Gateway opts for global restructure

Gateway has announced plans to restructure its operations and cut 25% of its global workforce in an attempt to reach...

Gateway has announced plans to restructure its operations and cut 25% of its global workforce in an attempt to reach profitability by the end of the fiscal year.

The San Diego-based company said it expected to return a "slight" loss in the third quarter as a result of the initiative.

Confirming that it now intended to focus on the US market, the company announced plans to close its facilities in Japan, Australia, New Zealand, Malaysia and Singapore. A spokesman was unable to confirm whether the company was still intending to withdraw from the European market but said that a statement would be made within the next 30 days.

The cutbacks will also lead to the loss of approximately 15% of the company's US workforce, the winding down of a manufacturing facility in Utah and the closure of four call centres in various parts of the country.

"As tough as these decisions were to make, we're doing all the right things to create a new company with a healthy and profitable future," said Ted Waitt, Gateway's chairman and chief executive officer. "We intend to succeed as the only company that can deliver personalised technology solutions on a local basis."

A Gateway spokesman said the company was undertaking a "strategic shift" in order to position itself as a provider of personalised technology solutions.

Gateway now plans to augment its hardware operations with other offerings, including communications, applications, learning, financing and services businesses.

Gateway, as with others in the PC hardware business, has been hard hit by the current downturn in technology-related spending during the past year.

According to International Data, the worldwide PC market was stagnant in the second quarter of 2001, with shipments declining by 2%.

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