container  products increased 15% compared to the same period in 1997. Also
contributing  to the increase in sales for the first three  quarters of 1998 was
the  launch  of the  Company's  new  single  serving  products  in Japan and the
introduction  of a new line of premium  plus ice  cream,  Newman's  Own(TM)  All
Natural Ice Cream,  manufactured  and sold under a license  agreement  with Paul
Newman and Newman's Own.


<PAGE>



Packaged sales (primarily pints) represented 80% of total net sales in the first
three quarters of 1998 compared to 84% for the same period in 1997. Net sales of
2 1/2 gallon bulk containers represented  approximately 9% of total net sales in
the first three quarters of 1998 compared to 8% for the same period in 1997. Net
sales of novelties  accounted for approximately 9% of total net sales during the
first  three  quarters of 1998  compared to 6% for the same period in 1997.  Net
sales from the Company's retail stores  represented 2% of total net sales in the
first three quarters of 1998 and 1997.

International  sales were $15.0  million  during the first nine  months of 1998,
representing  9.1% of net sales, as compared to $6.4 million for the same period
in 1997, or 4.6% of net sales.  The increase in 1998 was primarily due to higher
sales to Japan and  Canada.  However,  the fourth  quarter  of 1998,  management
anticipates  that  international  sales as a  percentage  of total sales will be
somewhat lower.


Cost of Sales and Gross Profit

Cost of sales in the first three  quarters of 1998 increased  approximately  $17
million from the same period in 1997 and overall gross profit as a percentage of
net sales was 36.0% in 1998 as  compared to 35.3% for the  comparable  period in
1997.  The higher gross profit as a percentage of net sales  primarily  resulted
from increases in selling prices effective in January 1998 and July 1998, better
plant  utilization due to higher  production  volumes and a decrease in reserves
for potential  product  obsolescence,  offset by substantial  increases in dairy
commodity costs.

The Company experienced  significant increases in dairy prices in the first nine
months of 1998  compared  to a decrease in prices for the same period last year.
In response to higher dairy costs the Company  instituted a 3.3% effective price
increase  effective in July 1998 for its packaged  pint  products and a combined
10.2%  increase for its 2 1/2 gallon bulk  containers  effective in January 1998
and July 1998 to offset these increased  costs. If dairy commodity  prices begin
to rise to much higher levels,  there is the  possibility  that these costs will
not be passed on to customers,  which will negatively impact future gross profit
margins. See Risk Factors in the "Forward-Looking Statements" section.

Selling, General and Administrative Expenses

Selling,  general and  administrative  expenses increased 20.5% to $51.2 million
for the first nine  months of 1998 from  $42.5  million  for the same  period in
1997. Selling,  general and administrative  expenses were 31.1% of net sales for
the first nine months of 1998 and 1997. The $8.7 million increase in expenses is
attributable to increased sales and marketing  expenses to support the launch of
a new line of premium  plus ice cream  under the name of  Newman's  Own(TM)  All
Natural  Ice  Cream,   increased   international   costs,   increases  in  radio
advertising, in-store programs to drive product trial and brand awareness, scoop
truck marketing and the continued rollout of the new pint package design.


<PAGE>



Other Income (Expense)

Interest  income  increased  $327,000 during the first three quarters of 1998 as
compared to the same period in the prior year.  The increase in interest  income
was due to higher average  invested  balances  throughout  the period.  Interest
expense decreased $87,000 during the first three quarters of 1998 as compared to
the same period in the prior year.  Other  income  (expense)  increased  for the
first nine  months of 1998 from other  expense of  $312,000 in the prior year to
other income of $177,000 in 1998. This is primarily due to gains associated with
foreign currency exchange in 1998 compared to losses in the prior year.

Income Taxes

Income taxes  increased $1.1 million due to the increase in income.  The Company
anticipates  an effective  rate of 36.0% in 1998  compared to 38.0% in the prior
year.

Net Income

As a result of the  foregoing,  net income for the first three  quarters of 1998
increased  68.3% to $5.4 million for 1998  compared to $3.2 million for the same
period in 1997. Net income was 3.3% of net sales for the first three quarters of
1998 compared to 2.4% for the same period in 1997.  Diluted net income per share
increased  to $0.72  per  common  share  for the first  three  quarters  of 1998
compared to $0.43 for the same period in 1997.

Liquidity and Capital Resources

As of  September  26,  1998  the  Company  had  $60.3  million  of cash and cash
equivalents,  an increase of $13  million  since  December  27,  1997.  Net cash
provided  by  operations  in the first  nine  months of 1998 was $22.5  million.
Approximately  $7.5  million  was used for  additions  to  property,  plant  and
equipment, primarily for improvements at the Company's manufacturing facilities,
for the build out of three  Company  owned scoop shop  facilities  in France and
fit-up costs for a chain of cinemas in the United Kingdom.

Since December 27, 1997 trade  receivables,  and the sum of accounts payable and
accrued  expenses have increased  $2.6 million and $18.4 million,  respectively.
These increases reflect the seasonality of the Company's  business and increased
sales and marketing expenses.

The  Company  anticipates  capital  expenditures  in the  remainder  of  1998 of
approximately  $1.5  million.   Most  of  these  additional   projected  capital
expenditures  relate  to  equipment  upgrades  at  the  Company's  manufacturing
facilities, and computer related expenditures. 
<PAGE>

During the nine months ended September 26, 1998 the Company  repurchased a total
of 133,000 shares of the Company's Class A common stock for  approximately  $2.5
million.  122,500  shares were purchased  pursuant to the repurchase  program as
announced May 8, 1997 for use in  connection  with stock option awards under the
1995  Equity   Incentive  Plan.  These   transactions,   together  with  earlier
repurchases  of 77,500  shares,  complete the  repurchase of the 200,000  shares
authorized  under this program.  An additional  10,500 shares were  purchased up
through September 26, 1998 for approximately $150,000 under a repurchase program
announced in September 1998  authorizing  the Company to purchase  shares of the
Company's  Class A common stock up to an aggregate  cost of $5.0 million for use
for general  corporate  purposes.  Subsequent to the quarter ended September 26,
1998 and through  November 5, 1998 the Company  had  repurchased  an  additional
20,000 shares for approximately $320,000.

The Company has two lines of credit providing an aggregate of $20.0 million with
The First  National Bank of Boston and Key Bank of Vermont.  These are unsecured
agreements  providing for borrowings from time to time, expiring at December 29,
1998 and December 31, 1998, respectively. The agreements specify interest at the
banks'  Base  Rate or at the  Eurodollar  rate plus a  maximum  of 1.25%.  As of
November  6, 1998,  there  have been no  borrowings  under  these line of credit
agreements.

Management  believes that internally  generated  funds,  cash currently on hand,
investments held in marketable  securities  (pending their use in the business),
and equipment lease financing will be adequate to meet anticipated operating and
capital requirements.

"Forward-Looking Statements"

This  section,  as well as other  portions of this  document,  includes  certain
forward-looking  statements about the Company's business,  new products,  sales,
dairy prices,  other  expenditures  and cost savings,  Year 2000 program  costs,
effective tax rate, operating and capital requirements and refinancing. Any such
statements  are subject to risks that could cause the actual results or needs to
vary materially. These risks are discussed below.

Risk Factors

Dependence on Independent Ice Cream Distributors.  Historically, the Company has
been dependent on maintaining satisfactory relationships with Dreyer's Grand Ice
Cream, Inc. and the other independent ice cream  distributors that have acted as
the Company's exclusive or master distributor in their assigned territories.  In
1997,  Dreyer's  distributed  significantly more than a majority of the sales of
Ben & Jerry's  products.  While the  Company  believes  its  relationships  with
Dreyer's and its other  distributors  generally have been  satisfactory and have
been instrumental in the Company's growth,  the Company has at times experienced
difficulty in maintaining such relationships to its satisfaction. 
<PAGE>

In early 1998 Dreyer's made overtures to Ben Cohen and Jerry  Greenfield,  the
Company's co-founders,  to obtain their support for an offer that Dreyer's would
make to acquire the Company. The co-founders rejected these overtures.

In late August  1998,  Ben & Jerry's  announced  a redesign of its  distribution
network  intended to create more Company  control over sales and more efficiency
in the distribution of its products.  Under the planned redesign,  Ben & Jerry's
will  increase the direct  sales calls by its own sales force (as  distinguished
from  calls  by the  distributors'  sales  forces)  to  all  grocery  and  chain
convenience  stores and will have  established a network where no distributor of
Ben &  Jerry's  products  will  have a  majority  percentage  of  the  Company's
distribution. Pursuant to this redesign, Ben & Jerry's entered into an agreement
in  late  August  with  The  Pillsbury  Company   ("Pillsbury")   providing  for
distribution on a non-exclusive basis by Pillsbury, the parent of Haagen-Dazs, a
major  competitor of the Company,  of Ben & Jerry's products in various areas of
the United  States,  commencing at some point to be mutually  agreed in 1999. On
August 31, 1998 Ben & Jerry's gave Dreyer's notice of termination of its present
distribution  agreement with Dreyer's.  Dreyer's then filed a complaint  against
Ben & Jerry's in the United States  District  Court for the District of Northern
California.  In this action  Dreyer's seeks,  among other things,  to enjoin the
acceleration of the effective date of such  termination from August 31, 1999 (12
months  after the date of the notice) to April 15, 1999 (7 1/2 months  after the
date of the notice).  Ben & Jerry's believes that it has meritorious  defensives
to Dreyer's claims against such acceleration and is vigorously opposing Dreyer's
motion for  preliminary  injunction  against the  shortened  termination  notice
period.  Unless the matter is resolved  between Ben & Jerry's  and  Dreyer's,  a
hearing will be held in the United  States  District  Court in San  Francisco on
Dreyer's  motion for  preliminary  injunction.  The  hearing  date was  recently
postponed  at the request of both  parties,  and Ben & Jerry's and  Dreyer's are
currently in discussions  both with respect to resolving the pending  litigation
(and the  distribution  arrangements  that  would  remain in place  prior to the
expiration of the presently existing distribution agreement) and with respect to
reaching  agreement on a proposed new arrangement  providing for distribution by
Dreyer's on a  non-exclusive  basis of Ben & Jerry's  products,  commencing at a
date in 1999 to be specified, at which point the presently existing distribution
agreement  would  expire.  The  parties  presently   contemplate  that  the  new
distribution  agreement  between Ben & Jerry's and Dreyer's  would  pertain to a
smaller  geographic  area than covered under the  distribution  agreement now in
place and would be on terms and conditions different in some respects from those
applicable under the presently existing distribution  agreement.  However, there
can be no  assurance  that  either the  pending  litigation  brought by Dreyer's
against the Company will be resolved by agreement or that the parties will enter
into a new distribution agreement.

Under the distribution network redesign contemplated by Ben & Jerry's, Pillsbury
will distribute Ben & Jerry's products to specified territories;  the balance of
domestic  deliveries will be distributed in part by Dreyer's  handling a smaller
volume of Ben & Jerry's distribution in other specified territories, and in part
by  other  independent  distributors,   most  of  whom  are  already  acting  as
distributors for Ben & Jerry's.  In the event that the proposed new distribution
agreement cannot be concluded with 
<PAGE>

Dreyer's, Ben & Jerry's intends, during the remaining portion of the termination
notice  period under the  presently  existing  Dreyer's  agreement,  to conclude
distribution  arrangements for all the specified  territories  covered under the
present agreement with Dreyer's with such additional  independent  distributors.
In either  event,  no single  distributor  would  have over 40  percent of Ben &
Jerry's distribution.  However,  there can be no assurance that such alternative
arrangements  with other  independent  distributors  will be  concluded on terms
satisfactory to Ben & Jerry's,  and in general,  since  available  distribution
alternatives  are  limited,  there  can be no  assurance  that  difficulties  in
maintaining satisfactory relationships with distributors, some of which are also
competitors  of the  Company,  will not have a  material  adverse  effect on the
Company's business.

Growth in Sales and Earnings. During the first nine months of 1998, net sales of
the Company  increased  20.5% to $165 million from $137 million  during the same
period in 1997.  Pint volume during the first nine months of 1998 increased 8.7%
compared to the same period in 1997. The super premium ice cream,  frozen yogurt
and sorbet industry category sales remained flat during the first nine months of
1998 as compared to the same period in 1997.  Given these overall domestic super
premium industry trends, the successful  introduction of innovative flavors on a
periodic  basis has become  increasingly  important  to any sales  growth by the
Company.  Accordingly,  the  future  degree of market  acceptance  of any of the
Company's new products,  which will be accompanied by promotional  expenditures,
is likely to have an important impact on the Company's future financial results.

Competitive  Environment.  The super  premium  frozen  dessert  market is highly
competitive with the distinctions  between the super premium  category,  and the
"adjoining"  premium and premium plus  categories  less marked than in the past.
And, as noted above, the ability to successfully introduce innovative flavors on
a  periodic  basis  that  are  accepted  by  the  marketplace  is a  significant
competitive  factor. In addition,  the Company's  principal  competitors (two of
which  are or  will  be  distributors  of the  Company's  products)  are  large,
diversified  companies with resources  significantly greater than the Company's.
The Company expects strong  competition to continue,  including  competition for
adequate distribution and competition for the limited shelf space for the frozen
dessert category in supermarkets and other retail food outlets.

Increased Cost of Raw Materials. Management believes that the trend of increased
dairy  ingredient  commodity  costs may continue and it is possible that at some
future date both gross  margins and  earnings  may not be  protected  by pricing
adjustments, cost control programs and productivity gains.

Reliance  on a Limited  Number of Key  Personnel.  The success of the Company is
significantly  dependent  on the  services  of Perry Odak,  the Chief  Executive
Officer and a limited  number of executive  managers  working under Mr. Odak, as
well as certain  continued  services of Ben Cohen,  the Chairperson of the Board
and  co-founder  of the Company;  and Jerry  Greenfield,  Vice  Chairperson  and
co-founder  of the Company.  Loss of the services of any of these  persons could
have a material adverse effect on the Company's business.
<PAGE>


The  Company's  Social  Mission.  The  Company's  basic  business  philosophy is
embodied in a three-part mission  statement,  which includes a social mission to
"operate  the Company in a way that  actively  recognizes  the central role that
business  plays in the  structure of society by  initiating  innovative  ways to
improve  the  quality  of  life  of  a  broad  community:  local,  national  and
international.  Underlying the mission of Ben & Jerry's is the  determination to
seek new and creative ways of addressing  all three parts,  while holding a deep
respect for  individuals  inside and outside the Company and for the communities
of which they are a part."  The  Company  believes  that  implementation  of its
social  mission,  which is  integrated  into the  Company's  business,  has been
beneficial  to the  Company's  overall  financial  performance.  However,  it is
possible  that at some  future  date the amount of the  Company's  energies  and
resources  devoted  to its  social  mission  could  have some  material  adverse
financial effect.

International.  The Company's  principal  competitors  have  substantial  market
shares in various  countries outside the United States,  principally  Europe and
Japan. The Company sells product (which is manufactured in the United States) in
the United Kingdom,  Ireland,  France,  the  Netherlands and Belgium,  and began
selling in Japan through a joint venture in 1998. The Company also has licensing
agreements in Israel (1987) and Canada (1998).  The Company is investigating the
possibility  of  further  international  expansion.  However,  there  can  be no
assurance  that  the  Company  will  be  successful  in  entering  (directly  or
indirectly   through   licensing),   on  a  long-term   profitable  basis,  such
international markets as it selects.

Control of the Company.  The Company has two classes of common stock - the Class
A Common  Stock,  entitled to one vote per share,  and the Class B Common  Stock
(authorized in 1987), entitled,  except to the extent otherwise provided by law,
to ten  votes  per  share.  Ben  Cohen,  Jerry  Greenfield  and  Jeffrey  Furman
(collectively the "Principal  Stockholders") hold shares representing 45% of the
aggregate  voting  power  in  elections  for  directors,  permitting  them  as a
practical  matter to elect all  members of the Board of  Directors  and  thereby
effectively  control the  business,  policies  and  management  of the  Company.
Because of their  significant  holdings of Class B Common  Stock,  the Principal
Stockholders  may  continue to exercise  this  control even if they were to sell
substantial portions of their Class A Common Stock.

In addition, the Company issued all of the authorized Class A Preferred Stock to
the Ben & Jerry's  Foundation in 1985.  All current  directors of the Foundation
are directors of the Company. The Class A Preferred Stock gives the Foundation a
class  voting  right to act with respect to certain  Business  Combinations  (as
defined in the  Company's  charter) and  significantly  limits the voting rights
that holders of the Class A Common Stock and Class B Common Stock, the owners of
virtually all of the equity in the Company, would otherwise have with respect to
such Business Combinations.

While  the Board of  Directors  believes  that the Class B Common  Stock and the
Class A  Preferred  Stock are  important  elements  in keeping  Ben & Jerry's an
independent, Vermont-based business focused on its three-part corporate mission,
the Class B Common  Stock and the  Class A  Preferred  Stock may be deemed to be
"anti-takeover" provisions in that the Board of Directors believes the 
<PAGE>

existence  of these  securities  will  make it  difficult  for a third  party to
acquire  control of the  Company on terms  opposed by the holders of the Class B
Common Stock, including primarily the Principal Stockholders, or The Foundation,
or for  incumbent  management  and the  Board of  Directors  to be  removed.  In
addition,  the 1997  amendments  to the  Company's  Articles of  Association  to
classify the Board of Directors and to add certain other related provisions (see
"Anti-Takeover  Effects of Class B Common Stock,  Class A Common Stock,  Class A
Preferred  Stock and  Classified  Board of Directors" in Item 1 of the Company's
Report  on  Form  10-K  for  the  1997   fiscal   year)  may  be  deemed  to  be
"anti-takeover"  provisions  in that the Board of Directors  believes that these
amendments  will make it difficult  for a third party to acquire  control of the
Company on terms opposed by the holders of the Class B Common  Stock,  including
primarily  the  Principal  Stockholders  and the  Foundation,  or for  incumbent
management and the Board of Directors to be removed.

In early August, 1998, following approval by its Board of Directors, the Company
put in place two Shareholder  Rights Plans, one pertaining to the Class A Common
Stock and one  pertaining to the Class B common Stock.  These Plans are intended
to protect  stockholders by compelling someone seeking to acquire the Company to
negotiate with the Company's Board of Directors in order to protect stockholders
from unfair  takeover  tactics and to assist in the  maximization of stockholder
value.  These Rights Plans,  which are common for public companies in the United
States, may also be deemed to be "anti-takeover" provisions in that the Board of
Directors  believes that these Plans will make it difficult for a third party to
acquire  control of the Company on terms which are unfair or  unfavorable to the
stockholders.  Also,  in April,  1998 the  Legislature  of the State of  Vermont
amended a provision of the Vermont Business  Corporation Act to provide that the
directors of a Vermont corporation may also consider,  in determining whether an
acquisition  offer or other matter is in the best interests of the  corporation,
the  interests  of  the  corporation's  employees,   suppliers,   creditors  and
customers,  the  economy of the state in which the  corporation  is located  and
including the  possibility  that the best  interests of the  corporation  may be
served by the continued independence of the corporation.

"Year 2000"

The Company has formed an internal  company-wide  Year 2000  compliance  team to
evaluate  and prepare its computer  systems for the year 2000.  A  comprehensive
evaluation  of the  impact  of  the  Year  2000  issue  on  both  the  Company's
infrastructure,  including  manufacturing  processes,  and business  information
systems has begun. This evaluation will also include the products and systems of
the Company's critical suppliers and other business partners.

The Company's internal team is in the process of completing the inventory of all
internal applications and infrastructure to determine Year 2000 readiness, which
it expects to  complete  by the end of 1998.  In  parallel,  the team is testing
certain equipment and software systems known to have possible Year
 <PAGE>

2000 issues and is in the process of assessing  possible  remediation  options.
The  assessment  phase is expected to be  completed  during the first and second
quarters of 1999.

The Company's corporate business  information  systems and certain  applications
are  believed to be Year 2000  compliant  and testing  and  validation  of these
systems are in process.  Other financial,  sales and manufacturing  applications
will be repaired during the fourth quarter of 1998 and the first quarter of 1999
with testing and  validation of these  applications  will occur during the first
half of 1999.  The  Company's  corporate  network  hardware and software are not
compliant and will undergo  renovation  during the first quarter of 1999.  Other
systems,  including  non-information  technology  systems and third party vendor
systems are still in the assessment  phase. The Company  anticipates  completing
the assessment during the first quarter of 1999 with remediation to follow.

The  Company  presently  believes  that  the  Year  2000  issue  will  not  pose
significant operational problems.  However, the future compliance with Year 2000
processing  within the Company is dependent on key personnel,  vendor  equipment
and component parts, third party suppliers'  internal systems,  and accordingly,
unresolved  failures remain a possibility.  As a result,  Year 2000 issues could
have a significant impact on the Company's  operations and its financial results
if  modifications  are not  completed  on a timely  basis,  unforeseen  needs or
problems   arise,   or  if  systems   operated  by  third   parties   (including
municipalities  or  utilities)  are not Year 2000  compliant.  At  present,  the
Company has not developed a contingency  plan but will determine  whether such a
plan is critical early in fiscal 1999.

Based on a  preliminary  assessment,  the Company  expects that the costs of the
foregoing Year 2000 programs,  which primarily include  redeployment of existing
internal  resources,  external project management costs and upgrades to existing
applications  will not be  material.  The  Company  will  expense  the  costs of
modifying  existing systems and capitalize the replacement cost of software that
is not "Year  2000"  compliant.  There can be no  guarantee,  however,  that the
systems of other entities which the Company relies upon,  will be converted on a
timely basis or that any failure to convert by another  entity would not have an
adverse effect on the Company's systems and operations.

<PAGE>



                           PART II - OTHER INFORMATION

ITEM 1. - LEGAL PROCEEDINGS

On August 31,  1998  Dreyer's  Grand Ice Cream,  Inc.  and Edy's Grand Ice Cream
filed a complaint  against  Ben & Jerry's  Homemade,  Inc. in the United  States
District Court for the Northern District of California (San Francisco Division).
In this action Dreyer's seeks, among other things, to enjoin the acceleration of
the  effective  date of Ben &  Jerry's  termination  of the  presently  existing
Distribution  Agreement  between Ben & Jerry's and Dreyer's from August 31, 1999
(12 months after the date of Ben & Jerry's notice of  termination  without cause
on August  31,  1998) to April 15,  1999 (7 1/2  months  after the date of Ben &
Jerry's  notice of  termination).  On October 14,  1998 Ben & Jerry's  filed its
Answer to the  Complaint  and a motion in  opposition  to  Dreyer's  motion  for
preliminary injunction. While at this date of the proceedings, with no discovery
having  occurred  and no hearing  having been held,  it is not  possible for the
company to provide a definitive  opinion on this matter.  Ben & Jerry's believes
that it has meritorious  defenses to Dreyer's complaint and Dreyer's motion. Ben
& Jerry's is vigorously  opposing  Dreyer's  motion for  preliminary  injunction
against the shortened  termination  notice period.  In any event,  Ben & Jerry's
believes that any adverse outcome of this litigation would not have any material
adverse effect on the Company's financial results.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

    (a) Exhibit (11) Statement Re: Computation of Per Share Earnings
        Exhibit (27) Financial Data Schedule

    (b) The  following  reports  were filed on Form 8-K:  
        1. Filed July 30, 1998 to reflect  amendments to the By-laws as adopted
           June 26, 1998.
        2. Filed August 13, 1998 to  reflect  adoption  of Class A Common  Stock
           and  Class B Common  Stock shareholders Rights Plans.

SIGNATURES

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

                                         BEN & JERRY'S HOMEMADE, INC.



DATE: November 10, 1998                 BY:/s/Frances Rathke
                                        ---------------------------------------
                                        Frances Rathke, Chief Financial Officer
<PAGE>

                          BEN & JERRY'S HOMEMADE, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                     ASSETS
                                 (In thousands)


                                              September 26,     December 27,
                                                  1998             1997
                                              ------------      -----------
                                                      
                                              (Unaudited)         (Note)

Current assets:                                  
 Cash and cash equivalents                      $ 60,325        $ 47,318
 Investments                                         586             481
 Trade accounts receivable:
  (less allowance of $1,059 in 1998
  and $1,066 in 1997 for doubtful accounts)       15,348          12,710
 Inventories                                      12,116          11,122
 Deferred income taxes                             9,221           6,071
 Prepaid expenses and other current assets         2,611           2,378
                                                --------        --------
                                                
  Total current assets                           100,207          80,080

 Property, plant and equipment, net               64,292          62,724
 Investments                                         301           1,061
 Other assets                                      3,201           2,606
                                                ========        ========
                                                $168,001        $146,471
                                                ========        ========
                                                




Note:  The balance  sheet at December 27, 1997 has been derived from the audited
financial  statements  at that date but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.

           See notes to condensed consolidated financial statements.

                                      - 1 -
<PAGE>


                          BEN & JERRY'S HOMEMADE, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS

                       LIABILITIES & STOCKHOLDERS' EQUITY
                        (In thousands except share data)

                                             September 26,   December 27,
                                                 1998            1997
                                             ------------    ------------
                                                             
                                             (Unaudited)        (Note)
Current liabilities:
     Accounts payable and accrued expenses      $ 41,691        $ 23,266
     Current portion of long-term debt and
       obligations under capital leases            5,389           5,402
                                              ----------     -----------
                                                                 
     Total current liabilities                    47,080          28,668

Long-term debt and obligations under 
capital leases                                    25,431          25,676

Deferred income taxes                              5,162           5,208

Stockholders' equity:
$1.20  noncumulative  Class A preferred
   stock - par value $1.00 per share,
   redeemable at $12.00  per  share; 900 shares
   authorized, issued and outstanding;
   aggregated preference on liquidation - $9           1               1
Class A common stock - $.033 par value; 
   authorized 20,000,000 shares; issued: 
   6,542,394 at September 26, 1998 and 6,494,835
   at December 27, 1997                              216             214
Class B common stock - $.033 par value; 
  authorized 3,000,000 shares; issued:  
  854,438 at September 26, 1998 and 866,664
  at December 27, 1997                                28              29
Additional paid-in-capital                        50,224          49,681
Retained earnings                                 44,488          39,086
Cumulative translation adjustment                   (142)           (129)
Treasury stock, at cost: 257,532 Class A and 
  1,092 Class B shares at September 26, 1998
  and 124,532 Class A and 1,092 Class B shares
  at December 27, 1997                            (4,487)         (1,963)
                                                --------        --------
                                                                
  Total stockholders' equity                      90,328          86,919
                                                --------        --------
                                                $168,001        $146,471
                                                ========        ========
                                                                 




Note:  The balance  sheet at December 27, 1997 has been derived from the audited
financial  statements  at that date but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.

           See notes to condensed consolidated financial statements.

                                      - 2 -

<PAGE>




                          BEN & JERRY'S HOMEMADE, INC.

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                                   (Unaudited)

                     (In thousands except per share amounts)


<TABLE>
<CAPTION>

                                         For the Thirteen weeks ended            For the Thirty-nine weeks ended

<S>                                   <C>                 <C>                 <C>                 <C>
                                      September 26,       September 27,       September 26,       September 27,
                                           1998                1997                1998               1997
                                      -------------       -------------       -------------       -------------

Net sales                                  $ 64,566            $ 49,956            $164,870           $136,805

Cost of sales                                40,339              30,838             105,529             88,534
                                      -------------       -------------       -------------       -------------

Gross profit                                 24,227              19,118              59,341             48,271
Selling, general and
 administrative expenses                     20,018              14,977              51,270             42,565
                                      -------------       -------------       -------------       -------------

Operating income                              4,209               4,141               8,071              5,706

Interest income                                 596                 487               1,626              1,299
Interest expense                               (460)               (466)             (1,433)            (1,520)
Other income (expense), net                     174                 (89)                177               (312)
                                     -----------------  ------------------    --------------      -------------
                                    
                                                310                 (68)                370               (533)
                                      -------------       -------------       --------------      -------------

Income before income taxes                    4,519               4,073               8,441              5,173

Income taxes                                  1,627               1,545               3,039              1,963
                                      -------------       -------------       --------------      -------------

Net income                                 $  2,892            $  2,528            $  5,402           $  3,210
                                      =============       =============       ===============     =============


Shares Outstanding:
  Basic                                       7,181               7,279               7,223              7,250
  Diluted                                     7,446               7,341               7,481              7,314
Basic income per common share              $   0.40           $    0.35            $   0.75           $   0.44
Diluted income per common share            $   0.39           $    0.34            $   0.72           $   0.43


                                   


                                    See notes to condensed consolidated financial statements.

</TABLE>
<PAGE>

                          BEN & JERRY'S HOMEMADE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                 (In thousands)
                                   (Unaudited)


                                          For the Thirty-nine weeks ended

                                            September 26,   September 27,
                                                1998            1997
                                            ------------    ------------

Net income                                      $  5,402        $  3,210
Adjustments to reconcile net income to net
cash provided by operating activities:
  Depreciation and amortization                    5,711           5,797
  Provision for bad debts                             50             408
  Deferred income taxes                           (3,196)         (1,506)
  Stock Award                                                        212
  Loss on disposition of assets                       90              99
Changes in operating assets and liabilities:
  Accounts receivable                             (3,572)         (6,898)
  Inventories                                       (994)          3,280
  Prepaid expenses                                  (526)           (152)
  Accounts payable and accrued expenses           16,981          11,883
  Income taxes payable/receivable                  2,615           2,460
                                            ------------    ------------
 Net cash provided by operating activities        22,561          18,793

                                                          
Additions to property, plant and equipment        (7,481)         (2,747)
Proceeds from sale of assets                                          48
Changes in other assets                             (483)           (260)
Decrease (increase) in investments                   655             (63)
                                            ------------    ------------
Net cash used for investing activities            (7,309)         (3,022)


Repayments of long-term debt and capital leases     (258)           (607)
Repurchase of common stock                        (2,524)           (988)
Proceeds from issuance of common stock               544           1,116
                                            ------------    ------------
Net cash used for financing activities            (2,238)           (479)

Effect of exchange rate changes on cash               (7)             (2)
                                            ------------    ------------
Increase in cash and cash equivalents             13,007          15,290

Cash and cash equivalents at beginning of 
  period                                          47,318          36,104
                                            ------------    ------------
Cash and cash equivalents at end of period      $ 60,325        $ 51,394
                                            ============    ============


            See notes to condensed consolidated financial statements.

                                      - 4 -