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Not So Golden Gateway

Computer company will cut costs, but expand retail chain, after disappointing holiday season

Published

23 years ago

January 12, 2001

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Gateway,Inc., the San Diego-based computer company that said in November its holiday sales would be disappointing, confirmed that bad news yesterday. The company said it lost $94.3 million during the quarter ending Dec. 31, 2000; a year ago, it showed a profit of $126 million for the same period. And it warned of continuing difficulties for the next six months, due in part to the soft consumer computer market and in part to the company's swollen inventories.

“There's no way to sugarcoat the next several months,” said president and ceo Jeffrey Weitzen.Gateway is the Number Two personal computer company, behind Dell.

Gateway said it will immediately undertake cost-cutting measures, including streamlining manufacturing, consolidating purchasing efforts among fewer vendors and eliminate about 10 percent of its workforce (or about 2400 jobs). However, the company said its plans will include expanding its own chain of retail stores. It currently has about 300 Gateway Country stores across the nation.