Gateway to Close Retail Stores, Cut Jobs
POWAY, Calif. (AP)--Troubled computer maker Gateway Inc. announced Thursday it will shutter all of its retail stores next week, eliminating 2,500 jobs, or nearly 40 percent of its work force.
The company, based in the San Diego suburb of Poway, said its 188 stores will close on April 9 and workers will be dismissed as the store operations wind down.
The company, which recently posted its 12th loss in 13 quarters, said it is exploring other retail options to sell its products.
Gateway has been struggling in a PC market dominated by Dell Inc. and Hewlett-Packard Co. It has expanded its product line to include plasma-screen televisions, digital cameras and other consumer electronics.
It recently completed its purchase of Irvine, Calif.-based eMachines Inc. for $290 million and named Wayne Inouye its new chief executive, the same job he held at eMachines. Inouye replaced Gateway founder Ted Waitt, who remains the company's chairman.
On Tuesday, Gateway announced it will move its headquarters north to Orange County, closer to home for many of the executives who joined the company from eMachines.
Gateway was founded in 1985 in an Iowa farmhouse and evolved into one of the world's biggest and most influential computer makers over the next decade. The company is known for its distinctive cow-spotted boxes, a tribute to its farm heritage.
The company moved its headquarters to the San Diego area six years ago. About 550 of its 6,500 workers are based at its headquarters. At the end of 2002, the company had 11,500 employees, and in 2000 it had 25,000.
The Gateway stores will all close on the same day. Spokesman David Hallisey said it was still unclear how the company would deal with its stores' inventory. Gateway plans to continue selling its products over the Internet and by phone.
AP-NY-04-01-04 1808EST
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