Gateway Swings to Loss on Retail, Internet Units

Computer maker Gateway Inc. said falling margins from its retail business and slowing sales over the Internet to commercial customers led to a second-quarter loss.

Gateway shares, which had gained 2 cents to $1.59, slipped 14 cents or 8.8% after hours after its earnings announcement

Irvine-based Gateway lost $7.68 million, or 2 cents a share, compared with profit of $17.2 million, or 5 cents a share, in the same quarter last year.

Revenue was $919.3 million, up 5.3%.

Former Chief Executive “Wayne Inouye said if revenue dropped under a billion dollars, they’d have issues maintaining scale, and here they are, under a billion,” said Roger Kay, president of market intelligence firm Endpoint Technologies.

-- Terril Yue Jones