Gateway cuts costs by shedding 1,900 jobs
POWAY, Calif. -- Gateway Inc. said Monday it is eliminating 1,900 jobs, 17 percent of its work force, in the latest round of fiscal belt-tightening at the beleaguered computer maker.
The company also announced plans to close 80 -- nearly a third -- of its Gateway stores by March 24 as part of a plan to save the company about $400 million a year.
"These things are never easy," Gateway's Chairman and Chief Executive Ted Waitt said. "But it's the right thing to do to reach our goals."
Trading of Gateway's shares was halted Monday on the New York Stock Exchange at $2.40, up 20 cents or 9 percent.
Cutting its work force will allow the company to generate a positive cash flow, a key measure of a business' financial health. Roughly half the job cuts are coming from shuttering the stores. The rest are spread around Gateway's headquarters in Poway and operations and manufacturing facilities around the country.