Gateway Inc [GTW] has posted a dramatic third-quarter loss and warned the market that it may post a larger fourth-quarter loss than previously anticipated.
For the third quarter ending September 30, Gateway posted a net loss of $138.8 million, or $0.43 a share, compared to a loss of $49.7 million, or $0.15 a share, for the same period last year. This latest loss includes a charge of $73 million for restructuring costs. Sales totaled $883.1million, down 21% from $1.12 billion last year.
It is in the midst of eliminating 1,800 jobs by the middle of next year, representing 21% of its workforce, as part of a $400 million cost-cutting and restructuring plan. It has also re-modeled 185 of its retail stores since last year.
The California-based company said it expected to post a fourth-quarter loss of between $0.09 and $0.15 a share, excluding restructuring charges ranging between $50 million and $60 million.
That compares to its July estimate of a loss of $0.09 a share. It also said it expects to post revenue between $925 and $975 million in the fourth quarter, in line with its July estimate of $954 million, but down from $1.06 billion in last year’s fourth quarter.
The personal computer maker has moved into the consumer electronics market in the hope of reversing its sagging fortunes in the PC business. It now offers flat-panel TVs, digital cameras, and digital music players. The company has introduced 72 products since May.
During the third quarter, Gateway sold 558,000 PCs, down 24% from last year and it is estimated its share of US shipments fell to 3.3% from 5.5% last year.
This article was based on material originally published by ComputerWire.