Gateway reports $7.7 million loss for Q2

Posted by Wolfgang Gruener

Gateway, the third largest PC company in the U.S., to day reported sales of $919 million and a net loss of $7.7 million for the second quarter. In Q2 of 2005, the company had reported $873 million in sales and a net profit of $17.7 million.

"While we are disappointed with our performance in the second quarter, we believe that our efforts in the first half of the year are beginning to resonate with customers and move us in a positive direction," said Rick Snyder, Gateway's chairman and interim chief executive officer. "Our Professional business showed solid improvement and our Direct business is repositioned to regain positive momentum."

Gateway said that it sold 1,170,500 PC units during the quarter, up 16% year-over-year and down 15% sequentially. 949,000 PCs were sold through the firm's retail channels; 36,000 PCs through direct sales. Professional PC sales accounted for the remaining 186,000 units. Based on these numbers, Gateway's retail sales average about $624 per unit, the average PC sold through Gateway's website or by phone rings in at about $2138 and professional PCs sell for $1344 on average.

Quoting preliminary research results from IDC, Gateway estimates in U.S. market share at about 6.5%, up from about 6.0% a year ago.