<ARTICLE> 5 <LEGEND> THIS FINANCIAL SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS CONTAINED IN THE FORM 10-Q OF VERILINK CORPORATION FOR THE FIRST FISCAL QUARTER ENDED SEPTEMBER 27, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. </LEGEND> <MULTIPLIER> 1,000 <PERIOD-TYPE> 3-MOS <FISCAL-YEAR-END> JUN-27-1999 <PERIOD-START> JUL-29-1998 <PERIOD-END> SEP-27-1998 <CASH> 12,741 <SECURITIES> 29,145 <RECEIVABLES> 7,814 <ALLOWANCES> 62 <INVENTORY> 4,864 <CURRENT-ASSETS> 56,291 <PP&E> 16,629 <DEPRECIATION> 9,513 <TOTAL-ASSETS> 65,262 <CURRENT-LIABILITIES> 10,603 <BONDS> 0 <PREFERRED-MANDATORY> 0 <PREFERRED> 0 <COMMON> 139 <OTHER-SE> 54,520 <TOTAL-LIABILITY-AND-EQUITY> 65,262 <SALES> 17,078 <TOTAL-REVENUES> 17,078 <CGS> 8,308 <TOTAL-COSTS> 8,308 <OTHER-EXPENSES> 8,218 <LOSS-PROVISION> 0 <INTEREST-EXPENSE> 0 <INCOME-PRETAX> 1,111 <INCOME-TAX> 389 <INCOME-CONTINUING> 722 <DISCONTINUED> 0 <EXTRAORDINARY> 0 <CHANGES> 0 <NET-INCOME> 722 <EPS-PRIMARY> 0.05 <EPS-DILUTED> 0.05