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

                                   FORM 10-Q
                                        

[X]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                OF THE SECURITIES AND EXCHANGE ACT OF 1934
                                        
For the quarterly period ended                     SEPTEMBER 27, 1997

OR

[_]          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D)
                OF THE SECURITIES AND EXCHANGE ACT OF 1934
                                        
             For the transition period from ..........to..........

                        Commission file number: 1-14092

                         THE BOSTON BEER COMPANY, INC.
            (Exact name of registrant as specified in its charter)

MASSACHUSETTS                                              04-3284048
(State or other jurisdiction of incorporation              (I.R.S. Employer
  or organization)                                         Identification No.)

                  75 ARLINGTON STREET, BOSTON, MASSACHUSETTS
                   (Address of principal executive offices)
                                     02116
                                  (Zip Code)

                                (617) 368-5000
             (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities 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
                                     -----    ----   
Number of shares outstanding of each of the issuer's classes of common stock, as
of October 31, 1997:

            CLASS A COMMON STOCK, $.01 PAR VALUE          16,338,274
            CLASS B COMMON STOCK, $.01 PAR VALUE           4,107,355
            (Title of each class)                  (Number of shares)

<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                   FORM 10-Q

                                QUARTERLY REPORT
                               SEPTEMBER 27, 1997

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
 
 

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

            Item 1.  Consolidated Financial Statements
 
                     Consolidated Balance Sheets
                     September 27, 1997 and December 28, 1996                           3
                                                                          
                     Consolidated Statements of Operations for the        
                     Three and Nine Months Ended September 27, 1997 and   
                     September 28, 1996                                                 4
                                                                          
                     Consolidated Statements of Cash Flows for the        
                     Nine Months Ended September 27, 1997 and             
                     September 28, 1996                                                 5
                                                                          
                     Notes to Consolidated Financial Statements                       6-8
 

            Item 2.  Management's Discussion and Analysis of
                     Financial Condition and Results of Operations                   9-11
 

PART II.   OTHER INFORMATION
 

           Item 1.   Legal Proceedings                                                 12
                                                                       

           Item 2.   Changes in Securities                                             12
                                                                       

           Item 3.   Defaults Upon Senior Securities                                   12
                                                                       

           Item 4.   Submission of Matters to a Vote of                
                     Security Holders                                                  12
                                                                       

           Item 5.   Other Information                                                 12
                                                                       

           Item 6.   Exhibits and Reports on Form 8-K                               12-18
 
SIGNATURES                                                                             19
 
</TABLE>


                                       2


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                          CONSOLIDATED BALANCE SHEETS
                       (in thousands, except share data)
                                  (unaudited)
 

<TABLE> 
<CAPTION> 
 
                                                                           September 27,         December 28,
                                                                                1997                 1996
                                                                         ----------------     ----------------
 
<S>                                                                        <C>                  <C>
ASSETS
     Current Assets:
            Cash and cash equivalents                                            $      -              $ 5,060
            Short term investments                                                 35,735               35,926
            Accounts receivable                                                    21,366               18,109
            Allowance for doubtful accounts                                        (1,952)              (1,930)
            Inventories                                                            16,535               13,002
            Prepaid expenses                                                          468                  674
            Deferred income taxes                                                   2,990                2,968
            Other current assets                                                    1,213                3,882
                                                                         ----------------     ----------------
              Total current assets                                                 76,355               77,691
 
            Restricted investments                                                      -                  611
            Equipment and leasehold improvements, at cost                          37,648               21,043
            Accumulated depreciation                                               (9,544)              (6,412)
            Deferred income taxes                                                      87                  151
            Other assets                                                            2,967                3,469
                                                                         ----------------     ----------------
              Total assets                                                       $107,513              $96,553
                                                                         ================     ================
 
LIABILITIES AND STOCKHOLDERS' EQUITY
     Current Liabilities:
            Accounts payable                                                     $  8,751              $17,783
            Line of credit                                                         14,275                    -
            Accrued expenses                                                       14,083               12,064
            Current maturities of long-term debt                                        -                   75
                                                                         ----------------     ----------------
              Total current liabilities                                            37,109               29,922
 
    Long-term debt, less current maturities                                             -                1,800
            Commitments and Contingencies                                               -                    -
     Stockholders' Equity:
            Class A Common Stock, $.01 par value;
             20,300,000 shares authorized; 16,335,073 and 15,972,058    
             issued and outstanding as of September 27 1997 and         
             December 28, 1996, respectively                                          163                  160
            Class B Common Stock, $.01 par value;
             4,200,000 shares authorized; 4,107,355           
             issued and outstanding as of September 27, 1997  
             and December 28, 1996                                                     41                   41
            Additional paid-in-capital                                             56,010               55,391
            Unearned compensation                                                    (218)                (363)
            Unrealized loss on investments in marketable securities                (1,868)                (442)
            Unrealized (loss) gain on forward exchange contract                         -                   31
            Retained earnings                                                      16,276               10,013
                                                                         ----------------     ----------------
               Total stockholders' equity                                          70,404               64,831
                                                                         ----------------     ----------------
               Total liabilities and stockholders' equity                        $107,513              $96,553
                                                                         ================     ================
</TABLE>


    The accompanying notes are an integral part of the financial statements

                                       3


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (in thousands, except per share data)
                                  (unaudited)


<TABLE> 
<CAPTION> 
                                                            Three months ended                          Nine months ended
                                               ------------------------------------------  ----------------------------------------
                                                   September 27,          September 28,        September 27,         September 28,
                                                        1997                   1996                1997                  1996
                                               -------------------    -------------------  ------------------    ------------------
                                                                                          
<S>                                           <C>                    <C>                  <C>                   <C>
Sales                                                      $55,664                $51,598            $159,621              $160,457
Less excise taxes                                            7,047                  5,486              19,311                17,145
                                               -------------------    -------------------  ------------------    ------------------
Net sales                                                   48,617                 46,112             140,310               143,312
Cost of sales                                               22,000                 22,901              68,578                71,831
                                               -------------------    -------------------  ------------------    ------------------
Gross profit                                                26,617                 23,211              71,732                71,481
                                                                                          
Operating expenses:                                                                       
Advertising, promotional and selling expenses               17,415                 17,118              51,802                51,488
General and administrative expenses                          3,190                  2,402               9,217                 8,251
                                               -------------------    -------------------  ------------------    ------------------
          Total operating expenses                          20,605                 19,520              61,019                59,739
                                               -------------------    -------------------  ------------------    ------------------
Operating income                                             6,012                  3,691              10,713                11,742
                                                                                          
Other income (expense):                                                                   
Interest income                                                451                    522               1,340                 1,455
Interest expense                                              (183)                   (57)               (540)                 (182)
Other income (expense), net                                   (511)                   (28)               (389)                  (32)
                                               -------------------    -------------------  ------------------    ------------------
          Total other income                                  (243)                   437                 411                 1,241
                                                                                          
Income before income taxes                                   5,769                  4,128              11,124                12,983
Provision for income taxes                                   2,521                  1,832               4,861                 5,686
                                               -------------------    -------------------  ------------------    ------------------
Net income                                                 $ 3,248                $ 2,296            $  6,263              $  7,297
                                               ===================    ===================  ==================    ==================
                                                                                          
Net income per common and                                                                 
  common equivalent share                                    $0.16                  $0.11               $0.31                 $0.36
                                               ===================    ===================  ==================    ==================
                                                                                          
Weighted average number of common                                                         
  and common equivalent shares                              20,509                 20,427              20,453                20,397
                                               ===================    ===================  ==================    ==================
 
</TABLE>


    The accompanying notes are an integral part of the financial statements

                                       4


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (in thousands)
                                  (unaudited)

<TABLE> 
<CAPTION> 
 
                                                                                                     Nine months ended
                                                                                           September 27,            September 28,
                                                                                                1997                    1996
                                                                                       -------------------      ------------------
 
<S>                                                                                      <C>                      <C>
Cash flows from operating activities:
Net income                                                                                        $  6,263                $  7,297
Adjustments to reconcile net income to net cash
        provided by operating activities:
        Depreciation and amortization                                                                3,029                   1,874
        Deferred Income taxes                                                                           42                       -
        Bad debt expense                                                                               118                     670
        Stock option compensation expense                                                              185                     132
        Changes in assets and liabilities:
        Accounts receivable                                                                         (3,353)                 (5,091)
        Inventory                                                                                   (3,533)                 (4,982)
        Prepaid expenses                                                                               206                    (202)
        Other current assets                                                                         1,106                     354
        Other assets                                                                                   502                     169
        Accounts payable                                                                            (9,032)                  7,635
        Accrued expenses                                                                             2,019                     569
                                                                                       -------------------      ------------------
Total adjustments                                                                                  ( 8,711)                  1,128
                                                                                       -------------------      ------------------
 
Net cash (used in) provided by operating activities                                                 (2,448)                  8,425
                                                                                       -------------------      ------------------
 
Cash flows for investing activities:
        Purchases of fixed assets                                                                  (15,042)                 (8,549)
        Purchases of marketable securities                                                               -                  (4,286)
        Purchases of government securities                                                          (1,232)                  1,048
        Purchases of restricted investments                                                           (625)                  1,213
        Proceeds from maturities of restricted investments                                           1,236                  (1,222)
                                                                                       -------------------      ------------------
Net cash (used in) investing activities                                                            (15,663)                (11,796)
                                                                                       -------------------      ------------------
 
Cash flows from financing activities:
        Proceeds from exercise of management incentive options                                         628                     493
        Proceeds from sale of common stock under stock purchase plan                                    23                       -
        Principal payments on long-term debt                                                        (1,875)                    (75)
        Net borrowings under lines of credit                                                        14,275                   1,076
                                                                                       -------------------      ------------------
Net cash provided by financing activities                                                           13,051                   1,494
                                                                                       -------------------      ------------------
 
Net decrease in cash and cash equivalents                                                           (5,060)                 (1,877)
 
Cash and cash equivalents at beginning of period                                                     5,060                   1,877
                                                                                       -------------------      ------------------
 
Cash and cash equivalents at end of period                                                        $      -                $      -
                                                                                       ===================      ==================
 
Supplemental disclosure of cash flow information:
 
Interest paid                                                                                     $    391                $    224
                                                                                       ===================      ==================
Taxes paid                                                                                        $  5,471                $  4,708
                                                                                       ===================      ==================
</TABLE>



    The accompanying notes are an integral part of the financial statements

                                       5


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                        

A.  BASIS OF PRESENTATION:

The Boston Beer Company, Inc. (the "Company") is engaged in the business of
brewing, marketing, and selling beer and ale products throughout the United
States and select international markets.  The accompanying consolidated
financial position as of  September 27, 1997 and the results of its consolidated
operations and consolidated cash flows for the interim periods ended September
27, 1997 and September 28, 1996 have been prepared by the Company, without
audit, in accordance with generally accepted accounting principles for interim
financial information and pursuant to the rules and regulations of the
Securities and Exchange Commission.  Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements and should be read in conjunction with the
audited financial statements included in the Company's Annual Report on Form 
10-K for the year ended December 28, 1996.

UTILIZATION OF ESTIMATES

To prepare the financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and assumptions
that affect the reported amounts of assets, liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expense during the reporting period.  In
particular, the Company records reserves for estimated product returns, for the
valuation of inventory, and regarding the collectibility of accounts receivable.
Actual results could differ from the estimates and assumptions used by
management.

RECLASSIFICATIONS

Beginning in the fourth quarter of 1996, certain expenses which were previously
classified as general and administrative expenses were reclassified as
advertising, promotional, and selling expenses.  All prior period financial
information has been reclassified to conform with the current presentation.
Certain other period amounts have also been reclassified to conform with the
current year's presentation.

MANAGEMENT'S OPINION

In the opinion of the management of the Company, the Company's unaudited
consolidated financial position as of September 27, 1997 and the results of its
consolidated operations and consolidated cash flows for the interim periods
ended September 27, 1997 and September 28, 1996, reflect all adjustments
(consisting only of normal and recurring adjustments) necessary to present
fairly the results of the interim periods presented.  The operating results for
the interim periods presented are not necessarily indicative of the results
expected for the full year.


B.  SHORT TERM INVESTMENTS:

Short term investments include marketable equity securities having a cost of
$4,289,000 and $4,286,000 and a market value of $2,421,000 and $3,844,000 at
September 27, 1997 and December 28, 1996, respectively.  This resulted in an
unrealized loss of $1,868,000 and $442,000 at the end of the respective periods.
In addition, the Company has investments in U.S. Government securities having a
cost of $33,314,000 and $32,082,000 at September 27, 1997 and December 28, 1996,
respectively, which approximate fair value.

                                       6



<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (CONTINUED)
                                        

C.   INVENTORIES:

Inventories, which consist principally of hops, brewery materials and packaging,
are stated at the lower of cost, determined on a first-in, first-out (FIFO)
basis, or market.

Inventories consist of the following (in thousands):


<TABLE>
<CAPTION>
                                              September 27,         December 28,
                                                  1997                  1996
                                             ---------------      ----------------
                                       
<S>                                          <C>                  <C>
Raw materials, principally hops                      $13,935               $12,677
Work in process                                          841                     0
Finished goods                                         1,759                   325
                                             ---------------      ----------------
                                       
                                                     $16,535               $13,002
                                             ===============      ================
</TABLE>


D.    FINANCIAL INSTRUMENTS:

During 1996 and 1997, the Company entered into several forward exchange
contracts to reduce exposure to currency movements affecting existing foreign
currency denominated assets, liabilities, and firm commitments.  The duration of
the contracts match the duration of the currency positions.  The future value of
the contracts and the related currency positions are subject to offsetting
market risk resulting from foreign currency exchange rate volatility.  There
were no material gains or losses on the contracts in the nine months ended
September 27, 1997.  It is the intention of the Company to enter into such
foreign exchange contracts periodically.


E.  DEBT

On March 21, 1997, the Company entered into a credit agreement to increase its
existing $14,000,000 line of credit to $15,000,000 ("the $15,000,000 line") and
to establish an additional $30,000,000 line of credit ("the $30,000,000 line").
On March 31, 1999, the $15,000,000 line expires and the balance outstanding
under the $30,000,000 line converts to a term note.  Principal payments on the
term note are payable in twenty quarterly installments, with the final payment
due at maturity, December 31, 2003.  Through March 31, 1999, interest is payable
quarterly on both the $15,000,000 and $30,000,000 lines at either the Prime Rate
or the applicable Adjusted Libor Rate plus .50%.  After March 31, 1999, interest
on the term note is payable quarterly at either the Prime Rate or the applicable
Adjusted Libor Rate plus .75%.

As of September 27, 1997, $4,274,864 and $10,000,000 are outstanding under the
$15,000,000 and $30,000,000 lines, respectively, at an average interest rate for
the quarter of  6.54%.  The Company must pay a commitment fee of .15% per annum
on the average daily unused portion of the total $45,000,000 commitment.
Additionally, the Company is obligated to meet certain financial covenants,
including the maintenance of specified levels of tangible net worth and net
income.

                                       7


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (CONTINUED)


F.   RECENT ACCOUNTING STANDARDS:

In February, 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS 128) and No.
129, "Disclosure of Information About Capital Structure" (SFAS 129).  SFAS 128
specifies the computation, presentation and disclosure requirements for earnings
per share and is designed to improve earnings per share information and increase
comparability of per share data on an international basis.  SFAS 129 requires
the disclosure of certain information about an entity's capital structure which
would include a brief discussion of rights and privileges for securities
outstanding.  These standards will be effective for financial statement periods
ending after December 15, 1997.

The Company has reviewed the adoption and impact of SFAS No. 128, "Earnings Per
Share" and SFAS No. 129, "Disclosure of Information About Capital Structure",
but does not expect either recent accounting standard to have a material impact
on the Company's results of operations or its financial position.

                                       8


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

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


The following is a discussion of the financial condition and results of
operations of the Company for the three and nine-month periods ended September
27, 1997 as compared to the three and nine-month periods ended September 28,
1996.  It should be read in conjunction with the "Consolidated Financial
Statements" of the Company and related "Notes to the Financial Statements"
included in this Form 10-Q.  On March 1, 1997, the Company acquired all of the
equipment and other brewery related personal property of an independent brewing
company located in Cincinnati, Ohio.  This Cincinnati Brewery is currently
managed by the Samuel Adams Brewery Company, Ltd., a wholly owned affiliate of
the Company.  The results of operations of the Samuel Adams Brewery Company,
Ltd. are included in the accompanying consolidated financial statements since
the date of acquisition.


RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 27, 1997 COMPARED TO THREE MONTHS ENDED SEPTEMBER
28, 1996

Sales volume increased by 21.4% from 294,000 barrels in the three months ended
September 28, 1996 to 357,000 barrels in the three months ended September 27,
1997.  This increase was due primarily to the inclusion of 53,000 barrels in
1997 of non-company products, produced and sold by the Samuel Adams Brewery
Company, Ltd. beginning  March 1, 1997.   Net sales increased by 5.4% from
$46,112,000 in the three month period ended September 28, 1996 to $48,617,000 in
the three month period ended September 27, 1997.  Net sales increased primarily
due to the increased volume for Boston Beer Company's branded products, and to a
lesser extent, the inclusion of sales to others by the Samuel Adams Brewery
Company, Ltd. as well as the implementation of selected price increases to the
company's wholesalers.  Net sales were also positively impacted by the
reclassification of all royalties earned year to date from other income to
revenue.

Gross profit increased by 14.7% from $23,211,000 in the three months ended
September 28, 1996 to $26,617,000 in the three months ended September 27, 1997.
Cost of sales decreased  from 49.7% of net sales in the three months ended
September 28, 1996 to 45.3% in the three months ended September 27, 1997.  This
decrease is primarily due to favorable raw material and packaging costs as well
as a decrease in certain other costs, such as net deposits and benefits from
reused returnable glass.  No inferences should be drawn from the reduction in
cost of sales for the quarter.

Advertising, promotional, and selling expenses in total increased by 1.7% from
$17,118,000 in the three months ended September 28, 1996 to $17,415,000 in the
three months ended September 27, 1997.  This increase was primarily attributable
to an increase in sales salaries and related benefit expenses, and an increase
in promotional spending. Partially offsetting these increases were decreases in
advertising and travel expenses.  As a percentage of net sales, total
advertising, promotional, and selling expenses decreased from 37.1% in the three
months ended September 28, 1996 to 35.8% in the three months ended September 27,
1997.

General and administrative expenses increased by 32.8% from $2,402,000 in the
three months ended September 28, 1996 to $3,190,000 in the three months ended
September 27, 1997.  This increase is primarily due to the inclusion of the
Samuel Adams Brewery Company, Ltd. which is not reflected in our 1996 numbers.
As a percentage of net sales, general and administrative expenses increased from
5.2% for the three months ended September 28, 1996 to 6.6% for the three months
ended September 27, 1997.

Other income (expense) net, for the three months ended September 27, 1997, was
($243,000), representing a decrease of $680,000 vs other income net, for the
three months ended September 28, 1996.  The decrease is due to a charge for the
repurchase of  certain overseas distribution rights, the reclassification of all
royalties earned year to date to revenue and an increase in interest expense due
to increased borrowings against the revolving line of credit.

                                       9


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        
ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS


Net income increased by 41.5%  to $3,248,000 in the three months ended September
27, 1997 compared to $2,296,000 in the three months ended September 28, 1996.
The combined effective tax rate decreased to 43.7% in the three months ended
September 27, 1997 compared to 44.4% in the three months ended September 28,
1996, due primarily to a lower projected income level for 1997.

NINE MONTHS ENDED SEPTEMBER 27, 1997 COMPARED TO NINE MONTHS ENDED SEPTEMBER 28,
1996

Sales volume increased by 12.3% from 913,000 barrels in the first nine months of
1996 to 1,025,000 barrels in the first nine months of 1997.  This increase in
1997, was due to the inclusion of 144,000 barrels of non-company products
produced and sold by the Samuel Adams Brewery Company, Ltd., beginning March 1,
1997. Despite this, net sales decreased by 2.1% from $143,312,000 in the first
nine months of 1996 to $140,310,000 in the first nine months of 1997, as sales
of products produced by the Samuel Adams Brewery Company, Ltd. to others are
made at prices much lower than those of other Company products.

Gross profit increased  from $71,481,000 in the first nine months of 1996 to
$71,732,000 in the first nine months of 1997.  Cost of sales decreased to 48.9%
of net sales in the first nine months of 1997 from 50.1% of net sales in the
first nine months of 1996.  This decrease in cost of sales as a percent of sales
was primarily due to favorable raw material and packaging costs and a shift in
the core business package mix towards kegs, which resulted in decreased
packaging material costs.

Advertising, promotional, and selling expenses in total increased from
$51,488,000 in the first nine months of 1996 to $51,802,000 in the first nine
months of 1997.  This increase was primarily attributable to increases in sales
salaries and related personnel and travel expenses, and the costs of promotional
materials, partially offset by lower purchases of point of sales material, and
lower advertising spending.  As a percentage of net sales, total advertising,
promotional, and selling expenses increased from 35.9% in the first nine months
of 1996 to 36.9% in the first nine months of 1997.

General and administrative expenses increased by 11.7% from $8,251,000 in the
first nine months of 1996 to $9,217,000 in the first nine months of 1997.  This
increase is primarily due to the inclusion of the Samuel Adams Brewery Company,
Ltd. which is not reflected in our 1996 numbers.  As a percentage of net sales,
general and administrative expenses increased from 5.8% in the first nine months
of 1996 to 6.6% in the first nine months of 1997.

Other income (expense) net,  decreased from $1,241,000 in the first nine months
of 1996 to $411,000 for the first nine months of 1997.  The net decrease is due
primarily to a charge for the repurchase of certain overseas distribution rights
and an increase in interest expense due to increased borrowings against the
revolving line of credit.

Net income decreased by 14.2% to $6,263,000 in the first nine months of 1997
compared to $7,297,000 in the first nine months of 1996.  Income taxes decreased
by $825,000.  The combined effective tax rate was 43.7% in the first nine months
of 1997 compared to 43.8% in the first nine months of 1996.

                                      10


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

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


LIQUIDITY AND CAPITAL RESOURCES

During the first nine months of 1997, the Company recorded net income of
$6,263,000, and net cash used in operating activities was $2,448,000.  This
$8,711,000 is primarily due to increases in accounts receivable, inventory, and
a reduction in accounts payable, and were offset by a decrease in other current
assets and an increase in accrued expenses.

During the first nine months of 1997, the Company used $15,663,000 in investing
activities.  This primarily reflects the purchase of fixed assets, consisting of
brewery and packaging equipment for the Cincinnati brewery and the addition of
new sankey kegs.

During the first nine months of 1997, the Company generated $13,051,000 from
financing activities which primarily reflects amounts borrowed against the
Company's revolving lines of credit.  As of  September 27, 1997, net borrowings
were $14,275,000.  On July 15, 1997, the Company repaid the remaining $1,875,000
owed under the MIFA loan.

The Company's management believes that working capital as of September 27, 1997
of $39,246,000 (of which 91.1% is in cash and equivalents and short term
investments), in conjunction with existing lines of credit, should be sufficient
to meet the Company's operating, capital, and debt service requirements through
the next twelve months.


RECENT ACCOUNTING STANDARDS

In February, 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS 128) and No.
129, "Disclosure of Information About Capital Structure" (SFAS 129).  SFAS 128
specifies the computation, presentation and disclosure requirements for earnings
per share and is designed to improve earnings per share information and increase
comparability of per share data on an international basis.  SFAS 129 requires
the disclosure of certain information about an entity's capital structure which
would include a brief discussion of rights and privileges for securities
outstanding.  These standards will be effective for financial statement periods
ending after December 15, 1997.

The Company has reviewed the adoption and impact of SFAS No. 128, "Earnings Per
Share" and SFAS No. 129, "Disclosure of Information About Capital Structure",
and does not expect either recent accounting standard to have a material impact
on the Company's results of operations or its financial position.


SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS

This Form 10-Q filing contains forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995.  Such forward-looking statements are based on management's current
expectations and involve known and unknown risks, uncertainties, and other
factors which may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance, or
achievements expressed or implied by such forward-looking statements.

Factors which may cause actual future results to differ from forward-looking
statements include, among others, the following: changes in consumer
preferences; general economic and business conditions; increasing competition in
the craft-brewed and high-end beer segments; success of operating initiatives;
possible future increases in operating costs; advertising and promotional
efforts; changes in brand awareness; the existence or absence of adverse
publicity; changes in business strategy; quality of management; availability,
terms and deployment of capital; business abilities and judgment of personnel;
availability of qualified personnel; labor and employee benefit costs; change
in, or the failure to comply with, government regulations; and other factors.

                                      11


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

P
ART II.          OTHER INFORMATION


         ITEM 1.  LEGAL PROCEEDINGS

                  The Company is a party to certain claims and litigation in the
                  ordinary course of business. The Company does not believe any
                  of these proceedings will result, individually or in the
                  aggregate, in a material adverse effect upon its financial
                  condition 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 INFORMATION

                  Not Applicable


         ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
 
EXHIBIT NO.                         TITLE
- ----------                          -----
<S>                          <C>                                              
 
3.1                          Articles of Organization (incorporated by reference
                             to Exhibit 3.2 to the Company's Registration
                             Statement No. 33-96162).

3.2                          By-Laws of the Company (incorporated by reference
                             to Exhibit 3.2 to the Company's Registration
                             Statement No. 33-96162).
 
3.3                          Restated Articles of Organization of the Company
                             (incorporated by reference to Exhibit 3.3 to the
                             Company's Form 10-K filed on April 1, 1996).

3.4                          Amended and Restated By-Laws of the Company
                             (incorporated by reference to Exhibit 3.4 to the
                             Company's Form 10-K filed on April 1, 1996).

4.1                          Form of Class A Common Stock Certificate
                             (incorporated by reference to Exhibit 4.1 to the
                             Company's Registration Statement No. 33-96164).
</TABLE>
 

                                      12


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

PART II.    OTHER INFORMATION (CONTINUED)

         ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

                           EXHIBIT INDEX (CONTINUED)

<TABLE>
<CAPTION>
 
EXHIBIT NO.                          TITLE
- -----------                          -----        
<S>                          <C>                    
 
         10.1                Revolving Credit Agreement between Fleet Bank of
                             Massachusetts, N.A. and Boston Beer Company Limited
                             Partnership (the "Partnership"), dated as of May 2,
                             1995 (incorporated by reference to Exhibit 10.2 to
                             the Company's Registration Statement No. 33-96162).

         10.2                Loan Security and Trust Agreement, dated October 1,
                             1987, among Massachusetts Industrial Finance
                             Agency, the Partnership and The First National Bank
                             of Boston, as Trustee, as amended (incorporated by
                             reference to Exhibit 10.2 to the Company's
                             Registration Statement No. 33-96164).

         10.3                Deferred Compensation Agreement between the
                             Partnership and Alfred W. Rossow, Jr., effective
                             December 1, 1992 (incorporated by reference to
                             Exhibit 10.3 to the Company's Registration
                             Statement No. 33-96162).

         10.4                The Boston Beer Company, Inc. Employee Equity
                             Incentive Plan, as adopted effective November 20,
                             1995 and amended effective February 23, 1996
                             (incorporated by reference to Exhibit 4.1 to the
                             Company's Registration Statement No. 333-1798).

         10.5                Form of Employment Agreement between the
                             Partnership and employees (incorporated by
                             reference to Exhibit 10.5 to the Company's
                             Registration Statement No. 33-96162).

         10.6                Services Agreement between The Boston Beer Company,
                             Inc. and Chemical Mellon Shareholder Services,
                             dated as of October 27, 1995 (incorporated by
                             reference to the Company's Form 10-K, filed on
                             April 1, 1996).

         10.7                Form of Indemnification Agreement between the
                             Partnership and certain employees and Advisory
                             Committee members (incorporated by reference to
                             Exhibit 10.7 to the Company's Registration
                             Statement No. 33-96162).
 
         10.8                Stockholder Rights Agreement, dated as of December,
                             1995, among The Boston Beer Company, Inc. and the
                             initial Stockholders (incorporated by reference to
                             the Company's Form 10-K, filed on April 1, 1996).

</TABLE>
 

                                      13


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

PART II.    OTHER INFORMATION (CONTINUED)

         ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

                           Exhibit Index (continued)



<TABLE>
<CAPTION>
 
EXHIBIT NO.                         TITLE
- ----------                          -----
<S>                          <C>                                               

         +10.9               Agreement between Boston Brewing Company, Inc. and
                             The Stroh Brewery Company, dated as of January 31,
                             1994 (incorporated by reference to Exhibit 10.9 to
                             the Company's Registration Statement No. 33-96164).

         +10.10              Agreement between Boston Brewing Company, Inc. and
                             the Genesee Brewing Company, dated as of July 25,
                             1995 (incorporated by reference to Exhibit 10.10 to
                             the Company's Registration Statement No. 33-96164).

         +10.11              Amended and Restated Agreement between Pittsburgh
                             Brewing Company and Boston Brewing Company, Inc.
                             dated as of February 28, 1989 (incorporated by
                             reference to Exhibit 10.11 to the Company's
                             Registration Statement No. 33-96164).

         10.12               Amendment to Amended and Restated Agreement between
                             Pittsburgh Brewing Company, Boston Brewing Company,
                             Inc., and G. Heileman Brewing Company, Inc., dated
                             December 13, 1989 (incorporated by reference to
                             Exhibit 10.13 to the Company's Registration
                             Statement No. 33-96162).

         +10.13              Second Amendment to Amended and Restated Agreement
                             between Pittsburgh Brewing Company and Boston
                             Brewing Company, Inc. dated as of August 3, 1992
                             (incorporated by reference to Exhibit 10.13 to the
                             Company's Registration Statement No. 33-96164).

         +10.14              Third Amendment to Amended and Restated Agreement
                             between Pittsburgh Brewing Company and Boston
                             Brewing Company, Inc. dated December 1, 1994
                             (incorporated by reference to Exhibit 10.14 to the
                             Company's Registration Statement No. 33-96164).

         10.15               Fourth Amendment to Amended and Restated Agreement
                             between Pittsburgh Brewing Company and Boston
                             Brewing Company, Inc. dated as of April 7, 1995
                             (incorporated by reference to Exhibit 10.16 to the
                             Company's Registration Statement No. 33-96162).

         +10.16              Letter Agreement between Boston Beer Company
                             Limited Partnership and Joseph E. Seagram & Sons,
                             Inc. (incorporated by reference to Exhibit 10.17 to
                             the Company's Registration Statement No. 33-96162).

 
</TABLE>


                                      14


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

PART II.    OTHER INFORMATION (CONTINUED)

         ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

                           Exhibit Index (continued)

<TABLE>
<CAPTION>
 
EXHIBIT NO.                             TITLE
- -----------                             -----                  
<S>                          <C>                           
 
    10.17                    Services Agreement and Fee Schedule of Mellon Bank,
                             N.A. Escrow Agent Services for The Boston Beer
                             Company, Inc. dated as of October 27,
                             1995.(incorporated by reference to the Company's
                             Registration Statement No. 33-96162.)

    10.18                    Amendment to Revolving Credit Agreement between
                             Fleet Bank of Massachusetts, N.A. and the
                             Partnership (incorporated by reference to Exhibit
                             10.17 to the Company's Registration Statement No.
                             33-96164).

    10.19                    1996 Stock Option Plan for Non-Employee Directors
                             (incorporated by reference to the Company's Form 
                             10-K, filed on March 28, 1997).

   +10.20                    Production Agreement between The Stroh Brewery
                             Company and Boston Beer Company Limited
                             Partnership, dated January 14, 1997 (incorporated
                             by reference to the Company's Form 10-K, filed on
                             March 28, 1997).

   +10.21                    Letter Agreement between The Stroh Brewery Company
                             and Boston Beer Company Limited Partnership, dated
                             January 14, 1997 (incorporated by reference to the
                             Company's Form 10-K, filed on March 28, 1997).
 
   +10.22                    Agreement between Boston Beer Company Limited
                             Partnership and The Schoenling Brewing Company,
                             dated May 22, 1996 (incorporated by reference to
                             the Company's Form 10-K, filed on March 28, 1997).

    10.23                    Revolving Credit Agreement between Fleet Bank of
                             Massachusetts, N.A. and The Boston Beer Company,
                             Inc., dated as of March 21, 1997 (incorporated by
                             reference to the Company's Form 10-Q, filed on May
                             12, 1997).

   +10.24                    Amended and Restated Agreement between Boston
                             Brewing Company, Inc. and the Genesee Brewing
                             Company, Inc. dated April 30, 1997 (incorporated by
                             reference to the Company's Form 10-Q, filed on
                             August 11, 1997).

   *11                       Schedule of Computation of Net Earnings Per Share.

</TABLE>
 

                                      15


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

PART II.    OTHER INFORMATION (CONTINUED)

         ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)

                           Exhibit Index (continued)
                                        
EXHIBIT NO.                 TITLE
- -----------                 -----

         21.1    List of subsidiaries of The Boston Beer Company, Inc.
                 (incorporated by reference to the Company's Form 10-K, filed on
                 March 28, 1997).

         *27    Financial Data Schedule (electronic filing only).

         *  Filed with this report.

         +  Portions of this Exhibit have been omitted pursuant to an
            application for an order declaring confidential treatment filed with
            the Securities and Exchange Commission.

(b)             Reports on Form 8-K.

                The Company filed no reports on Form 8-K with the Securities and
                Exchange Commission during the quarter ended September 27, 1997.

                                      16


<PAGE>
 
                         THE BOSTON BEER COMPANY, INC.
                                        

PART II.    OTHER INFORMATION (CONTINUED)

         ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)



<TABLE>
<CAPTION>
Exhibit 11
- ----------
                                         STATEMENT REGARDING COMPUTATION OF NET EARNINGS PER SHARE
                                                   (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                                (UNAUDITED)
 
 
                                                                Three months ended                     Nine months ended
                                                         -----------------------------------   ------------------------------------
                                                             Sept 27,           Sept 28,            Sept 27,           Sept 28,
                                                               1997               1996                1997               1996
                                                         ---------------   -----------------   ----------------   -----------------
                                                                                             
<S>                                                        <C>               <C>                 <C>                <C>
Weighted average number of common shares outstanding          20,427,036          20,051,470         20,289,222          19,963,466
                                                                                  
                                                                                                                 
Add: Common equivalent shares representing                                                                       
   shares issuable upon conversion of stock                                                                      
   options                                                        81,910             375,217            163,538             433,505
                                                                                                                 
                                                                  
Weighted average number of common and common                                                                     
   equivalent shares                                           20,508,946          20,426,687          20,452,760         20,396,971

                                                             ============        ============       ============        ============

Net Income                                                   $     3,249         $     2,296        $     6,263         $     7,297
                                                             ============        ============       ============        ============
                                                                                             
Primary earnings per share                                   $      0.16         $      0.11        $      0.31         $      0.36
                                                             ============        ============       ============        ============
                                                                                             
Fully diluted earnings per share                             $      0.16         $      0.11        $      0.31         $      0.36
                                                             ============        ============       ============        ============

</TABLE>


                                      17


<PAGE>
 

SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934,
         the registrant has duly caused this Form 10-Q to be signed on its
         behalf by the undersigned thereunto duly authorized.


                         THE BOSTON BEER COMPANY, INC.
                                 (Registrant)



         Date:  November 7, 1997          By:  /s/: C. JAMES KOCH
                ---------------                --------------------------------
                                                C. James Koch
                                                President, Chief Executive
                                                Officer, Clerk and Director
                                                (principal executive officer)



         Date:  November 7, 1997        By:    /s/: ALFRED W. ROSSOW, JR.
                ---------------                --------------------------------
                                               Alfred W. Rossow, Jr. Executive
                                               Vice President, Chief Financial
                                               Officer (principal financial and
                                               accounting officer) Treasurer and
                                               Director

                                      18






<TABLE> <S> <C>


<PAGE>
 
<ARTICLE> 5
<LEGEND>
SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BOSTON BEER COMPANY, INC.'S
CONSOLIDATED BALANCE SHEET AND CONSOLIDATED STATEMENTS OF OPERATIONS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
       
<S>                             <C>
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-28-1997
<PERIOD-START>                             DEC-29-1997
<PERIOD-END>                               SEP-27-1997
<EXCHANGE-RATE>                                      1
<CASH>                                               0
<SECURITIES>                                    35,735
<RECEIVABLES>                                   21,366
<ALLOWANCES>                                   (1,952)
<INVENTORY>                                     16,535
<CURRENT-ASSETS>                                76,355
<PP&E>                                          37,648
<DEPRECIATION>                                 (9,544)
<TOTAL-ASSETS>                                 107,513
<CURRENT-LIABILITIES>                           37,109
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                           204<F1>
<OTHER-SE>                                      70,200
<TOTAL-LIABILITY-AND-EQUITY>                   107,513
<SALES>                                        159,621
<TOTAL-REVENUES>                               140,310
<CGS>                                           68,578
<TOTAL-COSTS>                                  129,597
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 540
<INCOME-PRETAX>                                 11,124
<INCOME-TAX>                                     4,861
<INCOME-CONTINUING>                              6,263
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                     6,263
<EPS-PRIMARY>                                     0.31
<EPS-DILUTED>                                     0.31
<FN>
<F1>THIS NUMBER INCLUDES 16,335,073 SHARES OF CLASS A COMMON STOCK WITH A PAR VALUE
OF $163,000 AND 4,107,355 SHARES OF CLASS B STOCK WITH A PAR VALUE OF $41,000.
</FN>
        

</TABLE>